FEDERAL COURT OF AUSTRALIA Wide Bay Conservation Council Inc v Burnett Water Pty Ltd (No 9) [2011] FCA 661 Citation: Wide Bay Conservation Council Inc v Burnett Water Pty Ltd (No 9) [2011] FCA 661 Parties: WIDE BAY BURNETT CONSERVATION COUNCIL INC v BURNETT WATER PTY LTD ACN 097 206 614 File number: QUD 319 of 2008 Judge: LOGAN J Date of judgment: 10 June 2011 Catchwords: COSTS – discretion to award costs – abandoned allegation of misconduct by respondent - whether to depart from usual order that unsuccessful party pays the costs of the successful party – requirement for special feature in the case – no special feature to warrant departure from the general rule – whether to award costs on indemnity basis in respect of abandoned misconduct allegations – as to abandoned misconduct allegations, costs awarded on indemnity against applicant and otherwise awarded against applicant on a party and party basis COSTS – application for a gross sum costs order under O 62 r 4(2)(c) of the Federal Court Rules – relationship between assessment of a gross sum and principles of taxation of costs – where case involved extensive evidence but no complex points of law – whether to allow counsel's and solicitor's fees on a time costing basis – discussion of time based costing – for counsel a fee on brief costing basis more appropriate – no allowance for two senior counsel in respect of interlocutory practice and procedure applications – costs awarded as a gross sum Legislation: Environmental Protection and Biodiversity Conservation Act 1999 (Cth) s 475 Fair Work Act 2009 (Cth) s 570 Federal Court of Australia Act 1976 (Cth) s 43 Income Tax Assessment Act 1936 (Cth) s 260 Migration Act 1958 (Cth) Native Title Act 1993(Cth) s 85A Solicitor General Act 1985 (Qld) ss 8, 11, 12, 13, 14, 15, 16 Federal Court Rules O 62 r 1A, O 62 r 4(2)(c), O 62 r 12, O 62 r 19, Sch 2 Sustainable Planning Act 2009 (Qld) ss 457, 689 Cases cited: AM Stevens Pty Ltd v Australian Red Cross Society [2002] FCA 91 cited Auspine Ltd v Australian Newsprint Mills Ltd (1999) 93 FCR 1 cited Australian Conservation Foundation v Forestry Commission (1986) 81 ALR 166 followed Beach Petroleum NL v Johnson (No 2) (1995) 57 FCR 119 applied Brookfield, Ian Walter & Anor v Davey Products Pty Ltd [1997] FCA 1462 cited Canvas Graphics Pty Ltd v Kodak (Australasia) Pty Ltd [1998] FCA 23 cited Charlick Trading Pty Ltd v Australian National Railways Commission [2001] FCA 629 considered Colgate Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225 applied David Sparnon v Apand Pty Ltd [1998] FCA 164 cited Friends of Hinchinbrook Society Inc v Minister for the Environment (No 5) (1998) 84 FCR 186 considered Kroehn v Kroehn (1912) 15 CLR 137 referred to Leary v Leary [1987] 1 WLR 72 referred to Lumley Life Limited v IOOF of Victoria Friendly Society (unreported, Lockhart J, 23 April 1992) considered Magna Alloys & Research Pty Ltd v Coffee (No 2) [1982] VR 97 considered New South Wales Bar Association v Evatt (1968) 117 CLR 177 considered New South Wales Crime Commission v Fleming (1991) 24 NSWLR 116 considered Oshlack v Richmond River Council (1998) 193 CLR 72 considered Qantas Airways v Cameron (No 3) (1996) 68 FCR 387 considered Re Morris Fletcher & Cross' Bill of Costs [1997] 2 Qd 228 considered Seven Network Limited v News Limited [2007] FCA 2059 applied Singleton v Macquarie Broadcasting Holdings Ltd (1991) 21 NSWLR 103 considered Stanley v Phillips (1966) 115 CLR 470 cited Wide Bay Conservation Council Inc v Burnett Water Pty Ltd (No 2) [2009] FCA 237 cited Wide Bay Conservation Council Inc v Burnett Water Pty Ltd (No 3) [2009] FCA 540 cited Wide Bay Conservation Council Inc v Burnett Water Pty Ltd (No 8) [2011] FCA 175 cited Wilderness Society Inc v Turnbull, Minister for the Environment and Water Resources (2007) 98 ALD 651 considered Quick, R, Quick on Costs (Law Book Co, subscription service (update 70)) Gibbs CJ, "The State of the Australian Judicature" (1985) 59 ALJ 522 Gleeson CJ, Commentary on Paper by Lord Browne-Wilkinson (Supreme Court of New South Wales 1998) http://www.hcourt.gov.au/assets/publications/speeches/ former_justices/gleesoncj/cj-cj2.htm viewed 9 March 2011 Kirby J, Legal Professional Ethics in Times of Change (1998) 72 ALRC Reform 5 Martin CJ, Billable Hours – past their use by date (Perth Press Club 2010) http://www.lawsocietywa.asn.au/client/ multimedia/news/Perth_press_club_law_week – 20100517.pdf viewed 9 March 2011 Solomon D, "Registrar lays down restrictive tests for taxing costs" [1986] 7 Leg Rep 1 Spigelman CJ, Opening of Law Term Dinner 2004 (Supreme Court of New South Wales 2004) http://www.lawlink.nsw.gov.au/lawlink/supreme_court/ 11_sc.nsf/vwprint1/sco_speech_020204 viewed 8 March 2011 Date of hearing: 22 March 2011 Place: Brisbane Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 134 Counsel for the Applicant: Mr K Fleming QC with Ms P Hay and Mr C McGrath Solicitor for the Applicant: Environmental Defenders' Office (Qld) Inc Counsel for the Respondent: Mr W Sofronoff QC with Mr D Clothier Solicitor for the Respondent: Allens Arthur Robinson IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY GENERAL DIVISION QUD 319 of 2008 BETWEEN: WIDE BAY BURNETT CONSERVATION COUNCIL INC Applicant AND: BURNETT WATER PTY LTD ACN 097 206 614 Respondent JUDGE: LOGAN J DATE OF ORDER: 10 June 2011 WHERE MADE: BRISBANE THE COURT ORDERS THAT: 1. Subject to the costs order made in favour of the applicant on 7 September 2009 providing for set off in respect of costs thrown away by it by the adjournment of the trial, the applicant is to pay the respondent's costs of and incidental to the proceedings. 2. In respect of the issue, abandoned at trial, of the respondent's alleged misconduct, the applicant is to pay the respondent's costs on an indemnity basis. 3. Pursuant to Federal Court Rules, O 62 r 4(2)(c): (a) the respondent is entitled, as against the applicant, in respect of its costs of and incidental to the proceedings, including those ordered to be paid on an indemnity basis, to a gross sum of $1,090,031.50 instead of taxed costs; and (b) the applicant is entitled, as against the respondent, in respect of its costs thrown away by the adjournment of the trial to a gross sum which, by consent, is fixed in the amount of $50,000 instead of taxed costs. 4. Allowing for set off, the applicant is to pay the respondent the amount of $1,040,031.50 in respect of its costs of the proceedings. 5. To the extent that any subsisting order provides for taxation of costs ordered to be paid by one party to the other, that order is vacated. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using Federal Law Search on the Court's website. IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY GENERAL DIVISION QUD 319 of 2008 BETWEEN: WIDE BAY BURNETT CONSERVATION COUNCIL INC Applicant AND: BURNETT WATER PTY LTD ACN 097 206 614 Respondent JUDGE: LOGAN J DATE: 10 june 2011 PLACE: BRISBANE REASONS FOR JUDGMENT 1 As a sequel to the dismissal of the Conservation Council's application, qv Wide Bay Conservation Council Inc v Burnett Water Pty Ltd (No 8) [2011] FCA 175 (the principal judgment), Burnett Water made an application not just for an order that costs follow that event but also for orders that so much of its costs as were referable to the allegation of misconduct made against it but abandoned during trial be taxed on an indemnity basis and, further, that its costs be assessed in a gross sum. These reasons for judgment concern that application. They must be read in conjunction with those given in the principal judgment for the dismissal of the substantive application. 2 The Conservation Council neither consented to nor opposed any of the orders sought. Rather, its stance was to abide the order of the Court. 3 Unlike, for example, s 457 of the Sustainable Planning Act 2009 (Qld) (Sustainable Planning Act) in respect of a proceeding in State jurisdiction in the Planning and Environment Court and the position under some Commonwealth Acts which confer jurisdiction on this Court, for example, s 570 of the Fair Work Act 2009 (Cth) and s 85A of the Native Title Act 1993 (Cth), the Environmental Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act) does not contain any provision which limits the general discretionary power in respect of the awarding of costs conferred on the Court by s 43 of the Federal Court of Australia Act 1976 (Cth). 4 One of the purposes of the environmental impact statement process under Queensland's Sustainable Planning Act is the meeting of assessment requirements for development which is, under the EPBC Act, a controlled action: s 689(h)(i). It is possible to envisage circumstances where litigation touching on such a requirement might occur in that State's Planning and Environment Court, where the costs power would not be at large, and where litigation in respect of the controlled action giving rise to that requirement might occur in this Court, where the costs power would be at large. The respective Parliaments have made differing value judgments as to the extent to which parties to litigation touching on the operation of the EPBC Act should be exposed to an order for costs. 5 The Commonwealth Parliament has made its value judgment even in respect of cases where it has, by s 475(1) of the EPBC Act, conferred standing on a body such as the Conservation Council, in addition to the Minister, to seek injunctive relief in respect of conduct that is alleged to constitute an offence against or other contravention of that Act. As I observe in the principal judgment, at [21], that conferral of standing is an exception to the traditional public law position that it is the Attorney-General who has standing to seek in the public interest the judicial review and remedies in respect of allegedly unlawful acts. 6 When an Attorney-General (or, as is now not unusual by express statutory provision, a Minister who administers the particular legislation) institutes such proceedings that official is able to command for that purpose all of the financial and other resources of a body politic. That is not the case in respect of a person who falls within the definition of "interested person" for the purposes of s 475(1) of the EPBC Act. The resources available to such a person will, inevitably, be very different to those of a body politic. Yet the potential exposure to an order for costs, in the event that the proceeding fails, of each class with standing to institute an enforcement proceeding, Minister or "interested person", is no different. In some cases, the public policy objective of facilitating, by an express conferral of wider standing, the seeking of an enforcement remedy in cases where the Minister may be unable or unwilling so to do may be undermined by the absence of any special provision in respect of costs. Equally though, in other cases, the absence of any such special provision may serve to temper what I described in the principal judgment, at [26], as the litigious ardour of the zealot, with consequent saving of expense for a prospective respondent and of scarce judicial resources. 7 As the EPBC Act stands, the value judgment Parliament has made is not to confer any special, general immunity as to costs on an "interested person". Rather, if, in a matter arising under the EPBC Act, there is to be an exception in respect of proceedings instituted by "interested persons" from the usual position in respect of an exercise of the discretion as to the awarding of costs conferred by s 43 of the Federal Court of Australia Act, which is that costs follow the event, that exception must be found in the circumstances of a particular case. For the present, the position is as put by Burchett J in Australian Conservation Foundation v Forestry Commission (1986) 81 ALR 166 at 170-171 in a passage which (at 171) concludes with the following observation: If a body is set up to pursue causes, which its founders consider to be in the public interest, and which generally may be in the public interest, by means including court proceedings against others, it does not follow that those proceeded against should be deprived of the ordinary protection of a right to an order in respect of their costs in the event the claims made against them prove unfounded. That passage, including that observation, was expressly approved by Lindgren and Lehane JJ in Qantas Airways v Cameron (No 3) (1996) 68 FCR 387 at 389 and later in Friends of Hinchinbrook Society Inc v Minister for the Environment (No 5) (1998) 84 FCR 186 at 188. Nothing in the later observations on the subject of the costs discretion made by various members of the High Court in Oshlack v Richmond River Council (1998) 193 CLR 72 at [2] per Brennan CJ, at [30]-[31] per Gaudron and Gummow JJ and at [91], [97]-[98] per McHugh J calls into question the correctness of the observation made by Burchett J. Thus, if there is to be a departure from the usual order as to costs in this matter such as would deprive Burnett Water of some or all of the costs which remain for determination it must be found not in some general, nebulous, public interest litigation exception but rather in some special feature of this case. 8 That special feature is not to be found merely in the self appointed conservation protection and interest group status of the Conservation Council. Nor, in my opinion, is it to be found just in the desirability, long recognised in Queensland, of taking in the public interest measures to preserve for posterity the Queensland lungfish. That is a relevant but not determinative consideration in respect of any departure from the usual order. 9 It was a feature of the case that the upstream fish transfer device found at the Paradise Dam was similar to one which was to be incorporated into the proposed Traveston Dam on the Mary River. Especially prior to the decision taken by the Minister not to approve the latter under the EPBC Act, that feature led to a degree of wider interest in this case, but I remind myself that the interest of the public in a case is not to be confused with whether the institution or defence of a proceeding should be regarded as in the public interest. Further, and as Burnett Water rightly highlighted in its submissions, whatever benefit may have been perceived by the Conservation Council in the institution and prosecution of this proceeding in respect of the making of a Ministerial decision as to whether to approve that proposed dam is a benefit foreign to this proceeding. A special feature of a case warranting a departure from the usual order as to costs is not to be found in a collateral purpose of a party. 10 A consideration which may be relevant, in light of what I apprehend to be one reason why Parliament has liberalised and made express provision in respect of the standing to seek injunctive relief, is the studied distancing of himself from this proceeding by the then Minister, notwithstanding the preliminary and then final administrative conclusion of officers of his department that there had been "partial non-compliance" by Burnett Water with the conditions of the Ministerial approval of the construction and operation of the Paradise Dam. As an abstract, general proposition, even though it ultimately failed, and at least in circumstances where it could not be concluded that the institution and prosecution of a proceeding for enforcement in a matter concerning a listed vulnerable species was frivolous or vexatious, a proceeding instituted by an interested person in circumstances where, notwithstanding a conclusion that a condition of an approval had been breached, a Minister was unable or unwilling to take enforcement action may well warrant a departure, in whole or in part, from the usual order as to costs. That consideration was not a feature of Wilderness Society Inc v Turnbull, Minister for the Environment and Water Resources (2007) 98 ALD 651 where the discretion was exercised so as to make the usual order that costs follow the event. 11 Does this general proposition have application in this case? In the "Final Compliance Audit Report" dated 28 December 2008, prepared by the Minister's department in respect of an audit of the Paradise Dam conducted between 25 and 28 June 2007, the following departmental response is made in respect of one of the department's perceived "partial non-compliances" with the conditions of the Ministerial approval namely, "The Fishway has not fully commenced": The fishway was to commence when the dam became operational. It is DEWHA's [By then the Minister's portfolio had become known as the Department of the Environment, Water, Heritage and the Arts] view that the dam became operational in December 2005. Only part of the fishway is operating (upstream). A rating of partial compliance is given where there is more than one element to the condition or requirement being assessed and the auditee has complied with some but not all elements. In this instance the fishway contains both upstream and downstream elements, and both of these have not been met, therefore a rating of partial compliance is appropriate. It is however noted, that the rating of partial compliance is due to drought conditions and low dam levels. It should also be noted that the requirements of the State differ from that of the Federal Government. The Federal Government's condition issued by DEWHA does not specify an operating range. This response was based upon a construction of condition 3 that, for reasons given in the principal judgment, was incorrect. It is elsewhere apparent in this audit report that the construction of the condition which came to prevail was put to the department by Burnett Water in the course of its response to the draft of that report, which it received on 1 August 2007. The department's view as to the construction of the condition reflected that adopted by the authors of the draft audit report. 