Wilkie v Brown

Court of Appeal (NSW)|2016-05-26|Before: Beazley P, McColl JA, Gleeson JA, Ward JA

Solicitors: Slattery Thompson (Applicant) In person (Respondent) File Number(s): 2015/202870 Decision under appeal Court or tribunal: District Court Date of Decision: 9 June 2015 Before: Maiden DCJ File Number(s): 2015/74248

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Held (Beazley P, McColl and Gleeson JJA agreeing): (1) Where a statute provides a general power to award costs, and that power as framed does not limit or define it in any relevant way, there is binding High Court authority that costs may be awarded to solicitors appearing for themselves. [27]-[29]. Guss v Veenhuizen (No 2) [1976] HCA 57; 136 CLR 47; London Scottish Benefit Society v Chorley, Crawford and Chester (1884) 13 QBD 872; Atlas v Kalyk [2001] NSWCA 10; Gett v Tabet [2009] NSWCA 76; 254 ALR 504; Cachia v Hanes [1994] HCA 14; 179 CLR 403; Wang v Farkas [2014] NSWCA 29 (2) The inclusion of the word "payable" in the definition of "costs" in the Civil Procedure Act 2005 (NSW), as well as the introduction of the costs regime under the Legal Profession Uniform Law as it applies in New South Wales, raises a number of questions as to the Chorley rule in proceedings in this Court. [35]-[48]. Re JJT; Ex parte Victoria Legal Aid [1998] HCA 44; 195 CLR 184; Cachia v Hanes [1994] HCA 14; 179 CLR 403; Hamod v State of New South Wales and Anor [2011] NSWCA 375; Kelly v The Queen [2004] HCA 12; 218 CLR 216; Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; 239 CLR 27 (3) In the absence of an active contradictor it was not appropriate to finally determine the questions of principle raised. The applicant may be taken to have conceded that the respondent is entitled to his professional costs. [49]. Guss v Veenhuizen (No 2) [1976] HCA 57; 136 CLR 47 (4) In the circumstances, a gross sum costs order was appropriate and the sum claimed by the respondent was reasonable. [50]-[53] Hamod v State of New South Wales and Anor [2011] NSWCA 375

Judgment

BEAZLEY P: On 29 April 2016, the Court dismissed the applicant's summons for judicial review. The respondent, who is a solicitor who acted for himself on the summons, sought an order that he be paid the costs of the summons by way of a gross sum, including costs for the professional work he performed on the matter. This raised the question whether a solicitor can recover his costs of representing himself.
The principal proceedings related to a dispute as to the costs payable in respect of legal services provided to the applicant by the respondent, her former solicitor. After that dispute arose, the respondent sought an assessment of costs under the Legal Profession Act 2004 (NSW) (now repealed). On 26 February 2014, costs were assessed in the sum of $32,917.38. That assessment was affirmed by a costs review panel on 12 August 2014. The respondent subsequently filed the certificate of determination of costs by the costs review panel in the Liverpool Local Court. On 25 November 2014, judgment in the sum of $33,003.98 was entered in the respondent's favour pursuant to the Legal Profession Act, s 368(5).
The applicant sought leave to appeal against the assessment in the District Court pursuant to the Legal Profession Act, s 385. The matter was listed before Maiden DCJ on 9 June 2015. The applicant did not appear personally and nor was she represented by a legal practitioner. The summons seeking leave to appeal was dismissed.
A summons was filed by the applicant in the supervisory jurisdiction of this Court on 10 July 2015. The applicant subsequently failed to file submissions and notice was issued to show cause why the summons should not be struck out for want of prosecution pursuant to the Uniform Civil Procedure Rules 2005 (NSW) (UCPR), r 13.6. In the event, proceedings were not struck out: Wilkie v Brown (Ward JA, Court of Appeal, 7 December 2015, unreported), but procedural orders and orders for the costs of the show cause proceedings were made in the respondent's favour. The applicant subsequently filed an amended summons and submissions.
The matter was set down for hearing before this Court on 29 April 2016. On 28 April 2016, the applicant informed the Court by telephone that she would be withdrawing her application. The applicant was represented at the hearing by her solicitor, Mr Darvill, who confirmed that the applicant wished to withdraw the application. The respondent appeared in person. He filed a notice of motion by which he, relevantly, sought his costs of the proceedings in this Court, assessed in a lump sum of $5,161.20. He also filed an affidavit affirmed by him on 26 April 2016.
The Court made orders dismissing the applicant's summons and directing the respondent and the applicant to file and serve submissions as to costs by 6 and 13 May 2016 respectively. Submissions were received from the respondent but not from the applicant. Although a solicitor appeared for the applicant on 29 April 2016 it is reasonable to infer that the applicant was unlikely to have any further representation in the matter. The respondent's submissions have helpfully assisted the Court in its determination although, as I indicate below, the question raised is an important one and the Court has had to determine it without the assistance of an active contradictor.

