Vincent Francis Stanizzo v Karina Vivianna Fregnan

Jurisdiction to hear appeal

1. At the commencement of the hearing, in response to a question by me, Mr Rollinson indicated that the appeal was brought under s 89 of the LPULAA. Although no significant court time was spent on this jurisdictional issue, it seems to me that the issue is not as straightforward as was suggested at the hearing. This is because the statutory regime governing appeals from costs assessments in NSW has had a relatively complex history.
2. Under the Legal Profession Act 1987 (NSW), there was appeal by leave to the Supreme Court for practitioner/client costs or to the court or tribunal that had ordered costs for party-party assessments: s208M. An appeal also lay to the Supreme Court for an error of law: s208L.
3. The Legal Profession Act 1987 was replaced by the Legal Profession Act 2004 (NSW) ("LPA") which maintained a similar system for appeals in ss 384-385; namely, there was an appeal by right for an error of law to the Supreme Court. Appeal by leave was permitted for client/practitioner costs to the Supreme Court and ordered costs were appealed by leave to the court or tribunal that made the order. In 2008, Schedule 14 of the Courts and Crimes Legislation Amendment Act 2008 (NSW) changed the references in ss 384-385 from the Supreme Court to the District Court (see [1]-[3]).
4. The LPULAA commenced on 1 July 2015 and again altered the appeal regime. Appeals on matters of law remained with the District Court. Further, re-hearings with fresh or additional evidence were heard in the District Court with leave.
5. Only five months after the LPULAA was enacted, further changes were made to the appeal regime in NSW with the enactment of the Courts and Other Justice Portfolio Legislation Amendment Act 2015 (NSW) on 23 November 2015. That change resulted in the current appeal provision being s 89 of the LPULAA, which is in these terms: (1) A party to a costs assessment that has been the subject of a review under this Part may appeal against a decision of the review panel concerned to: (a) the District Court, in accordance with the rules of the District Court, but only with the leave of the Court if the amount of costs in dispute is less than $25,000, or (b) the Supreme Court, in accordance with the rules of the Supreme Court, but only with the leave of the Court if the amount of costs in dispute is less than $100,000. (2) The District Court or the Supreme Court (as the case requires) has all the functions of the review panel. (3) The Supreme Court may, on the hearing of an appeal or application for leave to appeal under this section, remit the matter to the District Court for determination by that Court in accordance with any decision of the Supreme Court and may make such other order in relation to the appeal as the Supreme Court thinks fit. (3A) The Supreme Court may, before the conclusion of any appeal or application for leave to appeal under this section in the District Court, order that the proceedings be removed into the Supreme Court. (4) An appeal is to be by way of a rehearing, and fresh evidence or evidence in addition to or in substitution for the evidence before the review panel or costs assessor may, with the leave of the Court, be given on the appeal.
6. The amendment made in November 2015 was in response to the recommendations made by Brereton J in the Report of the Chief Justice's Review of the Costs Assessment Scheme (12 March 2013) ("the Report"). The Report noted that the provisions in the LPA were "complex and confusing", especially in relation to the distinction between appeals requiring the applicant to show an error of law and those requiring leave. The review was also critical of the removal of the Supreme Court's traditional supervisory jurisdiction over appeals from costs assessments under the LPULAA. As such, the Report recommended that (footnotes omitted): "The Review considers that, consistent with its traditional supervisory role in this field, the Supreme Court ought to retain supervisory jurisdiction over appeals from costs assessments. However, the quantum and issues in such appeals can vary widely, and far from all warrant the consideration of the Supreme Court. For this reason, an integrated appeal structure providing an appeal to the District Court or the Supreme Court is proposed. The concept is that smaller appeals should go to the District Court unless there is some feature that justifies the attention of the Supreme Court, but that the Supreme Court should be capable of exercising jurisdiction in any appropriate case."
7. There are two threshold questions for consideration in this matter. First, is s 89 the correct appeal provision for both costs orders; and, if so, is this a matter in which leave ought to be granted to bring this appeal to the Supreme Court rather than the District Court given that the amount involved is below $100,000.
8. Dealing with the question of the relevant appeal provision first, on the face of it, s 89 of the LPULAA would appear to be the relevant provision under which to bring this appeal. Furthermore, the relevant transitional provision is reg 59 of the Legal Profession Uniform Law Application Regulation 2015 (NSW) which provides the following: "The provisions of the Legal Profession Act 2004 and the Legal Profession Regulation 2005 relating to ordered costs continue to apply to a matter if the proceedings to which the costs relate commenced before 1 July 2015."
9. The District Court proceedings were commenced in April 2012. The Court of Appeal proceedings were commenced on 22 March 2016. The Court of Appeal made two separate costs orders on 22 September 2016: that Mr Stanizzo pay the costs of the appeal to the Court of Appeal and also that he pay Ms Fregnan's costs of the Notice of Motion in the District Court on an indemnity basis
10. Having regard to reg 59, the LPA appeal scheme continues to apply to ordered costs where the "proceedings" to which the costs relate were commenced before 1 July 2015. This raises the question of which were the relevant "proceedings" to which the order that Mr Stanizzo pay Ms Fregnan's costs of the District Court Motion relate. If the relevant "proceedings" are the District Court proceedings then that order is still governed by the LPA because the District Court proceedings were commenced in 2012. On the other hand, if both costs orders relate to the Court of Appeal proceedings then the relevant appeal regime is under the LPULAA. I have been unable to find any decision concerned with the approach to be taken under reg 59 of the Regulation when an appellate court orders that costs be paid both in relation to its proceedings and in relation to proceedings in the court below. There are, however, a number of Court of Appeal decisions in which the question of the applicable appeal regime has been considered.
11. In Voicu v Owners-Strata Plan No 1624 [2020] NSWSC 296 ("Voicu") proceedings were commenced on 5 June 2015 in the Local Court and then appealed to the District Court by summons on 16 October 2015. Costs were the subject of several assessments, which were then appealed during 2018-2019. An application for judicial review was then brought to the Court of Appeal against a decision of the Manager of Costs Assessment refusing to extend the time for which a further review could be sought.
12. Basten JA held that the relevant proceedings to which the costs related were the two notices of motion filed after the dismissal of the proceedings in the District Court. As such, the relevant "proceedings" was the summons filed on 16 October 2015, rather than the original originating process filed on 5 June 2015. As such, the applicable legislation was the LPULAA.
13. The question of whether the wrong assessment scheme was applied was considered by the Court of Appeal in Ferella v Stomo [2017] NSWCA 268. In that matter the applicants had sought judicial review of a decision of the District Court relating to a costs assessment carried out for costs orders made in the Supreme Court and the Court of Appeal in March and November 2014. White JA found that the LPA scheme for appeals applied by virtue of reg 59. His Honour went on to make the following comment as to the relative similarity of the two provisions at [33] as follows: "Even if the applicants' submission as to the applicable legislation were correct, prerogative relief is discretionary. It would not be appropriate to set aside the decision under review on the ground of the alleged error where the result would have been the same, even had the primary judge proceeded on the basis of what the applicants contend was the correct legislation. Neither the proceeding in the District Court nor in this Court had any underlying merit. The applicants did not suggest that there were any differences between the LP Act and the Application Act that could have led to the costs assessor or the Review Panel reaching different figures had they applied Pt 7 of the Application Act instead of the LP Act."
14. In a separate judgment, Sackville AJA commented that: "The ground of the application for judicial review was that the District Court (like the Review Panel) erred in applying the provisions of the Legal Profession Act 2004 (NSW) (LP Act) rather than the provisions of the Legal Profession Uniform Law (NSW). Mr Newton was asked what difference it would have made had the Review Panel applied what the applicants said were the correct provisions. His answer was 'On one view, it would make possibly not a lot of difference'."
15. Although it is to be accepted that there is little difference between the schemes, the distinction is a significant one in the present matter given the changes made to the regime at relevant times during the procedural history of the primary proceedings in this matter.
16. As will be seen below, both the Costs Assessor and the Review Panel proceeded on the basis that the LPULAA applied to both of the costs orders because the Court of Appeal proceedings were commenced after 1 July 2015.
17. It seems to me that there is some doubt as to whether the costs order that Mr Stanizzo pay Ms Fregnan's costs for the District Court Notice of Motion is in fact an order in which the "proceedings" to which the costs relate commenced before 1 July 2015 (as per reg 59) but I propose to proceed on the basis that s 89 of the LPULAA applies for three reasons. First, both the Assessor and the Review Panel have proceeded on the basis that the LPULAA applied and no point has ever been taken as to that approach; secondly, the relevant costs orders were both made by the Court of Appeal and the proceedings in that court were commenced after 1 July 2015; and thirdly, there is support for the approach I have taken to be found in the decision of Basten JA in Voicu.
18. For these reasons, although the matter is not straightforward, I am satisfied I have jurisdiction to hear this appeal. In doing so, I make the observation that reg 59 does not appear to have been drafted with the contemplation that costs orders might be made in relation to more than one "proceedings" at the same time.
19. The next question is whether I would grant leave to bring the appeal. The effect of s 89(1) of the LPULAA is that a party to a costs assessment that has been the subject of a review by the Review Panel has four options on appeal: 1. To the District Court, as of right if the amount of the costs in the dispute is over $25,000 but under $100.000; 2. To the District Court, but only with the leave of the Court if the amount of costs in dispute is less than $25.000; 3. To the Supreme Court, as of right if the amount of the costs in the dispute is over $100.000; 4. To the Supreme Court, but only with the leave of the Court if the amount of costs in dispute is less than $100.000.
20. Two certificates of determination were issued by the Review Panel: a Certificate of Determination of Review in the amount of $37,963.93 (inclusive of filing fees) and a Certificate of Determination of Review Panel Costs in the amount of $8,036.88 (half of which to be paid by Mr Stanizzo). Mr Stanizzo had an appeal as of right to the District Court. He did not appeal to the District Court. Rather, he appealed to this Court and requires leave to do so.
21. No authorities were provided by Mr Rollinson as to what discretionary factors are relevant to the consideration of whether leave should be granted to appeal to the Supreme Court rather than to the District Court. Ms Fregnan did not address the issue in her written submissions and I did not invite her to do so at the hearing.
22. Although I have found no authority directly on point, I note that the following was stated in the Report on this issue at 5.3.8: "When should leave should be required. At present, leave is required to appeal from any determination, other than on a question of law under s 384, and regardless of quantum. This can give rise to sterile arguments as to whether there is a question of law. Where there is a question of law, the amount in issue might nonetheless be very small. It is considered that a monetary threshold is a superior measure of when leave is required than the existence of a question of law. For appeals to the District Court, a threshold of $25,000 in issue on the appeal is proposed, and for the Supreme Court, $100,000. Obviously enough, the existence of an arguable question of law would be a significant factor in favour of the grant of leave in a case where leave was required." (Emphasis added.)
23. At 5.3.4, the Report also indicated that the principles for granting leave were outlined by Fitzgerald JA in Chapmans Ltd v Yandell [1999] NSWCA 361 at [12] in relation to the appeal regime in place at that time. In that case his Honour observed that: "12 It is also in my opinion important to keep in mind that s208M must be considered in the context of s208L, which restricts an appeal as of right to matters of law. In considering whether or not leave to appeal is granted, it must be decided whether or not, there not being a matter of law arising in the proceeding and there being an appeal as of right only as to a matter of law, there is some other matter which in justice requires that leave to appeal be granted to allow that matter to be relitigated. The party seeking leave to appeal obviously bears the burden of establishing that justice does require that leave to appeal be granted. Further, the master when considering whether to grant leave to appeal obviously has a very wide discretion: see CDJ v VAJ [1998] HCA 67 per McHugh, Gummow and Callinan, JJ."
24. Recently, in Gazecki v McCabes Lawyers Pty Ltd [2020] NSWCA 98, Basten JA (with whom Leeming JA and Simpson AJA agreed) cast doubt as to whether courts applying s 89 of the LPULAA should apply principles from decisions under the previous appeal regimes. After discussing the history of the provisions preceding s 89, his Honour noted at [43] "No submissions were made in this Court on the scope and operation of s 89; accordingly, it is both unnecessary and inappropriate for the Court to resolve these questions in this case. What is clear, however, is that courts exercising jurisdiction under this provision must pay close attention to the terms of the statutory power and should not adopt statements from earlier cases dealing with different powers, unless persuaded that they remain applicable. Although the distinction between appeals on matters of law and appeals from the final determination of a costs assessment have been removed, it may, nevertheless, be appropriate to adopt different standards of scrutiny with respect to each. Thus, questions of law are inherently liable to review according to a correctness standard; a lower standard of scrutiny may well be applicable to an assessment of what costs are fair and reasonable in the circumstances of the particular case. Particularly is that so where a specific body of costs assessors, appointed solely for that function, reach evaluative judgments. Furthermore, costs assessors are expected to ensure consistency of approach, being a standard which cannot readily be applied by a reviewing court with limited experience of such matters."
25. I am satisfied that no questions of law arise in the present matter nor any particular matter of principle. No other reason was identified as one warranting leave to appeal to this Court when an appeal lay as of right to the District Court. Despite the fact that Mr Stanizzo put forward no cogent basis for leave being granted in this matter, I am prepared to grant leave to appeal to this Court in this matter for three reasons. First, as a matter of procedural fairness, this was not a matter that was addressed at the hearing. Secondly, the unfortunate and protracted principal proceedings were heard in this Court. This provides some jurisdictional nexus with this Court. Thirdly, serious allegations are made by Mr Stanizzo as part of this appeal.
26. In being satisfied that leave should be granted in the circumstances of this case, I wish to make it clear that just because principal proceedings are heard in this Court does not mean that leave would inevitably be granted to appeal a costs decision of a Review Panel concerning a costs order made in this Court; I am simply satisfied that the interests of justice warrant it in this case.

