Re Dacey, Les Ex parte Chick & Kev Distributors Pty Ltd [1981] FCA 46

This is an application to review the decision of a Deputy Registrar in Bankruptcy disallowing certain items on the taxation of a bill of costs.

A sequestration order: was made by this Court against the estate of Les Dacey ("the bankrupt") on 8 May 1979 on the petition of Chick & Kev Distributors Pty. Limited ("the petitioning creditor"). The petitioning creditor's solicitors filed their bill of costs whach was taxed on 19 February 1980. The certificate of taxation 1ssued on 18 April 1980. The bill of costs covered the work generally carried out by a solicitor for a petitioning creditor but, in addition, included three items which the taxing officer disallowed. They are described in the applicatior as follows:-

(a) " 8.5.1979 23 (a) Allowance under Rules 170 (4) and 171 (4) for Solicitor acting as Counsel $40.00."

(b) " 22 (b) Travelling time to and from Court for hearing (2 hours) (Rule 171 (5) ) $40.00."

(c) "19.2.1980 30 (b) Travelling - 2 hours $40.00."

No evidence was led before the taxing officer in respect of these contentious items; the taxing officer formed the opinion that the matters raised questions of principle in the taxation of bills of costs generally in bankruptcy matters so he consulted his fellow Deputy Registrars and subsequently disallowed all three items.

Counsel for the petitioning creditor sought the Court's leave, pursuant to Bankruptcy Rule 173 (3), to read the affidavit of David Graeme Francis sworn 31 March 1981 which was not before the taxing officer. The granting of this leave was not opposed by the Registrar in Bankruptcy who appeared before this Court on the application for review. I allowed it to be used.

It is convenient to consider item (a) first and then turn to the other two items together as they both relate toa claim for "travelling time".

Item (a) claims an allowance on 8 May 1979 under Rules 170 (4) and 171 (4) for the solicitor acting as counsel ~ $40.00.

The petitioning creditor submitted that the taxing officer should have allowed a reasonable sum for the appearance of a solicitor on the hearing of the petition, on 8 May 1979, who conducted the case himself. Mr. Francis, the solicitor for the petitioning creditor carries on practice at Miranda. He employs a Mr. L. B. Patrick, solicitor. Mr. Patrick appears to have had the carriage of this matter and he appeared on the hearing of the petition on 8 May 1979.

The petitioning creditor submitted that if counsel had been briefed the costs would have been greater and that the allowance in fact made by the taxing officer on taxation for Mr.

Patrick to attend court and represent the petitioning creditor

himself namely, $90.00, was no greater than it would have been 1£ he had attended court merely for the purpose of instructing counsel. It was submitted that some recognition should have been made by the taxing officer of the fact that Mr. Patrick conducted the case himself. The allowance of $90.00 was on the basis of the attendance of the solicitor for 2 hours at the then allowed rate of $45.00 per hour. The period of two hours allowed on taxation was from the time the court commenced sitting that morning until it had disposed of the petition in this matter.

Reliance was placed on rules 170 (4) and 171 (4) both before the taxing officer and this Court. The petitioning creditor submitted that, as no additional allowance had been made at all in respect of Mr. Patrick's appearance without counsel on the hearing of the petition, the taxing officer had erred in principle.

"170 (4) Where a practitioner acts in the capacities of both barrister and solicitor, or in the capacity of counsel, instructed by his partner acting as solicitor, items

7 and 21 in Schedule 3 do not apply but the taxing officer may allow such sum as he considers reasonable in the circumstances in respect of the work done by the practitioner in preparing for the hearing and in preparing notes, being notes known as 'brief notes', for use on the hearing."

the taxing officer in his discretion thinks reasonable, having regard to all the circumstances of the particular case, for

work and labour properly performed and not specifically provided for by these Rules,

A solicitor is entitled to appear without counsel before this Court. In bankruptcy matters, especially undefended matters, solicitors frequently do so appear. Plainly there are cases where solicitors who conduct cases without briefing counsel should be allowed additional amounts in preparing for the hearing. The taxing officer took the view that this was not such a case. There was no evidence before him, or indeed before this Court, that there were any "brief notes" (rule 170 (4) ). Reference is made to "brief notes" in paragraph 10 of the affidavit of Mr. Francis but not in terms suggesting that there was any evidence before the taxing officer, or before this Court, that such notes existed. Nor was there any evidence before.the taxing officer, or this Court, of any particular work done by Mr. Patrick in preparation for the hearing (rule 170 (4) ).

Doubtless the taxing efficer had in mind in disallowing this item the fact that the petition was heard ex parte and did not present any unusual or complicated features. Indeed, it occupied only some six minutes of the Court's time.