Is the respondent entitled to costs?

There can be no dispute that, had he been represented, the respondent would have been entitled to his costs of the proceedings. The applicant only informed the Court the day prior to the hearing that she did not wish to proceed with her summons.
The general rule is that a litigant in person who is successful in the litigation is entitled to recover disbursements but is not entitled to claim costs for time spent in the conduct of litigation: Cachia v Hanes [1994] HCA 14; 179 CLR 403 at 412-3. The question in issue here is whether that position is altered by the circumstance that the respondent is a solicitor representing himself. That question turns on whether the principle from London Scottish Benefit Society v Chorley, Crawford and Chester (1884) 13 QBD 872 (Chorley) applies to proceedings in this Court.

Authorities

The respondents in Chorley, a firm of solicitors, successfully defended themselves against a civil action and claimed costs, including professional costs, for the time spent in the conduct of the litigation. At 875-6, Brett MR held: "When an ordinary party to a suit appears for himself, he is not indemnified for loss of time; but when he appears by solicitor, he is entitled to recover for the time expended by the solicitor in the conduct of the suit. When an ordinary litigant appears in person, he is paid only for costs out of pocket. He cannot himself take every step, and very often employs a solicitor to assist him: the remuneration to the solicitor is money paid out of pocket. When, however, we come to the case of a solicitor, the question must be viewed from a different aspect ... The true rule seems to be that when a solicitor brings or defends an action in person, he is entitled to the same costs as an ordinary litigant appearing in person, subject to this restriction, that no costs which are really unnecessary can be recovered."
The respondent submitted that the principle from Chorley, that a solicitor appearing in person may recover costs for time spent conducting the case, was applied in Guss v Veenhuizen (No 2) [1976] HCA 57; 136 CLR 47. In that case, a solicitor who had conducted a successful appeal on his own behalf in the High Court was awarded costs. On taxation, however, it emerged that, as a result of a clerical error, the solicitor's name had not been entered on the Register of Practitioners and he was not entitled to practice in the High Court. The Registrar disallowed the bill of costs for that reason.
A majority of the High Court (Gibbs ACJ, Jacobs and Aickin JJ), relying on Chorley, held that the solicitor was entitled to recover costs. Their Honours outlined the basis of the rule and of their determination at 52, as follows: "The work was done by [the solicitor] in person and the only question is whether in the special circumstances here existing he was entitled to the benefit of the rule of practice established by the authorities to which we have referred. The answer depends on the true basis of the rule. Since its basis is not one of privilege to a solicitor (in which case it might be argued that the precise qualification must be satisfied) but is that work done by a solicitor can be quantified on a taxation of costs, there is no reason why work done by the appellant whose lack of the precise qualification was the result of an error of an officer of the Court, should not have the benefit of the rule of practice. If the error had not been on the part of an officer of the Court but had been the fault of the party himself, the Court would not attempt to assess his capacity to do the work done by him. He would be regarded as in the same position as an ordinary layman."
It is clear from the above passage that, while the rule derived from Chorley was applied in Guss v Veenhuizen, that was not the central issue in the case. Rather, the issue, as framed at 53, was "the extension of that rule to the very special circumstances of [the] case": see Cachia v Hanes at 412; Wang v Farkas [2014] NSWCA 29 at [24].
Reservations were expressed in Cachia v Hanes about the approach in Chorley to the costs of a solicitor litigant. The appellant in that case, an engineer, had successfully defended himself in civil proceedings and was awarded costs. On taxation, his claims for out of pocket expenses and for compensation for loss of time spent, calculated by reference to his fees as an engineer, were disallowed. After considering the statutory basis for the awarding and taxation of costs (then the Supreme Court Act 1970 (NSW) and the Supreme Court Rules 1970 (NSW)), a majority of the High Court (Mason CJ, Brennan, Deane, Dawson and McHugh JJ) held, at 409: "It is fundamental to the appellant's argument that the time he lost in preparing and conducting his case constitutes 'costs' within the meaning of [r 23.2]. He is, however, unable to sustain that proposition. The 'costs' provided for in the Rules do not include time spent by a litigant who is not a lawyer in preparing and conducting his case. They are confined to money paid or liabilities incurred for professional legal services. It is only in that sense that the Rules speak of 'costs'."