12 In the interval between its receipt of the draft audit report in August 2007 and the department's issuing of the final audit report extensive correspondence passed between Burnett Water and the department in relation, initially and materially, to whether there was partial non-compliance as alleged and thereafter as to measures which might be taken to address the same. In the course of that correspondence the department expressed the view (letter of 31 October 2008) that its position had never been that that the fishway (ie upstream and downstream devices) had to operate 100% of the time. In that same letter the department expressly drew attention to the requirement in condition 3 that the fishway be "suitable for the lungfish". Overall, the impression gained from the exchange of correspondence, which continued into 2009, is that the department was not so much concerned with whether the fishway at the dam had become operational when required but rather whether it was in any event in the prevailing circumstances "suitable for the lungfish". To that end, there is much discussion in the exchange concerning the formulation and provision of results of a monitoring programme. 13 It is certainly not the case that the Minister is obliged to institute enforcement proceedings in each and every case where he believes that a contravention of the EPBC Act has occurred. Whether or not so to do is a matter for the discretionary value judgment of the Minister, with the benefit of advice from his department, in the course of his general administration of the EPBC Act. Sometimes, and the present case appears to be one, a policy of watchful waiting, as opposed to the institution of enforcement proceedings, may commend itself to the Minister as the more prudent course to take, at least as an initial response. The making of such value judgments is the peculiar and particular responsibility of a Minister of State for which he is responsible to Parliament and perhaps also to what is sometimes termed the court of public opinion, but not to this Court. What is prudent, watchful waiting to some may appear to be supervised neglect or inaction in the face of an apparent contravention to others, particularly to those who have not been privy to an exchange of correspondence in relation to an audit report and who do not, as does a Minister, have the benefit of all of the advisory and other resources of a Department of State. 14 It is not difficult to see how, in the face of a persisting and readily observable failure on the part of the impounded water in the Paradise Dam, following its December 2005 commissioning, to reach the level of the downstream fish transfer device, coupled with the periods of inoperability of the upstream device, also readily observable, and an absence of the institution of enforcement proceedings by the Minister, an interest group such as the Conservation Council might conclude, given the listed vulnerability of the lungfish, that it ought to exercise the standing conferred on it by Parliament to take action, because there was Ministerial inaction. Put another way, it is not impossible to see how, questions of suitability aside, the Conservation Council might have concluded that the fishway just had not commenced operation as required. Though it did not prevail, the construction of condition 3 which the Conservation Council came to promote was neither not reasonably open nor idiosyncratic. Condition 3 admitted of difficulties of construction and the construction promoted by the Conservation Council was one shared by the Minister. 15 It is important in deciding whether, in a case like the present, there are special circumstances warranting a departure from the usual order as to costs not wholly to judge the course of action taken by the Conservation Council by reference to the wisdom of hindsight. At the time when the Conservation Council instituted this proceeding in 2008 and viewing the matter in prospect, it is not impossible to see how the Conservation Council might have concluded that the Minister was unwilling to institute an enforcement proceeding which needed to be instituted. That is so even though, with the benefit of examining the departmental correspondence directed to Burnett Water, the better view is that the lack of Ministerially instituted enforcement proceedings was the result of a value judgment that the better course, in the prevailing circumstances which included a then persisting drought, was to await the results of monitoring. 16 There is though a speculative quality to the reaching of conclusions about the Conservation Council's motivations in respect of such matters. Neither its president nor any other officer of the Council has given evidence on the costs application as to the reasons why, on the information then to hand, the Conservation Council instituted the proceeding. Had such an officer of the Conservation Council given evidence, he or she would have been amenable to cross-examination on behalf of Burnett Water. That may, for example, have revealed the nature and extent, if any, to which the Council was privy, in advance of its instituting this proceeding, to the course the department had chosen to adopt following the audit in 2007. I do not consider that speculation as to what may have been the Conservation Council's motivations is a basis for concluding that special circumstances exist warranting a departure from the usual order as to costs. 17 Section 475 of the EPBC Act does not confer standing upon an "interested person" just to seek declaratory relief, as opposed to injunctive relief in respect of a contravention. It is possible to seek for declaratory relief in conjunction with an application for injunctive relief. Further, the Federal Court Rules admit of the possibility of the determination of a separate question of law or fact. One course open to the Conservation Council would have been to seek the determination as a separate question, of whether, on the true construction of condition 3, the downstream fish transfer device had commenced operation when the dam was commissioned, given that the water level did not then reach its entry level. That fact was an uncontroversial given. 18 Ordering that a question be the subject of separate determination can be fraught with the prospect of serving only to delay the final determination of a matter by reason of appellate challenge to the answer given to the separate question. Sometimes though the determination of that separate question may, either in law or in any event in practice, settle a controversy. Again, had such a course been adopted by the Conservation Council, there may well have been a basis, in circumstances of inaction by the Minister, for not ordering the Council to pay costs in respect of the hearing and determination of such a separate question. 19 This though is not the course which the Conservation Council chose to adopt. A failure to commence operation was but one facet of a wider alleged contravention case which it sought to mount. That wider case involved a broad factual excursion into the subject of whether, as constructed in that location, the fishway at the dam was "suitable for the lungfish". The Conservation Council persisted in the prosecution of that wider case in the face of it being served with the affidavit evidence from two eminent experts, Dr Mallen-Cooper and Dr Kind. Of course it was entitled to do this and to rely on the views of Mr Tait, whom it considered to be an expert. However, that it chose so to do is not, in my opinion, a circumstance telling in favour of a departure from the usual order as to costs, rather the reverse. Given the background of Ministerial inaction, a listed vulnerable species and an apparently inoperable fishway, the position may well have been different had the Conservation Council sought to discontinue the proceeding once it had the benefit of the affidavit evidence of Dr Mallen-Cooper and Dr Kind and an opportunity, via discovery and the affidavit of Burnett Water's Chief Executive Officer, Mr Boettcher, to study the exchange of correspondence in relation to the departmental compliance audit which passed between the department and that company. This also was not a course adopted by the Conservation Council. 20 Contrary to the submission of Burnett Water, I do not regard the admittedly lamentable history of the evolution of the Conservation Council's statement of claim as relevant to whether or not to order the Council to pay such of the costs of the proceeding which are not already the subject of express order. Insofar as there were failings in the Conservation Council's pleadings, which became the subject of successful interlocutory applications by Burnett Water, the costs orders made on those occasions have already recognised the forensic success it enjoyed on the hearing of those applications. 21 In short then, even though the Conservation Council chose not actively to contest whether a costs order should be made, I have nonetheless expressly considered whether the circumstances of the case warrant a departure from the usual order as to costs. I do not consider that such circumstances exist. 22 Such a conclusion would, in the ordinary course, result in an order that, without prejudice to costs orders already made in favour of Burnett Water in the proceeding, the Conservation Council pay its costs of and incidental to the proceeding, including reserved costs, less the costs awarded in favour of the Council arising from the adjournment of the trial in 2009, which would be set off. Further, in default of agreement with the Council, the amount of Burnett Water's costs and those awarded in favour of the Council would have to be determined by a registrar on taxation of respective bills of costs, Burnett Water's on a party and party basis and, given the terms of the order, those of the Council on an indemnity basis. 23 As noted though, Burnett Water seeks not only that some of its costs be determined on an indemnity basis but that all of its costs be fixed in gross. 24 As to the former, the rationale for the awarding of costs ordinarily on a party and party basis and only exceptionally on an indemnity basis is the subject of a comprehensive exposition by Sheppard J in Colgate Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225 (Colgate Palmolive), which is frequently cited with approval The ordinary position is that costs are awarded on a party and party basis, which does not provide a full indemnity to the beneficiary of that costs award. Neither, strictly and notwithstanding its description, does an indemnity costs order, for costs which are unreasonable in amount are excluded from costs taxed on this basis. 25 While the categories of case in which, as a matter of discretion, a departure from the ordinary position is warranted are not closed, a number of categories in which in the past indemnity costs have been awarded are summarised by Sheppard J in Colgate Palmolive at 233-234. Amongst these are the making of allegations of fraud known to be false and the making of irrelevant allegations of fraud. An allegation of fraud is but a singular example of an allegation of misconduct. I do not doubt that an indemnity costs order may be warranted in respect of costs incurred as a result of the making of such an allegation which it is known to be false or which is irrelevant. That may be viewed as a correlative of the rule of practice that an allegation in a pleading in respect of a serious matter such as fraud, bad faith, misfeasance, or misconduct must not be made unless the author of the pleading either has or reasonably expects to have at trial evidence to prove such an allegation. 26 In the present case, an allegation of misconduct on the part of Burnett Water in attempting to mislead officers of the department during the audit was made. This was not relevant to whether the fishway had or had not commenced operation or was or was not suitable in terms of condition 3 of the Ministerial approval. Such misconduct on the part of Burnett Water could only have been relevant to whether a contravention of a condition of the approval was knowing and thus to an exercise of discretion as to whether to grant injunctive relief and perhaps also to the terms of that relief. Much of Mr Boettcher's affidavit was directed to the subject of dealings between Burnett Water and the department in relation to the audit. Save for the allegation of misconduct, an account of those dealings was not otherwise relevant to the question of whether condition 3 had been contravened. In particular, it is axiomatic that the department's view that there had been a "partial contravention", as revealed in the correspondence exhibited to that affidavit, not only could not bind the Court but was irrelevant to the question as to whether the Conservation Council had proved the contravention it alleged and particularised. 27 The Conservation Council has not sought to explain by submissions, much less by supporting evidence, the basis upon which the allegation of misconduct was made. Viewing the matter in prospect, observations as to the "downtime" of the upstream fish transfer device, the prolonged time before the impounded water reached the level of the downstream fish transfer device and what one might term a "conspiracy theory" would not provide a basis for the making of an allegation of misconduct. I consider that Burnett Water has, exceptionally, established a basis for an order for indemnity costs, limited to the costs of and incidental to the preparation (including settling by junior counsel), filing and service of the affidavit of Mr Boettcher. It may be that so to limit the order does not wholly capture all of the costs flowing from the abandoned allegation of misconduct but the further identification of the same would greatly complicate any taxation of costs and entail, I expect, a law of diminishing returns in terms of the costs to the parties of the same relative to a difference as between Burnett Water's party and party and indemnity costs. Burnett Water did not submit how the costs relating to the allegation might be identified with precision. I consider that substantial justice will be done between the parties by so limiting the order. 28 That then leaves for resolution the question as to whether or not Burnett Water's costs should be fixed in gross? 29 That there is power to make such an order is undoubted. Materially, O 62 r 4(2)(c) of the Federal Court Rules provides that, "Where the Court orders that costs be paid to any person, the Court may further order that as to the whole or any part of the costs specified in the order, instead of taxed costs, that person shall be entitled to … a gross sum specified in the order". The power to make such an order is discretionary. A practice note (CM 4 dated 25 September 2009) is applicable. That requires that any such application be accompanied by an affidavit stating: (a) the amount of the gross sum sought to be specified in the order; and (b) how the gross sum has been arrived at and how it is justified. The application made by Burnett Water was accompanied by an affidavit affirmed by a costs assessor and also by an affidavit affirmed by a solicitor in the employ of the firm acting for that company in the proceeding. 30 In my experience, the fixing of costs in gross most frequently occurs in appeals from the Federal Magistrates Court in matters arising under the Migration Act 1958 (Cth) but the occasion for the exercise of the power is by no means confined to proceedings of that kind. The prevalence of the practice in migration matters is referable to its convenience, efficiency in use of court resources, the repetitious, compressed nature of the legal work associated with such a proceeding and the present frequency of such proceedings, considerations which collectively lend themselves to ready estimation of the party and party legal costs entailed. The power though is general in its application. 