The Assessment History

1. On 7 April 2017, Ms Fregnan filed an application for assessment of party/party costs following the Court of Appeal costs order. She did so without the assistance of a lawyer and it is common ground that she did not provide a copy of the bill to Mr Stanizzo before she did so.
2. The assessment of ordered costs is provided for under Divisions 2 and 3 of the LPULAA. Applications for costs orders can be made by persons liable to pay or receive such costs or as referred by a court or tribunal: s 74. The costs assessor is to have regard to what is fair and reasonable: s 76.
3. After the application was received, the Assessor, Mr McIntyre, wrote to Mr Stanizzo inviting submissions which he subsequently supplied. He also made other inquiries, as set out in his reasons.
4. Ms Fregnan put in bills totalling $212,527.85. This amount was significantly reduced by the Assessor. On 4 October 2017, he issued a Certificate of Determination of Costs under ss 70, 78 of the LPULAA headed: "Supreme Court of New South Wales Court of Appeal matter number 2016/00099299 Karina Vivianna Fregnan v Vincent Francis Stanizzo costs order dated 22 September 2016"
5. The amounts determined by the Assessor are as follows: 1. Amount of costs assessed (inclusive of any GST component allowed) $44,728.36; 2. Interest on costs to date (Civil Procedure Act 2005, s 101) $3,446.53; 3. Total of items above $48,174.89; 4. Add costs of costs assessment (proportion of filing fee) $447.28; 5. Nil; 6. Total amount specified in the certificate, payable by costs respondent to costs applicant $48,622.17.