Importantly, at 411, their Honours identified the statutory basis of costs and the purposes for which they are awarded, as follows: "It has not been doubted since 1278, when the Statute of Gloucester introduced the notion of costs to the common law, that costs are awarded by way of indemnity (or, more accurately, partial indemnity) for professional legal costs actually incurred in the conduct of litigation. They were never intended to be comprehensive compensation for any loss suffered by a litigant. As Coke observed of the Statute of Gloucester, the costs which might be awarded to a litigant extended to the legal costs of the suit, 'but not to the costs and expences of his travell and losse of time'" (citations omitted)
Their Honours considered the "somewhat anomalous exception" to the general rule that litigants in person could not recover costs, derived from Chorley, at 411 ff. At 412, the majority doubted assertions in Chorley that it would be "absurd" to refuse to allow solicitors to charge for work done by themselves but allow them to charge for work for which they engaged another. They considered that those assertions "ignore the questionable nature of a situation in which a successful litigant not only receives the amount of the verdict but actually profits from the conduct of the litigation." Their Honours further stated, at 412-413: "If the explanations for allowing the costs of a solicitor acting for himself are unconvincing, the logical answer may be to abandon the exception in favour of the general principle rather than the other way round. However, it is not necessary to go so far for the purposes of the present case. It suffices to say that the existence of a limited and questionable exception provides no proper basis for overturning a general principle which has, as we have said, never been doubted and which has been affirmed in recent times."
At 414, their Honours considered (albeit in obiter) that, under the rules then applicable concerning taxation of costs, costs could not be recovered by a litigant in person regardless of whether she or he was a solicitor: "Taxation on a party and party basis is required to be in accordance with the relevant table in Sched.G and that makes no provision for the reimbursement of a litigant for time lost in the preparation or presentation of his case. It does provide for solicitors' costs which have been incurred. That affords some basis (although insufficient in our respectful view) for an award of costs in favour of a solicitor acting for himself and so performing professional duties, but it affords no basis whatsoever for an award by way of recompense to a litigant for time lost in the preparation or presentation of his case." (emphasis added)
In Dobree v Hoffman (1996) 18 WAR 36, the Full Court of the Supreme Court of Western Australia refused to apply the Chorley exception in favour of a solicitor litigant. At 45, Parker J, with whom Rowland and Steytler JJ agreed, held that Guss v Veenhuizen was not binding. The bases for the Court's determination were: first, that the application of the Chorley principle in Australia was not directly in issue in Guss v Veenhuizen, such that the judgment did not have the force of binding precedent on that point; and secondly, "more importantly", that Guss v Veenhuizen was concerned with the practice of the High Court, not with that of the Supreme Court of Western Australia as regulated by the Supreme Court Act 1935 (WA) and the relevant rules. Thus, Parker J held: "While the reasoning of the majority [in Guss v Veenhuizen] would suggest that it was open to apply the Chorley exception to the practice of this Court as an established rule of practice, the decision … did not purport to do so and should not, in my view, be taken to have determined that matter."
Parker J considered that the relevant statutory provisions and instruments provided no foundation for the application of the Chorley rule in Western Australia and that, having regard to the criticism of the rule in Cachia v Hanes, it ought not be applied: see at 51.
Parker J's approach has not been applied in New South Wales. In Atlas v Kalyk [2001] NSWCA 10, Handley JA, with whom Meagher and Sheller JJA agreed, dismissed an appeal against a costs order made on the basis of the Chorley rule. His Honour, after considering the statements in Cachia v Hanes, stated: "9 It is nevertheless clear that the majority [in Cachia v Hanes] did not overrule Guss v Veenhuizen [No 2] and their statements about the position in the case of solicitors acting for themselves in litigation were only dicta … 10 In the end, despite the decision of the Western Australian Full Court in Dobree & Ors v Hoffman I am of the view that the duty of this Court is as described in Garcia v National Australia Bank Ltd (1998) 194 CLR 395 where at 403 the majority said: 'It should be emphasised it is for this Court alone to determine whether one of its previous decisions is to be departed from or overruled'. 11 The decision in Guss v Veenhuizen [No 2] allowed a solicitor to recover his professional costs of acting for himself in litigation. The statements of the majority in that case were not dicta. 12 In my judgment this Court should follow Guss v Veenhuizen [No 2] and should therefore dismiss this appeal with costs."
