Hingston v Challiston Pty Ltd & Ors [2006] WADC 132 (28 August 2006)

Last Updated: 28 November 2006

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA

IN CHAMBERS

LOCATION : PERTH

CITATION : HINGSTON -v- CHALLISTON PTY LTD & ORS [2006] WADC 132

CORAM : DEPUTY REGISTRAR HARMAN

HEARD : 5 MAY 2006

DELIVERED : 28 AUGUST 2006

FILE NO/S : CIV 295 of 2003

BETWEEN : BRADLEY HINGSTON

Plaintiff

AND

CHALLISTON PTY LTD

First Defendant

DEAN GEORGE SCOOK

CAROL NORMA HARDIE

Second Defendants

Catchwords:
Practice - Practice under the Rules of the Supreme Court of Western Australia - Review of taxation - sufficiency of objection - Getting up case for trial

Legislation:
Nil

Result:
Objection not within the scope of r 53(1)

Representation:

Counsel:

Plaintiff : Mr S Forbes

First Defendant : No appearance

Second Defendants : Mr H R Robinson

Solicitors:

Plaintiff : Paiker & Overmeire

First Defendant : Haydn Robinson

Second Defendants : Haydn Robinson

Case(s) referred to in judgment(s):

May v Vincent Smith as Administrator for Cole Engineering Pty Ltd (Under Administration) & Anor [2001] WASC 352

Roblett v Pieroni [2005] WADC 215

Case(s) also cited:

Nil

1 DEPUTY REGISTRAR HARMAN: Under the order for the costs of the action the plaintiff was entitled to the reasonable cost of services necessarily provided to him for the purposes of the action. His bill of costs was taxed and the defendants have filed a notice of objection in the following terms:

"The Defendants object to the allowance of $14,000.00 for Item 16 Getting up for Trial and contend the allowance should have been an amount not in excess of $3,000.00.
The reasons for the objection are:
1. A getting up component is already included in items 1, 2, 8, 9 and 11.
2. To settle the SOC, apply for summary judgment, argue the summary judgment before Deputy Registrar Harman and appeal before Marino DCJ, brief counsel for the appeal plus the work done by counsel covered by Item 17, means the Plaintiff had substantially got the case up for trial before the Entry for Trial.
3. The amount of work required by the Plaintiff's solicitor in getting up over and above the work already done and covered by the other items should therefore have been minimal.
4. A proof was required from the Plaintiff but he must have already provided a proof prior to the Entry for Trial, evidenced by his affidavits and the pleadings.
5. The Plaintiff's solicitor conferred with others including Wallace (sic) Bleakley (sic) and other investors who had signed like deeds as referred to in the SOC. This does not mean the Defendants should pay for the costs thus incurred, because none of those witnesses would have been allowed to give evidence, all being irrelevant.
6. The Plaintiff proposed to call Travers, Shann and Hardie but did not take proofs from any of them.
7. The issues for determination were fundamentally questions of law. There was very little in issue on the facts.
8. The issues included:

• was the instrument relied upon by the Plaintiff a deed?

• was the instrument duly signed?

• did the Plaintiff duly exercise the put option in terms required by the instrument?

• what is the proper construction of the instrument?

• did the plaintiff provide consideration for the option?

• was there a transfer of shares re Tuart Resources?

• what was the price of shares in Tuart on the ASX at 31/8/01?

• Did the letter of 20/9/01 in its terms alter the contractual relationship between the parties?

9. Counsel fee was $3,300.00 GST inclusive for preparation for the trial, indicating minimal work was required by counsel to get on top of the brief and deal with the issues on the pleadings and the simplicity of the issues.
10. Plaintiff's counsel submitted more than 90 hours have been spent in getting up, but did not produce any schedules or documents in support of the contention.
11. The Defendants contend examination of the plaintiff's file will disclose the amount of work spent in getting up was excessive and the costs incurred unreasonable.
12. Getting up only applies if there is a substantial trial. The items does not apply for the general preparation of a case: Civil Procedure Western Australia [66.11.6]
13. This action did not involve any issues of unusual complexity or difficulty.
14. Experienced solicitor and counsel should have been able to get the case up for trial for a fraction of the amount claimed, a fortiori given the interlocutory processes that occurred prior to the Entry for Trial.
15. The Defendants contend the amount claimed by the Plaintiff is unreasonable and disproportionate to the work that was properly required.
16. The Defendants further contend costs awarded should be reflective of the amount in issue, $85,340.00.
17. The Plaintiffs claimed in total $32,095.42 plus the taxing fee without there being a trial, being a disproportionately high figure against the amount in issue; of this excessive amount getting up is 59%.
18. In the above circumstances, by allowing $14,000.00 the learned Registrar erred because the allowance was demonstrably against the weight of evidence and submissions made about getting up and entirely unverified.
19. The Plaintiff failed to establish getting up costs were reasonably and properly incurred. Responsibility to pay costs for inefficiencies by the Plaintiff's legal representatives should not fall on the Defendants."