Reasons of the Assessor

1. The Assessor noted that attached to the application was a bill of costs, dated 22 November 2016, from Donnelly Lawyers to the costs applicant in the sum of $110,490.85, a tax invoice dated 31 January 2016 from Mr Kumar, barrister, in the sum of $32,736 addressed to both Donnelly Lawyers and Ms Fregnan (in relation to the District Court proceedings) and a tax invoice dated 6 December 2016 from Mr Kumar in the sum of $63,558 addressed to Ms Fregnan (in relation to the Court of Appeal proceedings). He then recounted the documents and material he had received during the course of the assessment. That material included letters from Mr Stanizzo on 9 May 2017 (2 letters), 10 May 2017, 11 May 2017, 12 May 2017, 16 May 2017, 22 May 2017, 24 May 2017, 8 June 2017, 15 June 2017, 28 June 2017 (two letters) and 6 July 2017. He also received letters from Mr Stanizzo's barrister, Mr Rollinson, on 16 June 2017 and 29 June 2017.
2. In addition to all of this correspondence from Mr Stanizzo, he also received letters from Ms Fregnan on 17 May 2017, 7 June 2017 and 20 June 2017, as well as the following three letters: 1. 30 June 2017, letter from Paul Donnelly, the solicitor who acted for Ms Fregnan. 2. 10 July 2017, letter from Mr Kumar. 3. 13 July 2017, letter from Mr Donnelly.
3. After setting out this extensive list of correspondence, the Assessor then added the following at [2.4]: "I also record for the purposes of transparency that both parties from time to time attempted to speak to me in person by telephoning my office. I spoke to neither party on the telephone concerning the matter. My secretary on my instructions informed both parties that the assessment process was paper driven and that all issues concerning the assessment should be the subject of correspondence to me with a copy provided to the other party."
4. At [4] the Assessor observed that the proceedings in which the costs order was made were commenced on or after 1 July 2015 and, thus, the Uniform Law applied. After referring to the relevant order of the Court of Appeal, the Assessor observed the following at [6.4]: "Since the costs order relating to the Notice of Motion in the District Court and the Appeal before the Court of Appeal was made by the Court of Appeal in proceedings commenced after 1 July 2015, the assessment must be conducted pursuant to the provisions of the Uniform Law and whilst I'm not required to issue separate certificates as the cost orders were not made in different proceedings, I will later in these reasons provide details of the costs which are referable to the Notice of Motion in the District Court and the Costs referable to the Appeal before the Court of Appeal."
5. The Assessor then set out the background to the application, in doing so he observed at [7.1]: "Much of the communication from the parties was either irrelevant or superfluous to what I am reasonably required to conduct the assessment but I was obliged to consider it nonetheless."
6. In setting out the history he further observed at [7.2]: "I note that the Summons Seeking Leave to Appeal was signed personally by [Ms Fregnan] on the basis that she was not legally represented at that time…. The costs applicant was represented in the District Court proceedings by Paul Donnelly, solicitor but he appears to have ceased to act in the costs applicant in the District Court proceedings on or about 21 March 2016 and took no part in the Court of Appeal proceedings. Ashok, Kumar of counsel appeared for the costs applicant in the District Court proceedings relating to the Notice of Motion filed on 19 October 2015 and also in the Court of Appeal. The decision of the Court of Appeal confirms that there was no solicitor acting for the costs applicant in the Court of Appeal proceedings as the papers indicate that the costs applicant appellant was 'self-represented'."
7. At [8.3] the Assessor observed the following: "Considered on a global basis the costs claimed in the sum of $212,527.85 appeared to be well in excess of what might be considered fair, reasonable and proportionate for the hearing of a notice of motion in the District Court over two days in which the issue was whether or not the particulars provided were adequate and a one-day hearing in the Court of Appeal in relation to the same issue with several short directions hearings."
8. The Assessor noted that Mr Kumar of counsel had a cost agreement dated 29 August 2015 with Donnelly Lawyers in relation to the District Court proceedings which provided for a daily rate of $3,000 on an hourly rate of $400, both amounts plus GST. The Assessor then stated the following in relation to the costs agreement between Ms Fregnan and Donnelly Lawyers, dated 10 February 2015. He noted that it did not state the manner that it related to and disclosed a charge rate of $500: "Neither costs agreement complied with the disclosure requirements that were applicable at the time but nothing turns on that in assessing audit costs. I was not provided with any costs agreement between counsel and the client in relation to the Court of Appeal proceedings the council has prepared his tax invoice for those proceedings at the same rates that applied for the District Court proceedings. For the purposes of the assessment I have assumed the council was under the mistaken impression that the cost agreement dated 29 August 2015 was applicable to the Court of Appeal proceedings notwithstanding that it was a direct access brief with the client with no instructing solicitor. In any event, I am not required to apply the provisions of a costs agreement in determining an appropriate rate of charge. Having regard to the Cost Assessor's Rules Committee Guidelines and all relevant factors as set out in the Uniform Law a fair and reasonable hourly rate for Paul Donnelly of Donnelly Lawyers was determined by me to be $350.00 per hour plus GST and for Ashok Kumar of counsel a fair and reasonable rate was determined by me to be $3,000.00 per day for a 10 hour day for a brief on hearing in $300.00 per hour for other work. Counsel's fees in relation to the Court of Appeal proceedings were reduced from $63,558.00 inclusive of GST to $19,618.50.00 inclusive of GST. These fees are usually categorised as expenses or disbursements for the purposes of an assessment. In this matter their true nature is that of professional costs having regard to the fact the council was directly briefed by the costs applicant. The items in both tax invoices of Ashok Kumar that were reduced or disallowed are set out in the schedule attached to these reasons."
9. The Assessor then addressed the general objections and submissions of the parties, before observing the following at [11.7]: "Sorting the wheat from the chaff I record that the general objections and submissions of the cost responded fell into a number of categories which I will summarise as follows: That the cost agreement was recently created document created by a person named by the cost responded who was neither the costs applicant, the solicitor Paul Donnelly or the barrister Ashok Kumar. There was no evidence to support this allegation and I rejected it. ... That Mr Donnelly and Mr Kumar acted for the costs applicant on a pro bono basis and that the cost applicant had no legal obligation to pay the fees of either Mr Donnelly or Mr Kumar. To deal with this submission I wrote to the costs applicant putting that proposition to her. She denied it. I also wrote to Mr Donnelly and Mr Kumar and put to them that proposition. They both rejected it. I have not been provided with any evidence from the costs applicant that the bill of costs of Mr Donnelly and the tax invoices of Mr Kumar have been paid. Payment of the invoices by the costs applicant is not a prerequisite for her seeking to have an order for the payment of audit costs assessed. I accepted for the purposes of the assessment that the costs applicant had entered into a costs agreement with Mr Donnelly in relation to the District Court proceedings and that she had received a bill of costs from him and is liable to pay it. In relation to Mr Kumar he had a cost agreement with his instructing solicitor Mr Donnelly in relation to the District Court proceedings and he has issued a tax invoice in relation to that matter. In relation to the Court of Appeal proceedings the costs agreement that Mr Kumar entered into with Mr Donnelly does not apply to the Court of Appeal proceedings. Notwithstanding that Mr Kumar did not enter into a direct access cost agreement with the costs applicant did not make disclosure to her in accordance with the Uniform Law, he is entitled as a matter of law to the payment of a fair and reasonable amount for his services on a quantum meruit basis. It may be the case that the costs applicant does not have the resources to pay the costs owed to her solicitor and barrister but in the absence of any evidence that they acted on a strictly pro bono basis, she is entitled to have her party/party costs assessed."
10. The Assessor then noted that the amount that he allowed for costs and counsel's fees including GST is $38,926.36 made up of the following: "(1) Professional costs of Donnelly Lawyers in related to the Notice of Motion in the District Court $4,061.86 (incl of GST) (2) Counsel's fees in relation to the District Court Notice of Motion $15, 246.00 (incl of GST) (3) Counsel fees in relation to the Court of Appeal proceedings $19,618.50 (incl of GST)"
11. The Assessor then noted that he had not been provided by either party with any offers made in relation to the costs and observed the following: "In more than 10 years as an assessor I've never undertaken an assessment which occupied so much time in perusing and responding to correspondence with the parties. I was provided with a significant amount of written material which was simply a necessary to enable me to conduct the assessment was obliged to read it and consider it. On a party/party basis the amount claimed by the costs applicant was manifestly excessive. In addition, no attempt had been made to confine the amount claimed to the costs actually recovered by the terms of the costs order. For his part, the cost responded was a prolific letter writer who initially opposed the application for assessment proceeding and raised every possible objection. The costs applicant is only recovered a small proportion of the amount she sought but I dare say that is still an amount in excess of what the cost responded would wish to pay. Both parties were contributors to the significant cost of the assessment. For the reasons set out above the parties will pay my costs of the assessment in equal shares."