The Court's power to review a taxing officer's decisions has been considered frequently in Australia. I respectfully adopt the summary of the law which was made by Jordan C.J., in whose judgment Harvey C.J. In Eq. and Street J. concurred, in Schweppes!

Ltd. v. Archer (1934) 34 S.R.(N.S.W.) 178 at pp. 183 and 184:

a decision of a Taxing Officer where it is contended that he has proceeded upon a wrong principle, for

the purpose of determining the principle which should be applied; and an error in principle may occur

allowed and in determining how much should be allowed. Where no principle is involved, and

the question is, whether the Taxing Officer has correctly exerciseda discretion which he possesses and is purporting to exercise, the Court is reluctant to interfere. It has undoubted jurisdiction to review the Taxing Officer's decision even where an exercise of discretion only is involved, and will do so freely on a proper case, using its own knowledge of the circumstances: Western Australian Bank v. Royal Insurance Co. (7 C.L.R. at 388); Clark, Tait & Co. v. Federal Commissioner of Taxation (47 C.L.R. 142, at 145-6), but it will in general interfere only where the discretion appears not to have been exercised at all, or to have been exercised in a manner which is manifestly wrong; and where the question

is one of amount only, will do so only in an extreme case."

See also Australian Coal and Shale Employees' Federation v.

The Commonwealth (1953) 94 C.L.R. 621 at p. 628 and Higgins v. Nicol (1972) 21 F.UL.R. 34.

In my opinion it has not been established that the taxing officer committed any error of principle. The mere fact that a solicitor does not brief counsel and presents a case himself before the Court does not necessarily entitle him to an additional allowance, even if it be established that he has done work additional to that which he would have done had he briefed counsel. It is very much a matter for the taxing officer in the exercise of his discretion. As I have said already, there was no evidence before the taxing officer, and there is none before this Court, as to any additional work that was done by the solicitor in the present case. The views I have expressed apply to both rules 170 (4) and 171 (4); although I must confess to having considerable doubt as to whether rule 171 (4) could

apply in the circumstances of this case; but this is not a

I turn to the other two matters challenged by the petitioning creditor. They relate to the disallowance by the taxing officer of the two claims for "travelling time". The first such item ( (b) ) is a claim for travelling time to and from Court for the hearing of the petition when the sequestration order was made. The claim is for $40.00 on the basis of the then rate of $20.00 per hour and it is based on rule 171 (5).

The second claim is also based on the same sub-rule and relates to a claim for travelling time (2 hours) when Mr. Francis travelled from his office at Miranda to the Registry for the taxation of the bill of costs.

It was submitted by the petitioning creditor that these claims should have been allowed as Mr. Francis carries on his practice at Miranda, some 20 kilometres from Sydney. In his affidavit, Mr. Francis said:~

unsatisfactory to both the client and my (sic) myself as it lengthens the lines of communication

In my opinion rule 171 (5) has no application to this case. It does not include a case, such as the present, where the solicitor carries on practice in the city of Sydney or its

suburbs and chooses to travel to the Court or the Registry in the

city to appear, whether with or without counsel, or to file

documents. The typical case envisaged by the rule is where it is necessary for a solicitor to travel from the city where he carries on practice to some other city or place for the purposes of the case, and he incurs travelling expenses, such as air fares and perhaps, in addition, charges for hotel accommodation. If the solicitor's claim were within the ambit of the rule in the present case then I see no distinction in principle between this case and a case where a solicitor has his office at say North Sydney or, for that matter, within the city of Sydney itself, say at Circular Quay. He travels from North Sydney or Circular Quay to this Court which necessarily takes some amount of time. This he may do many times in the course of a case to file documents or to instruct counsel or perhaps appear himself without counsel. He may have to attend on many separate occasions to file affidavits. If the petitioning creditor is correct then he may make separate claims for his travelling tame. I do not accept this argument. Where does one draw the line? Apart from the considerable, of not insuperable, practical difficulties that would arise on taxations of bills of costs, if claims of this kind were to be allowed, I do not regard rule 171 (5), upon its proper constructions, as including them. Plainly they relate to different claims.

Counsel for the petitioning creditor submitted, in the alternative, that the claim should be allowed under rule 171 (4). Again I have considerable doubt as to whether this rule could apply in the present case because the general subject matter of

solicitors's claims for travelling expenses is dealt with by

rule 171 (5), so it is doubtful if it could then fall within rule 171 (4). But even if it could, it is plain to my mind that it has not been established that the taxing officer erred in principle in disallowing these two claims.

In the result, the application should be dismissed.

The Court orders that the application be dismissed.