31 A survey of past authority discloses that, though occasions for the wider exercise of the power have been infrequent, it has been exercised even in respect of lengthy and complicated commercial litigation, eg Seven Network Limited v News Limited [2007] FCA 2059 (Sackville J) (Seven Network). Indeed, one reason given for the exercise of the power in such cases has been that a taxation of costs in such a case would be likely to involve unreasonable delay and expense: Beach Petroleum NL v Johnson (No 2) (1995) 57 FCR 119 at 120 (Beach Petroleum). As von Doussa J notes (ibid) in Beach Petroleum, that has been regarded in the United Kingdom as the purpose of such a rule: Leary v Leary [1987] 1 WLR 72. By reference to that British authority, his Honour further observed of the power (Beach Petroleum at 120) that, "An order that costs be assessed as a gross sum does not envisage that any process similar to that involved in taxation should take place, but the power must be exercised judicially and after giving the parties an adequate opportunity to make submissions on the matter". 32 Later, in Seven Network, at [25] Sackville J summarised principles which had emerged in respect of the fixing of costs in gross. I gratefully adopt his Honour's summary: 25 The authorities establish a number of principles applicable to a claim for a gross sum costs order to be made pursuant to FCR, O 62 r 4(2)(c): (i) The purpose of the subrule is to avoid the expense, delay and aggravation involved in protracted litigation arising out of taxation: Beach Petroleum v Johnson (No 2), at 120, per von Doussa J, applying Leary v Leary [1987] 1 All ER 261; Harrison v Schipp (2002) 54 NSWLR 738, at 742 [21] per Giles JA. (ii) An order that costs be assessed as a gross sum does not envisage that any process similar to that involved in taxation should take place. On the contrary, the Court applies a much broader brush than would be used on a taxation of costs pursuant to O 62: Beach Petroleum v Johnson (No 2), at 120, 124, per von Doussa J; Harrison v Schipp, at 743 [22], per Giles JA. (iii) The Court should be confident that the approach taken to the estimate of costs is logical, fair and reasonable. The Court should be astute to avoid both overestimating the recoverable costs and underestimating the appropriate amount, for example by applying an arbitrary discount to the amounts claimed: Beach Petroleum v Johnson (No 2), at 123, per von Doussa J. (iv) Although the power to assess a gross sum for costs involves the exercise of a discretion, it is necessary to bear in mind fundamental principles applicable to an assessment of costs on a party and party basis. These include the principles contained in O 62 r 19 (embodying the "necessary or proper" test) and those stated in Stanley v Phillips (1966) 115 CLR 470, at 478, per Barwick CJ (on a party and party taxation the emphasis is upon obtaining adequate representation to enable justice to be done, not upon the propriety of steps taken to ensure maximum success in the cause): Auspine Ltd v Australian Newsprint Mills Ltd (1999) 93 FCR 1, at 4-5 [12]-[15], per O'Loughlin J; Charlick Trading Pty Ltd v Australian National Railways Commission [2001] FCA 629, at [6]-[8], per Mansfield J. (v) Although the methodology permitted by O 62 r 4(2)(c) initially involves a broader approach than on a normal taxation, the provisions of O 62 and Schedule 2 provide assistance in fixing an appropriate gross sum: Charlick Trading Pty Ltd v ANRC, at [10], per Mansfield J. 33 To this summary, his Honour added the following, at [26] to [30]: 26 The last point should be developed a little further. FCR, O 62 r 4(2)(c) authorises the Court to order that, instead of taxed costs, the successful party should be entitled to a gross sum costs order. The subrule contains no express direction that the Court is to apply the detailed criteria that are laid down in O 62 and Schedule 2. On the contrary, the subrule apparently leaves the question of quantification at large. 27 Rule 4(2)(c) is, however, located within an Order that makes detailed provision for the assessment of party and party costs. It would be extremely odd if the more expeditious procedure contemplated by r 4(2)(c) resulted in either a successful or an unsuccessful party being exposed to an assessment of costs which simply ignores or overrides the basic principles applicable to a taxation of costs. I accept Mr Sheahan's submission that it would be an error for a Court to use its power under r 4(2)(c) to assess a gross sum clearly higher than that which would be allowed on a taxation of costs. 28 On the other hand, it must be borne in mind that r 4(2)(c) establishes a procedure that applies instead of taxed costs. As the cases have stressed, the object of the procedure is to avoid the expense, delay and aggravation that would be involved in a taxation of costs, especially in a lengthy and complex case such as this. The procedure is intended to replace the potentially elaborate process contemplated by O 62 and Schedule 2, whereby a taxing officer meticulously analyses a specially prepared bill of costs by reference to individual items, some of which have distinctly Dickensian overtones. 29 It is necessary for the Court to have sufficient information to enable it to make a logical, fair and reasonable estimate. In this respect, as the parties agreed, Telstra bears the onus of establishing that its claim to a gross sum satisfies the applicable test. In practice, this may involve the parties adducing evidence from expert costs assessors addressing whether the costs claimed by the successful party were "necessary or proper for the attainment of justice or for maintaining or defending the rights of a party" (O 62 r 19) or, in more general terms, whether the amounts sought would have been recoverable on a taxation of costs. 30 Care should be taken, however, to ensure that the process does not take on too many of the characteristics of a taxation of costs. … [Emphasis in original] 34 I respectfully agree with these further observations of Sackville J, subject to one qualification arising from his Honour's reference to some items which may fall for the analysis by a taxing officer of a bill of costs having "Dickensian overtones". 35 Upon a taxation of costs and in the absence of an order making specific provision to the contrary, a taxing officer is required to tax costs by reference to the scale of costs specified in the Second Schedule to the Federal Court Rules, as applicable from time to time: O 62 r 12. Some of the language employed in that schedule in respect of particular items is indeed redolent of a 19th century legal office – "engross" and "folio", for example. This acknowledged, to approach the subject of how much reasonably to allow in respect of legal costs by recalling the works of Charles Dickens may not, with respect, necessarily be a bad thing. 36 The rapaciousness in respect of fees of Dickens' character, the chancery lawyer, Mr Vholes in respect of Jarndyce v Jarndyce, the fictional case in the Court of Chancery, is a feature of his novel, "Bleak House". The views of Dickens and other authors on the legal profession were the subject of an illuminating lecture delivered in 1910 by Thomas Alexander Fyfe, Sherriff-Substitute (a Scottish judicial office, also termed Sherriff Depute, the holder of which exercises a jurisdiction similar to that of an Australian District or County Court judge) at Glasgow, to the Glasgow Dickens Society and shortly thereafter reproduced by him in book form as, "Charles Dickens and the Law", William Hodge and Company, Glasgow, 1910 (text available online at The Internet Archive, http://www.archive.org/stream/ charlesdickensla00fyfeuoft/charlesdickensla00fyfeuoft_djvu.txt). 37 Sherriff Fyfe commenced his lecture with the observation, "Charles Dickens was pre-eminently the novelist of the law, and his lawyers have a hold upon the public imagination far surpassing that of any other author. But, although his lawyer creations are most widely known, he is not the only author who has built a tale upon a legal foundation." One of the other authors to whom Sherriff Fyfe made reference was the eighteenth century Scottish novelist, Tobias Smollett, whose works influenced Dickens. Of Smollett's novel, "The Adventures of Ferdinand, Count Fathom" (1753), Fyfe stated: In "Ferdinand, Count Fathom," we meet a different type of attorney. His fortune was made — as has happened before and since — by special ingenuity in the construction of bills of costs, and one cannot but sympathise with his luck- less client who found that his lawyer's bill included 350 consultation fees in the course of a year of only 365 days including Sundays. But this attorney also deserves our sympathy, for Count Fathom's mode of paying his lawyer's bill was to split the poor attorney's head with a poker, and when remonstrated with by the doctor — who took a grave view of the possible result of his violence — his reply is significant of the estimation in which, in Smollett's day, the attorney was held. I am not so unacquainted with the resistance of an attorney's skull as to believe the chastisement I have inflicted upon him will at all endanger his life, which is in much greater danger from the hands of the common executioner. [Emphasis added] 38 If only by its very existence, the right to subject a bill of costs to scrutiny and determination, termed "taxation", by an independent officer of the Court, subject, if required, to review by a judge, for which elaborate provision is made in O 62, has an enduring relevance, in my opinion, in the discouragement of the claiming of unreasonably high legal fees or in respect of work not reasonably necessary in proceedings in the Court against an unsuccessful party in respect of whom a costs order has been made. In undertaking the duty of taxing officer, the Court's registrars necessarily acquire and maintain an expertise in determining what is reasonable and necessary. 39 Recognising this expertise, von Doussa J, with the consent of the parties, sat with a registrar in Beach Petroleum when hearing the application made in that case. His Honour remarked of this (57 FCR at 120) that the registrar, "has been able to confirm submissions made by the parties about normal practices on taxation, and about rates customarily allowed by taxing officers in this State". In Seven Network, the practice adopted in Beach Petroleum led the parties jointly to propose to Sackville J that he sit at the hearing with one of the court's registrars with extensive experience in the taxing of bills of costs. His Honour, at [11] and [13] records the participation of the registrar in the hearing, including in the questioning of the respective costs experts called by the parties, and of the "extremely valuable" assistance which he gained from consultations with the registrar in reaching his conclusions in respect of that particular application to fix costs in gross. 40 A survey of matters other than migration appeals, which I do not suggest is exhaustive, in which application has been made for the fixing of costs in gross in non-migration matters, discloses that it is not the invariable practice of the Court for a judge to sit with a registrar when hearing such an application: AM Stevens Pty Ltd v Australian Red Cross Society [2002] FCA 91; Charlick Trading Pty Ltd v Australian National Railways Commission [2001] FCA 629 (Charlick Trading); Auspine Ltd v Australian Newsprint Mills Ltd (1999) 93 FCR 1 (Auspine); David Sparnon v Apand Pty Ltd [1998] FCA 164; Canvas Graphics Pty Ltd v Kodak (Australasia) Pty Ltd [1998] FCA 23; Brookfield, Ian Walter & Anor v Davey Products Pty Ltd [1997] FCA 1462 (Brookfield v Davey Products). An application for the exercise of the discretion does, though, require an evidentiary foundation. The practice note anticipates as much in its requirement for any such application to be accompanied by an affidavit. In respect of lengthy or complex cases, that evidentiary foundation will often have to include expert evidence from a person familiar with the practice of taxing or assessing costs in respect of whether the amount of the gross sum sought is reasonable and why that is so. 41 Burnett Water recognised a need for the provision of expert evidence by its reliance in support of its application on the opinions expressed by Mr Bloom, a costs assessor, initially in two affidavits (filed on 3 and 11 March 2011 respectively). Mr Bloom described himself as General Manager and Senior Solicitor at QICS Costs Consultants in Brisbane. 42 Burnett Water did not though promote that I should sit with a registrar. In respect of an application that costs should be fixed in gross in a very large sum and in circumstances in which there was neither a contradictor in submissions nor a competing or check opinion in evidence, that is unfortunate though not, of course, fatal as to whether I should either proceed to fix costs in gross or to act on Mr Bloom's opinions and conclusions in respect of costs. For procedural fairness reasons, I did not consider it at all appropriate privately to consult with a registrar in relation to the amounts claimed. 43 I accept that the circumstances of this case are such that it would involve unreasonable delay and expense to require Burnett Water to tax its costs. To require that would, of course, subject Allens Arthur Robinson's bill of costs to the experienced and independent scrutiny of a registrar. There are certainly features of the fees of both counsel and solicitors, to which I advert below, which might be thought to warrant that. Equally though, the preparation of a bill of costs in taxable form would, on the evidence, visit on a company ultimately owned by shareholding Ministers on behalf of the State of Queensland tens of thousands of dollars ($70,000 to $100,000) of additional legal expenses as between solicitor and client and an associated delay of 2 to 3 months in preparation time and this in circumstances where the Conservation Council is not disposed actively to contest the amount of costs which should be awarded and where the prospect of Burnett Water's recovering any amount of costs which may be awarded is moot. Further, on the evidence, it would take a registrar some 20 days to tax the resultant bill of costs. I therefore propose to proceed to fix Burnett Water's costs in gross. 44 Whether I should do so within a range put forward by Burnett Water depends on the extent to which I am prepared to act upon the opinions expressed by Mr Bloom. 45 Another unfortunate aspect of Burnett Water's application is that, for the purpose of preparing the report and addendum report as to costs which were respectively exhibited to his affidavits filed in support of the application the solicitors acting for that company, Allens Arthur Robinson (AAR), did not direct Mr Bloom's attention to this Court's practice note in respect of expert evidence (Practice Note CM 7). Nor did Mr Bloom of his own motion make reference to the guidance offered by this practice note. The evidence which Mr Bloom gave as to costs was no less a species of expert evidence than evidence from those with expertise in other disciplines which I received in the course of the trial. The overriding duty to the Court emphasised in that practice note applies just as much to Mr Bloom as to those other expert witnesses. Again in circumstances where there was no contradictor, an assurance that the expert concerned understood that duty and had approached the task of offering expert opinion accordingly was of singular importance not, of course, with respect to the admissibility of the expert's opinion but rather with respect to the weight to give to it. 46 On the hearing of the application I pointed out to senior counsel for Burnett Water an apparent lack of engagement by Mr Bloom, on the face of his affidavits, with the requirements of the Court's practice note in respect of expert evidence. Counsel confirmed to me, on instructions, that Mr Bloom's attention had not hitherto been drawn to the practice note. A short adjournment for the purpose of securing, if possible, a supplementary affidavit from Mr Bloom addressing this deficiency and attesting to the impact on the opinions which he had expressed of his consideration of the obligations of expert witnesses as set out in the practice note was sought on behalf of Burnett Water. It seemed to me that the granting of such an adjournment was in the interests of justice. 47 It proved possible, as a result of that adjournment, for Burnett Water to secure a supplementary affidavit from Mr Bloom in which, inter alia, he deposed to having now considered the practice note concerning expert evidence and that, had he been provided with it by AAR, "my estimate of costs the subject of my Report would not have differed in any significant respect". He further deposed that, "notwithstanding the matters addressed in the Guidelines [i.e. the guidelines for expert witnesses in the practice note], the methodology I adopted to assess the costs would not have changed". Though I commend Mr Bloom's candour, it does sound a cautionary note in my mind that his estimate would have not been any different had he first considered the guidelines in the practice note. I did not have the benefit from him of particulars as to the nature and extent of the reconsideration, however abbreviated in the circumstances, that led to his adoption of the inherently imprecise formulation of no "significant" difference. 