Events following the assessment

1. On 4 December 2017, Ms Fregnan registered the Certificates of Determination in the Local Court and obtained a judgment in the amount of $50,783.55 and a Garnishee Order.
2. On 5 December 2017, Mr Stanizzo filed an application for a review to a Costs Review Panel.
3. On 15 January 2018, Mr Stanizzo filed a summons in this Court seeking a stay of the enforcement of the two costs certificates.
4. On 12 February 2018, Johnson J made an order staying the Garnishee Order issued on the application of Ms Fregnan until further order of the Court.
5. On 6 March 2018, Latham J made orders including that the enforcement of the Determinations, the Costs Judgment and the Garnishee order be stayed until the final disposal of the principal proceedings.
6. Mr Stanizzo sought a review of the decision of the Assessor to the Review Panel. A party may, within 30 days after receiving a certificate of determination, appeal to the review panel under s 83 of the LPULAA. The Manager of Costs Assessment can also apply for a review of a decision by the costs panel: s 84. When conducting the review, the panel has, in relation to the application for review, all the functions of a costs assessor in relation to the assessment concerned: s 85(2).
7. If, on review of a costs assessor's determination, a review panel sets aside and substitutes the determination, the panel issues a certificate that sets out its determination: s 87.
8. Mr Stanizzo relied upon the following grounds of complaint to the Review Panel (by reference to the paragraphs of the decision of the Assessor): Ground A: Costs applicant's failure to give prior notice of application (paragraphs 1 to 9); Ground B: Failure to provide costs respondent correspondence (paragraphs 10 to 16); Ground C: Rates (paragraphs 17 to 20); Ground D: General objections and submissions (repeat of allegations contained in the previous grounds alleging denial of procedural fairness and fabrication of the costs agreements) (paragraphs 21 to 29); Ground E: Specific objections (the bill did not contain item numbers) paragraph 30); Ground F: Bill of costs of Donnelly Lawyers (paragraphs 32 to 35); Ground G: Counsel's fees - invoice for District Court (paragraph 36); Ground H: Counsel's fees - invoice for Court of Appeal (paragraph 37); Ground J: Failure to set off costs owed to Mr Stanizzo by Ms Fregnan (paragraph 38); Ground K: Assessor's costs (paragraphs 39 and 43); Ground L: Payment of interest on costs (paragraph 40); Ground M: Determinations as to the costs of the assessment and filing fee (paragraphs 41 to 42).
9. On 3 December 2018, the Review Panel confirmed the Certificate of Determination of the Manager's Assessment Costs, lifted its suspension and issued two certificates: a Certificate of Determination of Review in the amount of $37,963.93 to be paid by Mr Stanizzo to Ms Fregnan and a Certificate of Determination of Review Panel Costs in the amount of $8,036.88 to be paid as to $4,018.44 (50%) by Mr Stanizzo and as to $4,018.44 (50%) by Ms Fregnan.

Reasons of the Review Panel

1. The Panel set out the process to be undertaken under the Act. It was noted that, although there were no decisions concerning the current legislation, a number of judicial views have been expressed in relation to the previous legislation. Reference was made to the decision of the Court of Appeal in Wende v Horvath (NSW) Pty Limited [2014] NSWCA 170 and the observations by Barrett JA (with whom Beasley and Basten JJA) agreed at [158]-[163].
2. The background of the review was then set out. The Panel then itemised the material that it had considered which included all of the material in the Assessor's file and further correspondence and submissions.
3. It was identified that the central allegation by Mr Stanizzo is that Ms Fregnan's solicitor, Paul Donnelly, and barrister, Ashok Kumar, were retained on a pro bono basis and that the costs agreements and associated documents relied upon by Ms Fregnan were recent creations to remove the pro bono arrangement and to make Mr Stanizzo liable for her costs.
4. The Panel considered ground A first, which complained that Mr Stanizzo had not been given any prior notice of the application and was denied procedural fairness. Although the Panel accepted that it would appear that he was not given such notice, he had been asked to identify with precision any prejudice that he may have suffered as a result. The highest that he could identify any prejudice was to assert that he had been denied the opportunity to take legal advice and lodge objections and/or attempt to settle the claim before the assessment process began. The Review Panel was satisfied, on the information available to it, that there was no reasonable prospect that the matter would have settled. In any event, he was given the opportunity to make submissions in relation to the application and did so. The Panel was of the view that this complaint was without substance and failed.
5. The second ground, ground B, was a complaint about the failure to provide certain correspondence to Mr Stanizzo, specifically letters sent to the Assessor from Mr Donnelly and Mr Kumar. The Panel noted that the usual practice is that other parties are copied into correspondence to observe the requirements of procedural fairness, but if an Assessor writes to a third party it is not standard practice to do so. It was accepted that there are no hard and fast rules in relation to third parties. The Panel concluded that no prejudice was caused to Mr Stanizzo and, thus, there was no substance to this complaint. The Panel then went on to observe this about Mr Stanizzo: "He makes serious allegations of fraud on the part of Ms Fregnan's legal advisers and of collusion between them in an attempt to overcome problems which would arise from the indemnity principle if she had no obligation to pay them at least as much as the costs claimed in the assessment."
6. It was noted that counsel for Mr Stanizzo had submitted to the Panel that it was required to conduct a "proper investigation" of the material. In response to this argument, the Panel stated that it had written to Ms Fregnan and both her lawyers on this issue and all of them had denied in writing any pro bono arrangement. Both Mr Donnelly and Mr Kumar had sent a copy of the costs agreements to the Assessor. The Panel was of the view that they were inconsistent with the existence of any pro bono arrangement. It was accepted that the Assessor had not been supplied with the correspondence which may have accompanied the costs agreement but the Panel did not accept the suggestion that the Assessor had failed to follow this up or that he was obliged to do so. The Panel then observed the following: "For the sake of completeness the Panel deals with the remaining allegations that there was some form of a 'conspiracy' on the part of Ms Fregnan the lawyers involved including solicitor 'X' to defraud Mr Stanizzo… Contrary to what Mr Stanizzo says the fonts used to not prove anything. Mr Stanizzo's letter of 14 June 2017 has come to the attention of Solicitor 'X' who sent a three-page letter (dated 26 June 2017) to the assessor vigorously denying the allegations made. He also said that many of the allegations were knowingly false and demanded a retraction and an apology. In the opinion of the Panel, based on the material available, the allegations made by Mr Stanizzo against solicitor 'X' appear to be in breach of the Legal Profession Uniform Law Australian Solicitors Conduct Rules 2015. Rule 32.1 states: 'A solicitor must not make an allegation against another Australian legal practitioner of unsatisfactory professional conduct or professional misconduct unless the allegation is made bona fide and the solicitor believes on reasonable grounds that available material by which the allegation could be supported provides a proper basis for It'." (Emphasis in original.)
7. The Panel went on to observe that: "In the opinion of the Panel there is, on the basis of the information available, no material, apart from unsupported assertions, nor any reasonable grounds to support the allegations made regarding the alleged fabrication of the costs agreements. The only remaining submission on this issue which warrants any comment is a suggestion by Mr Rollinson that the lack of evidence of any demand for payment of the cost by Ms Fregnan's legal advisers apart from the issue of the Invoices for their fees is a further indication that they were acting pro bono. Although Ms Fregnan's assertion that 'even if the engagement was pro bono Courts Have (sic) given reasonable legal costs to winning (sic) party' is not correct, the Panel finds no substance in Mr Rollinson's submission for the reasons set out in the third bullet point of paragraph 11.7 in relation to this ground and finds no substance in it."
8. As for ground C, the Panel considered Mr Stanizzo's complaint that the Assessor appears not to have enquired as to the basis upon which Mr Kumar acted and merely accepted his version. He also submitted that the rates of $350 per hour for the solicitor and $3,000 per day or $300 per hour for the barrister were not fair and reasonable.
9. The Panel considered this ground and stated that there was a flaw in Mr Stanizzo's understanding of the relevance of the costs agreement and his allegations were "mere conjecture". It was stated that Mr Stanizzo simply disagreed with the approach taken by the Assessor. The Panel was satisfied that the issues in question were ones upon which reasonable and informed opinions might differ from time to time. It concluded that the Assessor was entitled to reach the conclusions which he did. No error was found in the Assessor's approach.
10. As for ground D, the Panel was satisfied that they repeat the allegations already made alleging denial of procedural fairness and fabrications. The Panel stated the following: "The Panel does not intend to traverse all of the unsubstantiated allegations made by Mr Stanizzo many of which are defamatory. So far as allegations which are not so tainted are concerned Mr Stanizzo's submissions regarding the fonts used in the allegedly fake costs agreements, to which the Panel referred in paragraph 27, provide a good illustration of the nature of many of his allegations in 'support' of his contention that the costs agreements were fraudulently concocted. Mr Stanizzo had the onus of proving his allegations and the assessor found that he failed to do so. The Panel accepts that the assessor was entitled to reach the conclusion he did. In fact, on the material available to the Panel, this was the inevitable conclusion in all the circumstances. Mr Stanizzo has put nothing further to the Panel of sufficient probative value to substantiate his allegations and therefore this ground fails." (Emphasis in original.)
11. As for ground E, this complaint related to the fact that the bill did not contain item numbers. Although the Review Panel accepted that there was some merit in that complaint, the Assessor set out the basis of the reductions so there was no merit in the suggestion that Mr Stanizzo could not ascertain the reason for the reductions. The Panel noted that there are 141 individual items claimed for professional costs in the solicitor's bill and 44 individual items of work claimed in the two bills rendered by counsel. The Panel re-examined all three bills and noted some arithmetic and other errors on the Assessor's part, which would be dealt with below. Accordingly, the Panel varied those amounts slightly in Mr Stanizzo's favour.
12. As for ground F, there was an overlap with ground E. The complaint related to the Assessor's failure to apply a charging basis that was set out in the costs agreement and instead allowed charges on an hourly basis reducing them to what he regarded to be a fair and reasonable amount. The Panel determined that Mr Stanizzo misconceived the relevant issues and that the Assessor was not required to specifically make time estimates for each item and that the approach taken by the Costs Assessor was correct. This ground failed.
13. As for ground G, this was a repeat of the claim that the counsel's fee should not have been allowed at $3,000 a day. The Panel determined that, apart from an arithmetic error, a further error arose due to the fact that the counsel's invoice did not total $32,736 but actually totalled $37,136, which was an excess of $4,400. After some further calculations, a reduction of $3,300 to the Assessor's amount was arrived at.
14. As for ground H, it concerned individual items in counsel's fees. The panel was satisfied that, in addition to arithmetic errors, a further error arose due to the fact that the counsel's invoice did not total $63,558 but actually totalled $63,118 ($440 less). The Panel was otherwise of the view that the findings of the Assessor were fair and reasonable and the issues in question ones upon which minds might differ. After some further calculations, a reduction of $3,960 in the amount allowed by the Assessor for this bill was arrived at.
15. As for ground J, this was a claim that the Assessor had failed to set off costs owed to Mr Stanizzo by Ms Fregnan and that she should not have put "N/A" in paragraph 5 of the application. The Panel concluded that this was enforceable as a discrete matter and that the question posed at paragraph 5 of the application is concerned with applications made by the person liable to pay the costs and that it had no application in the present circumstances. As such, that ground failed.
16. As for ground K, a complaint was made as to the Assessor's costs. The Panel said this in relation to this complaint: "The panel has considered the assessor's file and can understand why the matter occupied this much time. Indeed the Panel has had to expend an unusually large amount of time in dealing with this matter partly due to the approach adopted by Mr Stanizzo and his counsel. In any event an assessor has no obligation to provide the parties with details as to how his or her fees are made up. This is not a matter which can legitimately be the subject of a ground in a review. This ground has no substance."
17. As for ground L, objection was made to the allowance of interest since the date of the court order on 22 September 2016. The Panel referred to s 101 of the Civil Procedure Act 2005 (NSW). The Panel determined that it would not allow any interest on the amount it determined to be fair and reasonable. Consequently, the amount of $3,444.53 would not be included in the final amount determined by the Panel.
18. As for ground M, it was submitted that the Assessor had disregarded the fact that Ms Fregnan's claim was found to be manifestly excessive. It was concluded that the Review Panel had reduced the Assessor's determination by a significant amount. It was noted that there was no evidence that the parties attempted to settle the matter and that Mr Stanizzo's bald assertion that he had never refused to pay any costs is disingenuous. It then noted this in relation to Mr Stanizzo: "His approach to the assessment of this review appeared to be completely inconsistent with any desire to settle the cost. His primary argument was that the costs agreements were a sham and a product of a fraud perpetuated by Ms Fregnan and her legal advisors. The Panel finds no substance in this ground."
19. Following the review of the decision of the Assessor the assessed amount of Ms Fregnan's reasonable costs pursuant to the Court of Appeal orders were reduced from $48,622.17 to $37,963.93.

