Court of Appeal Supreme Court New South Wales Medium Neutral Citation: Anderson v Canaccord Genuity Financial Ltd (No 2) [2024] NSWCA 161 Hearing dates: On the papers (final submissions 7 June 2024) Decision date: 05 July 2024 Before: Gleeson JA; Leeming JA; White JA Decision: 1. Dismiss the notices of motion filed by the second, third and fourth respondents on 22 December 2023 with costs. 2. Order that the judgments entered on 7 December 2023 against Ms Garrett, Mr Renauf and PPB attract interest calculated at pre-judgment rates from that day until today, and at post-judgment rates thereafter. 3. Note that the post-judgment interest is not payable on the judgment debts if the amount is paid in full within 28 days from today. 4. Set aside order 4 made in proceeding 2022/00173143 by this Court on 8 December 2023 insofar as it applies to the second, third and fourth respondents. 5. The exhibits to be returned, and the parties have leave to uplift the submissions and affidavits containing information said to be confidential from the Court's file. Catchwords: JUDGMENTS – significance of plaintiff who settles with one defendant and characterises payment as going to costs – meaning and scope of rule against double recovery – significance of plaintiff settling with and releasing a defendant after judgment has been entered – nature of defendants' liability after entry of judgment COSTS – gross sum costs order – costs of long and complex trial and appeal – whether materials sufficient to permit making of gross sum costs order – whether costs associated with after-the-event insurance were disbursements or expenses – significance of costs being necessary, reasonable, and brought about by application for security for costs by ultimately unsuccessful respondents – whether and how costs should be discounted for various matters Legislation Cited: Access to Justice Act 1999 (UK), s 29 Civil Liability Act 2002 (NSW), Pt 4 Civil Procedure Act 2005 (NSW), ss 3, 95, 98, 99, 100, 101 Court Suppression and Non-publication Orders Act 2010 (NSW), ss 8, 11, 12 Legal Profession Act 1987 (NSW) Legal Profession Uniform Law Application Act 2014 (NSW), s 63, Pt 7 Legal Profession Uniform Law (NSW), s 196, Div 7 of Pt 4.3 Queensland Law Society Act 1948 (Qld) Real Property Act 1900 (NSW), s 126 Solicitors Act 1843 (6 & 7 Vic c 73) Supreme Court Act 1935 (SA) Supreme Court Rules 1987 (SA), r 101.16 Uniform Civil Procedure Rules 2005 (NSW), rr 36.16, 42.1 Wrongs Act 1958 (Vic), s 24AA Cases Cited: Anderson v Canaccord Genuity Financial Ltd [2022] NSWCA 168 Anderson v Canaccord Genuity Financial Ltd [2023] NSWCA 294 Anderson v Canaccord Genuity Financial Ltd (No 2) [2022] NSWSC 649 April Fine Paper Macao Commercial Offshore Ltd v Moore Business Systems Australia Ltd (2009) 75 NSWLR 619; [2009] NSWSC 867 Attorney-General (NSW) v Brewery Employes Union of New South Wales (1908) 6 CLR 469; [1908] HCA 94 Australian International Academy of Education Ltd v Dr Nirmal Taluja (No 2) [2011] NSWSC 880 B O Morris Ltd v Perrott and Bolton [1945] 1 All ER 567 Banque Keyser Ullman SA v Skandia (UK) Insurance Co Ltd (No 2) [1988] 2 All ER 880 Baxter v Obacelo Pty Ltd (2001) 205 CLR 635; [2001] HCA 66 Bell Lawyers Pty Ltd v Pentelow (2019) 269 CLR 333; [2019] HCA 29 Berry v British Transport Commission [1962] 1 QB 306 BNM v MGN Ltd [2017] EWCA Civ 1767 Boncristiano v Lohmann [1998] 4 VR 82 Broadway Plaza Investments Pty Ltd v Broadway Plaza Pty Ltd; In the matter of Combined Projects (Arncliffe) Pty Ltd (No 3) [2021] NSWSC 1537 Burford v Allan [1998] SASC 6693 Cachia v Hanes (1994) 179 CLR 403; [1994] HCA 14 Cachia v Isaacs (Court of Appeal (NSW), 23 March 1989, unrep) Cassaniti v Ball as liquidator of RCG CBD Pty Ltd (in liq); Khalil v Ball as liquidator of Diamondwish Pty Ltd (in liq) (2022) 109 NSWLR 348; [2022] NSWCA 161 Castellan v Electric Power Transmission Pty Ltd (1967) 69 SR (NSW) 159 Coleman v Power (2004) 220 CLR 1; [2004] HCA 39 CSR Ltd v Eddy (2005) 226 CLR 1; [2005] HCA 64 Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2023] HCA 10; 97 ALJR 214 Dimos v Willetts (2000) 2 VR 170; [2000] VSCA 154 Energy & Resource Conservation Co Pty Ltd (in liq) v Abigroup Contractors Pty Ltd (Supreme Court (NSW), 18 March 1998, unrep) FM Capital Partners Ltd v Marino [2018] EWHC 2905 (Comm) FM Capital Partners Ltd v Marino [2021] QB 1; [2020] EWCA Civ 245 Gill v Ethicon Sàrl (No 12) [2023] FCA 902 Greentree v Jaguar Land Rover Australia Pty Ltd (Carriage Application) [2023] FCA 1209 Hamod v New South Wales [2011] NSWCA 375 Harplex Pty Ltd v Konstandellos (2018) 54 VR 174; [2018] VSCA 67 Herbert v HH Law Ltd [2019] EWCA Civ 527; [2019] 4 All ER 835 Houghton v Saunders [2019] NZCA 285 In re Blair & Girling [1906] 2 KB 131 In re Buckwell & Berkeley [1902] 2 Ch 596 In re Remnant (1849) 11 Beav 603; 50 ER 949 Jones v Sutton (No 2) [2005] NSWCA 203 Kea Investments Ltd v Watson [2023] EWHC 1830 (Ch) Landoro (Qld) Pty Ltd (Admin Apptd) v Jensen International Pty Ltd [1999] QCA 318 Legal Services Commissioner v Dempsey [2008] 2 Qd R 272; [2008] QCA 122 Lewis v Doran [2008] NSWSC 186 McGraddie v McGraddie [2015] UKSC 1; [2015] 3 All ER 61 McMillan Investment Holdings PL v Mangos (No 3) [2023] NSWSC 1327 Mills v Walsh [2022] NSWCA 255 Nau v Kemp & Associates Pty Ltd (2010) 77 NSWLR 687; [2010] NSWCA 164 Queensland Bulk Water Supply Authority t/as Seqwater v Rodriguez & Sons Pty Ltd [2021] NSWCA 206 Legal Services Commissioner v Dempsey [2007] QSC 270 Registrar-General (NSW) v Behn (1981) 148 CLR 562; [1981] HCA 36 SAS Trustee Corporation v Budd [2005] NSWCA 366; 3 DDCR 382 Scripture Union v Prime Industrial Pty Ltd [2006] NSWSC 38 The Berry Rural Co Operative Society Ltd v Sepak Industries Pty Ltd (No 4) [2018] NSWSC 1902 Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574; [1996] HCA 38 Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 507; [2015] HCA 28 Townsend v Stone Toms & Partners (1984) 27 BLR 26 Williamson v Sydney Olympic Park Authority [2022] NSWSC 1618 Texts Cited: J Chitty and T Chitty, Chitty's Treatise on Pleading (6th ed, 1836, Stevens & Sons) G Dal Point, Law of Costs (5th ed, 2021, LexisNexis) Lord Justice Jackson, Review of Civil Litigation Costs: Final Report (Ministry of Justice (UK), December 2009) L Oliver, Law of Costs (1960, Law Book Co) Category: Costs Parties: Daniela Alejandra Anderson (Appellant) Canaccord Genuity Financial Ltd (First Respondent) Nicola Lesleigh Garrett (Second Respondent) Samuel Mark Renauf (Third Respondent) Falcon Prime Pty Ltd (Fourth Respondent) Acorn Capital Ltd (Fifth Respondent) Albany Capital Investors Pty Ltd (Sixth Respondent) Ashington Capital Pty Ltd (in liquidation) (Seventh Respondent) Ashington Management Pty Ltd (in liquidation) (Eight Respondent) Representation: Counsel: P S Braham SC, A Bhasin and S Murray (Appellant) J A Redwood SC and E Bathurst (First Respondent) M Painter SC and T Bagley (Second and Third Respondents) G Ng SC and R Sud (Fourth Respondent) Solicitors: McLachlan Thorpe Partners (Appellant) Clayton Utz (First Respondent) Piper Alderman (Second and Third Respondent) Corrs Chambers Westgarth (Fourth Respondent) File Number(s): 2022/00048359 Publication restriction: Nil Decision under appeal Court or tribunal: Supreme Court Jurisdiction: Equity Citation: [2022] NSWSC 58 Date of Decision: 7 February 2022 Before: Ward CJ in Eq File Number(s): 2015/00285816 [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.] HEADNOTE On 8 December 2023 the Court of Appeal allowed an appeal and entered judgments in favour of Mrs Daniela Anderson against each of the first, second, third and fourth respondents (respectively, "Patersons", Ms Garrett, Mr Renauf and "PPB") in the amount of $3,016,304.23, which amount included pre-judgment interest of $1,426,304.23. After judgment was reserved but prior to judgment being delivered, the Court was told that Mrs Anderson had separately compromised her claims against the fifth and sixth respondents ("Acorn" and "Albany"). Consent orders were accordingly made dismissing Mrs Anderson's appeal against those parties and leaving in place the judgments in Acorn's and Albany's favour which had been made at first instance. The settlements involved each of Acorn and Albany paying substantial amounts of money. In the case of Acorn, some 97% of the amount was treated by the parties as a partial disbursement of Mrs Anderson's "costs incurred in prosecuting the Proceeding and the Main Appeal". In the case of Albany, the settlement deed identified five categories amongst which specified portions of the payment were to be treated. Three of those categories related to an after-the-event insurance policy that Mrs Anderson had entered into in order to provide security for costs of the proceedings in the Equity Division ("ATE Costs"), which amounts totalled $1,731,111.16. When judgment was delivered on 8 December 2023, the Court confirmed that the parties were entitled to be heard as to the effect of Mrs Anderson's settlements with Acorn and Albany, and that they could apply to set aside or vary the orders in accordance with r 36.16 of the Uniform Civil Procedure Rules 2005 (NSW). Each of Patersons, Ms Garrett, Mr Renauf and PPB applied under that rule within 14 days of the entry of judgment, by notices of motion filed on 22 December 2023. Submissions were exchanged between the parties in February and March 2024. While judgment was reserved on that application, on 8 May 2024, Patersons advised the Court that it had settled its dispute with Mrs and Mr Anderson, and consent orders were made to that effect, which included the dismissal of Patersons' notice of motion and an order that there be no order for costs between Mrs Anderson, Mr Anderson and Patersons. This settlement included broad releases in favour of Patersons in respect of its liability to pay the judgment amount and its liability for costs of the trial and the appeal and interest on those costs. As a result of her settlement with Patersons, Mrs Anderson advised on 7 June 2024 that she no longer sought any order as to costs as against Ms Garrett, Mr Renauf and PPB (collectively, "the active respondents"), save in relation to the costs of the motions to vary or set aside the judgments. There were three main issues before the Court. First, whether Mrs Anderson had to give credit for the entirety of the amounts paid by Acorn and Albany. Secondly, whether Mrs Anderson must give credit for the ATE Costs. Thirdly, whether Mrs Anderson's settlement with Patersons released the active respondents from liability. The Court (Gleeson, Leeming and White JJA) held, dismissing the applications to vary the judgments entered against the second, third and fourth respondents: As to the first issue: (1) The "rule against double recovery" will not permit a plaintiff, whatever procedural device is used, to recover more than the damage that he or she has suffered, no matter what the cause of action upon which he or she proceeds against various defendants. "Double recovery" in this context means actual double recovery: at [65]-[83]. (2) Mrs Anderson's entitlement to judgment for an amount of equitable compensation was separate from, and not "concurrent" with, an order entitling her to costs: at [89]-[91], [102]. Boncristiano v Lohmann [1998] 4 VR 82, distinguished. (3) There was nothing in the terms of the settlement which made it unconscionable for Mrs Anderson to allocate the money she received from Acorn and Albany to her costs: at [103]-[104]. Baxter v Obacelo Pty Ltd (2001) 205 CLR 635; [2001] HCA 66, applied. FM Capital Partners Ltd v Marino [2021] QB 1; [2020] EWCA Civ 245, considered. As to the second issue: (4) It was unnecessary for the Court to determine whether the ATE Costs were recoverable as a component of Mrs Anderson's party/party costs. Irrespective of whether the ATE Costs were recoverable as costs, the judgments in favour of Mrs Anderson should not be reduced by the amounts of ATE Costs, because that amount was necessarily incurred in order to prosecute the litigation, and was incurred only because of the security for costs applied for and obtained by the respondent wrongdoers: at [22]-[27], [146], [158]. Obiter consideration on the second issue: (5) Per the Court: The ATE Costs were not "disbursements", within the meaning of "costs" in ss 3 and 98 of the Civil Procedure Act 2005 (NSW), as they were not a payment which Mrs Anderson's solicitors were duty bound to make in their role as solicitor on the record, nor was there any established custom or practice of solicitors being liable to pay such costs: at [148]. In re Remnant (1849) 11 Beav 603; 50 ER 949, applied. In re Buckwell & Berkeley [1902] 2 Ch 596, In re Blair Girling [1906] 2 KB 131, Energy & Resource Conservation Co Pty Ltd (in liq) v Abigroup Contractors Pty Ltd (Supreme Court (NSW), 18 March 1998, unrep), Herbert v HH Law Ltd [2019] EWCA Civ 527; [2019] 4 All ER 835, considered. (6) Per Gleeson and Leeming JJA: Expenses must represent remuneration to a practitioner, or an expense incurred by a practitioner in the course of representing a client. The "Balance of Premium" component, which was only payable in the event of Mrs Anderson's success, resulted in the ATE Costs bearing the character of an investment in litigation and were therefore not "expenses" within the definition of "costs" in the Civil Procedure Act: at [149]-[151]. Cachia v Hanes (1994) 179 CLR 403; [1994] HCA 14, applied. Cachia v Isaacs (Court of Appeal (NSW), 23 March 1989, unrep), distinguished. Burford v Allan [1998] SASC 6693, McGraddie v McGraddie [2015] UKSC 1; [2015] 3 All ER 61, Houghton v Saunders [2019] NZCA 285, considered. (7) Per White JA: Although the insurer is obtaining an interest in the outcome of the litigation, from Mrs Anderson's perspective it was a necessary expense. The ATE Costs were incurred to enable Mrs Anderson to provide security for costs, which ought not to have been sought, and were thus a "litigation expense": at [152]-[157]. Burford v Allan [1998] SASC 6693, McCraddie v McCraddie, BNM v MGN Ltd [2017] EWCA Civ 1767, Herbert v HH Law Ltd [2019] EWCA Civ 527; 4 All ER 835, distinguished. As to the third issue: (8) The release by Patersons did not effect a release of Mrs Anderson's entitlement to enforce the judgments against the active respondents. Section 95 of the Civil Procedure Act 2005 (NSW) is inconsistent with the common law rule regarding release, and accordingly that rule must be taken to have been abrogated: at [168]-[178]. Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574; [1996] HCA 38, applied. Harplex Pty Ltd v Konstandellos (2018) 54 VR 174, approved. Cassaniti v Ball as liquidator of RCG CBD Pty Ltd (in liq); Khalil v Ball as liquidator of Diamondwish Pty Ltd (in liq) (2022) 109 NSWLR 348; [2022] NSWCA 161, considered. Consideration by the Court of: (9) The origin of the rule against double recovery at law and in equity: at [67]-[81]. B O Morris Ltd v Perrott and Bolton [1945] 1 All ER 567, Castellan v Electric Power Transmission Pty Ltd (1967) 69 SR (NSW) 159, Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 507; [2015] HCA 28, Registrar-General (NSW) v Behn (1981) 148 CLR 562; [1981] HCA 36, considered. (10) The appropriateness of a gross sum costs order, had Mrs Anderson's application not been withdrawn: at [180]-[241]. JUDGMENT 1. THE COURT: On 8 December 2023 this Court allowed two appeals following an eight day hearing in May 2023. The smaller appeal, which concerned a third party costs order, was entirely resolved by this Court's orders. The larger appeal, brought from judgments which were substantially adverse to the plaintiff/appellant Mrs Daniela Anderson following a trial occupying 28 days, resulted in a judgment in her favour against each of the first, second, third and fourth respondents (respectively, "Patersons", Ms Garrett, Mr Renauf and "PPB") in the amount of $3,016,304.23: Anderson v Canaccord Genuity Financial Ltd [2023] NSWCA 294. That amount included pre-judgment interest of $1,426,304.23: see [414]. 2. This second judgment resolves the single issue left outstanding from the larger appeal. After this Court had reserved judgment following the hearing in May 2023, it was told that Mrs Anderson had separately compromised her claims against the fifth and sixth respondents ("Acorn" and "Albany"), and consent orders were made dismissing her appeal against those parties and leaving in place the judgments in Acorn's and Albany's favour which had been made at first instance. The remaining respondents sought to have some (in the case of Patersons, Ms Garrett and Mr Renauf) or all (in the case of PPB) of the monies paid by Acorn and Albany brought to account to diminish the judgments now entered against them. While judgment was reserved on that application, on 8 May 2024, Patersons advised the Court that it had settled its dispute with Mrs and Mr Anderson, and consent orders were made to that effect. In what follows, references to "the active respondents" are to Ms Garrett, Mr Renauf and PPB. They seek to have the judgment against them set aside by reason of Mrs Anderson's settlements with Acorn, Albany and Patersons. 3. There was also a limited dispute as to costs. Prior to 8 May 2024 it was substantially common ground that there should be a single gross sum costs order reflecting Mrs Anderson's success, extending to the entirety of her costs both at trial and on appeal, and there was a relatively confined dispute as to its quantum. However, the more recent settlement reached with Patersons led to Mrs Anderson, by her submissions dated 7 June 2024, no longer to seek any order as to costs. 4. As will be seen, we have concluded that Mrs Anderson's submissions as to the effect of her settlements with Acorn, Albany and Patersons are correct, and it follows that we will accede to her more recent request that we not make a gross sum costs order in her favour. However, against the possibility that this judgment does not resolve the parties' dispute, and in deference to the parties' submissions on points which were fully argued, we have indicated our conclusions on most of those issues. 5. For the reasons which follow, the applications by Ms Garrett, Mr Renauf and PPB to vary the judgments against them should be dismissed. The reasons for that turn on the particular facts of this case, although in deference to the quality of the submissions the Court has received, we have also addressed them. By way of summary, the dispositive points are: 1. we do not accept PPB's broader submission that essentially the entirety of the settlements with Acorn and Albany must be brought to credit in diminution of Mrs Anderson's loss, as opposed to being on account of the costs judgments in her favour; 2. we do not accept the active respondents' submission that Mrs Anderson must give credit for the "ATE Costs", in circumstances where those costs were reasonable in amount, necessarily incurred in order to prosecute the litigation, and brought about solely by the respondents' application for security for costs which, having regard to the result of the main appeal, should never have been brought (or at least should not have been brought in anything like the amount for which security was sought and ordered), and 3. we do not accept the active respondents' submission that Mrs Anderson's settlement with Patersons, which involved a release by Patersons, had the effect of discharging the active respondents from the obligations under the judgments entered against them. 1. In accordance with directions made in December 2023, the parties supplied three tranches of submissions throughout February 2024 on each issue, together with supporting affidavits. Those materials were quite voluminous. For example, on the application to vary the judgment, there were initially three sets of submissions in chief, Mrs Anderson's submissions in opposition, and three sets of submissions in reply, together occupying 47 pages or 176 paragraphs. The affidavit material is extremely substantial, and although a great deal is directed to the costs incurred in substantial long-running litigation, there is also a deal of testimonial evidence. No useful purpose is served summarising the entirety of that material, which would substantially lengthen these reasons. 