48 This aside, my confidence in the weight to afford Mr Bloom's opinions was not assisted by a patent misconception on his part in his report of 2 March 2011 (Letter to AAR of that date), described below, in relation to the range of fees for counsel specified in this Court's National Guide to Counsel's Fees (National Guide) published from time to time. 49 The National Guide gives as alternatives a daily rate range and a fee on brief range for both junior and senior counsel. In the National Guide effective from 4 January 2010 the alternative ranges are specified thus: Applications/Appeals Junior Counsel Senior Counsel Fee on Brief (including: preparation at discretion of taxing officer and appearance on the first day of hearing) $1,200 – 4,800 $1,950 - $7,200 OR Appearance at hearing (daily rate including conference) $850-3,950 $1,950-6,000 Interlocutory Applications Motion/Interlocutory hearing $350 - 2,000 $400 – 3,000 - short (up to 2 hours) $650 - 3,900 $800 – 6,0000 - long (2 hrs plus) Other Hourly rate for: $250 – 500 $400 – 700 Directions hearing Preparation time Conferences (not occurring on day of hearing) Settling applications, statements of claim, affidavits, defence, other documents Written submissions (where not allowed above) Attending to receive judgment (where appropriate) Not otherwise provided for 50 The following guidance is given in the notes which are appended by the Registrar in respect of the fee ranges in the National Guide: The following guide may be applied by taxing officers of the Federal Court when making an estimate pursuant to Order 62 rule 46 of the Federal Court Rules or upon taxation of a party and party Bill of Costs. In many cases the range of fees in this guide will bear no relationship to the amounts that members of the Bar actually charge as a fee on an hourly rate. Where, for example, by reason of the number, difficulty and/or complexity of the questions of law or fact involved, the time required for preparation for the hearing is substantially extended beyond what might be regarded as "average", a taxing officer may determine that a fee at or above the upper end of the range may be appropriate. In particular cases, the standing and experience of the counsel concerned may also be a relevant matter for consideration. Similarly, where the matter is not complex or difficult, a fee at or towards the lower end of the range may be appropriate. The amounts listed are not to be regarded as limiting the taxing officers' discretion to allow higher or lower fees if it is considered appropriate. The fees in the National Guide are not expressed to be inclusive of goods and services tax (GST). Given that the rate of GST is 10%, none of the fees in the range has the appearance of being GST inclusive. In these circumstances, it seems reasonable to assume that they are not GST inclusive. 51 This case amply bears out the wisdom of the Registrar's observation that, "In many cases the range of fees in this guide will bear no relationship to the amounts that members of the Bar actually charge as a fee on an hourly rate." 52 Burnett Water was represented at the trial by senior and junior counsel, respectively Mr Sofronoff QC and Mr Clothier. Mr Gore QC led Mr Clothier on one interlocutory application and led Mr Pomerenke on another, notably those in respect of the Conservation Council's statement of claim. On other interlocutory occasions, Mr Clothier appeared alone. 53 As "interpreted" by Mr Bloom, Mr Clothier's hourly rate was $500 per hour with his daily rate being $4,400. Unhelpfully, Mr Bloom does not state whether or not these rates are GST inclusive. He does record that the total of Mr Clothier's fees was approximately $275,000, "pre-GST" and that, while no rates are apparent in his fee notes, the rates just quoted have been "interpreted" from them. The daily rate of $4,400 has the appearance of a GST inclusive fee ($4,000 plus $400 being GST at 10%) but the $500 hourly rate does not. Using $500 per hour as a divisor yields a round figure of 8 hours if divided into a net of GST daily rate of $4,000. Especially given that particular result in hours, which is a daily fee based on at least an 8 hour day, it seems inherently likely that Mr Clothier's hourly rate of $500 as referred to by Mr Bloom is net of GST. 54 Mr Bloom further states that these rates prevailed over the whole of Mr Clothier's involvement, which was from at least late 2008 until the conclusion of the trial. Effectively, Mr Clothier was retained for the whole duration of the proceeding. 55 Mr Bloom observes of Mr Clothier's fees that they appear to be at the maximum end of the National Guide for the whole of the period when work was conducted. Inferring, as I consider it reasonable so to do, that Mr Clothier's GST-exclusive daily rate was $4,000, that observation understates matters. For the whole of the period of his retainer from 2008 until the conclusion of the trial, his daily rate exceeded that specified from time to time in the National Guide for trial or, as the case may be, even for "long" interlocutory applications. Further, his hourly rate for all but work undertaken on and from 4 January 2010 was in excess of that specified for junior counsel in the National Guide. 56 As to Mr Sofronoff, Mr Bloom observes that he, "was engaged relatively late in the matter from approximately July 2009 to trial". His overall fees are expressed by Mr Bloom to be approximately $450,000 pre-GST. Apparently, Mr Sofronoff's fee memoranda did specify a daily rate, which was $10,000. Mr Bloom states that his hourly rate "appears to be "$1,000". He then states, "It is obvious that the daily fee rate for this Senior Counsel exceeds the Guide maximum of $7,200 per day". That is something of an understatement. The National Guide maximum daily rate for senior counsel was not $7,200 per day but rather $6,000 per day, and then only on and from 4 January 2010. For the period from 1 January 2009 to 3 January 2010 the maximum daily rate was $5,830. The trial was conducted over the following days: 7 – 8 September 2009 9 November 2009 - 23 November 2009 1 February 2010 4 – 5 February 2010 As can be seen, most of the trial occurred prior to 4 January 2010. What Mr Bloom has regarded as the maximum daily rate in the National Guide is in fact the specified maximum where counsel's fees are rendered not on a daily rate basis but rather on a fee on brief basis. It is overtly evident in Mr Bloom's initial report that he is aware that the counsel's fees specified in the National Guide did vary from time to time. Nonetheless, he has assessed Mr Sofronoff's fees on a false premise as to their relationship with the maximum daily rate specified from time to time in the National Guide. It was false because what Mr Bloom looked to was not a specified daily rate at all but rather that applicable to the first day of appearance when fees are charged on the different, fee on brief basis. Mr Sofronoff's daily fee for the hearing greatly exceeded the applicable maximum daily rate from time to time specified in the National Guide. 57 The fee on brief (or brief fee) basis, as the associated, parenthetical note in the National Guide indicates, includes, "preparation at discretion of taxing officer and appearance on the first day of a hearing". Though it is hardly necessary to cite authority for the proposition, for it was, during all the years of my public and private legal practice, a matter of common knowledge and understanding both at the Bar and amongst solicitors that where counsel's fees are rendered on a fee on brief basis, the fee in respect of a subsequent day, termed a "refresher", is usually two-thirds of the fee on brief for the first day of trial, though a higher amount is allowable at the discretion of a taxing officer. As to authority for the proposition, see Quick R, Quick on Costs (Law Book Co, subscription service) (update 70) at para 8.1530 and the cases there cited. A fee on brief for the first day includes not only the appearance on the first day but also an allowance for pre-appearance preparation whether on that same day or beforehand. Again. A taxing officer has a discretion to allow more in respect of preparatory work than that implicit in the fee on brief for the first day of a trial. 58 A fair reading of that part of Mr Bloom's report concerning Mr Clothier's fees is that the same misunderstanding attends his assessment of that counsel's fees. 59 The same may be observed in respect of his assessment of the fees of the other senior counsel who appeared for Burnett Water, Mr Gore QC. His total fees are stated to be approximately $56,000, pre-GST. Although his daily and hourly rates were, seemingly, not specified in his fee memoranda, Mr Bloom calculated these to be $800 per hour and $8,000 per day for all work. Once again and unhelpfully, Mr Bloom does not make explicit whether or not these calculated daily and hourly rates are or are not GST inclusive. Given his earlier reference to a GST exclusive ("pre-GST") total one might perhaps infer that the calculated rates are exclusive of GST. Once again, given what one might expect to be the impact of an inclusion of GST at 10% on a total, each of the rates has the appearance of a GST exclusive amount (7 x $8,000 = $56,000). 60 In arriving at his opinion as to the amount which would be allowed in respect of this counsel's fees, Mr Bloom applied "the top rate" in the National Guide and "other discounts for work which may not be considered necessary and proper under the Rules". 61 Mr Gore's appearances were solely at interlocutory hearings during 2009. As to these and in respect of both senior and junior counsel, the National Guide, then as now, and in respect of both junior and senior counsel, specifies different ranges of rates for counsel to those specified in respect of appearances at trial with the applicable range depending on whether the hearing exceeded two hours (and thus was "short" or "long"). Mr Bloom does not make explicit in his report that he is even aware of the different range specification in the National Guide in respect of interlocutory appearances by counsel, let alone that it was the earlier version of that guide with its lesser range that served as a non-binding touchstone in respect of fees allowable for the appearances made by Mr Gore. Nor is it apparent whether or not he has considered whether the interlocutory appearances were "short" or "long". Even looking to the maximum specified in the National Guide in respect of a long appearance by senior counsel at an interlocutory hearing in 2009, Mr Gore's daily fee was well above the then specified maximum of $5,830. 62 Mr Bloom makes reference to work undertaken for Burnett Water by two other counsel, Mr Pomerenke and Mr Sheahan. Their fees totalled $15,000 and $2,000 respectively. Mr Bloom stated in his initial report that he had sighted Mr Sheahan's invoices but not those of Mr Pomerenke. Mr Pomerenke's memorandum of fees was though exhibited to Mr Bloom's addendum report of 11 March 2011. Regard to that fee memorandum discloses that the figure of $15,000 utilised by Mr Bloom is GST exclusive. 63 What work Mr Sheahan undertook is a mystery to me for, though Mr Bloom refers to having sighted his memorandum of fees, he does not give particulars of the work which that counsel undertook. He does though opine in his initial report that, of the fees of Mr Pomerenke ($15,000) and Mr Sheahan ($2,000), between $10,000 and $12,000 would be recovered on taxation. 64 Regard to the interlocutory judgments which I delivered discloses that Mr Pomerenke appeared with Mr Gore QC on 10 March 2009. Judgment in respect of a number of interlocutory controversies raised by notices of motion filed by each party and heard on 10 March 2009 was delivered by me on 18 March 2009: Wide Bay Conservation Council Inc v Burnett Water Pty Ltd (No 2) [2009] FCA 237. After hearing submissions from the parties as to the result of the resolution of those interlocutory controversies by that judgment I made the following orders that day in respect of costs: Costs of and incidental to the applicant's notice of motion filed on 2 March 2009 be the respondent's costs in the proceedings. Half of the costs of and incidental to the respondent's notice of motion filed on 2 March 2009 be the respondent's costs in the proceedings. Costs thrown away by the orders for the filing of an amended statement of claim and defence be the respondent's costs in the proceedings. 65 Mr Bloom was not initially made aware of the terms of this particular costs order in his instructions from AAR. This deficiency was, though, made good by a supplementary letter of instruction to which Mr Bloom has responded by way of his supplementary report of 11 March 2011, exhibited to his affidavit affirmed that day. The instructions received by him from AAR in respect of that appearance were to deduct 50% of professional costs that firm identified from its costs entries as related to the notice of motion of 2 March 2009 and to likewise deduct the sum of $15,677.50, which was identified by AAR as being 50% of counsels' fees (I infer the use of the plural means that this figure makes allowance for the fees of both Mr Gore QC and Mr Pomerenke). 66 Taking these instructions into account, Mr Bloom made a revised calculation, which he opined was a "conservative recovery", of Burnett Water's party and party costs based on Schedule 2 of the Federal Court Rules as follows: Category Estimated recoverable fees Professional Costs AAR Professional Costs $930,000 - $996,000 Outlays Sub-total $537,000 - $615,0000 Total $1,467,000 - $1,611,000 67 In the course of submissions in respect of the application for costs to be fixed in gross I pointed out Mr Bloom's misconception as between fee on brief and daily rate in the National Guide to counsel for Burnett Water, prior to granting the adjournment mentioned. In the result, Mr Bloom made in his supplementary affidavit a revised calculation, making allowance for this misunderstanding. He stated that, "if I were to prepare my report on the basis that only $6,000 per day was to be allowed for all Senior Counsel's fees, my revised lower bound global figure would be $1,409,000 instead of $1,467,000". 68 This statement was preceded with the accurate, though gratuitous and rather defensive observation that, "the National Guide does not limit the taxing officer's discretion to allow higher or lower fees if it is considered appropriate". It also evidences still a want of application of an apparent understanding that the daily rate fees applicable not only varied from time to time for the duration of the proceeding but also that there was no necessary equivalence between a fee in respect of an appearance at trial and that on interlocutory applications. 69 Mr Bloom's patent misconception of the difference in the National Guide in respect of fee on brief and daily rate for counsel and his failure in any event to assess by reference to the particular type of appearances means that, for these reasons alone and in respect of these outlays, I do not accept that his estimate is "conservative". There are other reasons why, approaching the fixing of costs in gross and on a party and party basis, I do not accept that his assessment of outlays in respect of counsel is "conservative". 70 More fundamentally, Mr Bloom has not considered whether a prudent person (qv Kroehn v Kroehn (1912) 15 CLR 137 at 141) would allow the retention of counsel on a daily rate basis at all, as opposed to a brief fee basis, with appropriate additional allowance for reading fees, ie additional preparation beyond that implicit in the brief fee and conferences. In my opinion, party and party taxation of a bill of costs by a registrar would require the posing of just such a question in respect of counsel's fees. When a judge is requested to fix costs in gross it is both appropriate and necessary, in my opinion, to approach the allowance of an outlay in respect of counsel's fees as part of the gross sum on a like basis. 71 Yet further, is not evident from either Mr Bloom's original or his addendum reports that he has expressly considered whether or not it was appropriate at all, on a party and party basis, to allow the costs of the appearances made on behalf of Burnett Water by senior counsel at various interlocutory stages of the proceeding. Insofar as he has overtly turned his mind to the allowance on a party and party basis of the retention of senior counsel at all, it appears from Mr Bloom's report that he has regarded allowance for senior counsel as appropriate on the basis that "on taxation, it would be arguable that because of the particular complexity of the matter, the maximum daily rate in the National Guide should be exceeded by 10%". Implicitly, Mr Bloom has proceeded on the basis that the costs of all appearances by senior counsel should be allowed. 