The appeal to this Court

1. On 14 October 2019, Mr Stanizzo filed a summons in this Court seeking leave to appeal against the Review Panel's Reasons for Determination dated 3 December 2018. The Grounds of Appeal as described in the summons were precisely the same grounds relied upon in the appeal from the decision of the Assessor to the Review Panel, save for the different paragraph references: Ground A: cost applicants failure to give prior notice of application: Reasons par 14-19 Ground B: Failure to provide Costs Responded with correspondence: Reasons par 20-30 Ground C: Rates: Reasons par 31-32 Ground D: General objections and submission: Reasons par 33-36 (There was no Ground E) Ground F: Bill of costs of Donnelly Lawyers: Reasons par 42-43 Ground J: Failure to set of costs owed to Stanizzo to Fregnan: Reasons par 49, 50 Ground K: Assesses costs: Reasons par 51, 52 Ground M: Costs of assessment and filing fee
2. The hearing came before me on 24 June 2020. Mr Rollinson of counsel appeared for Mr Stanizzo and Ms Fregnan appeared for herself.
3. The plaintiff relied on the affidavit of Mr Stanizzo filed on 14 October 2019 with annexures and the defendant relied on her affidavit dated 18 June 2020 with annexures. I ruled that a number of the annexures of that affidavit were irrelevant. I note that following the hearing, Ms Fregnan copied my Associate on five separate occasions into email correspondence concerning other costs assessments and Mr Stanizzo's appeal to the Court of Appeal against the decision of Harrison J. I have not had regard to any of that material.
4. The eight separate grounds of appeal are directed at specific paragraphs of the decision of the Review Panel. In that sense, this is a global appeal and this Court is invited to find error in every matter decided upon by the Panel. There is a significant degree of overlap as between the respective grounds.
5. A number of Mr Stanizzo's submissions were directed at the terms of the relevant costs agreement. In order to understand those and some of the other complaints made in this Court, it is necessary to set out the terms of that costs agreement and the correspondence between the Assessor, Mr Donnelly and Mr Kumar.

Cost agreement documents

1. The costs agreement with Donnelly Lawyers was signed by Ms Fregnan and dated 10 February 2015, and was in these terms: "Thank you for your instructions to act for you in this matter. We are required by the Legal Professions Act (the 'Act') to set out the terms of our engagement, which are as follows: 1. We estimate that our charges for completing the work, up to and including (e.g. settlement) will be $500.00 per hour plus GST of $50.00 We expect to complete that work by December 2015 Paul Donnelly will be responsible for the work. All communications to the firm should be addressed to Paul Donnelly. 2. We may send you further bill/s for our charges and expenses:- 3. Throughout the matter at regular intervals and when the work is completed. 4. The Act provides that a legal practitioner cannot take action for recovery of legal costs until thirty (30) days after a bill of costs has been given to the person charged with their payment. 5. At the expiry of 30 days after the bill of costs is given to you, interest, at the rate specified in the Act, will be charged any amounts unpaid. 6. The Act gives you the right to have the charges made in a bill assessed for their fairness and reasonableness by an Assessor appointed by the Supreme Court. That right is not available to you in certain circumstances where there is a cost agreement which complies with the Act unless the Agreement is determined by a Costs Assessor to be unjust. 7. We will on completion of the work, retain any papers to which you are entitled, but leave in our possession (except documents deposited in safe custody) for no more than seven (7) years on the understanding that we have your authority to destroy the file seven years after the date of the final bill rendered by us in this matter. 8. We will begin the work promptly when you notify your acceptance of this offer, which you may do orally, or in writing, or be signing and delivering to us the attached duplicate. 9. We will not continue to do the work if you fail to pay our bills, if you fail to provide us with adequate instructions, or if you indicate to us that we have lost your confidence. We will give you at least fourteen (14) days notice of our intention to terminate our Agreement, and of the grounds on which the notice is based. You will be required to pay our charges for the work done, and for expenses incurred, up to the date of termination. You may terminate this agreement in writing at any time. If you do so you will pay our fees and expenses incurred up to the time of termination. 9. It may be necessary for us to engage, on your behalf, the service of another lawyer to provide specialist advice or services, including advocacy services. We will consult you as the terms of the lawyer's engagement, but you may be asked to enter into a fee agreement directly with the other lawyer. 10. If, in the proceedings to which this Agreement relates, an order is made, requiring another party to pay your costs of the proceedings, that order will not affect your liability to pay our costs and expenses under this Agreement, but the amount recovered (if any) may be applied towards satisfaction of our charges and expenses. It is possible that the Court may make an order that you pay another party's legal costs (if for instance you lose the case), which costs would be in addition to those payable to us under this agreement. 11. We have discussed with you, so far as it is relevant to the work, the question whether you may be eligible for Legal Aid. This Agreement is entered into onto understanding that:- (a) Legal Aid is not available in respect of the work; or (b) You are not eligible; or (c) You have declined to make an application for Legal Aid."
2. Attached to that agreement was a list of itemised charges as follows: "1 Drawing-contentions business (a) court documents (being part of any document filed in Court) (i) per page or part thereof $125.00 note: this item includes a subpoena for production (ii) using prescribed form or standard document, per page $65.00 (b) other documents including a party-party bill of costs in a form Required by the Act or Regulations, per folio $42.80 2 Drawing - non-contentious business (c) deeds, agreements, wills, abstract of title, requisition on title and answers thereto and documents of the like importance including contracts, transfers, caveats, grants of easement and notices to complete; (i) per page or part thereof $155.00 (ii) using printed or registration documents, per folio $12.80 (d) other, per folio $65.00 3 Typing and checking (e) court documents referred to in 1 (a) (i), per page $110.00 (f) documents referred to in 2 (c), per page $110.00 (g) other documents, including a bill of costs, per folio $32.80 4 Letters (including drafting typing and checking) (h) short letter (up to one folio in length) $60.00 (i) circulars-being identical (save for address details) with any other letter $30.00 (j) any other letter, per folio $42.80 5 Telephone calls (k) not requiring skill $50.00 (l) requiring skills or knowledge: (i) not more than six minutes $54.30 (ii) if continuing for more than six minutes, per six minute unit after first $50.00 6 Perusal off documents, letters and reports (m) being documents in item 2 (a) or 2 (c) or Court documents (being document filed hi Court), per page or part thereof $85.70 (n) other, per folio $21.40 7 Copying being a photographic reproduction, carbon or other copy of a document including sending or receiving a facsimile transmission, including the time reasonably spent by a Solicitor or Clerk in preparing, sorting and collating such documents for copying, per page $2.00 8 Time reasonably spent by a Solicitor including travelling, waiting time other than work referred to in items 1-7 inclusive or item 9, per quarter hour or part thereof $125.00 9 Time reasonably spent by a Solicitor attending Court as an advocate without Counsel, in any application, cause, motion, hearing or trial but not including attendance at any call-over, direction hearing, mention or adjournment, per quarter hour or part thereof $135.00 10 Time reasonably spent by a Clerk on work other than work referred to in items 1-7 inclusive, per minute six unit $25.00 11 in addition to the above rate we will also be adding a fee of 15% of our total costs assessed in accordance with the above Schedule of Charges. 12 Printing costs in email and the like $2.00 13 Facsimilies including sending or receiving a facsimile transmission, including the time reasonably spent by a Solicitor or a Clerk in preparing, sorting and collating such documents for faxing, per page $2.00 14 Allowable Sundries bank charges, STD calls, mobile calls, postage etc. At cost 15 GST is added as appropriate to the above charges and is payable by the client." (Emphasis in original.)