2. The parties' submissions did not address two unreported appellate decisions which at least arguably were squarely directed to the respondents' submission that most of the amount received by Mrs Anderson from Albany needed to be deducted from the judgments in her favour. One supported Mrs Anderson's position while the other tended against it. Accordingly, on 20 March 2024 the Court invited further submissions on those cases, and in accordance with that direction, Mrs Anderson, Patersons and PPB supplied further submissions on 27 March 2024. 3. On 8 May 2024, Patersons advised that it had settled with Mrs and Mr Anderson, and orders were made by consent shortly thereafter in accordance with an agreed form of order, which included the dismissal of Patersons' notice of motion filed 22 December 2023 with no order as to costs, a note that "the Appellant, Craig Anderson and the first respondent have reached a settlement as between each other, so that the Appellant and Craig Anderson's claim in respect of the Anderson Costs Application is fully extinguished, and the Court is no longer required to make an order in respect of the Anderson Costs Application", and an order that "there be no order for costs between the appellant, Craig Anderson and the first respondent such that each of them shall bear their own costs of this proceeding, including in respect of the appellant's application for costs made on 2 February 2024". 4. Thereafter each of the active respondents (Ms Garrett, Mr Renauf, PPB) and Mrs Anderson supplied further submissions as to the effect of the most recent partial settlement. The active respondents submitted that the settlement released them from liability, and sought orders setting aside the judgments against them, or else discharging them. Mrs Anderson resisted the conclusion that her settlement with Patersons had any effect upon the judgments in her favour against the active respondents, but said that her entitlement to costs was now completely satisfied, save in relation to the costs of the motions to vary or set aside the judgment. 5. Orders 5 and 6 made by this Court in the larger appeal on 8 December 2023 expressed the view that the outstanding applications be resolved on the papers. Mrs Anderson, Ms Garrett, Mr Renauf and PPB each said that she, he or it was content to have the issues resolved on the papers. The active respondents requested that this Court delay determining the remaining issues until 28 days after Patersons had performed its obligations under its settlement with Mrs Anderson and the releases she had given became effective. Application to vary the judgments Background 1. On 1 September 2023, after this Court's judgment had been reserved, the parties advised that Mrs Anderson and Mr Anderson had resolved their claims against Acorn, and orders were made by consent shortly thereafter dismissing each appeal against Acorn and vacating all prior orders as to costs. On the afternoon of 7 December 2023, after notification that judgment would be delivered had been given, the parties advised that Mrs Anderson and Mr Anderson had resolved their claims against Albany, and orders were made by consent that evening dismissing each appeal against Albany and vacating all prior orders as to costs. 2. When judgment was delivered on 8 December 2023, this Court made orders including entering judgment in a dollar amount, but confirmed that the parties were entitled to be heard as to the effect of Mrs Anderson's settlements with Acorn and Albany, and that they could apply to set aside or vary the orders in accordance with r 36.16 of the Uniform Civil Procedure Rules 2005 (NSW): see at [432]. Each of Patersons, Ms Garrett, Mr Renauf and PPB applied under that rule within 14 days of the entry of judgment, by notices of motion filed on 22 December 2023. 3. It will not be necessary, in order to resolve the applications under r 36.16, to identify the details of the settlements with Acorn and Albany, and thus it will not be necessary to determine whether, as Mrs Anderson seeks, without any opposition from the other parties, an order should be made under the Court Suppression and Non-publication Orders Act 2010 (NSW). That may be as well, because it is far from clear, having regard to the fact that a primary objective of the administration of justice is to safeguard the public interest in open justice, that any of the conditions in s 8(1) of that statute is satisfied. The fact that Acorn and Albany have settled is not confidential and is apparent from this Court's orders which are a matter of public record. Although it may be accepted that there is a strong public interest in litigants settling claims, which is furthered by permitting the terms of settlements to remain confidential, that consideration is diminished in a case such as the present where there has been a partial settlement. It must have been clear to Mrs Anderson, Acorn and Albany that if the result of the appeal was that Mrs Anderson was entitled to compensation against the active respondents, the details of the settlements could not be withheld from them. Nor could there be any basis for preventing the publication of the actual judgments entered against the active respondents after allowance was made for the settlements. Those circumstances substantially diminish the confidentiality that accompanies the compromise of litigation in other cases. Those are not the only considerations disfavouring orders under the Court Suppression and Non-publication Orders Act. Neither Mrs Anderson nor any other party identified the geographical extent or duration of the order she sought, notwithstanding that both are required by ss 11 and 12 of the statute. The geographical extent of any order is not without complexity in the present case, in circumstances where Acorn and Albany are based in Melbourne, and because s 11(3) provides that the order is not to apply outside New South Wales unless that is "necessary for achieving the purpose for which the order is made". For all those reasons, we would not have made the order without hearing further from the parties on those issues, all of which are mandatory aspects of the statute. 4. The settlements involved each of Acorn and Albany paying substantial amounts of money (in each case exceeding a million dollars). 1. In the case of Acorn, some 97% of the amount paid was treated by the parties as a partial reimbursement of "[Mrs Anderson's] costs incurred in prosecuting the Proceeding and the Main Appeal" (the balance was treated as Mr Anderson's costs and save for one aspect of PPB's submissions is not in dispute). 2. In the case of Albany, a deed dated 7 December 2023 identified five categories amongst which specified portions of the payment was to be treated: (a) a refund of security paid into Court by Mrs Anderson, (b) the "Deposit Premium and Deed fee", (c) interest on that amount, (d) an additional premium which accrued "in respect of the occurrence of a positive outcome within the meaning of the said policy", and (e) an amount representing "a partial contribution towards interest on costs incurred by [Mrs Anderson] in prosecuting the Proceedings and the Main Appeal". Categories (b), (c) and (d) all relate to the after-the-event insurance which is described below, and they total $1,731,111.16. 1. It will be convenient to follow the parties' nomenclature and refer to the $1,731.111.17 comprising the amounts summarised above connected with the after-the-event insurance policy as the "ATE Costs". There was uncontested evidence that all of the ATE Costs have in fact been paid. 2. There is no dispute about what occurred in relation to the incurring of ATE Costs, and it is unnecessary to provide all of the details. In short, Mrs Anderson had been ordered to provide security for costs for the proceedings in the Equity Division in tranches. With the assistance of family and friends, she paid the first, second and third tranches in July 2019 and February and June 2020, The largest tranche, in the amount of $2,087,235, was required to be provided on 4 January 2021 in advance of the trial. Following a contested hearing, the Court ordered that security could be provided by way of a deed of indemnity. There was uncontested evidence that Mr and Mrs Anderson did not have funds to provide that security as well as meeting their own costs of the trial, that a previous litigation funder had declined to provide funds, and that the only funding arrangement their solicitor could obtain was entering an after-the-event insurance policy with "Lloyd's Syndicate 4000 (Hamilton)". 3. The policy into which Mrs Anderson ultimately entered had a limit cover of $2,100,000 and an associated deed of indemnity issued by the Lloyd's syndicate in favour of the defendants as security for their costs. The premium was payable in two tranches. The "Deposit Premium" for that policy was $420,000, and there was also a "Balance of Premium", payable in the event of a "Positive Outcome", of $820,000. There were also duties and taxes. In addition, there was a "Deed Fee" of $208,723, being 10% of the amount indemnified. 4. There appears to be an error in the Albany settlement deed. The amount of $965,740 which is the fourth of five components of the settlement amount is described as "the additional premium payable by [Mrs Anderson] pursuant to the ATE Policy in respect of the occurrence of a positive outcome within the meaning of the said policy". However, Mrs Anderson's solicitor's affidavit identifies, by reference to invoices which are exhibited to it, an amount of $893,800 being the additional premium, and a separate amount of $71,940 being the additional premium "pursuant to a separate ATE Policy obtained on 24 March 2023 to cover Peter Braham SC's costs". Those two amounts add to the amount mentioned in the Albany deed. The evidence was that the second ATE Policy was obtained from the same syndicate in order to secure the payment of senior counsel's fees. 5. Those amounts plus interest comprise the $1,731,111.16 of "ATE Costs". 6. All of the active respondents submitted that the $1,731.111.16 of ATE Costs had to be treated by Mrs Anderson as a benefit which offset her claim for equitable compensation. On the other hand, Mrs Anderson maintained that the payment of ATE Costs was referable to her costs, and the payments should be deducted from any costs order made in her favour. 7. The main insurance policy is a little unusual, especially having regard to the second and larger component of the premium, which was only payable in the event that Mrs Anderson obtained a judgment in her favour. The position arguably differs from the expense incurred by a plaintiff in purchasing a bank guarantee following an order to provide security for costs. Most if not all "after-the-event insurance" involves a third party becoming exposed commercially to a risk of litigation, and that is all the more apparent in a case such as the present where the larger component of the premium is only payable in the event that Mrs Anderson's case succeeds. In substance, the ATE Costs reflect the cost of a form of litigation funding, where part of the bargain between litigant and funder is a payment in the event the litigation achieves a successful outcome. To be clear, we are not suggesting that there is anything improper in that course, especially in light of the unchallenged evidence that the only way Mrs Anderson could satisfy the orders for security for costs was to take out the insurance on the terms summarised above. However, the nature of the ATE Costs is squarely relevant to whether they are characterised as costs, disbursements or expenses. No necessity to determine whether the ATE Costs are recoverable costs 1. Mrs Anderson's primary submission was that the question whether the costs of obtaining after-the-event insurance are recoverable as a component of a successful plaintiff's party/party costs did not need to be resolved. She submitted: As between the appellant and the respondents, there is a genuine dispute as to whether the respondents are liable to the appellant for those costs as part of their general liability to pay the costs of the proceedings and the appeal. If the ATE Costs are recoverable from the respondents as part of the costs of the proceedings, then the appellant acknowledges that the respondents' liability is concurrent with that of Albany, and they are entitled to a credit for the settlement sum. However, in that instance, the question is moot, because the settlement sum has discharged that concurrent liability, which is not sought from the respondents. If, on the other hand, the cost of the ATE policies is not recoverable from the respondents as part of the costs of the proceedings, then, for that reason alone, their liability to the appellant is not concurrent with the liability of Albany to the appellant. That is because Albany accepted a liability to the appellant for the ATE Costs, and the settlement sum was in respect of that agreed liability, which is not a liability of the respondents on this hypothesis. 1. We agree that this point need not be determined. If the ATE Costs are properly characterised as part of Mrs Anderson's costs of the proceedings, then in circumstances where Mrs Anderson does not seek to recover costs from any active respondent, nothing more need be said. Alternatively, if the ATE Costs are not properly characterised as part of Mrs Anderson's costs of the proceedings, then even so, in the particular facts of this case, we are of the view that the receipt of that amount from Albany is not a receipt for which Mrs Anderson must give credit in favour of the active respondents. That is because of the way in which the ATE Costs came to be incurred. 2. In very large measure, Mrs Anderson was obliged to incur the ATE Costs not so as to fund her own costs of litigation, but in order to comply with orders for security for costs sought and obtained by the respondents. As will be seen below, the amount of those ATE Costs was reasonable, and the evidence was that Mrs Anderson had no other way of complying with the order for security for costs. But Ms Garrett and Mr Renauf were found to have been fiduciaries engaged in a dishonest and fraudulent breach of fiduciary duty, in which the other respondents knowingly assisted, thereby causing loss to the Ashington companies. On the facts as ultimately found, no respondent was entitled to security and the application for security for costs should never have been brought. Save in one minor respect, the ATE Costs were brought about by an application for security for costs which, with the benefit of hindsight should never have been made. Irrespective of whether the ATE Costs were recoverable as costs, we do not think that Mrs Anderson should be required to give credit for the receipt of the ATE Costs from Albany when she in fact incurred and paid those costs and should never have had to do so in light of the facts as ultimately found. 3. The rule the active respondents seek to invoke is a rule against double satisfaction (below at [67]-[83]). 4. Here there was no double satisfaction. The ATE Costs Mrs Anderson incurred were not recoverable against the respondents as compensation. She took an assignment of the Anderson companies' claim for compensation. Nonetheless, the ATE Costs were necessarily incurred by Mrs Anderson to enable her to continue her pursuit of her claim. 5. The qualification to paragraph [24] concerns an additional premium of $71,940 paid in respect of a separate ATE Policy to cover senior counsel's costs. This amount is somewhat less than 5% of the "ATE Costs". But in any event, although it is of a different character, nothing turns on the difference. The evidence was that the first, second and third tranches of security were paid for with the assistance of family and friends, and only the fourth tranche was satisfied by the deed of indemnity the price of which was the balance of the ATE Costs. There is no reason to doubt that but for the respondent wrongdoers having sought and obtained security for their costs, Mrs Anderson would have been able to fund the payment of senior counsel's fees from other financial resources available to her. In short, the $71,940 is an amount incurred which was also the direct consequence of the wrongdoing respondents' application for security for costs. The parties' submissions on whether the ATE Costs are recoverable costs 1. Against the possibility that Mrs Anderson's primary submission was not accepted, the parties exchanged submissions as to whether the ATE Costs were recoverable as part of her costs. Although Patersons and Mrs Anderson compromised their dispute some months after the exchange of those submissions, the active respondents adopted those submissions, and in what follows it will be convenient to refer to them as "Paterson's submissions" despite the slight inaccuracy in doing so. 2. Patersons accepted that the amount paid by Acorn in partial settlement of Mrs Anderson's costs and the amount of paid by Albany as a partial contribution towards the interest on costs incurred by Mrs Anderson in prosecuting the litigation were properly regarded as being attributable to costs. 3. However, Patersons submitted that the ATE Costs were not properly characterised as disbursements. Patersons said that a disbursement was a "payment made, or a liability incurred, by a lawyer on behalf of a client", and relied upon the analysis by Hammerschlag J in Lewis v Doran [2008] NSWSC 186 at [48], [56] and [58] to the effect that disbursements needed to have a nexus to the law practice. Patersons said: The ATE Policies were not taken out by the appellant's solicitors in furtherance of any procedural or evidentiary step in the conduct of the proceedings. Rather, they were taken out by the appellant and Mr Anderson personally as financial protection against an adverse outcome to them in the proceedings. They were personally responsible for the payments arising thereunder and were set to personally benefit from the proceeds of the insurance. In that way, the amounts payable under the ATE policies fall within the general categories of examples which are not disbursements (see Costs Guide NSW which refers to debts or costs paid to the other party, money paid in to court, money lent to the client, deposits for security for costs). This is consistent with the observations of Rolfe J in Energy & Resource Conservation Co Pty Ltd (in liq) v Abigroup Contractors Pty Ltd (SC NSW 55023 of 1997, 18 March 1998) at 32-33 (Rolfe J) where his Honour held: The necessity to borrow money and insure against an adverse result in the litigation in the present case could not, in my opinion, be said to be "a direct consequence" of Abigroup's breach of contract. Rather, it was a direct result of ERCC's impecuniosity and, it is important to note, that there is no allegation in the present case that that was brought about by any breach on the part of Abigroup. Mr Harper submitted that the insurance premium should be treated as a necessary expense, which Mr Weston and Mr Shirlaw are entitled to recover by way of costs. In my opinion that expense does not fit within the category of costs in the way in which I consider that word must be applied. 1. Patersons noted that those observations were cited by approval by Demack J in Landoro (Qld) Pty Ltd (Admin Apptd) v Jensen International Pty Ltd [1999] QCA 318 at [22]. Dealing with the separate point whether such costs were recoverable as damages, Patersons noted that Demack J went on to uphold the rule in Berry v British Transport Commission [1962] 1 QB 306 that a party cannot recover "expenditure on litigation", saying: As long as this rule remains, the necessity to borrow money and to insure against an adverse result is properly categorised as expenditure on litigation and is not recoverable. The amendment to claim this amount should not be allowed. 1. Patersons said that the amounts received from Albany constituted a substantial offsetting benefit received by Mrs Anderson in connection with the settlement of her claim, and said that that was particularly the case in respect of the "Balance of Premium", which was expressly tied to an award of compensation in the proceedings. 