2 Under O 66 r 53(1) of the Rules of the Supreme Court a party may seek review of taxation by objecting to the allowance or disallowance in whole or in part of an item in a bill of costs. In Roblett v Pieroni [2005] WADC 215 I reviewed some recent authority that would suggest that to engage the jurisdiction provided by that rule it is sufficient that a notice of objection be lodged. There is little point in undertaking the same exercise again. I will simply refer to the reasons for my decision in that case and adopt them in this instance. In my opinion the onus is upon the defendants to establish that the objection is within the scope of the rule.
3 Such an objection would relate to a determination made under the first limb of the test of recovery: the necessity for the provision of a service as a whole or the part or parts the subject of objection. On a simple reading of the terms of the defendants' objection it is apparent that they do not allege any error in the allowance of any part of the relevant service for which the plaintiff maintained a claim at taxation. That is not a surprising observation as the need to make such a determination did not arise. I should record that in the course of taxation the defendants had portrayed what is identified at par 5 of the notice of objection as an unsustainable part of the claim. The plaintiff conceded the point. I note that par 5 of the notice does not actually assert that allowance was made for that part. In a case where the only determination made at the taxation was under the second limb of the test: the reasonable cost of the service, it is inevitable that any objection would fail at the jurisdictional hurdle.
4 I recognise that determinations made upon judicial review have expressed the proposition that where the objecting party contends that a quantum determination reveals that it could not have been made by a taxing officer acting reasonably, r 55 would provide scope for review. The closest that the defendants come to expressing such an error is at par 18 of the grounds where they refer to the "allowance" being against the weight of "evidence". The questionable use of terminology to one side, I suspect that ground is not sufficiently close to the formulation that I have expressed to amount to a reviewable error even before a judge. I might record that at the review it was the plaintiff's submission that in a similar case against the same defendants in this case, a taxing officer had awarded an amount in excess of the determination made in this case and that they had not objected.
5 Be that as it may I will comment in relation to the terms of the defendants’ notice if for no reason other than that they indicated that they would take the matter further.
6 It is fundamental to an appreciation of what is canvassed in pars 1 to 3 inclusive of the notice that the scale item ‘getting up case for trial’ refers to the sum of the parts of the process of bringing the issues isolated upon the close of pleadings to trial but excludes services for which the scale otherwise provides recovery. It is fundamental to an appreciation of the results of taxation that the only determinations to be made are under the limbs of the test of recovery. The reason for that being the case extends beyond the obvious to the fact that the terms of the scale regulate the process by which the discretion of the taxing officer is exercised. Most of the scale items including getting up case for trial express a process. At the point of its introduction into the scale in 1967 getting up case was a novel concept. It replaced a number of bases upon which recovery for the process of taking a case to trial had been regulated and limited. The change had a dual impact on taxation practice. The first was that the taxing officer would no longer be required to consider either the significance of the whole or parts of a particular manifestation of a practitioner's consideration or its value in whole or in part. The second was that the concept became a process. The result was that the taxing officer would not be obliged to consider whether a particular manifestation of consideration by a practitioner would fall within the scope of getting up the case for trial, much the same as there was no reason to do so for the purposes of determining the result of a claim under most other items. In dealing with a claim for getting up case for trial, in all but an unusual case no issue would arise under the first limb of the test of recovery and consideration of the value of the service would be informed by the datum of the competent practitioner providing the service in an efficient manner.
7 As to par 1 of the objection, items 1, 2, 8, 9 and 11 of the plaintiff's bill were respectively for writ of summons, writ of summons against an additional defendant, getting up appeal including new evidence, counsel fee on preparation and hearings on 7 March and 14 March 2003 and reply. The appeals heard on those dates were brought by the parties in relation to determinations made on the plaintiff's application for summary judgment. At taxation a single determination was made in relation to quantum for the services comprehend by items 8, 9 and 10 of the bill. (Item 10 being a claim for attendance upon a reserved decision in the appeal).