Documents provided to the Assessor by Mr Donnelly and Mr Kumar

1. On 17 June 2017, Mr Kumar sent the following email to Ms Fregnan: "I refer ( sic) you request to clarify the basis of my retainer: 1. Basis of retainer My involvement in the matter was in accordance with the costs agreement provided by me. My retainer continued on that basis in the Court of Appeal. I did not act pro bono and I am not sure of the basis of the assertion. 2. Payment I have not received any monies on account of my fees and costs such as photocopying that I paid from the chambers. Any payment for expert and the like was direct payment arrangement between you and the expert and I am not party to it. I hope that the above satisfies you in respect of the queries raised by the Costs Assessor in the matter."
2. On 20 June 2017, Mr Donnelly sent the following email to Ms Fregnan: "I wish to confirm that I acted in accordance with the retainer signed by you. I deny the assertion by Mr Stanizzo that I acted on a pro bono basis. Further I confirm that I have not been paid any monies at all and that my account is still outstanding."
3. On 10 July 2017, Mr Kumar wrote a letter to the Assessor, Mr McIntyre, in which he stated the following: "The costs agreement/costs disclosures are irrelevant to (sic) statutory task the application requires you to do: in this case party party costs. Nonetheless I am happy to provide and do enclose these documents to you. Even if the cost disclosure was not entered into your role would not have changed. This is not a matter that is NGO or Bar Association referral. I confirm that my instructions are not on pro bono publico basis or speculative basis. My initial instructions came from Mr Donnelly solicitor who I understand was appointed several months before. Mr Donnelly did not request me to act on pro bono publico basis or speculative basis. The final hearing date was already set in the District Court when I was initially instructed. The costs respondent's submissions to this effect is ridiculous and last-ditch effort to avoid payment of costs for very misconceived application even if initially successful in the Court below. Mr Donnelly played a limited role on appeal. A new solicitor was sought to be appointed by the client was ultimately unsuccessful. My retainer continued in the Court of Appeal on the basis of my cost disclosure as the Costs Applicant continued instructing me in the matter on that basis. The costs agreement contains standard provision that enabled me to continue on the basis of continued instructions."

Grounds A, K and M: The Review Panel erred in finding that Mr Stanizzo should pay a proportion of the costs of both the Assessor and the Panel

Mr Stanizzo's submissions

1. Mr Stanizzo's submissions dealt with these three grounds together. He contended that the fact that he was not provided with a copy of Ms Fregnan's bill prior to her filing an application for costs assessment on 7 April 2017 means that the entire expense of the assessment process was created by Ms Fregnan and she should pay for it all. Mr Stanizzo contended that had Ms Fregnan served her proposed application on him he could have provided objections and there was a likelihood that the matter could have settled. It was submitted that it was not open to the Review Panel to find that there was no reasonable prospect that the matter would settle.

Ms Fregnan's submissions

1. In her written submissions Ms Fregnan relied upon the findings of the Assessor and the Review Panel as being correct. She pointed out that the Assessor had corresponded with Mr Stanizzo as early as 5 May 2017 and he was invited to make submissions. She relied upon the fact that the Assessor is under no obligation to provide the parties with details as to how his or her fees are made up. She observed that it was Mr Stanizzo who sought the review; not her. She noted the observation of the assessor that Mr Stanizzo had been extremely active in providing as many submissions as possible including a plethora of objections which provided as much work for the assessor as she did. She submitted that this was a valid reason for the ruling made in this regard.

Consideration grounds A, K and M

1. It is to be accepted that Ms Fregnan, who was unrepresented at the time, did not comply with reg 35 of the Legal profession Uniform Law Application Regulation 2015. The Panel did not find otherwise. The difficulty with ground A, as the Panel observed, is that Mr Stanizzo was unable to identify any prejudice arising from this oversight besides some generalised assertion that the matter would have settled in part or in full if he had been provided with such notice.
2. The background of hostility between Ms Fregnan and Mr Stanizzo is such that it is speculative in the extreme to suggest that the parties could have settled some or all of the matters in contention if Mr Stanizzo had been on notice of the application.
3. Once the application was filed, Mr Stanizzo was invited to make any submissions in relation to the application he wished to and he did. There was no suggestion that after becoming aware of the application he was not provided with sufficient time to make submissions. Thus, although the procedure was not strictly complied with, it could not be said that he was denied procedural fairness as a result.
4. As for Mr Stanizzo's claim that he should not have to pay any of the costs of the assessment, the reasons for ordering that those costs be paid in the proportion they were is clearly set out in the reasons of both the Assessor (extracted above at [54]) and the Panel (extracted above at [79]). Although it is to be accepted that Ms Fregnan's solicitor put in an inflated claim, the fact remains that it was Mr Stanizzo who created much of the work that the Assessor was required to undertake. Mr Stanizzo asserts that the fact that the amount claimed was significantly reduced necessarily means that Ms Fregnan should have to pay all of the assessment costs; this ignores his own contribution to the significant amount of time required to assess the matter.
5. I would dismiss these grounds.

Grounds B and D: the barrister and solicitor acted pro bono

Mr Stanizzo's submissions

1. Mr Stanizzo's position was that none of the professional costs in the District Court or counsel's fees in the Court of Appeal should be paid by him because they are sought on a fraudulent basis.
2. He relied upon inconsistencies on the face of the costs agreement that I will address below. He relied upon the fact that Ms Fregnan had no funds to pay a lawyer so posed the question, why would she sign a full indemnity costs agreement? He submitted that the fact that Ms Fregnan had no funds, and the costs agreement was not drafted on a contingency basis led to the only conclusion that her lawyers had conspired against him to pretend that they were not acting pro bono when they in fact were.