2. Finally, Patersons said that it was prepared to accept, favourably to Mrs Anderson, that the credit for the ATE Costs was to be applied at the time it was received. We consider that concession, if indeed it is a concession, is properly made. That is to say, we agree with the appropriateness of that approach, at least in the present case. The position is quite stark. The loss determined by this Court is $1.59m, which accrued in September 2009. Mrs Anderson recovered the ATE Costs more than 14 years later, in December 2023. The dollar amount of ATE Costs slightly exceeds the loss in 2009, but is much less when pre-judgment interest over the ensuing 14 years is incorporated. We do not accept that a settlement with one defendant many years after the event, in an amount which exceeds the principal amount awarded, will in any ordinary case disentitle a successful plaintiff from claiming pre-judgment interest from another defendant, at least where the plaintiff has been out of pocket throughout that period. 3. If credit is given for the ATE Costs on the date of the deed of settlement (7 December 2023), then the effect is to reduce the equitable compensation including pre-judgment interest to $1,285,125.35 (it is the judgment sum entered on 8 December 2023, less the $1,731,111.16 of ATE Costs, less one day's interest on the ATE Costs). 4. Ms Garrett and Mr Renauf submitted that "[i]n the context of class actions, courts have repeatedly held that insurance [against the possibility that the party loses the litigation] is not appropriately deducted as a part of the settlement – instead it is part of the 'costs of doing business' for litigation funders", citing Williamson v Sydney Olympic Park Authority [2022] NSWSC 1618 at [70]ff and Greentree v Jaguar Land Rover Australia Pty Ltd (Carriage Application) [2023] FCA 1209 at [30]. They submitted that although those decisions did not directly address whether the costs of a policy are recoverable against a defendant, "the fact that they cannot be recovered in a settlement as against the Applicant strongly suggests that the same reasons would hold as against the Respondent". 5. Ms Garrett and Mr Renauf relied upon statements in Bell Lawyers Pty Ltd v Pentelow (2019) 269 CLR 333; [2019] HCA 29 at [33] that "costs are awarded by way of … partial indemnity … for professional legal costs actually incurred in the conduct of litigation", and that costs "were never intended to be comprehensive compensation for any loss suffered by a litigant". 6. Ms Garrett and Mr Renauf concluded: [T]he Applicant cannot discharge her onus to show that the payment by Albany was not received by the Applicant in compensation for the same loss. The costs that it purported to discharge were not recoverable costs. They may have been payments associated with the proceedings, but that does not make them recoverable costs. The Applicant chose to insure herself against the possibility of an adverse outcome by purchasing a policy of insurance. The costs of purchasing that policy was not a professional legal cost actually incurred in the conduct of litigation. For example, if the Applicant instead [had] chosen to finance her security for costs obligations by borrowing money from the bank and paying interest, there could be no doubt that those interest payments were not recoverable from the [respondents]. 1. PPB's primary submission was that credit had to be given against the judgments entered against the active respondents for the entirety of the amounts paid by Acorn and Albany; we address this submission below. PPB's alternative submission was that amounts paid by way of expenditure on litigation, otherwise in respect of legal fees or disbursements, were not recoverable as damages or costs. PPB relied on what Rolfe J had said in Energy & Resource Conservation Co Pty Ltd (in liq) v Abigroup Contractors Pty Ltd (Supreme Court (NSW), 18 March 1998, unrep). They made the further point that Mrs Anderson took an assignment of the causes of action, and thus "even if it can be said that she was forced to purchase the ATE insurances as a consequence of her own impecuniosity, there is nothing to link that impecuniosity to any wrongdoing that caused loss to the relevant Ashington entities". 2. Mrs Anderson submitted that there seemed to be no direct Australian authority on point, but said that the reasoning in Gill v Ethicon Sàrl (No 12) [2023] FCA 902 at [108] was persuasive and ought to be followed. There it was said that: In short, if an applicant in a large class action being conducted on a speculative basis can prove the only practical way a defended proceeding could have come to a successful conclusion on common issues was for the applicant, acting reasonably and prudently, to incur a litigation expense such as a disbursement facility interest charge, there is no reason in law or logic why that sum ought not to be recoverable from a respondent whose unsuccessful defence of the class action caused the necessary cost to be incurred. This is little different to the position that has commended itself to judges in personal injury litigation in the United Kingdom, albeit under different costs rules. It is unnecessary to form a view as to the legal position for the purposes of this application but, in my view, the Court has ample statutory power under Pt IVA to make such an order if it was thought it in the interests of justice to do so. 1. Mrs Anderson said that those observations applied a fortiori in the present case, because rather than a large class action being conducted on a speculative basis, her litigation was being conducted by an impecunious individual. As she puts it: The ATE Costs were not merely any cost incurred in the conduct of litigation. Nor were they simply a device by which the appellant sought to mitigate her risk of an adverse outcome. Rather, … they were expenses necessarily incurred to enable the litigation to be pursued, and compensation for the respondents' wrongful conduct obtained. 1. On that basis Mrs Anderson sought to distinguish decisions such as Energy & Resource Conservation Co. She said that in that decision there was "no allegation that the plaintiff's impecuniosity was brought about by any breach on the part of the defendant, with the result that the expenses could not be said to be a 'direct consequence' of the breach". 2. Mrs Anderson criticised Patersons' reliance on the observations of Demack J in Landoro for failing to note that his Honour was in dissent on the relevant point. Mrs Anderson also criticised the reliance by Ms Garrett and Mr Renauf rely on other authorities in "the entirely different context of class action settlement approval", which were not comparable given the specific public policy considerations that apply involve weighing the respective returns between funders, lawyers and class members apply. The observations relied upon were also said to depend upon a view of ATE insurance as the "cost of doing business" as part of a risk mitigation strategy, which is inapposite to the circumstances in which the plaintiff had to incur the ATE Costs in this case. 3. It is unnecessary to summarise the submissions in reply, save to say that although they extended to the character of the ATE Costs as "costs" or "disbursements", they did not deal in any detail with whether they were "expenses". 4. In the course of preparing this judgment, the Court reviewed Cachia v Isaacs (Court of Appeal (NSW), 23 March 1989, unrep), an unreported decision of this Court in which a litigant in person succeeded on appeal and was awarded costs, which included a bank guarantee fee incurred in order to comply with an order for security for costs, and Burford v Allan [1998] SASC 6693, an unreported decision of a Full Court of the Supreme Court of South Australia in which it was held that the costs recoverable by a successful plaintiff did not include an amount paid by way of interest and charges for a litigation loan. Both were prima facie relevant, and there is, to say the least, a tension between the reasoning in each decision. 5. On 20 March 2024, the Associate to Gleeson JA sent the following email to the parties' lawyers: The purpose of this email is to invite the parties' submissions on the treatment of ATE Costs. Without intending to traverse the entirety of the parties' submissions, the Court observes that: 1. Paragraph 20 of the first respondent's submissions dated 2 February 2024 refers to correspondence in which the appellant contended that the ATE Costs were legal costs or disbursements. Paragraphs 21-25 submit that they are not disbursements. 2. Paragraph 32 of the appellant's submissions dated 16 February 2024 asserts that the ATE costs were "expenses necessarily incurred to enable the litigation to be pursued". 3. Paragraph 9 of the first respondent's submissions in reply dated 23 February 2024 denies that the ATE Costs are disbursements, and submits that "an expense incurred to enable the litigation to be pursued does not render that expense recoverable". Some of the parties' submissions extend to whether the ATE Costs are an "expense", but the focus appears to have been on whether they are "disbursements". The Court notes that "costs" is defined in s 3 of the Civil Procedure Act to include "expenses". The Court draws to the parties' attention the unreported decision of Cachia v Isaacs (Court of Appeal, 23/3/89, unrep; BC8902724), a copy of which is attached. The Court would also be assisted by submissions on Burford v Allan [1998] SASC 6693; BC9802071, and any later relevant consideration of it. The Court invites the parties to provide any supplementary submissions, if they see fit, within seven days of today, on whether or not the ATE Costs are "expenses" which may be within the power to order costs pursuant to s 98 of the Civil Procedure Act. 1. Mrs Anderson, Patersons and PPB provided submissions in response. Perhaps unsurprisingly, Mrs Anderson submitted that this Court should follow Cachia v Isaacs and that Burford v Allan was wrong and to the extent necessary "plainly wrong", while Patersons and PPB submitted that this Court should follow Burford v Allan and that the reasoning in Cachia v Isaacs was inapplicable. (Once again, despite the subsequent settlement with Patersons, it is convenient to refer to the submissions made by Patersons, which were adopted by the active respondents.) 2. Mrs Anderson reiterated her primary contention that whether the ATE Costs were recoverable on a party/party basis need not be decided, but said that if the issue fell to be determined, then they were within the power to order under ss 3 and 98 of the Civil Procedure Act 2005 (NSW), that Cachia v Isaacs was "direct authority of this Court that the power to award costs extends to 'out of pocket expenses', and included costs associated with obtaining security such as the ATE Costs", that Burford v Allan should not be followed because it dealt with a different statutory regime and involved an outcome which the Court itself regarded as unjust, and if necessary should be found to be plainly wrong with compelling reasons to depart from it. 3. Patersons said that Cachia v Isaacs and Burford v Allan together with the definitions of "costs" and persuasive international common law jurisprudence supported the conclusion that the ATE Costs were not "expenses" for the purposes of the Civil Procedure Act, and even if they were, the Court should not in its discretion order that they be recoverable as such. Patersons acknowledged that "costs" was defined to include "expenses", which term was not itself defined, and should "not be construed as extending to expenses of a kind not concerned directly with the legal enforcement of the parties' obligations and should be confined to those expenses such as disbursements which are ordinarily encompassed by conventional orders for costs". Patersons said that this Court's decision in Cachia v Isaacs was "not binding or controlling here", because Samuels JA (with whom Clarke JA agreed) gave no account of whether the bank fee and associated expenses were in fact "expenses" for the purposes of the rule then in question, while Kirby P, dissenting in the result, focussed upon the inconsistency in the taxing officer's rulings. Conversely, Patersons said that Burford v Allan was "directly on point" and unlike Cachia v Isaacs "carefully addressed and analysed the metes and bounds of the statutory meaning of 'costs' in an equivalent statutory provision". Patersons also submitted, by reference to McGraddie v McGraddie [2015] UKSC 1; [2015] 3 All ER 61, Houghton v Saunders [2019] NZCA 285 and a line of first instance Canadian decisions, that ATE premiums and fees were not recoverable. Finally Patersons said that the "deed fee" should be treated in the same way as the ATE premiums. 4. PPB adopted Patersons' submissions, and added that while there was an analogy between some of the items considered in Cachia v Isaacs and the ATE Costs, nonetheless "Cachia v Isaacs should not be regarded as authority for some general proposition that a costs order permits recovery of expenses incidental to the provision of security, much less unusual and significant expenses such as the ATE Costs in the present case". PPB drew attention to the change in regulatory regime, from taxation to assessment, including the new legislation governing "ordered costs" and the new provision requiring a costs assessor to determine "what is a fair and reasonable amount of costs for the work concerned", which was said to suggest that ordered costs were "generally the costs of the proceedings, and not of the attainment of justice or the enforcing or defending of rights". PPB added that there was no detailed consideration of the costs associated with the provision of security for costs, nor any analysis of the meaning of "expenses", leading to the conclusion that Cachia v Isaacs was "neither binding nor persuasive authority" on the question before this Court. 5. PPB also said that the modest expenses claimed in Cachia v Isaacs were different from the ATE Costs, not merely in magnitude, but also in character. It was said that "the appellant incurred the liability to pay the ATE Costs because of her choice to provide security in an atypical form, being an indemnity from an insurer which charges premiums as opposed to a guarantee from a bank which only charges relatively modest fees". It was said that it would be "anomalous, if not contrary to the purpose of an order for security for costs, to require the defendant to compensate the plaintiff for the latter's costs of providing security at all, and particularly so if security is provided in a form other than the usual ways", in a case where the plaintiff succeeded. 6. PPB made this submission: It would be unfair in the present case to disadvantage the respondents because of the appellant's choice of form of security, even if that choice was necessitated by her impecuniosity. This is particularly the case given that the amounts of the 'ATE Costs' were not disclosed at the time security was sought and provided in 2020, and there was no foreshadowing that these amounts would be sought as part of a costs order in due course. Those matters might have had some bearing upon the decision of the primary judge to accept security in the form proposed by the appellant, not least in the form of conditions that might have been attached to such acceptance. It is, for example, not inconceivable that having regard to the atypical form of the security sought to be furnished, her Honour might have required that the appellant herself bear the costs of providing security in that form. The 'ATE Costs' were only disclosed to the respondents for the first time in the form of references to them in the Acorn Settlement Deed and Albany Settlement Deed, and those deeds and the documents giving rise to the ATE Costs were only provided to the respondents for the first time in December 2023, years after security was provided … 1. PPB said that the ATE Costs were more analogous to the costs of funding the litigation discussed in Energy & Resource Conservation Co or the interest on the litigation loan discussed in Burford v Allan, and should not be recoverable as costs. 2. Ms Garrett and Mr Renauf adopted the submissions of Patersons and PPB. Consideration 1. First, the uncontroverted affidavit evidence supplied in support of Mrs Anderson's position is that there was no other source of funding available to her to obtain the means of discharging the orders that she provide a final tranche of security in advance of the trial. No application was made to cross-examine Mrs Anderson. We do not accept the submissions made on behalf of PPB, including in the passages quoted above, to the effect that Mrs Anderson made some "choice" to incur the ATE Costs. Everything we have seen about this litigation suggests that it was hard-fought, with at least some of the defendants taking very active steps to avoid a trial on the merits through exercising their entitlements to security for costs. It is not suggested there was anything necessarily improper in that course, although (to anticipate an issue addressed below) it is disquieting to learn that the motion for security for costs and to set aside some subpoenas, heard over parts of two days, resulted in total costs in the order of $300,000-$500,000). 2. Secondly, there is a difference between a "cost" or "expense" or "disbursement" incurred in litigation, and an amount paid whereby a third party obtains an interest in the outcome of the case in exchange for indemnifying the plaintiff. True it is that from the plaintiff's point of view, it is another cost or expense of the litigation. However, the third party is not merely providing a service like a lawyer or an expert or a photocopier. An integral part of the role played by "Lloyd's Syndicate 4000 (Hamilton)" is that it is investing in the potential success of the litigation. The present case is quite stark, because most of the third party's remuneration (ie, the so-called "Balance of Premium") was only payable in the event that Mrs Anderson achieved a "Positive Outcome". We shall return to this below. 3. Thirdly, the question is quite narrow. The question is not whether the ATE Costs were causally connected with the breaches of duty for which Mrs Anderson sued. Nor is the question whether the ATE Costs are "recoverable" in some abstract sense. The question which is sufficient, on the view we take, to resolve this issue, is a very precise one: is there power to make a costs order in favour of Mrs Anderson which extends to an obligation that the respondent pay the ATE Costs. 4. That is on any view a narrower question than the explicitly obiter observations in Gill v Ethicon Sàrl (No 12) which were about the recoverability of certain litigation expenses as part of a settlement of representative proceedings, about which we express no view. Nor is it necessary to express any view on whether, and if so in what circumstances, costs incurred by Mrs Anderson are recoverable as part of the loss caused to her by the breaches of duty by the respondents. That was what was accepted by a majority of the Queensland Court of Appeal in Landoro, albeit only as a contention which could be pleaded and which should not be dismissed as "so obviously untenable that [it] cannot possibly succeed": see at [12] (Davies JA, with whom McMurdo P agreed). Davies JA emphasised that "To allow these claims to proceed is not, by any means, to assert their correctness". Likewise, it is neither necessary nor appropriate in these reasons to express a view as to the recoverability by way of compensable loss of the premiums for after-the-event insurance, either generally or in the particular circumstances in which Mrs Anderson (a relatively impecunious assignee who was for a time out of the jurisdiction) found herself. 5. Fourthly, we note that the ATE Costs were, save in one minor respect, not the costs of funding Mrs Anderson's own litigation. Instead, they were the costs of obtaining an indemnity required to comply with orders for security for costs sought and obtained by the respondents. As noted at the outset, and as will be developed below, that distinction makes this a clear case, because we are of the view that the active respondents should not obtain the benefit of a reduction in the amount of equitable compensation they must pay by reason of the fact that Albany has reimbursed Mrs Anderson for costs she incurred in order to comply with orders for security for costs brought by respondents who have now been found to have been wrongdoers. This decision does not decide anything concerning other instances of ATE insurance. 