In Khera v Jones [2006] NSWCA 85, leave to appeal a costs decision in which the Chorley principle was applied was refused on the authority of Atlas.
Wang v Farkas concerned an appeal against the award of costs to the respondent, a solicitor, in proceedings brought under the Crimes (Domestic and Personal Violence) Act 2007 (NSW) in which he represented himself. A specific costs regime applied under the Crimes (Domestic and Personal Violence) Act: see s 99 and the Criminal Procedure Act 1986 (NSW), Ch 4 Pt 2, Div 4. One feature of that regime was that the costs which could be awarded were, relevantly, "professional costs": Criminal Procedure Act, s 215. Basten JA, with whom Bathurst CJ and I relevantly agreed, considered those provisions in some detail. Basten JA held that: "21 … Accordingly, properly construed, the term 'professional costs' as it appears in the Criminal Procedure Act, Pt 2 of Ch 4, does not extend to a valuation of time devoted by a litigant, even if a legal practitioner, to his or her own proceedings. 22 … Accordingly, unless authority commands a different conclusion, the language of the Criminal Procedure Act forecloses an order for costs which includes a component calculated by reference to the time expended by the successful litigant on his or her own case."
Basten JA then considered the scope of the relevant authorities, and in particular Guss v Veenhuizen as follows, at [29]: "Guss turned on (but did not discuss) the power to award costs in the High Court, which was conferred by reference to the term 'costs', undefined in any relevant respect: Judiciary Act 1903 (Cth), s 26. Accepting that Guss v Veenhuizen is binding as to the correct construction of that language in any statute, in principle it would not bind this Court (or another court) in respect of a materially different statutory provision."
At [37], his Honour concluded: "This review of the cases relied upon by the respondent demonstrates that there is no authority requiring the Court to apply the Chorley exception in construing the relevant provisions of the Criminal Procedure Act. For the reasons given above, that step should not be taken: the order for costs made in the Local Court was therefore erroneous in point of law."
Dobree v Hoffman was expressly overruled in Soia v Bennett [2014] WASCA 27; 46 WAR 301 at [78]-[86] per Pullin JA, with whom Newnes and Murphy JJA agreed. Pullin JA was particularly critical of statements in Dobree to the effect that Guss v Veenhuizen did not have precedential effect on the unargued question of the validity of the Chorley principle in Australia. His Honour stated, at [80]: "According to McHugh J in Coleman v Power [2004] HCA 39; (2004) 220 CLR 1 [79], if no issue is raised about a point of law, then the application of such point of law does not form part of the ratio decidendi. However, courts do not apply the law as the parties agree it if the court thinks that the parties have a wrong view of the law. The parties' wrong view of the law does not bind the court: Pantorno v The Queen [1989] HCA 18; (1989) 166 CLR 466, 473 (Mason CJ & Brennan J). In Guss v Veenhuizen (No 2), it was necessary that the successful litigant be a lawyer if he was to recover costs. The court decided that because he was a lawyer litigant in person, then, based on the Chorley exception, he was entitled to his costs, subject to the resolution of an issue about whether he was a lawyer if his name was not on the High Court roll of practitioners. A necessary material fact in Guss v Veenhuizen (No 2) was that the successful litigant was a lawyer. The decision was that because he was a successful litigant and a lawyer, he was entitled to his costs because of the Chorley exception. On that reasoning, the reference to the Chorley exception formed part of the ratio of the case. … However, even if what was said by the majority in Guss v Veenhuizen (No 2) should be characterised as obiter, it was, as already mentioned, 'seriously'' considered obiter of the High Court and it should have been followed by the Full Court in Dobree v Hoffman: see Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89 [134]."
His Honour also found it relevant that other Australian jurisdictions, including New South Wales, Victoria, Queensland, South Australia and the Federal Court, had applied the Chorley exception and had not followed Dobree v Hoffman: see at [77] and [81] and the cases cited therein. He also considered that it was highly desirable that the same rule of practice should apply in all jurisdictions until the High Court decides otherwise: at [82]. Special leave to appeal from Soia v Bennett to the High Court was refused: Soia v Bennett [2014] HCASL 248.