Ms Fregnan's submissions

1. Ms Fregnan submitted in writing that there was no contradiction in the terms of the costs agreement. On the issue of any pro bono agreement she submitted: "Of course, Mr Donnelly and Mr Kumar have not been paid any costs. They knew full well that I had no money with which to pay either on an ongoing basis, or in advance. I would also remind the plaintiff that in the absence of any bona fides evidence that my solicitor or barrister acted on a strictly pro bono basis, I am entitled to have my party/party costs assessed. Also as bills have ready been submitted to the assessors by both legal representatives, and the assessors have already accepted that legitimate costs have occurred and are being claimed, the definition of "on a strictly pro bono basis" has already naturally been eliminated as a possible determination." (Emphasis in original.)
2. In her oral submissions at the hearing of the appeal Ms Fregnan explained how it was that Mr Kumar came to be retained: "I went around looking for a number of barristers, went back to the Bar Association. I was refused - no-one would work pro bono for me. Everybody wanted to be paid. So I asked the question to the Bar Association, 'Why can't I get another barrister to represent me?' 'Because you are only entitled to one pro bono per civil case,' and this was the reason why I could not get a pro bono solicitor to work for me. Everyone that I asked wanted to be paid. Now, with Kumar, in the direct Supreme Court across the road last year, he went for one day for me, after representing all that time, and his whole, whole thing was, 'When am I going to be paid? When will you pay me? When ‑ I didn't agree to this. You must pay me. You must pay me. You must pay me.' It got to a point that that's why I rushed to the assessors while he was overseas and put it in so that he could be paid, so he could represent me in the Supreme Court. So this guys, these people, were not working on pro bono, they wanted to be paid, but they knew I didn't have any money to get that, so they waited, but the thing was, he still was saying, 'I want to be paid. I don't want to do this anymore because I'm not getting paid,' because he said, 'I lost' - he said to me, 'I'm going to lose a case that's worth $30,000 to me if I go on and represent you without being paid.' So I had to tell the Court that Harrison J that I'm dismissing him and I had - was forced to represent myself because I could not pay him."
3. And later: "So I did everything in my power to find someone to help me and then I was lucky enough that Kumar came on board, but he wanted to be paid. Paid. Right? And I thought, when he came on, because they kept dragging the trial and delaying, because I was in a, a combination with Mr Badarne, it was called a cross-claim, they were suing me for malicious prosecution and I was suing for damages. Therefore, they kept delaying and delaying and delaying. We thought that this was going to be done and dusted two years prior or whatever is. They just kept delaying and delaying and, therefore, Kumar got frustrated. He said, 'This - I'm never going to be paid.' He, he's, he said, he wanted to be paid and I was embarrassed. I was embarrassed that I couldn't pay and, and he knew that there was going to be ‑ he knew I was going to win. He stuck it out and did the right thing and he did all this work. Now, this work, your Honour, is not worth $30,000; it is worth three times as much. This man put hours and hours into it and to - and this, this man here, Mr Rollinson, emailed so many letters to him that were unnecessary, just like they did with the costs - the review - the cost, cost assessment and the review panel. Lots and lots of correspondence that was unnecessary that created more work for everybody and more money that I had to borrow from my children. I had to borrow $6,200 and something to pay the Court and then I had to borrow $8,000 to get the costs assessment review, again, to get the money for Mr Kumar and Mr Donnelly so that he could represent me in the trial - in the Court of …."

Consideration grounds B and D

1. Ground B is a complaint that Mr Stanizzo should have been provided with the correspondence from Mr Kumar and Mr Donnelly whilst the matter was still before the Assessor. When Mr Stanizzo first made the fraud allegation, the Assessor wrote to Ms Fregnan, Mr Donnelly and Mr Kumar about this and they all replied in writing. They all denied that the agreement was a pro bono one. Their replies form part of the material before me and are summarised in the reasons of both the Assessor and the Panel.
2. The Review Panel considered Mr Stanizzo's complaint on this issue and distinguished this situation from the situation where a party is not copied into correspondence with another party. It was noted that there is no particular policy that all such third party correspondence must be provided to the parties.
3. In hindsight, it seems to me that had the Assessor provided the correspondence and costs agreement to Mr Stanizzo before the initial assessment was finalised it may have permitted him to address this issue squarely before the Assessor. But he had the relevant documents by the time of the Review. Thus, even if I was satisfied that there was a requirement for such documents to be provided to him by the Assessor, which I am not, the question arises as to what flows from such a finding. I propose to deal with this ground as being part of the more general complaint that the Review Panel should have been satisfied that the relevant costs agreements were fraudulent.
4. Ground D is the nub of the appeal. Mr Stanizzo contends that both the Assessor and the Panel erred in finding that Mr Stanizzo should have to pay any costs at all because Mr Kumar and Mr Donnelly were acting on a pro bono basis. Complaint is also made that the Panel failed in its task by not enquiring further as to whether there had in fact been a fraud.
5. Although I am not satisfied that Mr Stanizzo has established that Mr Kumar and Mr Donnelly were acting pro bono, I do have some doubt as to the genuineness of the costs agreement and subsequent bill provided by Donnelly Lawyers to the Assessor for the following reasons.
6. First, it was common ground that Ms Fregnan had no resources to pay for her legal fees upfront. She had sought pro bono assistance through the Bar Association in June 2014. As I have extracted above, her understanding was that Mr Kumar and Mr Donnelly expected to be paid but knew that she did not have any money until the matter was finished. In those circumstances, I accept that it seems unlikely that she would be required to sign a fully indemnifying costs agreement with no contingency clause.
7. Secondly, there is an inconsistency on the face of the costs agreement as it refers to an hourly rate of $500 on the first page and then attaches a list of itemised rates.
8. Thirdly, Mr Donnelly's bill was clearly inflated. It repeats entries and does not always reconcile with the court record which shows Ms Fregnan being unrepresented at various times where she was charged for legal services.
9. Fourthly, the tax invoice Donnelly Lawyers sent to Ms Fregnan on 22 November 2016 was sent after the decision of the Court of Appeal, whereas the costs agreement contemplated bills to be rendered on a monthly basis. This is the only invoice ever issued to Mr Fregnan (contrary to the terms of the agreement) and it was not calculated on the hourly rate (contrary to the terms of the agreement).
10. Fifthly, Ms Fregnan submitted that Mr Kumar wanted to be paid and repeatedly asked to be paid. As the extract above makes clear, this pertains to the time after the Court of Appeal hearing when Mr Kumar was going to appear for her in the proceedings before Harrison J, (which, that record shows, he did until part way through the proceedings at which time he withdrew). Her account is consistent with the agreement being a "no win no pay" one. She had won in the Court of Appeal thus he wanted to be paid. Despite this, the late Mr Kumar denied that the matter was pro bono or "spec" in his correspondence with the Assessor.
11. Having had regard to these matters it is clear that not all of this evidence can stand together. I am left with some doubt as to whether the agreement as between Mr Donnelly/Mr Kumar and Ms Fregnan in the District Court and as between Mr Kumar and Ms Fregnan in the Court of Appeal was on an indemnity basis or on a spec basis. The difficulty for Mr Stanizzo, however, is that even if I was not satisfied that it was on a "spec" basis, that does not necessarily mean that it must have been on a pro bono basis. I am satisfied that Ms Fregnan's lawyers expected to be paid at some time and, more significantly, that they did do legal work on her matter as claimed.
12. As the Review Panel pointed out, Mr Stanizzo's focus on the costs agreement on this issue is misplaced: the question for the Assessor, for the Review Panel and for this Court is to determine what party/party legal costs Ms Fregnan incurred in her appeal to the Court of Appeal and in defending Mr Stanizzo's notice of motion in the District Court. The relevance of the costs agreement in this matter was to protect Ms Fregnan. As Bell J noted in Russells v McCardel [2014] VSC 287 at [10]: "The protective policy of requiring disclosure by lawyers and enhancing freedom of informed choice by clients underpins this legislation, reflecting the modern conception that clients are not just clients but also consumers who are typically in a position of negotiating disadvantage, that lawyers are not just professionals but also suppliers of legal services and that the provision of legal services is not just an indispensible ingredient of the system of justice but also a (national) market in which information and bargaining power are imperfectly distributed. In response to increasing concerns about the level of legal costs and disputes about this subject, the legislative expression of this policy has evolved over recent years such that the requirements of the Victorian legislation, and its national counterparts, are stronger now than they have previously been."
13. Under the LPULAA the consequences of a legal practitioner not arranging a costs agreement is that the client (or an associated third party payer) are not required to pay the legal costs until they have been assessed or any costs dispute has been determined by the designated local regulatory authority: s 178(1)(b) of the LPULAA. The effect of any incomplete disclosure on behalf of Mr Donnelly's law practice does not affect Mr Stanizzo's obligation to pay costs to Ms Fregnan.
14. I am not satisfied of any error on the part of the Review Panel in failing to find, as a positive fact, that the arrangement between Ms Fregnan and her lawyers was necessarily a pro bono one. Any doubts I might have as to the documents provided to the Assessor do not mean that Mr Stanizzo has established that Ms Fregnan's lawyers must have been acting pro bono.
15. Finally, as to the complaint that the Review Panel failed to make further inquiries to determine whether the arrangement was in fact a pro bono one, it is difficult to see what inquiries could have made. All the relevant actors denied any pro bono arrangement. The suggestion that the Assessor and the Panel should have required the legal practitioners to provide other examples of their standard costs agreements for comparison purposes misunderstands the role of the Assessor.
16. I would dismiss these grounds.

