Yao v State of New South Wales; Chen v State of New South Wales

Parties: Proceedings 2025/38750
Liyuan Yao (Plaintiff)
State of New South Wales (Defendant)
Proceedings 2025/63010
Yikai Chen (Plaintiff)
State of New South Wales (Defendant)

Representation: Counsel:
R Hudson (Defendant)
Solicitors:
Crown Solicitor’s Office (Defendant)

File Number(s): 2025/38750; 2025/63010

Publication restriction: Nil

JUDGMENT

1. HIS HONOUR: On 12 December 2025, I dismissed the plaintiffs’ motions in these matters seeking summary judgment: see Yao v State of New South Wales; Chen v State of New South Wales [2025] NSWSC 1485. I ordered the plaintiffs to pay costs.

2. The State of New South Wales now seeks a gross sum costs order pursuant to s 98(4)(c) of the Civil Procedure Act 2005. In support of that application, the State relies upon the affidavits of Fatima Shafaie affirmed on 9 December 2025 (filed in 2025/38750 and 2025/63010). Part of the affidavit read in Ms Yao’s proceeding is as follows:

“Costs incurred by CSO

17. The CSO structure comprises of a number of grades for solicitors and paralegals, with hourly charge-out rates for solicitors set according to their grade level (ranging from Solicitor Grade l-lll to Principal Solicitor Grade VI or Special Counsel).

18. I am a Senior Solicitor Grade V and I have performed the majority of the work on this file in relation to the Motion. I was admitted to practice in 2018 and have been a solicitor at the Crown Solicitor’s Office for over 7 years. My charge-out rate was $363.24 per hour plus GST up to 30 November 2025, and $363 per hour plus GST from 1 December 2025 onwards.

19. Some work has also been undertaken by paralegals in relation to the Motion, mainly in relation to printing and filing of court documents. Paralegal charge-out rate is $261 plus GST.

20. In preparing this Affidavit, I have reviewed invoices issued in the matter by the Crown Solicitor's Office (CSO) as well as ‘Work in Progress’ (WIP) fees incurred, and an invoice from Counsel for his fees to date, including the Motion hearing on 5 December 2025.

21. Based on my review of the CSO Billing System and a review of the timecards recorded on this file since 21 October 2025 in relation to the Motion, I estimate that the professional fees incurred by the CSO to date is approximately $3,969.74 inclusive of GST. [In Mr Chen’s motion, the fees incurred were $4,409.40 inclusive of GST.]

22. As at the date of this Affidavit the CSO has billed approximately 11 hours in relation to the Motion. This includes all time billed for:

(a) Perusing and considering the Plaintiff’s Motion;

(b) Analysis and perusal of the material referred to in the Affidavit and Submissions;

(c) Correspondence with client’s seeking instructions regarding the Motion;

(d) Correspondence with the Plaintiff regarding the Motion, seeking that it be withdrawn and explaining why;

(e) Perusing and responding to correspondence from the Plaintiff regarding request to consent to judgment;

(f) Identifying and briefing Counsel in relation to the Motion;

(g) Drawing observations and preparation of brief material to Raphael Hudson of Counsel;

(h) Obtaining transcript of previous hearing;

(i) Teleconferences with Counsel regarding background, issues, and hearing preparation tasks;

(j) Provision of further observations and material to Counsel and related perusals regarding notice to admit and dispute facts;

(k) Provision of further observations and material to Counsel regarding related constitutional challenge referred to in Plaintiff submissions;

(I) Obtaining, review and seeking instructions on advice from Counsel;

(m) Review and seeking of instructions regarding proposed submissions;

(n) Preparation of material for hearing, compilation of authorities, responding to Counsel queries regarding Court material, and compiling and indexing multiple lever arch folders of relevant material for Court hearing.

(o) Instructing Counsel at hearing on 5 December 2025.

Counsel’s fees

23. Since 15 September 2025, the Defendant has retained Mr Adrian Williams of Counsel in relation to the substantive proceedings. However, Mr Williams was not available to appear on the Motion.

24. On 27 November 2025, the Defendant retained Mr Raphael Hudson of Counsel to advise in relation to the Motion and appear at the Motion listing on 5 December 2025 as Mr Williams was unavailable. Mr Hudson’s Crown rates are $250 per hour/ $1,800 per day plus GST. Mr Hudson was admitted to practice in 2011 and to the Bar in 2023.