Consideration

The question for determination is whether the respondent, who is a solicitor, is entitled to costs in circumstances where he has acted for himself in the proceedings. In this regard, it should be noted that the respondent described himself as the principal of the incorporated legal practice "Browns the Family Lawyers". However, he deposed that he acted for the applicant as a sole practitioner prior to incorporation of his legal practice.
It is apparent from the case law to which I have referred that it is accepted that it was part of the ratio of the High Court's decision in Guss v Veenhuizen that the Chorley principle applies in Australia: see Soia v Bennett at [80]; Atlas v Kalyk at [11]. There was nothing before the Court to indicate that either decision was plainly wrong: Gett v Tabet [2009] NSWCA 76; 254 ALR 504 at [294]. Indeed, to view Guss v Veenhuizen as authority only for the narrow circumstances which gave rise to the issue in the case has the unlikely result of there being High Court authority that a solicitor in the unusual position of the respondent in that case could recover costs, but no authority (and potentially no ability to recover costs) beyond that narrow circumstance. It should also be emphasised that no aspect of Guss v Veenhuizen was overruled in Cachia v Hanes.
However, the binding effect of Guss v Veenhuizen in respect of the Chorley principle must give way to any statutory provision to the contrary or which is relevantly different: Wang v Farkas and Cachia v Hanes. As Basten JA observed in Wang v Farkas at [29], Guss v Veenhuizen will not be binding "in respect of a materially different statutory provision" (emphasis added).
The High Court's power to award costs in Guss v Veenhuizen was contained in the Judiciary Act 1903 (Cth), s 26, which provided that "[t]he High Court and every Justice thereof sitting in Chambers shall have jurisdiction to award costs in all matters brought before the Court ...". "Costs" was not defined and no other provision was of significance to the present question. Thus, where a statute provides a general power to award costs, and that power as framed does not limit or define it in any relevant way, Guss v Veenhuizen is authority that costs may be awarded to solicitors appearing for themselves.
In Wang v Farkas, the Criminal Procedure Act 1986 (NSW) contained very different statutory provisions from those applied in Guss v Veenhuizen. The particular costs provision was for "professional costs". As a matter of statutory construction, the Court held that professional costs were not payable to a self-represented party regardless whether the party was a legal practitioner. Guss v Veenhuizen was therefore distinguished: see at [29].
In the present case, the Civil Procedure Act 2005 (NSW) provides for the power of the Court to award costs in s 98(1), as follows: "(1) Subject to rules of court and to this or any other Act: (a) costs are in the discretion of the court, and (b) the court has full power to determine by whom, to whom and to what extent costs are to be paid, and (c) the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis."
Section 3(1) defines "costs" and "ordinary basis" as follows: "costs, in relation to proceedings, means costs payable in or in relation to the proceedings, and includes fees, disbursements, expenses and remuneration. … ordinary basis, in relation to the assessment of legal costs that a court has ordered to be paid, means the basis of assessing costs in accordance with Division 3 of Part 7 of the Legal Profession Uniform Law Application Act 2014." (Indemnity costs, as referred to in s 98(1)(c), are not defined but are not in issue here.)
Prior to the enactment of the Civil Procedure Act, "costs" were relevantly defined in the Supreme Court Act, s 19, as follows: "costs includes fees, charges, disbursements, expenses and remuneration."
In Wang v Farkas at [28], Basten JA commented, in relation to proceedings under the Civil Procedure Act, that: "The introduction of the emphasised word 'payable' [in the definition of costs in the Civil Procedure Act] may at some stage require reconsideration of the application of Chorley in civil proceedings in this State. It is not necessary for present purposes to resolve that question."
Part 7 of the Legal Profession Uniform Law Application Act 2014 (NSW) (the Application Act) creates a scheme of costs assessment. It applies to "Uniform Law costs and ordered costs". Section 63 provides definitions of those terms: "ordered costs means costs payable under an order or rule of a court or tribunal. … Uniform Law costs means legal costs referred to in Division 7 of Part 4.3 of the Legal Profession Uniform Law (NSW) and (without limitation) legal costs referred to in section 65 of this Act."
