CATCHWORDS PRACTICE - taxation of solicitor-client costs - whether Federal Court has power to order taxing officer to tax costs rather than Taxing Master of Supreme Court - exercise of discretion. Federal Court of Australia Act 1976 s.23 sy bh 4 \w ROGER CHARLES STEEDMAN and MARGARET OLIVE STEEDMAN vo L ~ ", GOLDEN FLEECE PETROLEUM LTD and KEITH HERCULES AND SONS No. VG 69 of 1983 Woodward J 11 June 1987 Melbourne IN THE FEDERAL COURT OF AUSTRALIA) ) ) ) ) VICTORIA DISTRICT REGISTRY No. VG 69 of 1983 GENERAL DIVISION BETWEEN: ROGER CHARLES STEEDMAN and MARGARET OLIVE STEEDMAN Applicants and GOLDEN FLEECE PETROLEUM LTD and KEITH HERCULES AND SONS Respondents MINUTES OF ORDER COURT: Woodward J. DATE: 11 June 1987 PLACE: Melbourne THE COURT ORDERS THAT: 1. The solicitor-client bill of costs dated 23 July 1986 delivered by the respondent firm of solicitors to the applicants be taxed by the District Registrar MERIT Poe Serwmpnpre rere ee Pe Te immediately following the taxation of the party-party costs in this matter, on a date to be fixed by the District Registrar on or after 15 July 1987. 2. Liberty to apply be reserved. 3. The respondents Keith Hercules and Sons pay the taxed costs of the applicants and the respondent Golden Fleece Petroleum Ltd of this notice of motion. (Note: Settlement and entry of orders are dealt with in Order 36 of the Federal Court Rules.) Ore peter Sr pe Spe RT nn ee ae - ene Hee ee = -e-- ay IN THE FEDERAL COURT OF AUSTRALIA) ' ) VICTORIA DISTRICT REGISTRY ) ) ) No. VG 69 of 1983 GENERAL DIVISION | | BETWEEN: ROGER CHARLES STEEDMAN and MARGARET OLIVE STEEDMAN Applicants and GOLDEN FLEECE PETROLEUM LTD and KEITH HERCULES AND SONS Respondents COURT: Woodward J. DATE: 11 June 1987 PLACE: Melbourne ok . ,-. REASONS FOR JUDGMENT In this matter I have been asked to determine whether the taxation of solicitor-client costs, following a successful * action in this Court, should be carried out by the District Registrar, as taxing officer of this Court, or the Taxing Master of the Supreme Court of Victoria. Counsel for the applicants urges that the arguments of convenience strongly favour the District Registrar of this Court because it will fall to him to tax the party-party costs. He also argues that it is appropriate for the Federal Court, as a superior court of record, to retain full control over its procedures and the practitioners who appear before it - so far as their conduct of Federal Court actions is concerned. He does not dispute that, in the absence of a special order of this Court, the solictor-client taxation would be governed by the Victorian Supreme Court Act and Rules. Counsel for the respondent firm of solicitors formally submitted that the Court had no power to make the order sought, but he conceded that, in the light of the decision of Dixon J (as he then was) in Woolf v Snipe (1933) 48 CLR 677, this argument was unlikely to succeed. In my view this concession was properly made. Dixon J held in that case that, "The superior Courts of law and equity possess a jurisdiction to ascertain, by taxation .... the costs, charges and disbursements claimed by an attorney or solicitor from his client, and that jurisdiction is derived from three sources -and falls under three corresponding heads. First, a jurisdiction exists founded upon the relation to the Court of attorneys and solicitors considered as its officers. This jurisdiction, commonly called the general jurisdiction of the Court, enables it to regulate the charges made for work done by attorneys and solicitors of the Court in that capacity, and to prevent exorbitant demands. Second, when a contested claim for costs comes before the Court it has jurisdiction to determine by taxation or analogous proceeding the amount of costs. ee londemtaaeneninadeaenthlinansanioaamnes — ree ee na eee Third, there is a statutory jurisdiction ...." (His Honour then described the statutory provisions applicable in state Supreme Courts.) It is the first of these sources of jurisdiction which is relevant for present purposes. The reference to a general jurisdiction, often spoken of as an "inherent" jurisdiction, is not entirely apt in the case of a superior court of record which is entirely a creature of statute, as is the Federal Court of Australia. It is more appropriate to speak of an implied jurisdiction in such cases. Thus in Jackson v Sterling Industries Ltd (1986) 69 ALR 92 at 96-7, Bowen CJ said, "The argument regarding the existence Or non-existence of inherent jurisdiction is an awkward one to fit into a Federal system. The High Court has its jurisdiction conferred upon it by statute, namely by the Constitution and by Acts of the Parliament; the Federal Court of Australia is constituted by an Act of the Parliament, namely the Federal Court of Australia Act and has jurisdiction conferred on it by various Acts of the Parliament; the Supreme Court of New South Wales as formerly established as the superior court of record in New South Wales was continued by the Supreme Court Act 1970 (NSW) (s 22) and that Act conferred upon the Supreme Court all jurisdiction which might be necessary for the administration of justice in New South Wales (s 23). Although the Supreme Court of New South Wales is spoken of as a court of 'general jurisdiction' and the statutory establishment of the court is referential, the fact is that the jurisdiction conferred on that court by statute is Necessarily subject to subtraction due to constitutional limits and to additions eg by the Judiciary Act 1903, in a way not usually associated with courts of general jurisdiction in a unitary State. In relation to a statutory court such as the Federal Court it is wise to avoid the use of the words 'inherent jurisdiction'. Nevertheless a statutory court which is expressly given certain jurisdiction and powers must exercise that jurisdiction and those powers. In doing so it must be taken to be given by implication whatever jurisdiction or powers may be necessary for the exercise of those expressly conferred. The