6. In answering that narrow question, we regard general observations to the effect that costs are a partial indemnity of no material assistance. Nor is any "rule" that a party cannot by a costs order recover "expenditure on litigation". Plainly a party can recover some amounts (such as filing fees) which are fairly described as "expenditure on litigation". Contrary to the general statements invoked in the submissions of Mrs Anderson and all active respondents, the solution to the issue will not turn on those general propositions, but on a careful analysis of the scope of the power to order costs. 7. It is sensible first to address PPB's broader submission that it obtain credit for the entirety of the amounts paid by Acorn and Albany, before turning to PPB's secondary submission, which was also the submission made by Ms Garrett and Mr Renauf, and formerly Patersons, concerning the ATE Costs. PPB's broader submission that Mrs Anderson must give credit for the entirety of the amounts paid by Acorn and Albany 1. Ms Garrett and Mr Renauf made no challenge to Mrs Anderson's allocation of the entirety of the payment made by Acorn to costs (save for ATE Costs). However, PPB submitted this was wrong. 2. PPB said that the relevant question was "whether the claims settlement by payment of those amounts was for the same loss as that which was the subject of the Judgment". If so, then according to PPB the claims are concurrent and allowance should be made for the settlement amount. It was said that the Acorn and Albany settlements were a compromise of Mrs Anderson's claim for equitable compensation, and "[i]t matters not that the appellant also settled her claim for costs, which is contingent on the substantive claim". It was said that Mrs Anderson's claim for costs was also "a concurrent claim in the relevant sense, and one which cannot be severed from the substantive claim". PPB said that it did not matter that the settlement deeds characterised amounts paid by Acorn and Albany as representing particular expenses incurred by Mrs Anderson, in circumstances where the settlement sums were paid in full and final settlement of all claims, which included the claims for equitable compensation. 3. Mrs Anderson submitted that PPB's argument is "contrary to authority, without merit, and can be dispensed with shortly". She said that a claim for costs is not concurrent with a substantive claim for damages. She said that in the absence of grounds asserting that a settlement was collusive or not made bona fide, the settlement terms "conclusively determine the question", both as to apportionment and as to the settling parties' liability in respect of the claim to which payment is apportioned: citing FM Capital Partners Ltd v Marino [2021] QB 1; [2020] EWCA Civ 245 at [69]-[70]; Townsend v Stone Toms & Partners (1984) 27 BLR 26 at 41, 51; Kea Investments Ltd v Watson [2023] EWHC 1830 (Ch) at [35]. She said that was supported by the public policy in favour of encouraging settlement, which extends even to claims that may be "unfounded and worthless", and would be undermined if a plaintiff had to give credit for the settlement sum to another defendant unless it could establish the merits of a settled claim: FM Capital at [70]. She said the express apportionment of payments under a settlement deed to particular losses or costs, as occurred here, accompanied by evidence that those costs have in fact been incurred and paid, was sufficient to discharge any evidentiary onus upon a plaintiff to show that payments do not relate to a concurrent loss for which credit has not been given. She said that the breadth of a release which is provided as part of a settlement does not affect the position, consistently with what was said in McMillan Investment Holdings PL v Mangos (No 3) [2023] NSWSC 1327 at [63] and Banque Keyser Ullman SA v Skandia (UK) Insurance Co Ltd (No 2) [1988] 2 All ER 880 at 882. 4. PPB's submissions in reply sought to confine the decisions upon which Mrs Anderson relied: Those cases thus stand for no broader proposition than that a settlement of all causes of action against previous defendants may, following judgment against the remaining defendants, be allocated against any concurrent claims for pecuniary relief, costs and interest in whatever sequence the plaintiff determines. It is, however, something else to say that where the claims against all defendants are concurrent, the plaintiff may, while settling all claims made against some defendants, determine that the relevant settlement sums are to be allocated to some concurrent claims but not others, leaving her free to achieve double recovery in respect of those concurrent claims against which no allocations have been made. And this is notwithstanding that the remaining defendants are not bound by those arrangements. Consideration 1. We agree with Mrs Anderson that PPB's submission must be rejected. However, PPB's complaint is not without superficial attraction. It may seem passing strange that the allocation of costs agreed by a plaintiff and a defendant who compromise a claim can detrimentally affect the judgment and costs to which the plaintiff is entitled against a co-defendant who does not participate in the compromise. 2. One of the problems here is the loose language deployed by PPB in its submissions. It says that acceptance of Mrs Anderson's submissions will leave her "free to achieve double recovery in respect of those concurrent claims against which no allocations have been made". But what precisely is meant by "double recovery" is passed over. 3. The sort of issue that arises in this case has arisen in civil litigation for centuries. As is often the case, it is helpful to approach the problem by having regard to the divergent approached taken at law and in equity to the problem. As much is apparent from the authorities on which PPB and Mrs Anderson relied. Puchas LJ influentially described "the rule against double recovery" in Townsend at 49: It follows that if in the first action a plaintiff recovers all that he is entitled to, then there is nothing left to recover in the second action. The law, now embracing equity, will not permit a plaintiff, by whatever procedural device he employs, to recover more than the damage that he has suffered, whether he claims in contract, tort or both. 1. That formulation has repeatedly been followed and applied in Australia, notably in Boncristiano v Lohmann [1998] 4 VR 82 at 89, where Winneke P substantially restated the principle in similar terms: The law, which now embraces equity, will not permit a plaintiff, whatever procedural device is used, to recover more than the damages which have been suffered, no matter what the cause of action upon which he proceeds against the various defendants. 1. The reference to "[t]he law, which now embraces equity" indicates that the response to this issue at law and in equity diverged. 2. The starting point is that "double recovery" in this context means actual double recovery. Take the very orders made in this case. Mrs Anderson obtained judgment against each of Patersons, Ms Garrett, Mr Renauf and PPB in the amount of $3,016,304.23 (note that it was not suggested that any of the claims were apportionable claims to which Pt 4 of the Civil Liability Act 2002 (NSW) applied). That does not mean that she can recover $3m from each respondent. As it happens, those judgments were obtained on the same day, and in the same appeal. But it is clear that even if Mrs Anderson had brought separate proceedings against the various defendants, which were determined at separate times, judgment in her favour against a defendant in one proceeding would not be a defence or bar to her obtaining judgment against another defendant in a second proceeding. 3. The position at law was explained by Lord Goddard writing for the Court of Appeal in B O Morris Ltd v Perrott and Bolton [1945] 1 All ER 567 at 569-570: [W]here there is no joint contract or relation of principal and agent an unsatisfied judgment against one person for the price of goods sold is not a bar to a subsequent action against another for the price of the same goods. It is clear that the test is not whether the subject matter of the contract is the same in both actions but whether her cause of action is identical in both. If it is, as is the case if the liability arises on a joint contract, judgment against one contractor is a bar to an action against another, as laid down in King v Hoare and Kendall v Hamilton. If the causes of action are different, judgment without satisfaction against one is no bar to an action against the other, and this is so even if the plaintiff deliberately refrains from proceeding to execution on the first judgment. The same is true in tort, as, for instance, where there have been successive conversions of the same goods, trover lies against all persons guilty of conversion and recovery of damages against one is no answer by the defendants in subsequent actions, though a second or subsequent defendant is entitled to credit for what may have been recovered in a former action and as soon as full satisfaction has been obtained the plaintiff has exhausted his rights. 1. Indeed, the familiarity to modern eyes of joining all of a plaintiff's causes of action in a single proceeding may make it hard to appreciate how foreign this would once have seemed. J Chitty and T Chitty, Chitty's Treatise on Pleading (6th ed, 1836, Stevens & Sons) addresses this point at 43-44: Where parties are sued separately, on a joint and several engagement to do a certain act … a recovery, and execution against the body of one, producing no actual satisfaction, will be no bar to an action against the other. And when the contract is joint and several, and the debt or demand considerable, it is most advisable to proceed separately, for if all the parties be joined, and one of them die after judgment, and before execution, the remedy at law against the personal estate or assets of the deceased is determined; and in the case of the death of a surety, even a court of equity will not in all cases relieve … In general, when a contract was joint and several, if the debt be considerable, it is most advisable to proceed separately, so that the creditor may thereby retain his legal remedies against each in case of death of one or more of the parties. (Citations omitted.) 1. That passage confirms that far from there being anything untoward let alone unconscionable in obtaining separate unexecuted judgments for the same loss in the case of a joint and several contract, that was the advisable course to take. 2. When then did a defendant have a defence at law because the plaintiff had already obtained a judgment for the same loss? The answer is only when that judgment had been recovered, or when the plaintiff had agreed to accept recovery of that judgment in satisfaction of the loss. As Gleeson CJ and Callinan J said in Baxter v Obacelo Pty Ltd (2001) 205 CLR 635; [2001] HCA 66 at [46]: If a plaintiff has agreed with one tortfeasor to accept a sum upon the basis that it will be received in full discharge of all claims for compensation for the loss or damage incurred by the plaintiff, it would ordinarily be unconscientious to pursue a further claim in relation to the same damage against another tortfeasor. And if a single loss has been fully recouped, there is no further remedy for a plaintiff to pursue. See also at [55]-[62] (Gummow and Hayne JJ). 1. It is not suggested that Mrs Anderson agreed with Acorn or Albany that her settlements with them would fully discharge the liability of the active respondents, and hence the question becomes what has she actually recovered. 2. Equity prevented a plaintiff from executing on multiple judgments in respect of the same loss. As Lord Goddard went on to say (at 570) in B O Morris, "Formerly had a plaintiff endeavoured to recover by execution on both judgments more than the real amount the Court of Chancery would have restrained him, exercising the jurisdiction it possessed of restraining proceedings at law". 3. These distinctions were apparent to Walsh JA, sitting on a pre-Judicature appeal to this Court in New South Wales in 1967, in Castellan v Electric Power Transmission Pty Ltd (1967) 69 SR (NSW) 159 at 176: I am prepared to assume that it was a rule of the common law that, if an injured person obtained judgment and also satisfaction against one tortfeasor, the liability of another concurrent tortfeasor was thereby discharged, although there is some ground for thinking that the source of the inability to maintain a further action in such a case was an equitable principle which would preclude the plaintiff from obtaining double satisfaction. But at all events his further action could be defeated, and for present purposes it may not matter whether this would be done by a plea at common law of the former judgment and satisfaction or by a perpetual stay of the action or by an injunction. (Footnote omitted.) 1. More recently in Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 507; [2015] HCA 28 at [27] the joint judgment referred to the "the distinct rule, equitable in origin, which prevents a person from actually recovering more than once for a given loss that results from breach of a given obligation". 2. It will be noted that Walsh JA referred to obtaining judgment "and also satisfaction", while the joint judgment in Tomlinson referred to "actually" recovering more than once. Those formulations reflect the proposition that merely obtaining a judgment did not engage the rule. 3. This is well illustrated by Registrar-General (NSW) v Behn (1981) 148 CLR 562; [1981] HCA 36, which is one of the decisions cited in Tomlinson. A defrauded landowner sued the fraudster Cornic to judgment, and then sued the Registrar-General for recovery out of the assurance fund pursuant to s 126 of the Real Property Act 1900 (NSW). The High Court rejected the Registrar-General's argument that the judgment the respondent had already obtained prevented her claim on the fund. Gibbs CJ, with whom Mason J agreed, said (at 568-569): The crucial question in the case is whether the respondent, having successfully sued Cornic to judgment on the contract, could, while that judgment stands, successfully sue Cornic again under s 126. There is no reason in law why the respondent could not do so. … Moreover, since the judgment obtained by the respondent against Cornic had not been satisfied, its existence would not mean that the respondent had sustained no damage as a result of the wrongful deprivation of the land. An action brought against Cornic under s 126 would therefore have succeeded even if Cornic had been solvent. 1. Gibbs CJ added that it would not be right to say that the respondent would have been able to proceed to execution on both judgments. The joint judgment of Murphy, Aickin and Brennan JJ stated at 571, consistently with the above, that: There is no reason why actions should not be brought against both provided there is no double recovery of damages. The respective measures of the damages recoverable by action against the person primarily liable and against the Registrar-General are the same, but the liabilities are several, and the extinction of the cause of action against the person primarily liable does not extinguish the cause of action against the Registrar-General. 1. Applying those principles to the position following Mrs Anderson's settlements with Acorn and Albany, it is quite clear that she does not seek actually to recover more than once for a given loss. Putting to one side the ATE Costs (and interest thereon), the amount Mrs Anderson has agreed with Acorn and Albany to be apportioned to her costs is considerably less than the costs she has in fact paid, as well as being considerably less than the recoverable costs determined by the judgment today. And Mrs Anderson accepts that she must give credit for the entirety of the payments from Acorn and Albany. 2. Nonetheless, it is true that Mrs Anderson has in fact received the amounts paid by Acorn and Albany. To use the language of Gleeson CJ and Callinan J in Baxter v Obacelo, which reflects the equitable origin of the principle invoked by PPB, is it unconscionable of Mrs Anderson to allocate the money she has actually received from Acorn and Albany (aside from ATE Costs) to her costs? PPB says that she must give credit for those amounts when seeking judgment on any "concurrent" claim. Mrs Anderson's entitlement to costs was not "concurrent" with her claim for equitable compensation 1. PPB relies on what was said by Winneke P in Boncristiano at 89: It is not to the point to argue, as Mr Ritter who appeared on this appeal with Mr Wilmoth for the owners was inclined to argue, that the claims made against the various defendants proceed from different causes of action. The fundamental question is whether the claims against the various defendants are "concurrent" in the sense that the relief sought is the same. 1. Simplifying the facts slightly, in Boncristiano the owners sued a builder and a solicitor, and accepted a settlement of $5,000 from the solicitor in "full and final settlement of the … proceeding" against them. 2. Winneke P said at 89 that "the fact of payment raises against the owners a presumption that the amount of the settlement was offered and accepted in satisfaction of the concurrent claim made by the owners against the solicitors and the builders", and applied what had been said by Oliver LJ in Townsend (at 41) concerning the presumption that arises where a plaintiff accepts payment in causes of action where there are concurrent claims, that: If it is to be said that the payment-in relates to some claims which are not concurrent, or which could not succeed against the defendant, the only person capable of providing that guidance is the plaintiff himself, who has accepted the payment. 1. The ratio of the relevant aspect of Boncristiano is found at 90: The builders having proved that the owners had accepted the sum of $5000 from the solicitors in "full and final settlement of the … proceeding" against them, the builders were entitled to claim, as they did, that such sum should be presumed to have been accepted in fulfilment of the concurrent claims made by the owners against them and the solicitors. 1. Boncristiano was not a case where the plaintiff and the settling defendant agreed as to the apportionment of the amount paid. Ultimately the decision turned on the fact that the owners had not established that the moneys received from the solicitors related to another claim. 2. We do not accept PPB's submission that the costs are "'concurrent' in the relevant sense" with the claim for equitable compensation. As is clear from what has already been said, this area of the law turns on actual recovery. The actual recovery of a judgment sum is different from the actual recovery of a costs order. Ordinarily, the difference is very stark: the process of obtaining execution of a judgment debt (including by bankruptcy notice, petition for winding up, garnishee, lodging of a writ) is very different from the process of assessment which will ultimately yield a costs certificate which in turn can be lodged in a court and enforced as if it were a judgment debt. The absence of concurrency is plain. There will be one judgment debt representing equitable compensation (and interest on equitable compensation), and a separate judgment debt representing costs (and interest on costs). 3. The entitlement to a judgment for an amount of equitable compensation reflecting the loss caused by breaches of duty is separate from an order entitling a litigant to costs. There will be cases where one is not accompanied by the other. The entitlement to costs depends upon the exercise of a separate discretionary power under statute, although of course one highly relevant consideration informing the exercise of that power is whether the plaintiff has succeeded in obtaining equitable compensation. 