Grounds C, G and H: Complaint as to the barrister's rates

Mr Stanizzo's submissions

1. This complaint is twofold. First, it is contended that the Panel should have enquired as to the basis upon which Mr Kumar appeared for Ms Fregnan on the appeal, rather than assuming that it was under the relevant costs agreement. The second complaint is that the rates of $350 an hour and $3,000 were not fair and reasonable.

Ms Fregnan's submissions

1. Ms Fregnan submitted that no error was disclosed in the Review Panel's finding in this regard.

Consideration

1. This ground can be dealt with shortly. Although Mr Kumar was under the belief that the disclosure he made for the District Court proceedings applied to the Court of Appeal proceedings, the Assessor came to the conclusion that this could not have been the case as his disclosure in the District Court was to Mr Donnelly, who no longer acted for Ms Fregnan in the Court of Appeal. The Assessor and the Review Panel both proceeded on the basis that Ms Fregnan was aware of Mr Kumar's costs from the previous disclosure via Mr Donnelly and that Mr Kumar acted for her on a direct access basis. I see no error in that approach. This complaint appears to be another way of contending that the Panel should have found that the arrangement was on a pro bono basis.
2. There can be no doubt that Mr Kumar did appear for Ms Fregnan in the Court of Appeal and in the District Court. Some of the entries on his bill correspond with the court's record. On 20 May 2016, for example, he appeared at a directions hearing before the Registrar. Similarly, on 11 July 2016, he appeared at another direction hearing. On 17 August 2016, he prepared written submissions and submissions in reply as required by these directions. On 29 August 2018, he appeared at the Court of Appeal hearing. There can be no doubt that he did the work necessary to prepare and appear on an appeal to the Court of Appeal. I have already concluded that Mr Stanizzo has not discharged the onus of establishing that he did so on a pro bono basis.
3. Mr Kumar's rates were assessed as $15,658.50 for the Court of Appeal matter (on a direct access basis) and $11,949.00 (for the District Court motion) respectively. The role of the Assessor and the Review Panel was to determine the "fair and reasonable amount of costs for the work concerned": s 76(1) LPULAA.
4. Section 76(2) of the LPULAA provides that in considering "what is a fair and reasonable" in these circumstances, the assessor may have regard to the factors in s 172(1) and (2) of the Legal Profession Uniform Law (NSW). These factors, as set out in 172(2), are as follows: (a) the level of skill, experience, specialisation and seniority of the lawyers concerned; and (b) the level of complexity, novelty or difficulty of the issues involved, and the extent to which the matter involved a matter of public interest; and (c) the labour and responsibility involved; and (d) the circumstances in acting on the matter, including (for example) any or all of the following - (i) the urgency of the matter; (ii) the time spent on the matter; (iii) the time when business was transacted in the matter; (iv) the place where business was transacted in the matter; (v) the number and importance of any documents involved; and (e) the quality of the work done; and (f) the retainer and the instructions (express or implied) given in the matter.
5. I have had regard to these matters on the same basis as did the Assessor and, in turn, the Review Panel. As the Review Panel observed in relation to the findings of the Assessor, an assessment of counsel's fees is one upon which reasonable minds might differ. Whether or not I would arrive at these precise figures is not the question; the question is whether I am satisfied that any error is disclosed in the Review Panel's finding that these amounts are fair and reasonable in the circumstances. I am not satisfied of any error in the assessment of counsel's costs.
6. I would dismiss these grounds.

Grounds E, F and K: Complaint as to solicitor's rates

Mr Stanizzo's submissions

1. These complaints all concerned Mr Donnelly's bill. The complaints are that the rates were too high, the bill was fabricated and that it did not contain item numbers. As stated above, these complaints have been largely upheld by the Assessor and the Review Panel already.

Ms Fregnan's submissions

1. Ms Fregnan addressed this ground in her written submission as follows: "Over the last few years, Stanizzo has stubbornly essentially presented the same allegations over and over again, under the guise of a variety of evolving iterations, only to have them rejected time and time again. The "Grounds Given" in the summons is just his latest attempt. He is very keen to repeat claims the monies owed to him and that Fregnan is the one who should be paying him, but he can only find spurious grounds to repeatedly attempt to justify those claims. To-date, he just cannot seem to accept that he is also repeatedly failing to meet the probative benchmark for successful grounds of appeal. If anything, his tactics are most definitely taking on a distinct appearance of desperation to avoid having to pay any allocated Costs at all costs."

Consideration

1. The complaints made under these grounds overlap and, again, to a large extent, repeat Mr Stanizzo's claim that Mr Donnelly is not entitled to anything. The Review Panel found that this complaint misunderstood the issues when dealing with court ordered costs. I am unable to find any error in the approach taken by the Panel on this issue and would not uphold this ground.
2. Despite the discrepancies in both the costs agreement and the bill provided by Mr Donnelly, Mr Stanizzo has not discharged the onus of establishing that Mr Donnelly was acting on a pro bono basis.
3. Mr Stanizzo has already been largely successful in his claim in this regard. An initial claim for $212,527.85 has been reduced to $37,963.93. Of that sum only $4,110.15 was referable to the solicitor's fees. Having regard to the s 76/s 172(2) factors I have extracted above, Mr Stanizzo has not established that this is not a fair and reasonable amount to be paid for the costs of the motion.
4. I would dismiss these grounds.

The parties' submissions

1. Mr Stanizzo submitted that the Review Panel failed to allow a "set off" of the costs payable by Ms Fregnan to him in the amount of $4,941, as per a Certificate of Determination of Costs issued on 12 January 2016 and sent to the parties on 16 March 2016.
2. Ms Fregnan contended that there is no remaining fee to set off, as these costs were effectively "wiped out" by the decision of the Court of Appeal.
3. Mr Rollinson, for Mr Stanizzo, was unable to explain why the costs were still owed as he was unable to identify the event that those costs followed. He was able to submit that the costs pertained to the service of medical reports and non-attendance at a medical examination. He was otherwise unable to assist as to the date of the decision, who the judge was and why Ms Fregnan was still required to pay the costs.
4. On the basis of a JusticeLink search conducted by my Associate during the hearing, five District Court outcomes were identified where costs orders were made against Ms Fregnan prior to the costs decision of Olsson DCJ on 11 December 2015. On 14 November 2014, she was ordered to pay the defendant's costs of that day as agreed or assessed, on 12 December 2015 she was ordered to pay costs of her motion but not until the conclusion of the hearing, on 16 April 2015 she was ordered to pay the costs of the defendant's motion, on 22 July 2015 she was ordered to pay the defendant's costs of the notice of motion associated with relisting the matter on 22 July 2015, and on 20 August 2015 she was ordered to pay the defendant's costs of the proceedings incurred since 22 July 2015 on an indemnity basis and payable forthwith.
5. Mr Rollinson submitted that the "set off" costs order related to an interlocutory order in Mr Stanizzo's favour against Ms Fregnan early in 2015 and prior to the decision of Olsson DCJ on 11 December 2015 and as such is unaffected by the decision of the Court of Appeal. He submitted that under the Uniform Civil Procedure Rules 2005 (NSW) Part 42, r 42.1 the court has an inherent discretion and power to allow set off costs orders if both were incurred in the same proceedings.

Consideration

1. Despite the amount of court time spent on this issue, it is ultimately not necessary for me to make any finding as to whether Ms Fregnan still owes Mr Stanizzo $4,941 from an interlocutory order made in 2015. This is because there was no obligation on the part of either the Assessor or the Review Panel to apply a set off to the amount of Ms Fregnan's assessed costs.
2. Mr Rollinson could not identify any provision of the Act or rules or any authority for the proposition that a costs assessor or a review panel must "set off" costs. This is because there is no such power and it forms no part of the assessment process. To contend otherwise misapprehends the nature of the role of the Assessor and the Panel.
3. I would dismiss this ground.

ORDERS

1. Accordingly, I make the following orders: 1. The appeal is dismissed. 2. The plaintiff is to pay the defendant's costs of the proceedings. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 24 September 2020