Section 3(2) provides that terms used in the Application Act and also in the Legal Profession Uniform Law (NSW) (the Uniform Law) have the same meanings in the Application Act as they do in the Uniform Law.
The Legal Profession Uniform Law, s 6, defines "costs assessment" and "legal costs" as follows: "costs assessment means an assessment of legal costs under Part 4.3; … legal costs means - (a) amounts that a person has been or may be charged by, or is or may become liable to pay to, a law practice for the provision of legal services; or (b) without limitation, amounts that a person has been or may be charged, or is or may become liable to pay, as a third party payer in respect of the provision of legal services by a law practice to another person - including disbursements but not including interest"
There are numerous authorities on the meaning of costs, including the meaning of party/party costs (the previous terminology for costs on the "ordinary basis"). In Re JJT; Ex parte Victoria Legal Aid [1998] HCA 44; 195 CLR 184, the High Court considered the meaning of "costs" in the Family Law Act 1975 (Cth). Relevantly, Hayne J, after making reference to the passage from Cachia v Hanes extracted above at [13], held, at [91]: "On its face, then, the reference in s 117 to 'costs' is a reference to 'costs' as that word is ordinarily understood in the law: the amount which the person to whom the order is directed must pay to some party to the litigation as partial indemnity for the professional legal fees and expenses incurred by that party in the course of the litigation." (emphasis added)
In Hamod v State of New South Wales and Anor [2011] NSWCA 375 at [813]-[820], in determining whether to make a gross sum order I referred to costs, for the purposes of the Civil Procedure Act, s 98(4) in terms of "costs incurred", but that case did not call for a consideration of whether costs included the professional costs of a self-represented legal practitioner. However, as is apparent from the above, the definition of "costs" in the Civil Procedure Act is different from the previous definition in the Supreme Court Act and is different from the provisions under consideration in Guss v Veenhuizen.
The question raised, therefore, is whether the introduction of the word "payable" in the definition of "costs" has the effect that "costs" refers only to those costs which the parties have incurred, including those professional costs incurred by reason of having engaged legal representation. That is one possible interpretation of the language and it would have the effect that the respondent could not claim for his own professional costs. The respondent in this matter suggests another interpretation: that the definition also extends to any costs "payable" pursuant to costs orders made in proceedings. On this construction it would follow that if a costs order was made which included his own costs in acting for himself including his professional costs, those costs would be "payable" to him.
The usual process of statutory construction requires the definition to be read into the provision or provisions in which the term as defined is used, assuming it is not expressly or impliedly excluded in that context: Kelly v The Queen [2004] HCA 12; 218 CLR 216 at [103] per McHugh J. In this case, that requires, relevantly, the definition of "costs" in the Civil Procedure Act, s 3 to be read into s 98. When that task is undertaken, s 98 reads as follows: "(1) Subject to rules of court and to this or any other Act: (a) costs payable in or in relation to the proceedings, [including] fees, disbursements, expenses and remuneration are in the discretion of the court, and (b) the court has full power to determine by whom, to whom and to what extent costs payable in or in relation to the proceedings, [including] fees, disbursements, expenses and remuneration are to be paid, and (c) the court may order that costs payable in or in relation to the proceedings, [including] fees, disbursements, expenses and remuneration are to be awarded on the ordinary basis or on an indemnity basis."
The starting point of statutory construction is the language of the provision in the context in which it appears in the statutory scheme: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; 239 CLR 27 at [47]. The phrase "costs payable in or in relation to the proceedings" is of wide import and, on that basis, the construction for which the respondent contends is arguable, subject inter alia to what it means to order costs on the ordinary or indemnity basis: s 98(1)(c). That question requires consideration of the scheme for the assessment of costs in Pt 7 of the Application Act and of the relevant costs provisions of the Uniform Law which are set out above at [35]-[ 37]. It is also necessary to have regard to the Legal Profession Uniform Law Application Regulation 2015 (the Regulation).