4. Boncristiano is accordingly distinguishable on two bases. The first is that Mrs Anderson's claim for equitable compensation is different from her claim for costs. The second is that the settlement deeds executed by Acorn and Albany expressly apportioned the amounts paid to costs. It is necessary to elaborate the consequences of the settling parties doing so. A plaintiff's entitlement to allocate amounts received amongst separate claims 1. A plaintiff who succeeds against a defendant in a money sum will often also be entitled to a favourable costs order. There is no reason why a plaintiff who settles against one defendant may not treat part or all of the settlement of the claim as going to the plaintiff's loss, and the balance as going to costs. There is nothing especially artificial about doing so; indeed, the plaintiff may be obliged to do so at least for some purposes, including its own accounts and taxation, especially if, say, the judgment sum represents capital and the legal costs represent a deductible expense. The settling parties' treatment is not determinative, and thus for example if the amount paid is out of all proportion to the plaintiff's recoverable costs, the court may go behind what has been agreed. Consistently with this, White JA's reasons in Mills v Walsh [2022] NSWCA 255 at [35] pointed to the absence in that case of any allocation in the settlement between damages and costs. 2. Where a settlement is inclusive of costs, Steyn J held that the party against whom a defence of satisfaction is pleaded will be entitled to deduct the costs of the settled action before having to give credit for the amount received under the settlement: Banque Keyser Ullman at 882. That was noted with evident approval by McColl JA in Nau v Kemp & Associates Pty Ltd (2010) 77 NSWLR 687; [2010] NSWCA 164 at [108]. 3. The position is unaffected by broadly worded releases being included in a compromise. We respectfully agree with what was said by Chen J, in a decision cited by Mrs Anderson and PPB, in McMillan Investment Holdings at [63]: The fact that a broadly worded release is provided (unremarkably, given its purpose) in my view does not amount to a claim by the plaintiff seeking the same loss or damage (less still a recovery) nor, in the present situation, does it engage, in my respectful view, the rule against double compensation. 1. The Court of Appeal of England and Wales has considered these issues in some detail. Most recently, in FM Capital, a company sued both its director and chief executive officer Mr Marino, and its director and chief investment officer Mr Bessot. (There was a third defendant whose appeal was dismissed other than on the merits, and the summary which follows omits reference to him for simplicity, and without distorting the principles applied.) Before trial, the company settled against Mr Bessot, and received a payment of US$2.8m. Sir Jack Beatson writing for that Court addressed the effect of a settlement on the judgment obtained against Mr Marino following trial. Importantly, the trial of the company's claims had been split into "phase 1" and "phase 2" claims, in part on the basis that "unless it was discovered that Mr Marino had significant undisclosed assets, the sums involved meant that in this case a second trial was 'the least likely outcome'": see at [16]. The company obtained judgment on the phase 1 claims against Mr Marino in the amount of $17.35m. The company apportioned the $2.8m recovered from Mr Bessot thus: $221,799.82 as to costs incurred in bringing and settling the claim against Mr Bessot, $435,101.03 to phase 1 claims, and $2,143,099.15 to phase 2 claims: see at [27]. That was said to be a "pro rata" approach having regard to the magnitude of the claims, and resulted in a 17% apportionment to phase 1 claims and a 83% apportionment to phase 2 claims. 2. Mr Marino sought to set off more of the settlement from Mr Bessot than the $435,101.03 apportioned by the claimant. The trial judge, Cockerill J, considered that the apportionment was not "obviously unsustainable" and declined to interfere: [2018] EWHC 2905 (Comm) at [26]-[27]. 3. On appeal by Mr Marino, the allocation of costs was not challenged, and the challenge turned upon whether the trial judge had erred in applying an undemanding "not obviously unsustainable" test on the 17%:83% split between phase 1 and phase 2 claims. 4. First, Sir Jack Beatson, with whom the other members of the Court agreed, made the same point as had been made in Townsend that cases like this were "highly fact sensitive" and that general rules should be avoided: at [42]. 5. Secondly, the Court emphasised the fact that in many cases of a compromise it would be difficult to form a view on the strength or weakness of a case, and the desirability of avoiding a mini-trial on the compromised claim. 6. Thirdly, the Court confirmed the qualification that where the apportionment involved collusion or bad faith, then it was not bound: see at [69]-[70]. Different considerations will apply if two parties compromising a claim agree to characterise part of the settlement in a way that bears no relation to the actual entitlements of the party. If say Acorn and Albany had paid $15,000,000 in settlement of Mrs Anderson's claims against them, and agreed that it would be treated as discharging Mrs Anderson's claim to costs only, then it would be unconscionable for Mrs Anderson to assert that PPB nonetheless had to satisfy a judgment. That is because it would permit Mrs Anderson actually to recover twice for the same loss, in circumstances where notwithstanding what Mrs Anderson had agreed with Acorn and Albany, it was clear that much of the $15,000,000 must represent the losses sustained by the Ashington companies that assigned their rights to her. 7. However, PPB denies that it is open to Mrs Anderson, Acorn and Albany to apportion most of the money received from the settlements to costs. PPB maintains that because Mrs Anderson sued PPB for the same loss, and obtained general releases from Mrs Anderson in respect of her claims against Acorn and Albany for the same loss, the amounts paid pursuant to the settlement must be treated as being actually received in diminution of the loss for which she sues PPB. 8. We do not agree. The entitlement to costs is separate from, and not "concurrent" with, the claim for equitable compensation. There is nothing in Mrs Anderson's acceptance of money from Acorn and Albany to lead to the inference that in so doing she was treating those funds as diminishing her loss as opposed to diminishing her entitlement to recover costs. Still less is there anything in the terms of the settlement which would make it unconscionable for Mrs Anderson to look to the active respondents to pay the whole of her loss less the ATE Costs. Conclusions 1. There is no suggestion that the terms of the settlements were collusive or other than bona fide. In light of the evidence in support of the gross sum costs order, it is plain that Mrs Anderson's recoverable costs would considerably exceed the amount allocated to costs in her settlement with Acorn and Albany. Mrs Anderson's claim for equitable compensation is not "concurrent" with her claim for costs. They are different losses, and the source of Mrs Anderson's entitlement to each amount was different. There is thus nothing contrary to conscience in Mrs Anderson seeking the entirety of the judgment of the equitable compensation which the active respondents are required to account, plus interest, against each active respondent. 2. No question of evidentiary onus arises. Many of the decisions in this area arise in the case of settlements where the parties to the compromise have not expressly allocated the settlement sum to any particular claim, and in such cases, there is said to be an evidentiary onus upon the settling parties to establish that a sum paid by one defendant who settles a concurrent claim is not to be regarded as a recovery in respect of which credit must be given by the plaintiff in its claim against another defendant: see for example Boncristiano at 89, where Winneke P said that "the fact of payment" raised a presumption that the amount was offered in settlement of the concurrent claim, and the "evidentiary onus" to which Mason P referred in SAS Trustee Corporation v Budd [2005] NSWCA 366; 3 DDCR 382 at [49]-[50]. But that is not this case. 3. For those reasons, we do not accept PPB's submission. Are the ATE Costs recoverable as Mrs Anderson's disbursements or expenses? 1. Section 98 of the Civil Procedure Act provides, relevantly: 98 Courts powers as to costs (cf Act No 52 1970, section 76; SCR Part 52A, rules 5, 6, 7 and 8; Act No 9 1973, section 148B; Act No 11 1970, section 34) (1) Subject to rules of court and to this or any other Act— (a) costs are in the discretion of the court, and (b) the court has full power to determine by whom, to whom and to what extent costs are to be paid, and (c) the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis. (2) Subject to rules of court and to this or any other Act, a party to proceedings may not recover costs from any other party otherwise than pursuant to an order of the court. … 1. As confirmed by s 98(2), the recoverability of costs between parties to proceedings turns primarily upon an order of a court. The regime is different from that between legal practitioner and client. One aspect of that difference may be seen in definitions of "ordered costs" and "Uniform Law costs" in s 63 of the Legal Profession Uniform Law Application Act 2014 (NSW). "Uniform Law costs" under Pt 7 of that Act are legal costs payable on a solicitor-client basis (see s 196 of the Legal Profession Uniform Law (NSW)) and assessed as such under Div 7 of Pt 4.3 of the Legal Profession Uniform Law (NSW), which contains its own definition of "legal costs". However, "ordered costs" are defined to mean "costs payable under an order or rule of a court or tribunal", such as costs payable pursuant to s 98 of the Civil Procedure Act. That Act defines "costs" in s 3 as follows: costs, in relation to proceedings, means costs payable in or in relation to the proceedings, and includes fees, disbursements, expenses and remuneration. 1. The parties' submissions were principally directed to whether the ATE Costs were "disbursements" or "expenses" within the meaning of that definition. The submissions exchanged prior to this Court's request for further submissions on 20 March 2024 were primarily directed at the meaning of "disbursements", with the subsequent submissions focussing on "expenses". We shall address them in the same order. Disbursements 1. "Disbursements" are not defined. But the concept of "disbursement" has been used in the area of solicitor's costs for many years, and there is no reason to doubt that it bears its traditional meaning, in accordance with the principle stated by O'Connor J in Attorney-General (NSW) v Brewery Employes Union of New South Wales (1908) 6 CLR 469 at 531; [1908] HCA 94, namely, "Where words have been used which have acquired a legal meaning it will be taken, [prima] facie, that the legislature has intended to use them with that meaning unless a contrary intention clearly appears from the context". That principle was applied to the word "disbursement" in the Queensland Law Society Act 1948 (Qld) in Legal Services Commissioner v Dempsey [2007] QSC 270 at [35], appeal dismissed [2008] 2 Qd R 272; [2008] QCA 122. 2. As explained in G Dal Point, Law of Costs (5th ed, 2021, LexisNexis) at [1.8], the classic definition is that of Lord Langdale in In re Remnant (1849) 11 Beav 603 at 613; 50 ER 949 at 954: And it seems to me a very reasonable and proper rule, that those payments only, which are made in pursuance of the professional duty undertaken by the solicitor, and which he is bound to perform, or which are sanctioned as professional payments, by the general and established custom and practice of the profession, ought to be entered or allowed as professional disbursements in the bill of costs. 1. That proposition was informed by the advice which the Master of the Rolls had taken from the taxing masters, which he recorded as follows: That such payments as the solicitor, in the due discharge of the duty he has undertaken, is bound to make, so long as he continues to act as solicitor, whether his client furnishes him with money for the purpose or with money on account, or not: as, for instance, fees of the officers of the Court, fees of Counsel, expense of witnesses etc. 1. Dal Point explains the distinction between "professional disbursements" for which the lawyer was duty bound to pay even if not put in funds by the client, and "non-professional disbursements", being monies paid as the client's agent, saying that the latter should be entered into the solicitor's cash account, but not on a bill of costs: see at [1.8]-[1.9]. However, only professional disbursements, as opposed to non-professional disbursements, are subject to costs assessment: see at [5.43]. 2. Ultimately the question is whether Mrs Anderson is entitled, when bringing to account the ATE Costs paid to her by Albany, to attribute the ATE Costs as an aspect of her own entitlement to costs, with the consequence that they clearly would not diminish the entitlement she enjoys to equitable compensation against the active respondents. If it were necessary for Mrs Anderson to establish that the ATE Costs fall into a category, the limits of which are defined by what is recoverable pursuant to a favourable party/party costs order, that inquiry would necessarily involve an analysis of what is recoverable pursuant to such an order. In turn, that inquiry would require one to return to the statutory basis of a litigant's entitlement to party/party costs. 3. Mrs Anderson's contention amounts to a submission that the definition of disbursement in In re Remnant is too narrow. However, a great deal of authority is contrary to Mrs Anderson's submission that merely because a cost is incurred in conducting litigation, it is a disbursement and therefore recoverable as part of a costs order. The decisions on "disbursement" under earlier English and Australian rules concerning costs inform the current (undefined) meaning of disbursement in the Civil Procedure Act. 4. In In re Buckwell & Berkeley [1902] 2 Ch 596, a solicitor acting for a plaintiff provided security in the amounts of £5 for the costs of discovery of documents and £8 for the costs of discovery by interrogatories. The action was compromised on terms (inter alia) that the defendant pay the plaintiff's costs. The plaintiff's solicitor sought to have taxed a bill of costs which included the two amounts paid. The taxing master disallowed those amounts, Kekewich J disagreed, but the Court of Appeal restored the decision of the taxing master. Vaughan Williams LJ applied In re Remnant and said at 599-600: [T]hese payments were not payments which the solicitors were "either by law bound to make, or by custom looked upon as the persons to make", on behalf of their client. The solicitors did in fact find the money to make the payments into court as required by the rules, but the money was simply lent by them to their client. I think the appeal should be allowed. 1. Romer LJ agreed, giving two reasons at 600. The first was: [T]hese payments cannot be distinguished in principle from any sum which a person is ordered to pay into court to enable him to proceed with his action. Take, for instance, a case in which a party who is out of the jurisdiction is ordered to pay money into court as security for costs. In such a case the solicitor would not be bound to find the money; but, if he did find it, whose money would the sum paid into court be? Clearly the money of the client. It would be a loan from the solicitor to the client, and ought to be entered in the cash account, and not to be treated as a "disbursement". 1. The second reason was that the amounts paid would be returned to the client if the client were successful. 2. What Tadgell JA described as "the standard textbook on costs in this State [scil Victoria]" and also the work of an "experienced taxing officer" (see Dimos v Willetts (2000) 2 VR 170; [2000] VSCA 154 at [24]), L Oliver, Law of Costs (1960, Law Book Co), addresses this point. That work states at 178-179: Disbursements – The only payments which should be entered or allowed as a professional disbursement in a bill of costs are those payments which are made in pursuance of the professional duty undertaken by the solicitor, and which he is bound to perform, or which are sanctioned as professional payments by the general and established custom and practice of the profession. Payments which cannot properly be included in a bill, though chargeable against the client, should appear in the cash account. (Footnotes omitted.) 1. Oliver proceeds to identify a list of disbursements which had been held to be properly charged in a bill, such as court fees and counsels fees, following which it is said at 179: The following should not be included as disbursements in a bill of costs: … money paid into Court, legacy duty, estate duty, deposit for security for costs … and money lent by the solicitor to the client. 1. In re Blair & Girling [1906] 2 KB 131 concerned a payment by a solicitor, who was instructed in relation to the formation and registration of a company, of the stamp duty payable on the registration of the company. The Court of Appeal held that the payment had not properly been included in the bill of costs as a "disbursement" within the meaning of the Solicitors Act 1843 (6 & 7 Vic c 73) and should be transferred to the cash account. Vaughan Williams LJ framed the issue thus (at 137): whether this large payment in cash has been made by the solicitors in their professional character as solicitors, or whether it has been made by them as agents independently of that character, just as a banker or any other agent might make disbursements for a client. 1. The other members of the Court applied In re Remnant. 2. Energy & Resource Conservation Co, an unreported reserved decision of Rolfe J delivered on 18 March 1998, was addressed by most of the parties. The case concerned a suite of contentious claims advanced by a successful plaintiff which was entitled to a favourable costs order. The passage reproduced in Patersons' submissions concerned "items 11 and 12", which were two premiums (of $40,617 and $31,500) for insurance for two loan facilities taken out in order to fund the litigation, and $10,000 by way of interest. After a careful analysis of "costs" as defined in the then current Legal Profession Act 1987 (NSW), Rolfe J addressed this claim as follows: ERCC claimed, by way of either costs or damages, the cost of insuring a loan facility, which it obtained, for the purpose of funding the litigation. The evidence was that unless the money had been borrowed there would not have been funds to enable ERCC to pursue the proceedings. 1. Pausing there, the position is identical with Mrs Anderson's claim for ATE Costs, save that Energy & Resource Conservation Co Pty Ltd sought to recover the premiums either as damages or alternatively as costs, whereas for the purposes of this argument the only question is whether Mrs Anderson can recover the ATE Costs as costs. 2. Rolfe J continued: The difficulty I have with this submission is that it seeks to add to the costs the cost of obtaining money, by the taking out of insurance and by the payment of interest, to prosecute the litigation. These expenditures do not amount to costs nor, in my opinion, do they constitute damages consequent upon the breach of contracts alleged. In every case a litigant will incur some expense in funding litigation. That will happen whether the litigant borrows money for the purpose, or utilises money, which the litigant could otherwise be using to earn interest. 1. After explaining why the amounts could not be recovered as damages, Rolfe J turned to whether they were recoverable as costs, and concluded that they could not, for the reasons extracted in Patersons' submissions above. 