PROCEDURE – COSTS – APPEALS AS TO COSTS – DISCRETION

PROCEDURE – COSTS – APPEALS AS TO COSTS – DISCRETION – where the court ordered the applicant to pay the respondent’s costs on the standard basis in an amount fixed by the court unless the parties agreed – where the parties did not agree as to costs – where the parties prepared an itemised cost statement and objections for the purpose of the court to fix costs – where the court held an itemised cost assessment is not preferable where costs are to be fixed – where the court fixed the amount of the respondent’s costs in accordance with r 687(2)(c) of the Uniform Civil Procedure Rules 1999 (Qld)

Farrar v Julian -Armitage & Anor [2016] QCA 141

In the judgment delivered on 18 December 2015, the application for leave to appeal was dismissed with costs. Costs were not agreed, so the Court of Appeal had to fix costs.

Rule 687(2)(c) of the Uniform Civil Procedure Rules 1999 (Qld) states that the court may order a party to pay another party “an amount for costs fixed by the court”. The process of fixing costs is not intended to replicate an assessment of costs but rather is intended to be speedy and inexpensive: Amos v Monsour Pty Ltd [2009] QCA 65; Goodwin v O’Driscoll [2008] QCA 43, [12]. This is also reflected in paragraph 3 of Practice Direction 3 of 2007

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After the application was dismissed and the costs order made, the respondents’ solicitors obtained a short form assessment and subsequently an itemised assessment. Objections were subsequently prepared. The Court noted at [9] that “the frolic of the parties procuring an itemised costs assessment and the detailed objections to it was unnecessary for the purpose of the court fixing costs. It was apparently prompted, at least in part, by an erroneous understanding that ChongHerr Investments is authority for the proposition that an itemised costs statement should be provided for the court to fix costs.” It was noted that the solicitor for the respondent could simply have deposed to their estimate of the recoverable costs.

The Court considered the nature of the application for leave to appeal and made observations in relation to the assessment of the cost assessor, which was a total of $68,777.46. An examination of the assessment showed a high level of reliance on counsel by the instructing solicitor and there was no commensurate tempering of the preparation work claimed by the instructing solicitor. Further, the Court considered that the claim of 30% of care and consideration was not apt in this case, “... if such an item is apt at all in a case like the present.” (at [21]).

It was noted that Gregg Lawyers acted for itself as Second Respondent as well as for the First Respondent but there was no evidence that any of the work performed by the Second Respondent was charged at all. However, the Court stated at [23] that it was “reasonable to infer a substantial proportion of that apparently unpaid work would have consumed some of the firm’s otherwise billable time and resources. Such work therefore came at a compensable cost attributable to professional skill and time in a way self represented laypersons’ work on their cases does not: Sochorova v Commonwealth of Australia [2012] QCA 152, [16].

Taking into account the considerations mentioned above, the Court found that a fair and reasonable estimate of the respondents’ recoverable costs is $45,000 and costs should be fixed at that amount, payable to the second respondent.