The Application Act, Pt 7 is entitled "Legal Costs - costs assessment". It refers to "Uniform Law costs" and "ordered costs". Those terms are both defined in 63, although "Uniform Law costs" are defined by reference to the Uniform Law. The word "costs" is not separately defined. The definition of "Uniform Law costs" includes the phrase "legal costs", which is itself a defined term in the Uniform Law (set out above at [37]). That definition refers to amounts that a person is or may be liable to pay to a law practice for the provision of legal services. Prima facie, such amounts are costs that are incurred by the person in respect of legal services provided. At least on a preliminary view, the language does not appear to be apt to extend to the professional costs of a solicitor acting in person.
Part 7, Div 2 of the Application Act is entitled "Costs assessment generally". Relevantly, s 67 provides that subject to the Application Act and the Uniform Law, assessments of "legal costs" are to be conducted in accordance with the costs assessment rules. Section 68, which is headed "Applications for costs assessments" refers in subs (1) to the assessment of "legal costs". However, subs (2) refers to an application for the assessment of "costs". Thereafter, the provisions of Div 2 refer to "costs". For example, s 70 requires the costs assessor to issue a certificate that "sets out the determination" and is to include "the amount of costs determined": para (a).
Part 7, Div 3 of the Application Act provides for additional provisions in respect of "ordered costs" and Div 4 provides an additional provision in respect of "Uniform Law costs". Accordingly, notwithstanding the terminology of the heading to Pt 7 and the terms of s 68(1), the scheme of the costs assessment provisions of the Application Act otherwise maintain a distinction between "ordered costs" and "Uniform Law costs". It would seem therefore that the provisions of Div 2, with the exception of s 68(1) applies to both categories of costs and it must be questionable whether the reference to "legal costs" in s 68 is a drafting error.
By contrast, the Uniform Law deals with "legal costs". It does not deal with "ordered costs". Part 4.3 is headed "Legal costs", and falls within that Chapter of the Law that governs "Business practice and professional conduct". Division 2 of Pt 4.3 provides that "legal costs" must be fair and reasonable. Other Divisions relate to costs disclosure: Div 3; costs agreements: Div 4; billing: Div 5; unpaid legal costs: Div 6; and costs assessment: Div 7.
Questions also arise as to the proper construction and application of the Regulation. Part 6 of the Regulation is entitled "Legal Costs - costs assessment". Division 2 governs applications for costs assessment. Regulation 32 is headed "Applications for Costs assessment - section 68 of the application Act". Regulation 32(1) provides that "for the purposes of s 68 (1) an application for costs assessment is to be made on the approved form and accompanied by the [prescribed fee]". "Costs assessment" is defined in the Uniform Law by reference to "legal costs": see above at [37]. However, and notwithstanding the heading to Pt 6, reg 34 deals separately with "Uniform Law costs" and reg 35 provides for the procedures which must be followed in respect of application for assessment of "ordered costs".
If, as I have indicated, "legal costs", as defined in the Uniform Law, do not extend to the professional costs of a solicitor acting in person, questions are raised as to whether that limitation must be read back into the Application Act, by reason of the references to "legal costs" in that Act and in the Regulation. In particular, there is a question as to whether "ordered costs" under the Application Act are limited to "legal costs" which are ordered by a Court or Tribunal. If so, there would be a further question as to whether the limitation must also be read into the definition of "ordinary costs" in the Civil Procedure Act and whether, for that reason or otherwise, that is a factor weighing in favour of the narrower reading of the phrase "costs payable" in the definition of "costs".
The costs regime under the Application Act and the Uniform Law is labyrinthine and, at this stage, largely unexplored in the case law. The relevance of cases dealing with previous statutory schemes may be questionable. I have come to the conclusion that, in circumstances where there is a significant question as to whether the costs provisions now in force are materially different from those applied in Guss v Veenhuizen but the Court has not had the benefit of submissions from a contradictor, it is not appropriate to finally determine the questions of principle raised. In the absence of any submissions put by the applicant, she may be taken to have conceded the point. In that circumstance, I am inclined to accept that the respondent should have his costs of the summons.