2. The Court of Appeal of England and Wales addressed this issue in a modern case, which coincidentally concerned after-the-event insurance premiums: Herbert v HH Law Ltd [2019] EWCA Civ 527; [2019] 4 All ER 835. After addressing the decisions mentioned above, Sir Terence Etherton MR said at [66]-[68]: It follows that a disbursement qualifies as a solicitors' disbursement if either (1) it is a payment which the solicitor is, as such, obliged to make whether or not put in funds by the client, such as court fees, counsel's fees, and witnesses' expenses, or (2) there is a custom of the profession that the particular disbursement is properly treated as included in the bill as a solicitors' disbursement. That would appear to be reflected in the distinction between the definition of "disbursement" and "professional disbursement" in the Solicitors Regulation Authority Handbook Glossary 2012. The expression "disbursement" is there defined as meaning: in respect of those activities for which the practice is regulated by the SRA, any sum spent or to be spent on behalf of the client or trust (including any VAT element) The expression "professional disbursement" is defined as meaning: in respect of those activities for which the practice is regulated by the SRA, the fees of Counsel or other lawyer, or of a professional or other agent or expert instructed by you, including the fees of interpreters, translators, process service, surveyors and estate agents but not travel agents' charges. The ATE insurance premium does not fall within either of those categories of solicitor's disbursements I have mentioned. It is a premium on a policy of insurance under which the client is the insured, pursuant to a contract of insurance made between the insurer and the client, in order to provide the client with funds to discharge costs which are not recovered from the opposing party and the client is liable to pay, whether those are costs of the other party or of the client's own solicitors. As the Court of Appeal observed in Hollins v Russell [2003] EWCA Civ 718, [2003] 1 WLR 2487 at [114], "the client's liability to pay the [ATE] insurance premium arises from the contract of insurance, not from her contract with the legal representative". In the present case, it was an insurance contract effected by HH as Ms Herbert's disclosed agent, and it specified Ms Herbert as "the Policyholder". An ATE insurance premium is not a payment which a solicitor is obliged, as such, to make irrespective of whether or not put in funds by the client, comparable to court fees and counsel's fees. It is not, technically speaking, a litigation expense at all: see BNM v MGN Limited [2017] EWCA Civ 1767 at [73]. Nor does the evidence establish that there is a custom of the solicitors' profession that an ATE insurance premium is to be treated as a solicitors' disbursement to be included in the bill submitted to the client. Ms Herbert relies on the practice of including the ATE insurance premium as a disbursement in the bill presented by the successful party to the losing party when success fees were recoverable before LASPO. I agree with Mr Bacon that this does not assist at all in establishing a custom that such a premium has customarily been treated as a solicitor's disbursement on solicitor and client assessments. There is no evidence at all before us as to such a custom. 1. All of the authorities point against Mrs Anderson's submission. In point of principle, there is nothing to suggest that it is part of a solicitor's duty to incur the cost of providing security for costs, and there is no established custom or practice in the profession for that to occur. The decision of the Queensland Court of Appeal leaves open the proposition that a claim for loss might be made for the costs of providing security, but that does not assist Mrs Anderson in establishing that she can recover the ATE Costs as costs. Expenses 1. Most of the parties' submissions on whether the ATE Costs were "expenses" followed the email of 20 March 2024 inviting further submissions on Cachia v Isaacs and Burford v Allan. It is convenient to commence with those decisions, and the overseas decisions to which Patersons referred. 2. In Cachia v Isaacs the Court was constituted by Kirby P, Samuels and Clarke JJA. The version available on Caselaw [1989] NSWCA 31 omits Clarke JA's concurrence with Samuels JA, which is clear from the unreported judgment (and is correctly noted in an appeal in separate proceedings brought by the same litigant in Cachia v Hanes (1994) 179 CLR 403 at 420; [1994] HCA 14). 3. Mr Cachia, a litigant in person, had obtained a favourable costs order following his success on appeal; there ensued further litigation, before the taxing officer, Grove J and the Court of Appeal in relation to the taxing of those costs. The largest component of the costs was time spent by him on the appeal. However, he had been ordered to provide security for the costs of his appeal, and in the taxation of his costs, he provided a "bill of costs" which included (as part of item 44) the bank fee for the supply of security, a bank guarantee fee of $5 per month (item 83) and a claim of $255 for "Loss of income on $4,000 deposited with bank as security for guarantee 4% per annum of period 1.11.84 to 1.5.86" (item 142): see at 6-7 of the unreported judgment of Samuels JA. A taxing officer allowed part of item 44, being the claim for the bank's fee for the supply of the bank guarantee as security for costs, but disallowed the claim for time spent in attending the bank to collect the security and travelling expenses to do so, and disallowed the latter items, and Grove J dismissed an appeal from the disallowance. 4. Samuels JA held that the appellant was entitled to out of pocket expenses of travel to collect the security, but was not entitled to recompense for time spent in doing so, or otherwise for his time spent on the litigation. The dispositive reasoning of Samuels JA in relation to the relevant items was as follows: No case places restrictions upon the character of out of pocket expenses in respect of which a litigant in person may recover; save that I think that it she is not entitled to be remunerated for appearing in court, she ought not to be paid for getting there. I see no reason therefore why unqualified persons cannot be paid to type if qualified persons can be paid to advise. I think that the error arises out of the concept that an unqualified litigant in person cannot recover for anything spent "for the carrying out of legal or professional work. That is not the test. Moneys spent ie moneys out of pocket, for such a purpose are recoverable. Compensation for time lost by the litigant in doing the work himself is not. That really disposes of the appeal … 1. Kirby P dissented on the main point argued, but agreed that these items were recoverable: The taxing officer's rulings in respect of the security which the Court ordered to be paid for the costs of the appeal appear to be inconsistent. It is hard to see a logic in permitting the recovery of the fee paid to the bank for the issuance of the security, but disallowing the fee for the discharge of the security or the loss of income incurred by the provision of the security. As the provision of the security was a price which the Court affixed to the appeal, and as that price necessarily and properly involved the appellant in expense which he would not otherwise have incurred, it is unreasonable to deny him the recovery of these claims. They cannot be denied consistently with the allowance of the fee for the grant of security in the first place. 1. Burford v Allan is an unreported decision of a Full Court of the Supreme Court of South Australia constituted by Doyle CJ, Millhouse and Nyland JJ. Millhouse and Nyland JJ agreed with Doyle CJ. The plaintiff (an infant who sued by her next friend) had obtained damages for personal injury in a motor vehicle accident and a favourable costs order. The appeal was from a decision of a Supreme Court judge upon a review of the decision of a master on the plaintiff's taxation of her costs. The costs were large, and appear mostly to have been fees paid to expert witnesses. Doyle CJ summarised the background as follows: As I understand it, there was no dispute that the plaintiff and her family lacked the funds required to meet the disbursements that her solicitors had to incur in preparing her case for trial. The disbursements were heavy. The bill of costs claimed disbursements amounting to $361,061.66, and disbursements were allowed at $196,640.07. Because the plaintiff was unable to provide funds to cover the disbursements, the plaintiff's solicitors arranged for what is called a litigation loan. We were not provided with any precise details about the loan, but I do not think that that matters. I proceed on the basis that a bank lent money to the plaintiff's next friend or, perhaps, to her mother, for the purposes of meeting disbursements to be incurred by the solicitors in connection with the litigation. I assume that the bank took some form of security over the anticipated proceeds of the action. We were informed that the loan was not used to meet costs payable to the solicitors or to meet counsel fees. The amount finally repaid to the bank was $185,650.85, which included $26,270.85 for bank fees and interest. The amount paid to the bank by way of interest and charges in respect of the litigation loan was claimed by the plaintiff upon the taxation of costs. The master allowed the sum of $14,000.00. It is not necessary to consider how he arrived at that amount. 1. On review, the judge held that the $14,000 of interest and charges for the litigation loan was not recoverable, and the Full Court dismissed the plaintiff's appeal. Doyle CJ proceeded on the bases that it was proper for the plaintiff to incur the interest and charges, and that the amount allowed was appropriate, and said that "the only issue is whether the court has power to allow such an item by way of costs". The Chief Justice then observed that the power was statutory, that the relevant statute (the Supreme Court Act 1935 (SA)) did not define costs, but that various rules addressed them, including one (r 101.16(d) of the Supreme Court Rules 1987 (SA)) which provided that "Any just and reasonable charges and expenses that appear to have been properly incurred in procuring evidence and the attendance of witnesses are to be allowed". Another rule (r 101.16(b)) authorised the taxing officer to allow "such charges and expenses as appear to him to have been necessary or proper for the attainment of justice". Doyle CJ said of the latter provision: Despite the apparent width of this provision, I consider that it governs the exercise of the discretion to award costs, and is not to be read as authorising the award of any amount that is considered to be a charge or expense necessary or proper for the attainment of justice. I say that partly because of the use of "costs" in the sub-paragraph, partly because of the constant use of "costs" throughout r 101, and also because of the use of that expression in s 40 of the Act. In other words, I can find nothing in the Rule to suggest that an amount may be allowed upon a taxation, that does not fall within the recognised meaning of "costs". (Emphasis added) 1. His Honour then referred to two passages in Cachia v Hanes in which Mason CJ, Brennan, Deane, Dawson and McHugh JJ made statements directed to the inability of a litigant who was not a lawyer to recover time spent by the litigant in preparing and conducting a case. The passages included the following (to which emphasis has been added): The "costs" provided for in the Rules do not include time spent by a litigant who is not a lawyer in preparing and conducting his case. They are confined to moneys paid or liabilities incurred for professional legal services. It is only in that sense that the Rules speak of "costs": at 409. and It has not been doubted since 1278, when the Statute of Gloucester 1278 (UK) 6 Edw I c 1 introduced the notion of costs to the common law, that costs are awarded by way of indemnity (or, more accurately, partial indemnity) for professional legal costs actually incurred in the conduct of litigation. They were never intended to be comprehensive compensation for any loss suffered by a litigant: at 410-411. 1. The dispositive passage of the reasoning of Doyle CJ rested upon that reasoning: In my opinion these passages have a twofold significance. First, the emphasis upon "costs" being professional legal costs, that is reimbursement to a practitioner for work done or expenses incurred by the practitioner. Secondly, the emphasis upon the fact that the award of costs is not intended to be complete compensation for losses suffered by a litigant. For both those reasons the majority concluded that the litigant in person could not recover compensation for time spent by him in preparing and conducting his case. In principle, I can see no difference between the claim made in that case and the claim made in the present case. First of all, in each case the claim is for an expense that does not represent remuneration paid to a legal practitioner or an expense incurred by the practitioner in the course of representing the client. The claim is for a cost to the client, not to the practitioner. Secondly, each claim seems to rest in part on the premise that an award of costs should adequately compensate a litigant for any cost or loss associated with the conduct of the litigation. It is surprising that no authority has been found by the parties more closely in point. However, in my opinion the principle that underlies the decision in Cachia v Hanes (supra) is that costs recoverable under s 40 of the Act are a reimbursement for work done or expenses incurred by a practitioner, and do not extend to an expense of the type claimed in the present case. In my opinion the judge was right, for this fundamental reason, to reverse the master's decision on the point. 1. Thus in Burford v Allan the Full Court's decision turned on the meaning of "costs" which was undefined by the Supreme Court Act 1935 authorising the payment of costs. Rule 101.16(b) authorising the allowance of expenses was constrained to expenses that fell within the conception of "costs". 2. In s 3 of the Civil Procedure Act, "costs" is defined to include expenses. 3. In Cachia v Hanes the question was whether an unrepresented litigant could recover costs for his own time in conducting proceedings. The High Court did not consider whether the expenses in obtaining a bank guarantee were recoverable as an "expense". That was not an issue. 4. In Burford v Allen, the Chief Justice (with whom Nyland J agreed) added that he considered the plaintiff's claim to be a reasonable one, and said that if it were to be allowed, it would be necessary to amend the Rules and perhaps the Act. Millhouse J agreed, but thought that the outcome was unjust. 5. McGraddie v McGraddie was a decision of the Supreme Court of the United Kingdom constituted by Lord Neuberger, Lady Hale and Lord Reed following ultimate success in a Scottish appeal. The ultimately successful party (we shall refer to him as the appellant although he was the "pursuer") took out ATE insurance against his potential liability for the respondents' costs against the possibility that the appeal was dismissed with costs. The premium was £40,000, and the insurance protected the appellant to a maximum liability of £100,000. It was held at [11] that it was "perfectly reasonable and sensible to protect himself in this way before embarking on an appeal to this Court to establish his ownership of a property and to vindicate his rights, even though it involved a substantial premium". But was the £40,000 ATE premium recoverable pursuant to an order for costs? Lord Neuberger writing for the Court said at [13]-[14]: So far as the SCR themselves are concerned, the expression "costs of any appeal" in rule 46(1) does not naturally extend to the cost of an ATE premium, which appears to me to be extraneous to the costs of the appeal, even though it was plainly closely linked to the appeal itself, at least from the [appellant's] financial perspective. In the absence of any express provision permitting it, one would not expect an ATE premium, taken out to protect the person who turns out to be the successful party against liability for costs in case he loses, to be recoverable from the unsuccessful party. It is simply not part of the costs of the appeal, as a matter of ordinary language. Further, it seems unlikely that, in the absence of an express provision so stating, the rules would have envisaged that a losing party's liability for a substantial sum should depend on the successful party's appetite for, and financial ability to take, the risk of losing and paying costs. It also seems to me that, if the successful party had taken out insurance to protect him against the costs of litigation generally (sometimes known as Before the Event, "BTE", Insurance), there would be no question of the BTE premium, or any part of it, being recoverable as part of that party's costs of proceedings. While it does not ineluctably follow that an ATE premium should not be recoverable as part of the costs, it would be somewhat surprising if wholly different considerations applied to the recoverability of ATE and BTE premiums. 1. Lord Neuberger addressed a series of other British decisions to the same effect at [17]-[18], concluding at [19]: In my view, therefore, (i) as a matter of principle, (ii) in the light of the terms of the relevant court rules, and (iii) on the basis of consistent judicial authority on both sides of the border, the law is clear. In the absence of agreement or a specific statutory sanction (either expressly or through valid delegated legislation) to the contrary, a successful party to litigation cannot recover an ATE premium, however reasonable it was to have incurred it, as part of his costs or expenses of legal proceedings 1. Lord Neuberger also noted at [20] that there had been a time when the ATE premium would have been recoverable as part of a successful party's costs. That was a reference to s 29 of the Access to Justice Act 1999 (UK), which when enacted had provided: Where in any proceedings a costs order is made in favour of any party who has taken out an insurance policy against the risk of incurring a liability in those proceedings, the costs payable to him may, subject in the case of court proceedings to rules of court, include costs in respect of the premium of the policy. 1. As explained by the New Zealand Court of Appeal in Houghton v Saunders, that section was repealed in 2013 for most litigation, and in 2016 in its entirety, following a review by Jackson LJ, Review of Civil Litigation Costs: Final Report (Ministry of Justice (UK), December 2009). The New Zealand decision was a joint judgment of the Court constituted by French, Miller and Collins JJ. The first stage of the hearing of a representative proceeding had failed at trial and on initial appeal, but a further appeal was allowed by the New Zealand Supreme Court. One aspect remitted to the Court of Appeal was costs, and one item which was in dispute was a premium of $47,000 paid by the litigation funder for an "adverse costs insurance policy". The Court disallowed the claim, saying at [22]-[24]: As regards the claim for recovery of the ATE insurance premium as a disbursement, that is governed by r 53 of the Court of Appeal (Civil) Rules 2005. It provides "that the Court may in its discretion make any orders that seem just concerning the whole or any part of the … disbursements of an appeal". The word "disbursement" for the purposes of this rule has the same meaning as in the High Court Rules 2016, namely "an expense paid or incurred for the purposes of the proceeding that would ordinarily be charged for separately from legal professional services in a solicitor's bill of costs". Contrary to the respondents' submissions, we consider the ATE insurance premium is capable of being categorised as an expense reasonably paid or incurred by Mr Houghton for the purpose of the appeal. However, regardless of whether we are right or wrong on that point, we would not allow recovery because in our view recovery would not be in the interests of justice. In coming to that conclusion, we have been influenced by the approach taken in other jurisdictions, in particular the United Kingdom. In the United Kingdom, there used to be a statutory provision which specifically allowed recovery of insurance premiums by way of costs. However, the relevant section was repealed following a comprehensive review of civil procedure rules. The review found recoverability of ATE insurance premiums imposed disproportionate cost burdens on defendants, while plaintiffs were able to litigate essentially risk free. The current position in the United Kingdom is that ATE premiums cannot be recovered from the defeated party and must be borne by the insured. (Footnotes omitted.) 