72 In the written outline of submissions of Burnett Water in respect of the present application the following submission was made by counsel in relation to the proceeding: The proceedings did not raise any novel or important question of principle about the EPBC Act, its interpretation or operation. They were resolved by reference to the terms of condition 3 having regard to the evidence. There was no question of general importance involved. 73 This submission was advanced in relation to why it was that there was no occasion in the present case to depart from the usual position that a judicial exercise of the costs discretion would be for costs to follow the event. It is indeed one such reason. However, the description offered by Burnett Water has a wider resonance. With the benefit of my continuous association as docket judge with this proceeding over all of its interlocutory stages, as well as the trial, I regard the description in the submission as a singularly apt way of generally describing the proceeding. 74 At the heart of the case was a point of construction about the meaning of a condition of the Ministerial approval, condition 3. The construction of condition 3 was not without difficulty but that point was a short one nonetheless. This apart, the case was one which required the resolution of questions of fact flowing from whether, as properly construed, there had been a contravention of that condition. In endeavouring to prove its case, particularly in respect of the core issue of suitability of the fishway for the lungfish, the Conservation Council introduced or sought to introduce a considerable body of evidence, documentary, affidavit and oral, the relevance of some of which was at best marginal. At the trial, Burnett Water adopted what I considered to be the prudent course of making particular, targeted objections to evidence, eg to the evidence of Mr Tait, but otherwise leaving the question of what, if anything, to make of much of the documentary material introduced by the Conservation Council to closing submissions. This resulted, undoubtedly, in an efficient use of hearing time. 75 The way that the Conservation Council chose to conduct its evidentiary case necessarily meant that there was a great deal of factual material with which those acting for Burnett Water had to come to grips, even if only to appreciate the marginal relevance of some of it. Burnett Water's evidentiary case was necessarily responsive but much more focussed. As the principal judgment reveals, that response included the introduction of appropriately relevant expert evidence. Though there was but a short point of law involved, the extent of the factual case was such that I am of the view that this case was always one where, at trial, the retention of two counsel is not to be regarded as referable to over-caution or indulgence but would be reasonable to allow on a party and party taxation to which the provisions of O 62 r 19 would be applicable. Further, for these same reasons, the view just expressed extends to the retention of senior counsel as one of those two counsel. I accept therefore that, in fixing costs in gross, it would be appropriate to reflect allowance in the total sum fixed for an outlay in respect of the fees of senior and junior counsel at trial. 76 It follows that I do not differ from Mr Bloom to the extent that he has cast his estimate on the basis of an allowance for the retention of senior and junior counsel for the trial. It does not follow that I consider it reasonable, on a party and party basis, to allow the maximum daily rate in the National Guide for either senior or junior counsel at trial, as Mr Bloom has done, or even a daily rate at all, let alone so to do on a basis which included the possibility that an argument that the nature of the case was such that a taxing officer might allow an even more generous rate on a party and party basis, were the matter to proceed to taxation, had a reasonable prospect of success. That possibility is at odds with the description of the case put to me in the written submission and my own assessment of it. That description, notably, is not a feature of the instructions given to Mr Bloom by AAR for the purposes of preparing his reports. Yet further, I do not accept that a prudent person would have agreed to the retainer of counsel on the time charging basis explicit in a daily rate retainer. 77 I also do not accept that the costs of an appearance by both senior and junior counsel at any of the interlocutory applications would be allowed on a party and party taxation. The interlocutory applications concerned raised issues of practice and procedure in relation to pleadings and discovery, as my interlocutory judgments in Wide Bay Conservation Council Inc v Burnett Water Pty Ltd (No 2), supra and Wide Bay Conservation Council Inc v Burnett Water Pty Ltd (No 3) [2009] FCA 540 reveal. The issues raised were well within the realm of work reasonably undertaken by junior counsel alone. That is not to say that the appearances with a junior made on these occasions by Mr Gore QC as senior counsel for Burnett Water were anything other than skilful and helpful. Rather, it is but an allusion by me to the point made by Barwick CJ in the following passage in Stanley v Phillips (1966) 115 CLR 470 at 478 in which his Honour refers to earlier remarks by Griffith CJ in Kroehn v Kroehn (1912) 15 CLR. 137 at 141. The emphasis throughout is upon obtaining an adequate presentation to enable justice to be done: it is not upon the propriety of the steps taken by a litigant to ensure the maximum of success in his own cause. That of course he may do but not, in my opinion, at his opponent's expense. As the question is whether the presentation of a case to ensure a just determination reasonably requires the services of more than one counsel, it is the nature and circumstances of the case which provide the determinants. The matter cannot as a general rule be determined by reference to the court in which the proceedings are taken, though the position of that court in the hierarchy of a judicial system may well be such that only cases of a complicated nature are generally litigated before it. This Court in Kroehn v. Kroehn expressed a test for deciding whether the fees for two counsel should be allowed in a party and party taxation. The question propounded by Griffith C.J. when he says: "Would a prudent person not compelled by poverty come into Court in such a case without two counsel?" must be understood in relation to the basic matter in issue, which is the presentation of the case to ensure a just adjudication. The question is not whether a man in seeking his own maximum advantage would be imprudent not to engage counsel of a particular level of experience or skill. The question is whether the services of more than one counsel are reasonably necessary for the adequate presentation of the case. It does not follow that, because the application of such a test yields a conclusion that it was "necessary and proper" to retain the services of senior and junior counsel at trial, it was likewise "necessary and proper" at interlocutory stages involving points of practice and procedure to retain senior counsel as well as junior counsel. I am very firmly of the opinion that an "adequate presentation" of Burnett Water's position on these interlocutory applications did not require the appearance of senior counsel. Insofar as Mr Bloom's assessment proceeds on the basis that the retention of senior and junior counsel in respect of the interlocutory applications would be allowed on a party and party taxation, I reject that proposition. 78 It is important to emphasise that it does not follow from the observations which I have made that, on a solicitor and client basis taxation, the interlocutory appearance of senior counsel would not be allowed. Nor does it necessarily follow that the daily rates charged by either Mr Sofronoff QC, Mr Gore QC or, for that matter, Mr Clothier and Mr Pomerenke would not be allowed on a taxation conducted on that different basis. Mr Sofronoff and Mr Gore are each well experienced senior counsel. As Sir Garfield Barwick when Chief Justice once stated extra-judicially in respect of the prospect of an experienced counsel becoming overworked at the Bar, "[I]n the long run, there is only one way to protect yourself and that is, to raise the ante yet that does not always work": Evidence to Sir Henry Benson's UK Royal Commission on Legal Services, 1977, p 10, cited in D Marr, Barwick (George Allen & Unwin Australia, 1980) at p 96. Mr Sofronoff QC and Mr Gore QC may well be in that position. 79 Especially when regard is had to the National Guide as applicable from time to time, the fees charged to AAR by both senior and junior counsel in this matter have the appearance of what O 62 r 19(b) terms "special fees to counsel". If a client nonetheless pays that fee to secure that skill (or at least that reputed skill) the fee may well be allowed on a solicitor and client based taxation, subject to an over-arching question as to whether it is, in the sense found in New South Wales Bar Association v Evatt (1968) 117 CLR 177 at 182, so high as to amount to unprofessional conduct to seek a fee of that amount for that work. It is just that, approaching the question by reference to a party and party basis and with all due respect to Mr Bloom, I am not prepared to accept, given my particular knowledge of this case, that it was one in which the retention of senior counsel of Mr Sofronoff's experience was reasonably required for an adequate presentation and just determination of the issues at the trial. The same may be said in respect of junior counsel retained both in respect of trial and interlocutory appearance related work. That is in not to be taken as critical of Mr Clothier, who is an experienced junior or, for that matter, Mr Pomerenke, only of the rationale in Mr Bloom's report for adopting the maximum daily rate in the National Guide as a starting point for the estimation of the outlays in respect of junior and senior counsel in respect of an assessment cast on a party and party basis. 80 There is a further observation which I make as a matter of fairness to Mr Sofronoff QC, given the status of the entity for which he appeared and an office which he holds. Burnett Water is a wholly owned subsidiary of Sunwater, a government owned corporation. It is a matter of public record that Mr Sofronoff has held the office of Solicitor-General for Queensland since 2005. He holds that office pursuant to the Solicitor General Act 1985 (Qld). (Solicitor General Act) As such, he is entitled to be paid salary at a rate per annum that is 80% of the aggregate rate per annum of salary and allowance payable from time to time to a Puisne Judge of the Supreme Court (s 11) with additional leave, pension and severance entitlements (s 12 to s 15). With the approval of the Governor in Council first had and obtained, Queensland's Solicitor-General is entitled to engage in private practice subject, as one might expect, to giving priority to Crown work, to avoiding conflicts of interest and to certain other restrictions which are not presently material (s 16). 81 Burnett Water's status and functions are such that, under the Solicitor General Act, it would have been lawfully possible for the Queensland Attorney-General to request Mr Sofronoff to act for it in this proceeding in his capacity as Solicitor-General (s 8). Inferentially, given that Mr Sofronoff did not so appear, such a request by the Attorney was not made but the requisite private practice approval had been given in advance by the Governor in Council. If they adverted to the subject at all, whether or to make a request, with the resultant saving in fees that would entail, was a matter for the value judgment of the Queensland Attorney-General, in consultation with his Ministerial colleagues who, as shareholding Ministers, controlled Sunwater and its subsidiary, advised by Sunwater's General Counsel and AAR. 82 The absence of any such request does not mean that Burnett Water is not entitled to recover anything at all attributable to the outlay represented by Mr Sofronoff's fees. Further, even if Mr Sofronoff had been requested to appear in his capacity as Solicitor-General, that would not have prevented Burnett Water from recovering as part of its costs "a fee commensurate with that which would be allowable if the lawyer had been a private lawyer may be allowed despite the fact that the party is unable to vouch payment of the fee either by the signature of the lawyer or otherwise": O 62 r 1A. 83 I accept that it is "necessary and proper" to allow time for reading and preparation for counsel briefed for the trial. There was, as I have observed, a considerable body of factual material with which to come to grips. My own experience when re-visiting this material for the purposes of preparing after the trial a judgement necessarily reserved underscores this in my mind. It is inherently likely that, even if counsel had been retained on a fee on brief basis, the fee on brief for the first day of the trial would have been supplemented by the marking of a separate reading and preparation fee. 84 According to Mr Bloom's report, Mr Clothier's rendered fees in respect of the trial included 24 days of preparation at his daily rate and Mr Sofronoff, 27 days. Mr Bloom gives no indication as to what was actually entailed in this. Indeed, it seems that Mr Sofronoff's fee notes provide no indication as to what was entailed in pre-trial work by him other than "preparation". Once again, without much greater detail than Mr Bloom offers in his report and given my particular knowledge of this case, I am not be prepared, even accepting all that is entailed in an assessment of costs in gross, to regard preparation periods of this length as "necessary and proper" for an "adequate presentation". That is so even though, as I have stated, I accept that it would be "necessary and proper" to make some allowance for the likelihood that a reading and preparation fee would be allowed were the matter to go to taxation. I likewise accept that, in relation to preparation, some allowance for pre-trial conferences with witnesses ought to be regarded as "necessary and proper" for an "adequate presentation". 85 Mr Bloom has opined that it is likely that, on a party and party taxation, a taxing officer would allow between 14 and 16 days trial preparation for senior and junior counsel in this matter. Drawing on my experience of this case and otherwise, it is not unreasonable, having regard to what can be entailed in the preparation of a lengthy evidentiary case, particularly given the range of documentary material, to make allowance, when fixing costs in gross, for the payment to counsel of a special, pre-trial reading and related preparation fee. Making allowance for a fee based on a period of 14 day's length for "adequate presentation" strikes me as reasonable. Thus, as to the length of the period, I accept Mr Bloom's opinion. Again, it does not follow from this that I accept his view that this would be allowed as part of allowing for a retainer of counsel on a daily rate basis. 86 In respect of the preparation of closing written submissions, Mr Bloom has noted that there was "limited involvement" by Mr Sofronoff QC (as gleaned from his fee notes) with the bulk of the preparatory work being undertaken by Mr Clothier. It may readily be inferred from Mr Bloom's report that it is likely that Mr Sofronoff's involvement took the form of initial guidance in consultation with Mr Clothier and the later settling of his draft. Such division of labour as between senior and junior counsel is by no means unusual. Mr Bloom has made reference to Charlick Trading and to the allowance in that case in the fixing of costs in gross for 16 days preparation time in respect of closing submissions for what had been a 32 day trial. He has used that as a comparative so as to opine that it would be likely that 9 days preparation time would be allowed in respect of the drawing of closing written submissions by junior counsel. Charlick Trading was though a case which involved "complex and contentious issues of law and fact" (per Mansfield J at [5]). That is not this case, especially in relation to the issues of law involved. 87 I accept that it is necessary and proper in the circumstances of this case in respect of outlays for counsel to include an allowance for the preparation of written closing submissions. While it might be said that counsel ought to be ready, immediately at the close of evidence, to make oral submissions, the circumstances of this case were such that it was neither possible nor convenient for submissions then to be made in that fashion. I have no doubt that, had oral submissions alone been made by the parties, these would, without any misuse of court time and even for "adequate presentation", have taken longer than the period occupied in February 2010. The adoption of the combination of written and oral closing submissions undoubtedly saved hearing time. I accept therefore that allowance ought to be made in relation to counsel's fees for preparation of the written submission. However, even accepting, as I do, that the succinct distilling, for the purpose of the written submission, of the substance and comparative strengths and weaknesses of the respective evidentiary cases alone must necessarily have been a time consuming task, from what I know of this case and based on general experience, an allowance of a period for junior counsel of six days, to include consultations with senior counsel or conferences with solicitors, strikes me as sufficient for "adequate presentation" with a further 2 days being allowed for senior counsel. 