Should the Court order costs in a gross sum?

The Court has a discretion to order costs in a gross sum pursuant to the Civil Procedure Act, s 98(4). That section provides, relevantly: "… at any time before costs are referred for assessment, the court may make an order to the effect that the party to whom costs are to be paid is to be entitled to: … (c) a specified gross sum instead of assessed costs …"
I set out the principles relevant to the exercise of that discretion in detail in Hamod at [813]-[820]. It is convenient to extract the relevant principles from what I said there: "813 The discretion [under s 98(4)] is not confined and may be exercised whenever the circumstances warrant its exercise, having regard to the scope and purpose of the provision: Harrison & Anor v Schipp [2002] NSWCA 213; 54 NSWLR 738 per Giles JA at [21]-[22]. In Harrison v Schipp, Giles JA considered that the discretion in s 98(4) may be exercised where the assessment of costs would be protracted and expensive and, in particular, if it appeared that a party obliged to pay the costs would not be able to meet a liability of the order likely to result from the assessment. However, his Honour stated, at [22]: 'The power should only be exercised when the Court considers that it can do so fairly between the parties, and that includes sufficient confidence in arriving at an appropriate sum on the materials available.' 814 … The courts have typically applied a discount in assessing costs on a gross sum basis… 816 The terms of s 98(4), together with the more general considerations reflected in the Civil Procedure Act, ss 56(1), 57(1)(d) and 60, suggest the factors that merit particular consideration include: the relative responsibility of the parties for the costs incurred (for example, Harrison v Schipp); the degree of any disproportion between the issue litigated and the costs claimed; the complexity of proceedings in relation to their cost; and the capacity of the unsuccessful party to satisfy any costs liability … 817 The exercise of the power conferred by s 98(4) is particularly appropriate where the costs have been incurred in lengthy or complex cases and it is desirable to avoid the expense, delay and aggravation likely to be involved in contested costs assessment … 818 The power may also be exercised where a party's conduct has unnecessarily contributed to the costs of the proceedings, especially where the costs incurred have been disproportionate to the result of the proceedings. … 820 The costs ordered should be based on an informed assessment of the actual costs having regard to the information before the court (for example, by relying on costs estimates or bills) … The approach taken to estimate the costs to be ordered must be logical, fair and reasonable … This may involve an impressionistic discount of the costs actually incurred or estimated, in order to take into account the contingencies that would be relevant in any formal costs assessment ..." (most citations omitted)
This matter has had a lengthy and unfortunate history. Costs were first assessed in February 2014. The applicant contested her liability to pay, unsuccessfully, at every stage. Her conduct, including her failure to attend court on multiple occasions, added significantly to the delay and cost which occasioned the case. I accept the respondent's submission that further costs assessment would likely be contested, and that the respondent would likely never recover the costs of such assessment. In those circumstances, I am satisfied that a gross sum costs order is appropriate.
The respondent annexed to his affidavit of 26 April 2016 an itemised list of costs incurred. Those costs amount, in sum, to $5,161.20. I am satisfied that the costs itemised are reasonable. Indeed, as they do not include costs of the (admittedly brief) hearing on 29 April 2016, or costs incurred in the preparation of submissions on costs, it is likely that they represent a discount on the costs which would otherwise be assessed: see Hamod at [814].

Conclusion

The following orders should be made: 1. Sophia Wilkie pay Michael Brown's costs of her summons seeking judicial review in the sum of $5,161.20, in addition to any costs orders previously made. 2. Notice of motion dated 26 April 2016 otherwise dismissed.
McCOLL JA: I agree with Beazley P.
GLEESON JA: I agree with Beazley P.

Amendments 26 May 2016 - Headnote, typographical error corrected 27 May 2016 - Minor typographical errors corrected 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: 27 May 2016

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Farkas, the Criminal Procedure Act 1986(NSW)

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