1. The Court also referred to some eight Canadian decisions which did not allow ATE premiums, although there was one, regarded by the Court as an outlier, which had. Their Honours concluded at [26]: In his recent High Court costs decision in this proceeding, Dobson J described it as being patently unfair that unsuccessful defendants should have to meet significant additional costs to cover a claimant group's insurance against the prospect of their losing. We agree. In the words of r 53 of the Court of Appeal Rules, an order to that effect would not seem just and therefore we decline to make it. (Footnote omitted.) Conclusion on the recoverability of ATE Costs 1. As noted at the outset, on the view we take it is not necessary to address these issues. Irrespective of whether or not the ATE Costs are recoverable costs, the judgments in favour of Mrs Anderson should not be reduced by the amounts of ATE Costs received by her from Albany, because that amount was necessarily incurred in order to prosecute the litigation, and was incurred only because of the security for costs applied for and obtained by the respondent wrongdoers. It is counterintuitive that the active respondents, who have now been found to be wrongdoers, should obtain a benefit from the fact that they did not admit liability and pressed applications for security for costs which obliged Mrs Anderson to incur the ATE Costs. 2. Nonetheless, in deference to the quality of the parties' submissions, and the fact that the same or similar issues will doubtless recur in other litigation, we express our views on these points which were fully argued. 3. First, we conclude that the ATE Costs are not "disbursements" within the meaning of "costs" in ss 3 and 98 of the Civil Procedure Act. There is no basis to conclude that the unbroken line of authority applying what was said in In re Remnant and the meaning of "disbursement" is inapplicable to the meaning of that term. Applying that definition, it was not suggested, nor could it have been suggested, that the ATE Costs were a payment which Mrs Anderson's solicitors were duty bound to make in their role as solicitor on the record. Nor is there any established custom or practice of solicitors being liable to pay such cost. The position may be contrasted with filing fees and counsel's fees. The premiums and other fees paid to Lloyd's syndicate are not disbursements. The taxes and interest paid in respect of the premiums and fees bear the same character as the premiums and fees. 4. Secondly, two of us (Gleeson and Leeming JJA) favour the view that the ATE Costs are not to be regarded as "expenses" within the definition of "costs" in the Civil Procedure Act either. That is so notwithstanding that they were amounts of money which Mrs Anderson was required to pay in order to comply with orders obtained by the defendants that she provide security, and that there was nothing unreasonable about the quantum. For the moment, we put to one side Cachia v Isaacs, which preceded the High Court's decision in Cachia v Hanes and the South Australian decision of Burford v Allan. Burford v Allan holds that an "expense" for the purposes of the power to order costs must represent remuneration to a practitioner, or an expense incurred by a practitioner in the course of representing a client. That was consistent with the statements by the High Court in Cachia v Hanes that the power to order costs (which were defined to include "expenses") were for "moneys paid or liabilities incurred for professional legal services" or "professional legal costs actually incurred in the conduct of litigation". Although Doyle CJ regarded the claim for the interest and charges on a litigation loan to be reasonable, in his Honour's view legislative change was required for that to be recoverable. 5. If the expense in the present case were analogous to the expenses in Cachia v Isaacs or Burford v Allan – for example, if it were the cost of providing a bank guarantee – then Gleeson and Leeming JJA incline to the view that the power to order costs would extend to it (we do not express a concluded view because to do so would involve departing from Burford v Allan and it is unnecessary to take that step in this appeal). However, in the view of Gleeson and Leeming JJA, this aspect of the appeal is more clearcut. That is because the ATE Costs are far removed from the expenses considered in any of the Australian decisions mentioned above. The critical point of distinction is apparent from the larger "Balance of Premium" payment, which is only payable if Mrs Anderson succeeds in the litigation. The inevitable consequence of that obligation is that the Lloyd's syndicate is obtaining a commercial interest in the outcome of the litigation. In accordance with the British and New Zealand decisions above, which dealt expressly with the recoverability of premiums for ATE policies which provided an indemnity against the possibility of an adverse costs order, those premiums are not recoverable under a costs order unless the power to order costs is more broadly worded (as it was until 2013 in the United Kingdom). In Gleeson and Leeming JJA's view, there is no sound basis to distinguish the character of the premium depending on whether or not it is taken out in order to comply with a security for costs order or otherwise; the essential nature of the policy and the premium remains the same. Although the New South Wales legislation is different, including in that it now provides for assessment rather than taxation, none of the differences detract from the persuasive authority of those decisions. 6. Returning to Cachia v Isaacs, Gleeson and Leeming JJA consider that it does not govern the ATE Costs. Cachia v Isaacs addressed fees and expenses incurred in order to comply with orders to provide security for costs, but without any suggestion that the third party was acquiring an interest in the outcome of the litigation. That is a very important distinction because it materially changes the nature of the payments. This is why the ATE Costs are much more substantial than the costs of a bank guarantee where the bank takes security over some asset of the plaintiff. The payment ceases to be merely the payment for a service to be provided in the course of the litigation; instead, it is part of a contract whereby a third party obtains a commercial stake in the litigation. It may be added that it was not disputed in Cachia v Isaacs that some of the bank's charges were allowable as costs (hence Kirby P's observation that the taxing officer's reasoning was inconsistent) and so strictly the decision is not authority even for that narrower proposition. Decisions are only authority for what is argued: Coleman v Power (2004) 220 CLR 1; [2004] HCA 39 at [79]; CSR Ltd v Eddy (2005) 226 CLR 1; [2005] HCA 64 at [13]; Davis v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2023] HCA 10; 97 ALJR 214 at [42] and [182]. 7. One of us (White JA) favours the view that the ATE Costs were, in the particular facts of this case, a recoverable expense. 8. White JA's view is that Burford v Allan is distinguishable. His Honour considers that Burford v Allan turned on the absence in the governing statute of a definition of costs, which led the Full Court to consider the meaning of "costs" in accordance with the reasons of the High Court in Cachia v Hanes. But Cachia v Hanes did not address the present issue. 9. White JA considers that if the Supreme Court Act 1935 (SA) had included a definition of "costs", such as is found in s 3 of the Civil Procedure Act, which would have authorised rule 101.16(l), the result would have been different. 10. White JA considers that McCraddie v McCraddie, BNM v MGN Ltd [2017] EWCA Civ 1767 at [73], and Herbert v HH Law Ltd at [66]-[68] held that the ATE premium was not a litigation expense, but was an expense incurred to enable the plaintiff to bring the litigation and meet an adverse costs order if the litigation were unsuccessful. 11. In his Honour's view, that is to be distinguished from the present case where the expense was incurred to enable the appellant to provide security for costs, which ought not to have been sought. His Honour considers this to have been a "litigation expense". 12. White JA considers that whether the ATE Costs were a recoverable expense falls to be considered from the perspective of Mrs Anderson, rather than from that of the insurer. Although the insurer is obtaining an interest in the outcome of the litigation, from Mrs Anderson's perspective, it was a necessary expense, not distinguishable in nature from a fee charged by a bank for a bank guarantee obtained to meet an order for security for costs. Because the expense was not incurred to pay the costs of litigation, or to offset an adverse costs order, but rather was to satisfy an order that Mrs Anderson provide security for costs, it was an expense with a sufficiently close relationship to the proceedings to be an expense "in or in relation to" the proceedings. That reasoning does not extend to the $71,940 paid for a separate ATE policy in respect of senior counsel's costs, but in the circumstances of this case, where the need to do so was a consequence of the orders for security for costs which should never have been made, that amount should also be regarded as an expense of the litigation. 13. We reiterate that the preceding paragraphs reflect divergent views on a question which is not necessary to determine the outcome of the applications to vary the judgments entered in favour of Mrs Anderson. All members of the Court are of the view that Ms Garrett, Mr Renauf and PPB, who have been found to have been fiduciaries who dishonestly breached their duty or else knowingly assisted in that breach, should not obtain a benefit from the payment by Albany to Mrs Anderson of the ATE Costs, those costs having been brought about by applications for security for costs which, with the benefit of hindsight, should not have been ordered. The effect of Mrs Anderson's settlement with Patersons 1. The comments made at the commencement of these reasons concerning whether it is appropriate for orders to be made under the Court Suppression and Non-publication Orders Act apply with equal force to this latest settlement. It suffices for present purposes to note that Patersons agreed to pay an amount in excess of $1,000,000 in two instalments, by around 15 May 2024 and 5 June 2024. Importantly, unlike the earlier settlements, the settlement with Patersons included broad releases in favour of Patersons in respect of its liability to pay the judgment amount and its liability for costs of the trial and the appeal and interest on those costs. The releases are conditional upon both instalments being paid. 2. PPB made two further submissions consequent upon the Patersons settlement: On the basis that a release of one respondent to a judgment for which several parties are jointly and severally liable releases them all (Walker v Bowry (1924) 35 CLR 48 at 53-58 (Walker)), Falcon Prime will, upon the releases in the Canaccord Deed of Settlement coming into effect, be released from any liability for the Judgment Amount, for the appellants' costs of these proceedings and of the proceedings below, and for interest on those amounts. This is notwithstanding the decision of this Court in Cassaniti v Ball as liquidator of RCG CBD Pty Limited (in liq) and related matters; Khalil v Ball as liquidator of Diamondwish Pty Ltd (in liq) and related matters [2022] NSWCA 161; (2022) 109 NSWLR 348 (Cassaniti). What was said in that case concerning the effect of s 95 of the Civil Procedure Act 2005 (NSW) (CPA) upon joint, or joint and several, liabilities and the effect, if any, of a release of an errant fiduciary upon the liability of a knowing assistant, has no application, where, as in the current context, the relevant causes of action have merged in a judgment expressed as imposing a joint and several liability. In that setting, the Court should conclude that the rule recognised by the High Court in Walker (Release Rule) remains operative. Further and in the alternative, applying the principle against double recovery, the totality of the appellant's recoveries, including the recovery from Canaccord, should reduce Falcon Prime's liabilities in respect of the Judgment Amount, as well as costs and interest, and not just the latter two liabilities. Given the extent of the appellant's recoveries to date, the Court should find that Falcon Prime's liability to pay the Judgment Amount is discharged, and make no order as to costs. 1. PPB said that it was telling that in addition to covenants not to sue, the deed contained a very broadly worded release by Mrs Anderson of Patersons, and said that that was sufficient to release the active respondents. PPB said that this was unaffected by s 95 of the Civil Procedure Act or the abrogation of the "release rule", because: far from there being multiple causes of action, the unity of which has been severed by s 95 of the CPA, there is only the one and indivisible judgment, upon which s 95 of the CPA does not, and is not expressed to, operate. 1. PPB said that s 95 was directed to the circumstance where liabilities have not merged in a judgment, and insisted that there was "no heresy" in its submission that judgments imposing a joint and several liability remained "one and indivisible" even after the enactment of s 95. 2. The next step in PPB's argument was that if s 95 did not abrogate the release rule, equity should follow the law and treat the active respondents as discharged. In attempting to distinguish the second aspect of what had been held by this Court in Cassaniti v Ball as liquidator of RCG CBD Pty Ltd (in liq); Khalil v Ball as liquidator of Diamondwish Pty Ltd (in liq) (2022) 109 NSWLR 348; [2022] NSWCA 161, PPB submitted: This Court's conclusion in Cassiniti that equity would not follow the rule, at least in cases involving errant fiduciaries and parties who assist in their breaches with knowledge of their dishonest and fraudulent designs, is not material to the present case. None of the concerns raised by the Court in Cassaniti as justifying equity's departure from the common law rule arise once a judgment has been entered. Where, as in this case, there is a judgment debt for which parties are jointly and severally liable, no issue arises as to the several liabilities of obligors being different from one another, for example to account for profits: cf Cassaniti at [104]. Nor, where there is but the one judgment debt, can there be any concern that joint obligors have different defences to the claim made against them, or that relief might be granted subject to different terms as between different defendants: cf Cassaniti at [116](1)-(2). Accordingly, where equitable causes have merged in a judgment expressed as imposing a joint and several liability, so as to engage the same enforcement processes as would be available in respect of a judgment based on a common law cause of action, there is no reason to depart from what would otherwise be the common law's recognition of the Release Rule. 1. The second aspect of PPB's submissions, based on the rule against double recovery, reiterated its earlier submissions. 2. Ms Garrett and Mr Renauf made submissions to the same effect. They maintained that "[t]he proper construction of the judgment is that it created a joint and several liability on the part of each of the Respondents to pay the amount of $3,016,304.23". They added that "[t]he judgment was based on a claim for equitable compensation, with the Appellants arguing that all respondents were responsible for the losses claimed". Accordingly, so it was said, the releases in the settlement with Patersons released those joint and several obligations: The release of one respondent to a judgment releases them all: Walker v Bowry (1924) 35 CLR 48 at 53-58. This rule has been applied and upheld in subsequent decisions, which have confirmed that it remains good law unless abrogated by statute (despite the underlying analysis being questioned): Cassaniti v Ball as liquidator of RCG CBD Pty Limited (in liq) and related matters; Khalil v Ball as liquidator of Diamondwish Pty Ltd (in liq) and related matters [2022] NSWCA 161 at [54]; Conridge v Schaapveld [2015] NSWSC 663 at [33]; Re Charles Vella Ex Parte: Perpetual Finance Corporation Limited [1992] FCA 462 at [20]. See too: Harplex Pty Ltd v Konstandellos & Ors [2018] VSCA 67 at [55]. The rule has not been abrogated by statute insofar as it relates to judgments. Although the Court of Appeal in Cassaniti held that s95 impliedly abrogated the release rule as it related to underlying causes of action, that reasoning does not apply to judgments. The Court's analysis at [73] involved a discussion of the effect that s 95 and its predecessor had on the underlying causes of action. Section 95 governs the effect of a judgment on the causes of action that underly the judgment, but does not seek to change the status of the judgment itself or the effect of a release on a judgment. Here, the judgment is (as set out above) a joint liability to pay a fixed amount. Nothing in the terms of s95 impliedly abrogated the ratio of Walker v Bowry as the decision relates to judgments. Likewise, the consideration by the Court in Cassaniti of whether equity would apply the release rule is not engaged here because the release was (or will be) given after the causes of action have merged into the judgment. (Footnotes omitted.) 1. Alternatively, Ms Garrett and Mr Renauf said that their liability should be discounted for the reasons earlier advanced. 2. It is not necessary to summarise Mrs Anderson's submissions fully. She said that the active respondents' submissions mischaracterised the judgment, that the release rule never applied in equity, that the suggestion that the statutory abrogation of the release rule was limited to causes of action and did not extend to the enforcement of consequent rights to relief lacked any basis in authority or principle, and that "[t]he precise argument now raised by the respondents was rejected by the Victorian Court of Appeal in Harplex Pty Ltd v Konstandellos (2018) 54 VR 174 at [51]-[63]". Consideration 1. The relevant order of this Court is: Set aside orders 1 and 2 made on 7 February 2022, except insofar as order 2 enters judgment in favour of the fifth respondent Acorn Capital Ltd and the sixth respondent Albany Capital Investors Pty Ltd, and in lieu thereof enter judgment in favour of Mrs Anderson against each of the first, second, third and fourth respondents in the amount of $3,016,304.23. 1. We do not accept that there is "only the one and indivisible judgment". This turns on the legal effect of this Court's order, which is that there are separate judgments in favour of Mrs Anderson against each of Patersons and the active respondents. There is not a single judgment against each of the first, second, third and fourth respondents; instead, by a single order made in Mrs Anderson's appeal, the separate judgments in favour of each active respondent were set aside and replaced by judgments in the amount of $3,016,304.23. 