88 Mr Bloom's approach so as to achieve what in his opinion was an amount likely to be allowed on a party and party taxation was to reduce the amount of Mr Clothier's time charged fees by 20%, given that they were at the maximum end of what he understood to be the range in the National Guide and then to allow for a reduction of at least a third in respect of preparation time. This yielded his range of $170,000 to $187,000. He adopted a similar process of reasoning in relation to his derivation of a range for Mr Sofronoff's fees. 89 As to Mr Sheahan and unlike Mr Bloom, I am not prepared to make any allowance in respect of an outlay for his fees because of the dearth of evidence which would allow determining whether such an outlay was reasonably necessary for an adequate presentation of Burnett Water's case. I have already indicated that I am not prepared to allow anything in respect of the retention of senior counsel (Mr Gore QC) on the interlocutory applications. 90 That an amount ought to be allowed in respect of the appearances of junior counsel at interlocutory stages and in respect of junior and senior counsel at trial is, even approaching the subject on a party and party basis, a given. The question though is whether it is reasonable on that basis to allow an amount in the range and on the basis put forward by Mr Bloom? 91 Taking Mr Clothier's actual gross fees, pre-GST, of $275,000 (approx) and his pre-GST daily rate of $4,000 I have derived an equivalent of 68.75 days involvement as counsel by way of appearance or other work. Of this, 16 days comprised appearance at trial, which included a necessary attendance by junior counsel at the view. A further 9 day period is referable, according to his fee notes, to preparation of closing written submissions. As already noted, that same source discloses that a further 24 day is referable to pre-trial "preparation". Mr Clothier also made some interlocutory appearances but the exact composition of the balance of 19.75 days is unclear. Inferentially, some of this must have been preparatory work in relation to interlocutory appearances. Further, in a case like this, it is inherently likely in a case that junior counsel had extensive involvement in the preparation of draft affidavits, which would include extensive conferences with witnesses, or, in some instances at least, the settling of the same as drawn by a solicitor. Such work must be regarded as a considerable task, even for "adequate presentation". What is not clear is whether the preparation period of 24 days included some or all of such work. 92 The 45 days charged by Mr Sofronoff QC, appears to comprise the following: pre-trial "preparation" – 27 days; appearance at trial (one day of which is referable to the view) – 16 days; settling written submissions, including related consultations and conferences – 2 days. 93 Quite what was entailed in Mr Pomerenke's preparation for the interlocutory practice and procedure application heard on 10 March so as to yield, in conjunction with an appearance fee, total fees, exclusive of GST, of $15,000 is a mystery on the face of Mr Bloom's report. A copy of his memorandum of fees does though disclose conferences with a solicitor from AAR, reading, preparation of an outline and consultation with Mr Gore QC. 94 The allowance, on a party and party taxation under O 62 of fees to counsel or solicitor's costs charged on a time charging basis is not forbidden by the Federal Court Rules. A taxing officer has a discretion as to whether to allow some or any costs so charged. A taxing officer may, for example, in respect of solicitor's costs, allow in lieu a fee specified in respect of an item in the Second Schedule together with some uplift in respect of care and consideration. In Charlick Trading, Mansfield J observed, at [17]: [The] assumption that all costs claimed on a time basis would be allowed on that basis, because the taxation officer has a discretion to do so, is one which I do not think should necessarily be adopted for the purposes of determining a gross sum for costs under O 62 r 4(2)(c). That assumption may be appropriate in some circumstances, but when analysis of the costs claim on a party and party basis for a sample period or periods (as done by Mr Cogan) indicates a significant overclaiming of costs on a party and party basis, I do not consider that the adoption of such an assumption is warranted. [Mr Cogan was one of the costs assessors who gave evidence in that case.] I respectfully agree with these observations. In contrast, Mr Bloom's assessment is premised on an uncritical assumption that, on a party and party taxation, a taxing officer would be disposed to exercise his or her discretion to allow costs on a time charging basis and that this assumption should carry over into the fixing of costs in gross. 95 Cautionary, if not deprecatory statements with respect to the practice of time charging by counsel and solicitors are both legion and not confined to the present generation of the judiciary. 96 In Magna Alloys & Research Pty Ltd v Coffee (No 2) [1982] VR 97 at 112 (Magna Alloys & Research Pty Ltd v Coffee (No 2)), Fullagar J stated: The time honoured basis of charging counsel's fees in respect of a court hearing remains the basis of a brief fee and refreshers of two-thirds of that fee, and prima facie this is the basis upon which counsel's fees will be taxed as between party and party. There must, in my opinion, be an onus upon the party who seeks a departure on taxation from that traditional and usual basis, and the onus must be one of satisfying the taxing officer that the traditional method of fee marking could not reasonably have been followed in all the circumstances of the case. … It might be perfectly reasonable for the solicitor to place himself and the lay client in the hands of counsel as to how long a preparation is in fact undertaken, but it is quite a different thing to say that the taxing master should allow against the other side on party and party taxation an amount arrived at by accepting, in addition to the propriety and correctness of the daily rate, the times said by counsel to have been worked by him as being (a) correct in fact and (b) necessary or proper to be worked. Even further removed from the customary checks and balances is the situation where, after the case is over, or after the pre-trial preparation is over or nearly over, counsel simply charges his "usual" daily fee multiplied by the time he says he has spent, without any agreement in advance by the solicitor. It is one thing to contend that counsel and the instructing solicitor may trust each other as gentlemen (as to which I say nothing because solicitors and counsel have their own respective rules of ethics), but it is in my opinion quite another thing to say that the litigant on the other side must be bound to pay on the footing that the aggregate charged was necessary or proper to be incurred. A decade later, in Lumley Life Limited v IOOF of Victoria Friendly Society (unreported, Lockhart J, 23 April 1992) (Lumley Life Limited v IOOF of Victoria Friendly Society), Lockhart J, without commending on the practice, referred to a "modern tendency" for counsel to charge fees on a daily rate basis for both appearance and preparation work, although he allowed that it was within the discretion of a taxing officer to tax a bill on a fee on brief basis in respect of counsel's fees. 97 In 1985, Sir Harry Gibbs, when giving, as Chief Justice, his speech, "The State of the Australian Judicature" (1985) 59 ALJ 522 at 526 observed: Where undue cost is caused simply by the unnecessary length of litigation, greater efficiency will provide the remedy… I have the impression that in some cases the fees charged by counsel – particularly by those who are not the most eminent – are disproportionately high. The practice of some counsel of charging for the time spent in preparation would seem to put a premium on that inefficiency. 98 In respect of counsel's fees rendered on a time charging basis the High Court's then Principal Registrar, Mr F Jones, had occasion shortly thereafter to consider that practice when taxing a bill of costs in respect of an appeal to that court: Commissioner of Taxation v Gulland in "Registrar lays down restrictive tests for taxing costs" (1985) 160 CLR 55; [1986] 7 Leg Rep 1 (Gulland). It is evident from his reasons that Registrar Jones shared with his Chief Justice a concern in relation to the premium on inefficiency which can attend time charging. He made the following observations: I do not accept the submission on behalf of the applicants that the time cost method of assessing as the most accurate method of ascertaining the work done by counsel in preparing an appeal to the High Court. Charging by time, in my opinion, favours the inexperienced counsel [over the experienced counsel] who is familiar with the principles involved in the matter and accordingly can prepare it in less time and at less cost to the client and the unsuccessful party. (at p 2) Rejecting the submission that, as a matter of discretion, fees rendered by counsel on a time charging basis should be allowed, he declined to depart from the traditional position of allowing only a fee on brief, refreshers where appropriate and such conferences which were necessary or proper in the circumstances of the case. He stated (at p 3), "No prudent man would have approved the time cost method of charging; he would have expected counsel to have charged a brief fee appropriate to the nature of the case". The registrar also discussed the nature of brief fees on page 3: "As a general rule, the brief fee contains an element of preparation and traditionally this has included a substantial part of the day before the hearing. For additional preparation fees to be allowed, a matter … must involve matters of great complexity or voluminous documentation". In the circumstances of that case the registrar allowed an amount equivalent to a refresher account for additional preparation time. The registrar was also prepared to allow such conferences with solicitors as were necessary and proper in the circumstances of the particular case. 99 Gulland, it might be recalled, was one of a trilogy of cases which marked the last of the cases in the High court concerning the operation and application of the former s 260 of the Income Tax Assessment Act 1936 (Cth), once that Act's principal, general anti-avoidance provision. The bill of costs concerned did not, of course, relate to a trial, but the legal issues in that case were markedly more complex than those in the present. 100 Even if one compares the pre-trial preparation period which commended itself to Mr Bloom as likely to be allowed on a party and party basis (14 to 16 days) with the periods of preparation which actually appear in counsel's fee notes the difference is stark. Of course that is a difference between a period which is regarded by him as reasonable to allow on a party and party taxation and one which might perhaps be allowed on a solicitor and client based taxation but, even allowing for that, the difference remains stark. In my respectful opinion, that difference is one way of highlighting why no prudent person would agree to an open-ended time charging arrangement in respect of counsel's fees. Seemingly though, that is what occurred in the present case. 101 More than a quarter century may have passed since Fullagar J in Magna Alloys & Research Pty Ltd v Coffee (No 2) and Registrar Jones in Gulland voiced the above sentiments in respect of time charged counsel's fees and applied in lieu the "time honoured" fee on brief approach when taxing a bill of costs but they remain relevant to this day; indeed even more so for the practice is, if anything, more pervasive in the legal profession than then, much and more than the "modern tendency" noted by Lockhart J in 1992 in Lumley Life Limited v IOOF of Victoria Friendly Society. These days, so prevalent is the practice that those who have commenced a legal professional career as a solicitor and later come to practise at the Bar may have encountered no other method of charging for professional services than time charging. The adoption as counsel of such a method for the rendering of fees will in such circumstances seem only natural. 102 The legal fees charged by Burnett Water's solicitor, AAR, also proceeded from a time charging foundation. Where that is the foundation for the rendering of fee accounts by a solicitor there is a risk that any failing in the adoption of or imprudence in agreeing to a like method of charging by retained counsel will not be self evident to the instructing solicitor. To highlight such a failing to a client in respect of such a basis for counsel's fees would very likely raise a similar interrogative note in relation to a like method of charging by the solicitor. Further, it does not follow that the only vice in time charging by counsel may be a favouring of the inexperienced counsel over the experienced. At times, the very thoroughness with which an experienced counsel may prepare for an appearance, with experience giving insight into potential issues that may escape the inexperienced, may lead to a greater preparation time than necessary for "adequate presentation". 103 While I accept that there exists a discretion to allow time charging, I decline, when making allowance for counsel's fees in the fixing of costs in gross in this matter, to approach the allowance of counsel's fees for trial or interlocutory applications on such a basis. I regard Mr Bloom's approach as flawed in that he has not adverted to whether or not it is appropriate at all, in respect of counsel's fees, to allow costs on a time charging basis. 104 Instead, in fixing costs in gross, I propose to allow a sum referable to counsel's fees on a fee on brief basis, as did Registrar Jones. I do not accept that, for "adequate presentation" of Burnett Water's case, the nature of the case warranted the payment of any special fee on brief to counsel beyond the range in the National Guide or even a fee at the maximum end of that range. Instead, looking to the range in that guide as applicable during the bulk of the trial period and to the nature of the case, the fees which I derive for trial are as follows: Senior counsel – fee on brief for trial - $6,000 (refresher $4,000) Junior counsel – fee on brief for trial - $4,000 (refresher $2600). In each instance, such a fee on brief is towards the upper end of that range. I consider that appropriate because of the volume of evidentiary material in the case. While it no longer necessarily follows that a junior counsel's fee must be two third's of that of senior counsel or, conversely, that a senior counsel's fee be half as much again as that of junior counsel, it does, in the circumstances of this case seem to me to be an appropriate relativity for "adequate presentation" of the respondent's case. 105 In addition, and for reasons given above, it also seems to me reasonable to make allowance for the payment of an additionally marked reading, preparation and conference fee beyond that implicit in the fee on brief for the first day of hearing. Such a fee would also include pre-trial conferences with witnesses. The allowance of such a fee on a "refresher" rate basis would not be unreasonable. Further and again for reasons given above, a reasonable period by reference to which to calculate such a fee would be 14 days. Similarly, I make allowance for a preparation fee in respect of written closing submissions on a refresher basis for a period of 6 days for junior counsel and 2 days for senior counsel, which sum is inclusive of all related consolations and conferences. 106 On this basis the amount which I allow in respect of senior counsel is as follows: Fee on brief on trial - $6,000. Refreshers on trial – 15 days at $4,000 = $60,000. Pre-trial preparation (reading, consultations and conferences etc) – 14 days at $4,000 = $56,000. Settling of closing written submissions and related consultations and conferences – 2 days at $4,000 = $8,000. Appearance on application for fixing costs in gross – no fee in respect of senior counsel allowed as the nature of the application did not, in my opinion, require the retention of two counsel for "adequate presentation". Total = $130,000. 