8 I disagree with what is implicit in the proposition expressed at par 1 that part of the services comprehended by each of items 1(a) and (c), 6(d) and 23 of the scale include a component of the service "getting up case for trial". Items 1(a), (c) and 6(d) of the scale relate to services that would be provided prior to the emergence of the issues with which the process of getting up would engage. As a matter of principle there could be no scope to consider that those items would provide a basis for recovering the cost of getting up case. That conclusion would be tested simply by the fact that there would be no scope to recover for any getting up had the action been concluded in some manner at the point of the close of pleadings. The claims expressed in items 8, 9 and 10 of the bill were taxed under item 23 of the scale. Whilst a recognised part of the services that relate to that item is for preparation, such preparation would be for the purpose of the application and not to the process of getting up the case for trial. There is a distinction properly drawn between the process of bringing an application by way of summary judgment and bringing even the same case to trial. The significant differences are the manner in which evidence is provided and the need on the application to establish a clear case. Otherwise an application and the case were put forward for determination at different times. The period of time between the date of the appeal and the date of trial was some 9 months.
9 At taxation no part or parts of the process of getting up the case were distributed to any of items 1, 2, 8, 9 and 11 of the plaintiff's bill. To have followed the course suggested by the terms of the defendants' objection would have amounted to an error in principle.
10 The same observations and considerations apply equally to the services nominated by the defendants at par 2 of the objection. The only additional comment that I would make is as to work undertaken by counsel. In the event that counsel undertook the provision of services that are properly characterised as getting up case, r 11(4) provides that they would properly be treated as such. The defendants have not articulated a case that any part of the services so rendered ought to have been so treated. As to the balance of what is contained in par 2, I do not appreciate the significance of the reference to the entry for trial. It appears that the defendants concede that the case had been substantially got up for trial prior to settlement.
11 To the extent that par 3 of the objection would raise the prospect that the task of getting up the case was minimal that is not an unusual submission for an adverse party to make. I have no doubt that it was made in this case. Otherwise par 3 depends upon the validity of the proposition advanced at pars 1 and 2.
12 As to par 4, the critical issue is not when the proofing was undertaken but that it had been undertaken. The defendants concede that proofing the plaintiff was necessary. For what it is worth I would suggest that it would be unremarkable if he had been proofed prior to entry for trial. As the action settled immediately prior to trial, the time at which he was proofed could not be significant. If by the manner in which par 4 is expressed the defendants' countenance that the plaintiff had been proofed over an extended period that too would not be significant. As I have indicated, the value of a service is not determined by the manner in which the beneficial parties' solicitor chose to provide it but rather by a competent practitioner providing the service efficiently.
13 It would have been of no consequence had the plaintiff's solicitor drawn upon a comprehensive proof in drawing the pleadings and presenting the case for summary judgment. The important consideration is that for the taxing officer to consider that the value of getting up case should thereby be reduced would amount to an error in principle. I have previously cited the test of recovery that applies under the order for costs. Efficiency operates as a consideration at the point of valuing a service that falls within the scope of the test. It does not assist in the process of determining the necessity for the provision of a service. It does not operate across scale items for the simple reason that the beneficial party is entitled to have each claim considered in accordance with the test.
14 As to par 5, I have already noted that no allowance was made for the discussions held between the plaintiff's solicitor and the named parties and that the objection does not contend otherwise. That said I accept that my note taking reveals to the contrary as on the bill I recorded the words "witness Wallace". I assume that I made the note when the name was first mentioned prior to the development of the context that I have previously expressed.
15 As to each of pars 6 to 8 inclusive, my only observation is that their content is addressed to some process other than review. As to par 9, I make the same observation but would add the qualification "of item 16".
16 As to par 10, regardless of how the plaintiff sought to justify the claim, he was not required to present schedules for the purpose of his claim being taxed and there is no reason to consider why otherwise he ought to have done so. I understand that current practice in the Supreme Court may require the provision of schedules. It is not a practice observed in this court.
17 As to par 11, as much as the process taxation of a claim to getting up case did not depend upon the review of a schedule, it did not depend upon the review of a beneficial parties file.
18 The first part of par 12 draws into consideration O 66 r 21. It is as follows:

"Where for any reason there is no substantial trial, the judge or the taxing officer may make such an allowance in lieu of the fees prescribed by any relevant scale as he considers to be merited in the circumstances."

19 At face value the rule might be taken to convey that where it applies, the taxing officer would ignore both the scale and the test of recovery. It is surprising that the adverse parties would advance such a proposition. Perhaps they intended that reference to the rule would somehow be balanced by the last part of par 12 which distinguishes activity from the process of getting up case for trial. However they do not contend that the determination made was other than for getting up the case for trial. In my opinion the parts of the paragraph whether alone or in combination fail to articulate any useful assertion.
20 The usual order for costs provides scope for recovery of the reasonable cost of services necessarily provided. The fact that an action had not proceeded to trial would not have any bearing upon whether a service had necessarily been provided. There is no reason to consider that want of a trial would render the process of valuation of such services as a special case. The scale provides the taxing officer with a range within which value could be determined. But for r 21 there would be no reason for the taxing officer not to refer to the scale in determining the extent of recovery under the order for costs where there had been no trial.
21 Prior to amendment to its present form in 1992 a significant feature of the context in which the rule operated was such that in some cases the value of the service getting up case for trial would include a fixed sum regardless of whether the action had been tried. Rule 21 operated so as to at least convert that fixed component into a discretionary component with the result that the extent of recovery could be commensurate with the extent to which the service had actually been provided. The change to the rule in that year was part of a broader process of amendment and reflected the fact that in the previous year the specification in the scale that generated the fixed component had been abandoned. On that analysis I would propose that r 21 and for the same reason r 20, might have been repealed.
22 In my opinion that history raises some doubt as to whether either prior or subsequent to 1992 it had been the intention of the court to permit the taxing officer to either abandon either the scale or the considerations that apply to limit the scope of recovery under the usual order for costs.
23 The second part of par 12 articulates the distinction between activity and the process of getting up case for trial. It has not had much of an airing in judicial utterances in recent times. One recent occasion upon which it was given an airing was May v Vincent Smith as Administrator for Cole Engineering Pty Ltd (Under Administration) & Anor [2001] WASC 352 where Templeman J in response to the proposition that costs incurred in the course of preparing a case and which are not claimable under any other item are claimable as getting up case stated at par 20.

"In my view, that submission is too broad. That is because item 13 relates not to the general preparation of a case, but to getting up a case for trial. I accept that there may be an overlap."

24 There is a fundamental distinction between mere activity and the process of getting up case for trial.
25 I have no difficulty with the proposition put at par 13. It, like par 14 is nothing more than a submission. The only other observation that I would make in response to par 14 is that it adds nothing to what the defendants had previously suggested at pars 1 to 3.
26 Perhaps in the light of my earlier observations as to the deficiencies of the notice it is a minor quibble that pars 15 and 17 are directed to the plaintiff's claim rather than the determination.
27 Paragraph 16 is founded upon the proposition that there ought to be scope to recognise some proportionality between the value of a particular service and the value of the subject matter of an action. In the context that I have canvassed that existed prior to 1991 it was the value of the subject matter of an action that determined the fixed component in the value of the service getting up case for trial. Now that there is no such component expressed in the scale, r 20 according to which actions were valued has fallen into desuetude.
28 I would recognise that a view of the value of the subject matter of an action appears to have some appeal for the purpose of analysis of the manner in which a case is being or has been conducted. In my opinion such an analysis would neither engage with or respond to any principle that would operate inter partes at any point of litigation including at taxation. In considering the satisfaction of the first limb of the test of recovery it would add nothing to an evaluation of the necessity of the provision of a service. Indeed it would be wrong in principle to deprive the beneficial party of the benefit that would accrue upon the taxing officer's satisfaction that a service had been necessarily provided. In considering the impact of the second limb of the test it is the service provided that is to be valued. In my opinion the dollar value of the cause of action is far removed from the scope of a proper assessment of the value of a service.
29 Regardless of that analysis in this case the action came relatively close to being tried. Of a maximum available of some $30,000.00 the plaintiff recovered $14,000.00 in a case in which $85,340.00 had been in issue.
30 But for the contention that the determination of quantum was unverified I have already canvassed the content of par 18. If by that contention the defendants seek reasons for the quantum determination they are no more than what was implicit when it was made. A single determination of value was made for all of the parts of the service that were provided in order to bring the issues on the pleadings to trial but only to the point that settlement foreclosed upon the task. That determination took into account the issues to be tried, the evidence by which the plaintiff’s case would be established, an assessment of the strengths and weaknesses of the cases of the parties and the need for the plaintiff to comply with the requirements of the rules.
31 As to par 19, the fact that I made a determination in relation to the plaintiff's claim for getting up case for trial demonstrates that contrary to the terms of the objection, the plaintiff did establish a case for recovery to the extent of that determination. I would add that the test suggested by the defendants is not that which applies at taxation under the usual costs order but that which applies under a retainer.