25. Mr Hudson’s fees up to and including the hearing of the Motion amount to $2,500 (inclusive of GST). I have reviewed Counsel’s invoice issued 5 December 2025 indicating that this sum covers: reviewing the brief and observations, conferences and correspondence with the CSO, the provision of advice on the Motion, analysis of the available evidence and Plaintiff’s documents, the drawing of submissions, settling of correspondence to the Plaintiff, settling the evidence on the Motion and his fee for hearing.

Total costs

26. I am informed and believe that the Crown Solicitor’s Office typically has lower charge-out rates compared to the Cost Assessment Rules Committee Guidelines or typical private rates charged by large firms of a similar size to the CSO.

27. For the purposes of providing a discounted amount for the purposes of a gross sum costs order, I have indicated the resulting figures if a ‘broad-brush’ discount 20% is applied to an order on the indemnity basis, or 30% for an order on the ordinary basis. A table setting out my costs for the Motion is set out below.”

3. The costs incurred in relation to Ms Yao’s motion are set out in the following table:

| Costs incurred re Motion up to and including listing on 5 December 2025 (including Counsel’s fees) | $6.469.74 inclusive of GST | | Total (less discount) | | 20% discount on indemnity basis | $5,175.79 inclusive of GST | | 30% discount on ordinary basis | $4,528.82 inclusive of GST |

4. The costs incurred in relation to Mr Chen’s motion are set out in the following table:

| Costs incurred re Motion up to and including listing on 5 December 2025 (including Counsel’s fees) | $6.909.40 inclusive of GST | | Total (less discount) | | 20% discount on indemnity basis | $5,527.52 inclusive of GST | | 30% discount on ordinary basis | $4,836.58 inclusive of GST |

State’s submissions

5. In terms of quantum, the State seeks that a gross sum costs order be made pursuant to s 98(4)(c) of the Civil Procedure Act. This Court has an unfettered discretion to make such an order where it can fairly determine a sum: Harrison v Schipp (2002) 54 NSWLR 738; [2002] NSWCA 213 at [21]. The State submitted that it would be appropriate to do so in the present case because of:

(a) the need to avoid satellite litigation about costs which could occur from any costs assessment with the plaintiffs; (b) the risk that the plaintiffs might cause significant costs to be incurred in the assessment process having regard to the conduct of this litigation, which might be disproportionate to the amount in issue; and (c) the plaintiffs’ apparent willingness to reagitate determined issues in a manner tending to create expense and delay and the need for protection against further unnecessary costs being incurred which a fixed costs order would provide.

See Wang v State of New South Wales (No 3) [2020] NSWCA 148 at [8]-[9]; Khanna v Bunnings Group Limited (No 2) [2025] NSWSC 677 at [26]-[34].

6. The State submitted that having regard to the quantum in issue without undertaking a line-by-line assessment, a broad-brush approach is to be preferred and that an appropriate discount of the costs incurred by the State is 10-20% if assessed on an indemnity basis or 25-35% if assessed on the ordinary basis.

Plaintiffs’ submissions

7. Despite the fact that I directed the plaintiffs to file submissions dealing with the application for a gross sum costs order, no such submissions were received. The plaintiffs did provide the Court with 20 pages of submissions, filed on 19 March 2026, but these submissions are wholly misconceived and fail entirely to deal with the present application. It is apparent that the plaintiffs had and have no proper understanding of the present application and are in severe need of legal advice for the purposes of these proceedings in general and this application in particular.

Disposition

8. The fact that the plaintiffs would appear not even to comprehend the nature of the present application or the type of response to it that they were invited by me to provide in my view strongly supports the State’s expressed concern that the costs assessment process in this case would be wholly inimical to the interests of justice. I anticipate that it would have the potential to achieve a life of its own, be time consuming and expensive, and in all likelihood fail to produce any benefit to the plaintiffs in terms of the quantum of the costs that they have been ordered to pay.

9. Having regard to what I have said with respect to the plaintiffs’ limited understanding of the proceedings, it is unsurprising that Ms Shafaie was not cross-examined. In the circumstances, and based on my experience, I consider that the costs explained by her in her affidavit are reasonable. I will therefore make a gross sum order for the costs of the motion on the ordinary basis in the amount of $4,500.00 in each case.

*************