107 I turn to the amount to include referable to the retainer of Mr Clothier. As mentioned, the composition of the balance of 19.75 days one derives from an analysis of what is mentioned by Mr Bloom of his fee notes is unclear. What is certain is that this balance must have included his appearance on two lengthy interlocutory applications, one on 18 December 2008 and another on 15 May 2009. It is also likely that he appeared at brief, interlocutory directions hearings on other dates although that is not explicit in the evidence before me and not otherwise able to be confirmed without a time consuming search through archived judges' and associates' notebooks. It is inherently likely that junior counsel undertook advice work and work in the drawing or settling of affidavits used at trial, but quite when it was undertaken is unclear. It would though be unjust not to make some allowance in respect of such work when making allowance for junior counsel's fees. 108 I further propose to allow the following: Fee on brief to appear on long interlocutory application (December 2008) - $2,600 Fee on brief to appear on long interlocutory application (March 2009) - $2,600. Recalling the nature of these applications, I propose to allow an additional, pre-hearing preparation fee on each occasion on a refresher basis, in total $3466 (2 x $1733), which would include any work in settling affidavits read on those applications. In addition, so as to do justice notwithstanding a paucity of information and so as to cover further, earlier tasks such as short interlocutory appearances, advices in conference or otherwise and preparation of affidavits used at trial and not already covered by the pre-trial preparation fee, work performed or inherently likely to have been performed by Mr Clothier as junior counsel, I feel compelled to allow a further period equivalent to 10 days of at least 8 hours at an hourly rate of $300 per hour, in all $24,000 (10 x 8 x $300). In so doing, I have noted that the National Guide does admit of the allowance of an hourly rate for counsel in respect of the performance of such tasks. In fixing that hourly rate, I have chosen a rate within the range specified at the time which seemed reasonable for "adequate presentation". To this limited extent I have reluctantly adopted time charging, if only to make explicit the composition of this further, global sum. Given the nature of the case, it seems to me the figure so derived is inherently likely, on a party and party basis, to be conservative and thus not unjust to visit upon the Conservation Council as part of an assessment of costs in gross. To give some recognition for a difference between party and party and indemnity costs in respect of involvement by junior counsel in the preparation of Mr Boettcher's affidavit, I allow a further $1,600 (based on a $200 per hour differential for 8 hours). In addition, a further sum should be allowed in respect of an appearance by junior counsel on the application for fixing of costs in gross, which was a "long" application. The rate in the National Guide has increased a little since the trial. I take that into account, in allowing a slightly increased fee on brief ($2750) in respect of this most recent appearance. 109 The amount allowed in respect of the retention of Mr Clothier thus comprises: Fee on brief on trial - $4,000. Refreshers on trial – 15 days at $2,600 = $39,000. Pre-trial preparation (reading, consultations and conferences etc) – 14 days at $2,600 = $36,400. Fee on brief in respect of two long interlocutory applications – 2 x $2,600 = $5,200. Refreshers for the same – 2 x $1,733 = $3,466. Other interlocutory appearance and other work – $24,000. Indemnity costs differential - $1,600. Settling of closing written submissions and related consultations and conferences – 6 days at $2,600 = $15,600. Appearance on application for fixing costs in gross – $2,750. Total = $132,016. 110 Mr Pomerenke, too, has been retained on a time charging basis. Given that he was retained at a time after Mr Clothier had already made at least one interlocutory appearance, it may be inferred that some at least of the preparatory work which he undertook involved his reading in to the case, including in relation to events which had already occurred in court. Necessarily, some of this preparatory work must have duplicated work already undertaken by Mr Clothier. This aside, the length of time devoted to preparatory work does seem to me to have been more than necessary for an "adequate presentation" of Burnett Water's position in respect of the interlocutory applications heard on 10 March 2010. In making allowance for an outlay in respect of junior counsel's fees in respect of appearance and related work undertaken by Mr Pomerenke, I have allowed $2,400 for an appearance on a "long" matter. by a junior counsel more junior than Mr Clothier. I further allowed, on a refresher basis, a pre-hearing preparation fee ($1,600) to cover preparation of an outline, advice in conference and the settling of any affidavit read on the application on the basis that this would be reasonably additionally necessary for adequate presentation. I would also allow $300 in respect of an attendance to receive judgment. This totals $4,300. In coming to this amount, I have taken into account the then applicable National Guide and my knowledge of the case. Having regard to the costs order which I made in respect of the application determined on 18 March 2009, I have then reduced this by half so as to derive an amount of $2,150. 111 The impact of the foregoing is summarised in the table below, which incorporates, for comparative purposes, the amounts originally allowed by Mr Bloom, prior to his later adjustments, noted above: Counsel Mr Bloom's original assessment Allowance in assessment in gross Mr Gore QC $40,000 to $48,0000 Nil Mr Clothier $170,000 to $187,000 $130,000 Mr Sofronoff QC $250,000 to $290,000 $132,016 Other counsel (Mr Pomerenke and Mr Sheahan) $10,000 to $12,000 $2,150 Total (Nil in respect of Mr Sheahan) $264,166 112 I have made allowance for these fees on the basis that they are exclusive of GST, as I apprehend does the National Guide. 113 It is desirable, albeit repetitious, to emphasise that it does not follow from the conclusions I have reached as to the amount to include by way of allowance for counsel's fees that the fees actually charged by any of the counsel retained would not be allowed on a taxation conducted on a solicitor and client basis. 114 As for other outlays, Mr Bloom has allowed the following: Expert reports - $20,000 to $25,000, based on outlays of $25,000 as evidenced in AAR's disbursement ledger. Mr Bloom adverts to having had "little details as to the content and import of those expert reports and/or of the oral evidence provided by these experts". In contrast, I have had the benefit as trial judge of ample details. Mr Bloom did review the various invoices and hourly rates of the experts and, drawing on his experience of costs assessments in respect of outlays in respect of the evidence of professional persons, regarded the amount of these outlays as reasonable. I see no reason to doubt this aspect of his assessment. The experts called by Burnett Water were eminent and when one allows for report preparation, consideration of affidavits, related conferences and attendances to give oral evidence, Mr Bloom's range strikes me as inherently reasonable to allow, even approaching matters on a party and party basis. I include $25,000 by way of allowance for outlays for expert reports. Travel expenses - $20,000 (approx) as evidenced in AAR's disbursement ledger. Mr Bloom records that these relate to travel by witnesses to and from Brisbane and also to travel to at least site inspections by senior and junior counsel, "during the trial". There was but one view of the dam site conducted in the course of the trial. That was, undoubtedly, necessary, even for "adequate presentation" of Burnett Water's case. It seems inherently likely that there were two visits by counsel to the dam site with the initial one by way of "reconnaissance". Each seemed well familiar at the time of the view with its features and those of the fishway. I suspect that what Mr Bloom is terming a second visit during the trial might more accurately be described as a pre-trial visit. Mr Bloom again looked to Charlick Trading in expressing an opinion that about 75% of this head of outlay would be allowed. Though Charlick Trading is not, in my opinion, a case applicable by analogy, it does seem reasonable in principle, even on the broad approach entailed in fixing costs in gross, to recognise that not all of this type of outlay might be allowed on a party and party taxation. On this basis, which coincidentally corresponds with an amount Mr Bloom would allow, I allow $15,000. Transcript fees - $25,000 as evidenced in AAR's disbursement ledger. Mr Bloom has opined that this outlay would be likely to be allowed in full. I agree. In a case like the present, the obtaining of transcript was reasonably necessary for adequate presentation of Burnett Water's case. Photocopying/Document Preparation – Mr Bloom notes that, "modest commercial rates were negotiated, rather than sometimes high internal firm copy rates". Apparently some 250,000 pages were copied during the course of the proceeding for Burnett Water at a total cost of about $30,000. I well remember the volume of affidavits, related exhibits and documentary exhibits. Further, as I have observed, Burnett Water's case had a necessarily reactive quality to a case in which the Conservation Council introduced or sought to introduce much material that at best had but tangential relevance. Mr Bloom also notes that electronic means were employed by those acting on behalf of Burnett Water so as to reduce some of the volume of photocopying. Once again, he has looked to Charlick Trading as offering precedent support for a 20% reduction when approaching the task of fixing party and party costs in gross. I accept that it is likely that there would be some reduction on a taxation in respect of this head of outlays on the basis that some such costs might be nonetheless be regarded as "unusual" or referable to "over caution" – O16 r 19. Coincidentally, I would allow $24,000 so as to recognise this contingency (Mr Bloom's range is $20,000 to $25,000). Court fees – Mr Bloom seems not to have been instructed by AAR that fees are payable in this Court in respect of the filing and hearing of an interlocutory notice of motion and that Burnett Water paid such fees; nor does he otherwise seem to be aware that such fees are payable in this Court, for his report makes no reference to them. The court record discloses that Burnett Water paid the following fees in respect of such notices of motion: Filing Date Filing Fee Paid 3 December 2008 $ 577.00 2 March 2009 $ 577.00 28 April 2009 $ 577.00 TOTAL $ 1731.00 On these occasions, costs were either reserved (3 December 2008) or awarded in favour of Burnett Water. Burnett Water filed a further notice of motion on 3 September 2009 but on that occasion costs were awarded to the Conservation Council on an indemnity basis. The application made on 3 December did not succeed. It is not appropriate to allow the related filing outlay, even though an appearance on the day for a directions hearing was always going to be necessary. The order made in relation to the notice of motion filed on 2 March warrants allowing Burnett Water half of its filing fee outlay. On this basis, a further $865.50 should be allowed to Burnett Water in respect of filing fees outlaid. 115 I turn to the subject of solicitor's professional fees. 116 Mr Bloom records in his report that "The AAR WIP [work in progress, I infer] ledger discloses total rendered professional fees of approximately $1.725 million. Those fees are derived from a range of fee earners incurred for the period approximately 2008 to 2010." The ledger discloses that fees were charged on a time charging basis. 117 Mr Bloom received instructions from AAR to delete from these fees the sum of $199,150 on the basis that the related work concerned the provision of discovery in respect of particular allegations made but later withdrawn by the Conservation Council but in respect of which the parties had agreed that Burnett Water would bear its own costs. In percentage terms, Mr Bloom calculates this to be a reduction of 11.53% from the total of the fees rendered as between solicitor and client. Mr Bloom then applied the following methodology and reasoning so as to derive the estimate in his initial report as to the range likely to be allowed in respect of solicitor's fees were the matter to proceed to taxation namely, $935,000 to $1,001,700: 2. Rather than endeavour to apply each of the numerous items provided in [the Schedule 2] Scale, which would have been an almost impossible task in the absence of the AAR files and also complicated by lump sum time entries occurring in the AAR time ledger, our global approach was instead to mainly apply hourly rates to all of the professional work undertaken in the matter. In our opinion, this has the effect of averaging out both the undercharging or overcharging effects that the Scale may have upon the firm's actual recorded time. Taking a conservative approach to those Scale amounts for the entire period October 2008 to February 2010, we have adopted the following rates (allowing for Scale changes): a) Examining - $160.00 p/h, $176.00 p/h, and $182.00 p/h. b) Attendances by solicitor - $260.00 p/h, $288.00 p/h, and $296.00 p/h. c) Disclosure preparation - $60.00 p/h throughout. c) Several other items for correspondence, telephone attendances, perusals, drawing and engrossing, and some photocopying were claimed at the applicable rates put in the Federal Court Scale from time to time. 3. For a number of time entries where the item description in the AAR ledger contained a range of tasks performed on a particular day, we endeavoured to separate and distinguish those tasks and estimate the rates and scale items to be applied to those tasks. In other others, some lump sum hours in the ledgers were converted by us to a combination of examination or attendance hourly rates, as well as a combination of Scale items for drawing and producing a document or for skilled telephone attendances. Whilst we concede that much of this was based on mere estimate, we believe it was more effective and accurate than simply converting every hourly AAR attendance to the Scale hourly rates. We were therefore endeavouring to distinguish the range of tasks contained in many of those lump sum descriptions to provide a realistic conversion to a party / partly figure. It is also worth noting that the professional work was undertaken over a relatively compact period of just over a year from filing the claim to trial. The AAR ledgers reflect the intensity of work often required in complex litigation conducted over a short period. Calculations 1. Noting your instruction letter of 22 February 2011, an amount of $199,150.00 is to be deducted from your base professional costs of $1,725,868.00. This represents a reduction of 11.539%. As we had already converted your base WIP fees to the Federal Court Scale, it was appropriate to reduce our base assessed fees of $1,258,220.17 by that same percentage. 2. As outline in point 2 of the Methodology described above, our first task was to exclude work that appeared to us to be of a solicitor / client nature, and therefore unlikely to be included in a drawn party / party Bill of Costs for taxation. Having applied that criteria and applied Scale rates to the entirety of the AAR time ledger, we estimate your firm's professional base costs in the sum of $1,258,220.17, reduced by the 11.539% referred to above, resulting in the base costs of $1,113,000.00 (rounded). 3. The next task was to allow for a further reduction of that party / party Bill of Costs assuming the matter proceeds to formal taxation. This represents an additional conservative reduction from the AAR base costs as well as that in point 2 above. Although taxations of large Bills of Costs are rare in the Brisbane Registry of the Federal Court of Australia, in our experience on such taxations, a likely reduction from the Bill of Costs as filed would be in the range of 25% - 30%. Having closely scrutinised many of the attendances described in your firm's time ledgers, we would expect a global reduction in the range of 25% - 30% from that base amount of $1,113,000.00, which results in a reduction of between $278,250.00 - $333,900.00. Such percentages are also consistent with the reductions applied in the few authorities concerning the fixing of party / party costs in this Court, and reflect a conservative view of the Respondent's costs recovery on formal taxation. 4. Such reduction is intended to broadly discount areas of work arguably vulnerable to objections / and disallowance on taxation and as contemplated by Order 62 Rule 19. Typical examples of vulnerable work include internal conferences; the number of lawyers working on the matter or at trial; self-education and / or excessive research; and the number of hours undertaken examining documents. This is not to be critical of the manner in which the firm conducted the litigation, but rather to reflect the generally conservative approach taken on formal taxations from our experience, and the expectation of vigorous objections to any Bill of Costs. 