implied power, for example, to prevent abuse of its process, is similar to, if not identical with, inherent power." {See also, to similar effect, Woodward J at 108 and Jackson J at 116.) In my view it is a necessary corollary of this Court's powers to award costs between parties and to fix by Rules of Court the costs of proceedings in the Court, that the Court may, by reference to a taxing officer, control the fees which are charged by a solicitor to his client for professional services in a matter tried by the Court. In doing so it would, within the meaning of s 23 of the Federal Court of Australia Act 1976, be making an order of a kind which it thought appropriate in relation to a matter in which it has jurisdiction. It remains to be considered, in the exercise of judicial discretion, whether such an order would be appropriate in the Present case. It is argued for the applicants that the taxing officer of the Court will have to tax the party-party costs of the matter, and to tax the solicitor-client costs at about the same time would not only be sensible and time-saving, but also ensure a consistency between the two adjudications. I find considerable force in both these arguments. The applicants' former solicitors argue that solicitor-client costs are normally determined by the Taxing Master of the Supreme Court, and in this case the applicants ie mse oeeuetiiaieteen aneentemendniaenanamintelinn mmamaneniel weer ene eee oe ene originally sought leave to have the bill of costs taxed, out of time, in the Supreme Court before abandoning that application and bringing the present one. Each case will turn upon its own facts, but in the present case I am impressed by the arguments of consistency and convenience. I am also concerned that it seems as though the applicants, who obtained a quite substantial judgment in this Court, could be deprived of much of the benefit of that judgment because of the difference between the costs they should be able to recover from the respondent and the costs which their former solicitor seeks to charge them. This is a matter about which the Court should be concerned and over which, through its officers, it should maintain control. I have no doubt that the taxing officer of this Court will, on matters where the Federal Court Rules and High Court Rules are silent, have due regard to the provisions of the Victorian Supreme Court Rules. The applicants obtained judgment for damages in the sum of $28,500. With the addition of interest, the final judgment sum was $40,050.57. The respondent solicitors have submitted a party-party bill of costs totalling $80,303 and a solicitor-client bill totalling $97,280. The discrepancy could, of course, be increased further if significant items were taxed off the party-party bill but found to have been reasonably incurred as between solicitor and client. It is, presumably, with this thought in mind that the respondent solicitors have refused to make any payment to the applicants from the damages paid over to them by Golden Fleece Petroleum Ltd following the judgment. meee ee It is now high time that this matter was finalised and I believe considerations of convenience and consistency require that the two bills of costs be taxed in tandem by the District Registrar of this Court. The parties disagree as to which should be dealt with first. I believe that it would be more appropriate and convenient if the party-party costs were dealt with first, as the respondent solicitors urge. All interested parties would no doubt be entitled to be present during the party-party taxation, and if the taxing officer felt that any item of the party-party taxation should be deferred until after the matter had been debated between solicitor and client, it would clearly be within his powers to arrange matters accordingly. There was some suggestion in argument that' the applicants had been disadvantaged by their former solicitors exercising their lien over documents. I need only say that I am not satisfied that the former solicitors have failed to make records available for inspection on reasonable terms. I shall reserve liberty to apply in case any difficulties arise before taxation occurs. The respondent Golden Fleece Petroleum Ltd has asked, for good reasons, that the party-party taxation not take place before mid-July. I shall therefore direct that the party-party taxation, to be immediately followed by the solicitor-client taxation, be conducted on a date to be fixed by the District Registrar on or after i5 July. us Fa The applicants have been successful in this notice of motion and I can see no reason why the costs should not follow the event. The respondent Golden Fleece Petroleum Ltd supported the applicants in their notice of motion and, 'in my view, should also have its costs against the respondent solicitors. The applicants merely asked in their notice of motion that costs be costs in the taxation, but that does not now seem to me to be an appropriate order in view of the way the matter has been contested. Successful litigants, who are already in danger of losing much of the benefit of their claim in legal costs, have been put to even further expense over a trivial issue as to where those costs should be taxed, as between solicitor and client. The suggestion that they be taxed along with party-party costs was always a sensible one and no good reason has been suggested to me why the former solicitors should not have co-operated in that course. I certify that this and the six (6) preceding pages are a true and accurate copy of the Reasons for Judgment herein of The Hon Mr Justice Woodward Associate Dated: 9 June 1987 Counsel for the applicants: Mr M. Lapirow Solicitors for the applicants: Slater and Gordon Counsel for the respondent Golden Fleece Petroleum Ltd: Mr M. Crennan . Solicitors for the respondent Golden Fleece Petroleum Ltd: Russell Kennedy and Cook Counsel for the respondents Keith Hercules and Sons: Mr J. Kaufman Solicitor for the respondents Keith Hercules and Sons: Mr A. Weingart