5. To that revised base range of $779,000.00 - $834,750.00 professional costs, we would apply a care and conduct amount of 20% on the basis of the complexity of the evidence and the length of the trial. Whilst such a percentage is at the maximum end of the range as guided by the Federal Court Senior Registrar, nevertheless, we believe this is one such matter where the maximum should be applied, and may even be exceeded on taxation. The addition of care and conduct results in a base of professional costs in the range of $935,000.00 - $1,001,700.00 (rounded). 118 A copy of the AAR WIP ledger, from which items referable to work where Burnett Water had agreed to bear its own costs or was otherwise not pursuing the recovery of costs on a party and party basis was deleted by masking, was exhibited to Mr Bloom's initial affidavit. I have perused that copy of the ledger in that form. My perusal of the entries in this ledger disclosed an ample foundation for what Mr Bloom has termed, in the context of discussing time charging, work vulnerable to disallowance or objection in the event of taxation on a party and party basis by reference to O 62 r 19. The impression which I gained was that there were numerous "typical examples of vulnerable work" in AAR's WIP ledger. The entries in the ledger in respect of activities within AAR on one day, 10 November 2009, in the course of the resumption of the trial give a fair impression of the involvement of numerous personnel from that firm in "preparation" and attendance at the trial: Transaction Date Billed Billed Operative Name Operative Rank Narrative Amt Hrs 10/11/09 211.29 0.6 Westgate, Suzanne Senior Associate Telephone call with I Stuart; telephone calls with C Broadfoot; correspondence regarding witnesses; meeting with T Elliss regarding witnesses and timetable 10/11/09 20.20 0.1 Bowyer, Joanne Legal Technology Projects Document Management – Instructions and Management 10/11/09 393.22 1.7 Kelaher, Mark Legal Technology Technical Document Management – Database Administration 10/11/09 331.76 1.4 Vidot, Jean-Marc Lawyer 2+ Years Researching for preparation for cross examination of J Tait; discussing with B McCredie; arranging for transcripts to be delivered to Court 10/11/09 5,735.97 14.5 Ilott, Michael Partner Preparation and attendance at Day 2 of the trial; attending witness conference with I Stuart; discussions with A Berghuis and C Broadfoot; reviewing all of the documents proposed to be tendered through I Stuart; A Berghuis and C Broadfoot; emails to SunWater; discussions with W Sofronoff QC regarding order of Burnett Water witnesses; conferring with T Elliss 10/11/09 3,521.55 10.0 Morrison, Robyn Special Counsel Preparing for and attending Court 10/11/09 1,859.24 4.7 McCredie, Bill Partner Reviewing emails, document list from WBBCC; discussing further witnesses and relevant documents with T Elliss; attending court; preparing for Court; discussing cross examination with J-M Vidot 10/11/09 1,538.28 7.8 Elliss, Tim Lawyer 2+ Years Reviewing Kreutz evidence; email to M Ilott; telephone call to R Hunt; preparing for trial; attending trial before Logan J; conferring with S Westgate; conferring with M Ilott; telephone call from M Ilott; telephone call to Auscript 10/11/09 518.32 3.0 Finn, Benjamin Legal Technology Technical Document Management – Trial Collection and Delivery 10/11/09 368.58 3.2 Gelic, Goran Lawyer 0-2 Years Document Management – Trial Collection and Delivery 10/11/09 105.63 0.3 Westgate, Suzanne Senior Associate Drafting updated witness schedule; correspondent to R Morrison 119 I have already referred, in the content of counsel's fees, to extra-judicial observations made a generation ago by Sir Harry Gibbs and to the statements made in cases by Fullagar J and Registrar Jones. These statements concerned time charging by counsel but there are many observations in respect of the practice of time charging by lawyers generally. The following might be noted. 120 In New South Wales Crime Commission v Fleming (1991) 24 NSWLR 116 at 126, Gleeson CJ, with whom Hope AJA agreed, referring to an order which provided solicitor's costs "for preparation, instructing [and] acting" at a specified hourly rate, made by way of exception to a proceeds of crime restraining order, stated: The order pays no regard to the kind of activity involved in "preparation" or "acting", or the seniority or experience of the particular solicitor doing the work. If, for example, the "preparation" involved looking up a point of law, a solicitor who knew where to look would be paid less than a solicitor who was less knowledgeable or efficient. An inexperienced solicitor might well charge much more than an experienced solicitor. It is true, as was noted earlier, that it would still be open to a taxing officer to treat particular time as having been spent unnecessarily, and therefore not reasonably chargeable to the client, assuming, of course, that the officer had the requisite information. Even so, to allow a simple, flat, hourly rate as the basis for charging for anything, of whatever character, done by any solicitor of whatever seniority and experience in relation to the matter, is difficult to justify. Also in 1991, in Singleton v Macquarie Broadcasting Holdings Ltd (1991) 24 NSWLR 103 at 109, Rogers CJ Comm D observed in respect of time charging: However, quite apart from any other feature, time cost charges may have conspicuous elements of unfairness. Most obviously it rewards the inefficient and the incompetent. The same item of work may quite obviously take half an hour in the hands of a highly skilled practitioner and two hours in the hands of someone of considerably lesser ability. To some extent of course, this will be compensated for by the fact that the charge out rate for the less skilled is likely to be much lower than for the highly skilled practitioner. However this is not necessarily so, and, in any event, the lower charge out rate may not sufficiently compensate for the greater amount of time occupied. As well, time cost charging loses the incentive to avoid unnecessary work or inefficient practices. Most importantly it does not discriminate according to whether the practitioner is engaged in the highly skilled task of preparing a statement of evidence, or the more mundane task of making a telephone report to the client of what may have passed in court fixing the date for hearing. There is nothing in a time cost agreement which provides a discrimen between the two situations and this may argue for the proposition that such an agreement is so unfair, or unreasonable, that the court ought not to give effect to it. 121 Locally, in Re Morris Fletcher & Cross' Bill of Costs [1997] 2 Qd R 228 at 239, Fryberg J stated to similar effect, in respect of a time charged bill of costs: There is also the potential for the inefficient use of time to be charged. Not only is that inherent in the system of time charging, but also it can be seen from paragraph 3 on page 2 of ex. 4. That exhibit was a document which was said to be a policy document of the solicitors in force at some time after the events in question. It is relevant, however, because it demonstrates the nature of the charging system and the inherent risk of error in it. 122 Similarly in this Court, in Auspine, O'Loughlin J stated at [40]: "Time charging", if not properly controlled, can favour incompetence in some, excessive caution in others. Time costing on the other hand, can penalise efficiency, knowledge and brilliance unless adequate compensation is implemented through an item of costing such as general care and conduct. 123 Contemporary extra-judicial observations by senior judicial officers in respect of the practice of time charging are to similar effect. For example: Chief Justice Gleeson (as Chief Justice of the High Court of Australia gave a speech, "Commentary on Paper by Lord Browne-Wilkinson" (http://www.hcourt.gov.au/ assets/publications/speeches/former_justices/gleesoncj/cj-cj2.htm) view 9 March 2011 on 11 September 1998 at page 6 where he commented on time charging: Charging for professional legal services on the basis of the time taken to render those services rewards delay, inefficiency, and slow thinking. Time costing is an appropriate mechanism, in-house, for checking upon the efficiency of a lawyer's operations. It is not, I believe, an appropriate basis for charging for professional services…Time charging is of particular significance in a process, such as litigation, which is a good example of Parkinson's Law! Work expands to fill the available time. When people are being paid on the basis of time spent, why wouldn't it? Chief Justice Spigelman, as he then was, in his address at the Opening of the Law Term Dinner 2004 (http://www.lawlink.nsw.gov.au/lawlink/supreme_court/ll_sc.nsf/ pages/SCO_speech_020204) viewed 8 March 2011 stated at page 5: One thing that has occurred over that period of ten years is that time based charging has become almost universal. I do not believe this is sustainable... It is difficult to justify a system in which inefficiency is rewarded with higher remuneration. The difficulty of course is that the person providing the service, namely the legal practitioner, does not have a financial incentive to do the service as quickly as possible. Justice Kirby in his speech "Legal Professional Ethics in Times of Change" (1998) 72 ALRC Reform 5, his Honour said at page 7: Hourly billing rewards inefficiency: the work of lawyer A, who spends 100 hours preparing a motion for summary judgment, costs the client 100 times the billing rate; the work of lawyer B whom it takes 200 hours to do the same work costs the client twice as much for the same service...The system of billable hours can reward the slow-witted lawyer. It can penalise the experienced, wise and efficient. In his address to the Perth Press Club, Chief Justice Martin of the Supreme Court of Western Australia ("Billable Hours – past their use-by date") (http://www. lawsocietywa.asn.au/client/multimedia/news/Perth_Press_Club_Law_Week_20100517.pdf) viewed 9 March 2011 states at page 9: In 1999, the Law Reform Commission of Western Australia reported on the incentive which time costing provided for the undertaking of unnecessary work and the maintenance of inefficient ways of doing work. At page 12: Time billing creates an inherent and irreconcilable conflict between the interest of the client in the achievement of an expeditious resolution, and the interest of the lawyer in billing time. The client has an interest in minimising the steps and the time taken between the commencement of proceedings and their completion, whereas the lawyer has an interest in maximising them. 124 As can be seen, concerns about fee charging practices in the legal profession are not confined to the authors of 18th or 19th century fiction. 125 Notwithstanding these and other modern criticisms of the practice, time charging remains prevalent. That he is aware of vices which may be inherent in the practice, or at least that he is aware that registrars acting as taxing officers are aware of those vices is implicit in Mr Bloom's reference in his report to "vulnerabilities". 126 In Brookfield v Davey Products, faced in an application for the fixing of costs with a time charged solicitor's bill which revealed "significant number of items recording time spent by more than one solicitor for 'perusal' or 'consideration' and for 'research', Branson J discounted the total by 40%. A like observation may be made in respect of what is revealed by AAR's ledger. Also in that case, Branson J observed in respect of the allowance of care and consideration under item 41 in the Second Schedule in respect of a bill of costs based on time charging: In my view, item 41 of Schedule 2 is principally intended to ensure that a scale of costs which is based overwhelmingly on specified fees or rates for items of work does not result in solicitors who represent clients in complex or novel matters being under-rewarded in comparison with those who are involved in more routine matters. Where a bill is based principally on time costing, the scope of operation of item 41 will, in my view, be limited. I note that the case of Southern Cross Exploration NL v Fire and All Risks Insurance Co Ltd (unreported, Supreme Court of New South Wales - Equity Division, Waddell CJ, 14 April 1986) upon which the respondent placed reliance is a case in which the bill of costs had been taxed on the basis of specified fees for items of work and not on a time basis. I respectfully agree with her Honour's observation. In the result, Branson J made what she described as a "modest allowance" of 7% in respect of care and consideration. 127 Mr Bloom has made a discount of 25% to 30% for the "vulnerabilities" he apprehended and then allowed an uplift of 20% attributable to the complexity of the evidence and the length of the trial. Based on my knowledge of this case and my perusal of the AAR ledger, I regard this discount as too modest and the uplift as too generous, especially having regard to the observation as to item 41 made by Branson J in Brookfield v Davey Products. 128 Yet a further consideration is the allowance already by me, in respect of junior counsel especially, of amounts in respect of pre-trial preparatory work by counsel. I have insufficient information as to the latter to judge the extent to which, for example, work in respect of the preparation and settling of affidavits and related conferences was distributed as between solicitor and counsel. Mr Bloom also seems not to have had the benefit of this detail. "Adequate presentation" may, for example, have required but one practitioner, solicitor or junior counsel, to prepare an affidavit following a particular conference with a prospective witness with the other practitioner commenting upon that draft before it was submitted to the deponent. Another concern I have is to avoid allowance for work that might otherwise have been efficiently and adequately distributed in this fashion. 129 In these circumstances, I propose to reduce Mr Bloom's base amount of $1,113,000.00 by 40%. That yields a revised base amount of $667,800. 130 Though this case was not legally complex, those representing Burnett Water did have to undertake a reactive role n respect of a diffuse body of evidence put forward by the Conservation Council and had a need to identify and present in admissible form relevant evidence which would rebut the case as finally pleaded against the company. Other solicitor's costs were incurred at an interlocutory stage because of the inadequate way in which the Conservation Council chose initially to plead its case. The work entailed in all these tasks is already recognised in the amount of the revised base amount. As with counsel, no payment of a special fee is warranted by the nature of the case for solicitors but the tasks mentioned nonetheless do warrant some modest additional allowance for care and consideration. I allow 10%. Applying that to the base amount yields a total for solicitor's fees of $734,580. I round that up to $736,000 so as to give some recognition to the indemnity costs element in respect of Mr Boettcher's affidavit. 131 As a check, I have considered the amount which I have allowed in respect of solicitor's fees relative to that allowed in respect of counsel's fees, having regard to the nature and length of the case and what one might apprehend to be a division of professional tasks as between counsel and solicitors. The relative amounts as between counsel and solicitors do not strike me as unreasonable. 132 When the trial was adjourned in September 2009 I made an order for the costs thrown away by that adjournment to be paid by Burnett Water on an indemnity basis. The parties have agreed between themselves that the amount of such costs is $50,000 and that this should be deducted from whatever sum I would otherwise fix in respect of the overall costs of Burnett Water. 133 In the result then, the components of the sum in which I fix costs are as follows: Item Amount Fixed $ Counsel's Fees Senior Counsel 130,000.00 Junior Counsel 134,166.00 Outlays Expert Fees 25,000.00 Travel Expenses 15,000.00 Transcript Fees 25,000.00 Photocopying/Document Preparation 24,000.00 Filing Fees 865.50 Professional Fees 736,000.00 TOTAL $ 1,090,031.50 134 For the above reasons, I fix Burnett Water's costs in gross in an amount of $1,090,031.50 from which, as to the amount to be paid by the Conservation Council, must be set off the costs of and incidental to the adjournment of the trial in September 2009 which, by consent, are fixed in the sum of $50,000. That means that the net amount which must be paid by the Conservation Council is $1,040,031.50. There will be orders accordingly. I certify that the preceding one hundred and thirty-four (134) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Logan. Associate: Dated: 10 June 2011