2. For the reasons given by Mrs Anderson, the release by Patersons does not effect a release of her entitlement to enforce the judgments against the active respondents. We start with the ratio of Cassaniti at [80]-[82]: The rule that the release of one or a number of persons subject to a joint and several obligation releases all of them has been disfavoured in all common law jurisdictions for decades. It may be accepted that the technical rules relating to joint obligations and releases – classic instances of "lawyers' law" – may not have been at the forefront of the subjective intentions of the parliamentarians voting in favour of s 95. This was part of the basis upon which Dixon CJ deprecated this principle of statutory construction as "quite artificial" in R v Reynhoudt (1962) 107 CLR 381 at 388; [1962] HCA 23. However, parliamentary intention is imputed, rather than subjective, and in any event, reasoning of this nature has in more recent times been less disfavoured. Thus, the joint judgment in Vella v Commissioner of Police (NSW) (2019) 269 CLR 219; [2019] HCA 38 at [19] said: "[19] … Where words have been judicially interpreted, it is possible to interpret a subsequent statute as having the meaning so assigned to those words. It may be assumed that the legislature has adopted the interpretation assigned to the earlier enactment, unless an intention to exclude that interpretation is evident." (Footnotes omitted.) Applying these principles, we would reason as follows. Section 5(1)(a) is mentioned in terms in s 95(3). It is well known that s 5(1)(a) abrogated the harsh common law rules in relation to joint tortfeasors. It is clear that s 95 had a similar reforming effect, but did not overlap with s 5(1)(a). It is natural to impute to the Legislature an intention to apply the settled construction of s 5(1)(a) to the broader field now covered by s 95. Another way of considering the effect of re-enacting s 97 of the Supreme Court Act as s 95 of the Civil Procedure Act is as follows. In circumstances where s 97 is explicitly linked to s 5(1)(a), and where the latter has been held impliedly to abrogate a disfavoured rule of common law, after which s 97 has been re-enacted in materially identical terms, this Court would introduce disharmony in the law if it held that the rule impliedly abrogated by s 5(1)(a) in the subject area to which it applies was not impliedly abrogated by s 95 in the wider subject area to which it applies. 1. There is no basis to read down what was there held so as to confine what was held about the abrogation of the common law rule concerning releases so that the rule continues to operate upon judgment debts. Not only the language, but also the reasoning, operates at a higher level of generality. 2. Further, the restricted approach propounded by the active respondents would introduce serious incongruity into the law. Take for example the simple case of a creditor who has multiple causes of action for the same debt against various borrowers and guarantors. According to the active respondents, if when settling a claim against one of the debtors a release is given, then its effect upon the others turns on whether there is a merely a claim in debt or whether that claim has become a judgment debt (including, presumably, a default judgment). 3. Still further, authority is squarely against the active respondents' submission. The Victorian Court of Appeal said in Harplex at [61]-[63]: The respondents further sought to limit the effect of s 24AA on the common law rule by submitting that, where judgment was entered against all joint, or joint and several, obligors, the effect was to create a new unity to which the common law rule could apply and as to which s 24AA had nothing to say. In other words, even if s 24AA destroyed the unity of the underlying cause of action, a new right took its place and it was clear from the facts of Walker itself that a release of one obligor from its obligations under a judgment debt operated as a release of all. However, the foregoing reasoning applies also to judgment debts. Assuming for present purposes that the common law rule extends to obligations owed by way of judgment debt (as to which, see proposed ground 3, below), two situations must be considered. The first is where, as in Walker itself, judgment is obtained against only one of a number of joint, or joint and several, obligors. It is plain from the reasoning in Thompson that s 24AA destroys the unity in the underlying causes of action of those obligors against whom judgment has not been entered, so that the entry of judgment no longer operates as a release against all of them and the common law rule is impliedly abolished by the section. In the second case, where judgment is obtained against all joint, or joint and several, obligors, no question of the judgment operating as a release of the parties' prior obligations can arise. Instead, the underlying obligations are merged into the judgment. In that context, the obligations under the judgment take on the character of the underlying obligations, and at common law a release from a joint and several judgment debt operates as a release against the other judgment debtors. In those circumstances, because s 24AA destroyed the unity of the underlying cause of action, there is no basis upon which the judgment obligations into which the causes of action merged take on any character of unity of their own. The common law rule regarding release is impliedly abolished in both contexts. (Footnotes omitted.) 1. The references to s 24AA was to that section of the Wrongs Act 1958 (Vic), which provided: Judgment recovered against any person liable in respect of any debt or damage shall not be a bar to an action, or to the continuance of an action, against any other person who is (apart from any such bar) jointly liable with the first-mentioned person in respect of the same debt or damage. 1. As this Court said in Cassaniti at [75], s 24AA is broader than the provisions considered by the High Court in Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574; [1996] HCA 38 and this Court in Cassaniti: [Section 24AA] is different from s 95 of the Civil Procedure Act in its scope. Section 23A of the Wrongs Act provides that for the purposes of provisions including s 24AA: "a person is liable in respect of any damage if the person who suffered that damage ... is entitled to recover compensation from the first-mentioned person in respect of that damage whatever the legal basis of liability, whether tort, breach of contract, breach of trust or otherwise". Thus, rather than having two separate provisions (s 5(1)(a) applicable to joint tortfeasors, and s 95 applicable to joint obligees who fall outside of s 5(1)(a)), the Victorian legislation has a single provision, extending to recovering compensation "whatever the legal basis of liability" and explicitly including "breach of trust". The Victorian Court of Appeal found no difficulty in applying the construction of the narrower provision considered in Thompson to s 24AA, to achieve the implied abrogation of the single and indivisible status of causes of action for debt in the same way as had been held for causes of action for tort in Thompson. We respectfully agree. 1. The reasons of the Victorian Court of Appeal holding that the common law rule regarding release was impliedly abolished in its application to a joint and several judgment debt by s 24AA is equally applicable to its New South Wales counterpart. Section 95 of the Civil Procedure Act provides: 95 Joint liability (cf Act No 52 1970, section 97) (1) If two or more persons have a joint liability and, in any proceedings, judgment on the liability is given against one or more but not all of them— (a) the liability of the other or others of them is not discharged by the judgment or by any step taken for the enforcement of the judgment, and (b) after the judgment takes effect, those of them against whom the judgment is given and the other or others of them become liable, as between those of them against whom the judgment is given on the one hand and the other or the others of them on the other hand, severally but not jointly, and (c) if there are two or more such persons against whom the judgment is not given, they remain, after the judgment takes effect, jointly liable amongst themselves, and (d) if the judgment is satisfied wholly or in part by payment or by recovery under execution, the liability of the persons against whom the judgment is not given is taken also to have been satisfied in the amount of the payment or recovery. (2) This section does not affect a person's right to contribution or indemnity in respect of the person's satisfaction, wholly or in part, of a liability that the person has (whether jointly or severally or jointly and severally) with any other person. (3) This section does not apply to a judgment to which section 5 (1) (a) of the Law Reform (Miscellaneous Provisions) Act 1946 applies. (4) In this section, liability includes liability in contract, liability in tort and liability under a statute. In particular, s 95(1)(d) speaks to the circumstances addressed by s 24AA. 1. The rejection of the active respondents' submission may be reached assuming, favourably to the active respondents, that the rule was capable of applying to judgments entered against them for claims based wholly in equity. Just as it was unnecessary in Cassaniti to reach a concluded view on that issue (although the Court favoured the conclusion that the release rule never applied in equity: see at [120]) it is unnecessary to rest this aspect of these reasons on that conclusion. 2. For those reasons, we do not accept the submissions of the active respondents that the effect of the settlement with Patersons is to release them from liability under the judgments against them. 3. The result is that the motions to vary the judgments obtained against the active respondents should be dismissed. Mrs Anderson's application for a gross sum costs order 1. As noted at the outset, Mrs Anderson advised on 7 June that, as a result of her settlement with Patersons, she no longer sought this order. We will nonetheless express our reasoning in relation to the submissions which were fully argued, noting that PPB also made a final short submission that in light of the totality of the settlements with other respondents, it should not have to pay a cent. Once again, we will refer to the submissions made by Patersons as such, despite its subsequent settlement with Mrs Anderson. 2. A gross sum costs order under s 98(4) of the Civil Procedure Act is appropriate where it is desirable to avoid the expense, delay and aggravation likely to be involved in a costs assessment, or where a party's conduct has unnecessarily contributed to the costs of the proceedings, "especially where the costs incurred have been disproportionate to the result of the proceedings": Hamod v New South Wales [2011] NSWCA 375 at [817]-[818]. The primary judge regarded the quantification of the respondents' costs as suitable in principle for a gross sum costs order, observing in Anderson v Canaccord Genuity Financial Ltd (No 2) [2022] NSWSC 649 at [179]-[180] that: there is little doubt that this is a case where the discretion to make gross sum costs orders would appropriately be exercised, in that the proceeding involved claims against multiple parties and raised complex issues; the litigation was long-running and hard-fought; and the likelihood of expense, delay and aggravation in a contested costs assessment seems to me to be inevitable. I consider that the assessment of costs in this proceeding would likely be protracted and expensive … Thus, I cannot see that the just, quick and cheap resolution of the real issues in dispute will be served by declining to exercise the gross sum costs discretion. Nevertheless, there must be confidence that the power can be exercised fairly between the parties and I have some concern that the information before me may be incomplete. 1. For similar reasons, there was a measure of agreement that Mrs Anderson's costs called for a gross sum costs order. The proceedings were large. The court book at trial comprised 22,878 pages. The parties served 17 lay affidavits and 20 expert reports, including joint expert reports. The judgment at first instance comprised 2,821 paragraphs on 879 pages. And the parties' history of disputation is suggestive that agreement as to costs is unlikely and assessment will be time-consuming and expensive. 2. However, in light of the concern that the information before her was incomplete, the primary judge referred the quantification of the respondents' application for a gross sum costs order to a referee. No such application was made in this Court. The evidence of Mrs Anderson's solicitor is that, in light of the experience of this matter, a reference to a referee for determination of costs on a gross sum basis would be time consuming and costly, costing tens of thousands of dollars and taking months to complete. 3. PPB accepted that it was appropriate for this Court to make a gross sum costs order, and that the material provided by Mrs Anderson was sufficient to do so. 4. However, Ms Garrett and Mr Renauf complained that Mrs Anderson "has not put before the court sufficient material to enable a lump sum costs order to be made". The only criticism made was that the redaction of work entries on the solicitor's invoices was said to make it "impossible to fairly assess the extent to which they reflect recoverable costs". That submission reflected the fact that all of the descriptions in Mrs Anderson's solicitor's bills have been redacted. By way of example, so as to convey the scale of this issue and the granularity of the redactions, the invoice for the period 13-31 October 2016, which charges professional fees of $5,748.05 including GST, has 74 entries redacted. Many of the entries are a single line, but some appear (from the spacing on the page) to be 3 or 4 lines or longer. Counsel's tax invoices are not redacted, but the descriptions were expressed in very general terms. 5. The affidavit of the solicitor for Ms Garrett and Mr Renauf provides an example of the difficulty said to have been produced by the redaction. The calculations put forward by Mrs Anderson make a deduction of $86,535.81 in relation to professional costs for work done which was the subject of interlocutory costs orders adverse to her. The solicitor said that she had been unable to consider whether the assumptions made in that respect "have been accurately or reasonably calculated" because all of the descriptions in the invoices have been redacted. There is a dispute about these deductions, to which it will be necessary to return. 6. In response, Mrs Anderson submitted that the individual work entries number in the thousands, and "[t]o require the appellant to review each of those entries for privilege prior to disclosure, so that the second and third respondents could then invite the Court to engage in a line-by-line disputation as to recoverability, would be to impose a disproportionate burden on the parties (including the two respondents who seek a gross sum costs order) and the Court and would cause the very expense, delay and aggravation that a gross sum costs order is intended to avoid". We agree. 7. The itemisation which has been provided is sufficient to identify the time spent on each day (which could if any party wished to do so be assessed against the timetable for the service of evidence and other steps in the litigation). The information also entitles the respondents to see which fee earner in the firm was performing the work, and to form a general view as to the extent to which more junior solicitors at lower hourly rates should have been involved. It is significant that notwithstanding the hundreds of redacted bills and thousands of redacted entries which have been provided, Ms Garrett's and Mr Renauf's only particularised complaint about the difficulties caused by the redaction was a very modest one, and one that was confined to an inability to check the reasonableness of the costs attributable to an interlocutory dispute which reflects some 1% of the amount claimed. As it happens, and as will be explained below, PPB went into evidence on this issue, and that evidence does not suggest any material inaccuracy in Mrs Anderson's calculations. What is more, some comfort may be derived from the fact that the active respondents are separately and capably represented by three firms of solicitors each of which has retained counsel, and only one of the three suggested that the evidence is insufficient to warrant a gross sum costs order. 8. We consider the material is sufficient to enable this Court to quantify the gross sum costs order, save in respect of one aspect of the calculation of interest, which Mrs Anderson and PPB agree should be deferred. The methodology adopted by Mrs Anderson 1. In what follows, all amounts are inclusive of GST. Amounts of interest have been taken from the affidavit evidence, where it has been calculated as at 29 February 2024, and the amounts of interest mentioned below reflect those calculations, although Mrs Anderson also seeks interest thereafter. 2. Mrs Anderson's submissions in chief sought a gross sum costs order of $4,053,185.14. That amount was calculated in the following way: 1. The starting point is the total solicitors' fees at trial applying a discount of 25% to reflect the usual reduction had there been a costs assessment, to which is added disbursements, counsel fees and third party fees (none of which attract any discount). 2. Those disbursements include $1,602,272.50 related to after-the-event insurance (this is less than the "ATE Costs" referred to above in connection with the settlement with Albany, because it does not include interest). 3. Mrs Anderson then claims interest, although her submissions in reply concede that her calculation is too generous and suggest that the parties be permitted to agree on orders or recalculate interest. 4. A deduction of $86,535.81 is then made for interlocutory costs orders adverse to Mrs Anderson. In paragraph 18 of her submissions in reply, Mrs Anderson concedes that she omitted reference to costs orders made on 11 July 2019 that she pay the costs of the respondents' security for costs motion and of an application by Ms Garrett and Mr Renauf to set aside certain subpoenas, and she agreed with their submission that that involved a reduction of $250,000 (she disagrees that the reduction should be the $400,000 as proposed by PPB). 5. A further deduction of $20,000 in respect of settlement discussions with Acorn and Albany. 6. Mrs Anderson then adds the total costs incurred by her in prosecuting the appeal, including the current and future anticipated costs of determining costs of the proceedings, plus interest (reflecting the same discounts and method of calculating interest as for the costs at trial). 7. Mrs Anderson then adds the seventh and eighth defendants' costs of $153,433.56. 8. The total amount received under the confidential settlements with Acorn and Albany, excluding the amounts paid under those deeds with respect to the return of security for costs paid by Mrs Anderson, is then deducted. 9. The total is $4,053,185.14. 1. The largest disbursements are counsel fees at trial ($1,807,094.13), expert fees ($828,778.43), counsel fees on appeal ($738,982.51) and costs associated with after-the-event premiums and fees ($1,602,272.50). 2. Following the concessions in Mrs Anderson's submissions in reply, the revised total is $3,803,185.14 (incorporating the $250,000 reduction concerning interlocutory costs), which requires further downwards revision concerning interest. 3. Rather than summarising the various submissions on each aspect of Mrs Anderson's calculation in turn, the most efficient approach is to address the points on an issue by issue basis, in approximately the same order as the various steps in Mrs Anderson's calculation summarised above. Should there be a discount reflecting Mrs Anderson's limited success? 1. The active respondents invited this Court to apply a global discount (Ms Garrett and Mr Renauf suggest 20%), which is to say a discount over and above the 25% already applied by Mrs Anderson upon her solicitor's professional costs. 2. Thus, Ms Garrett and Mr Renauf said that the Court should depart from the usual order as to costs, and make an award of 80% of the costs as agreed or assessed, reflective of the facts that (a) her victory, although more than nominal, was a small fraction of the amount claimed (it was said to be 1% of the claim sought at trial, and 3% of the amount claimed on appeal), (b) the judgment and submissions proceeded without reference to Mrs Anderson's own expert evidence, (c) the amount of costs was significantly disproportionate to the amount of equitable compensation awarded and (d) she was a stranger to the litigation. 3. By way of elaboration, Ms Garrett and Mr Renauf said: Garrett and Renauf accept that an award of $1.5m plus interest is not properly described as nominal damages. The amount recovered was, however, a fraction of the claimed damages and of the costs incurred by the Appellant in the conduct of the proceeding. In all, it is likely that some $20m was expended by all of the parties to bring to a conclusion a dispute ultimately about $1.5m plus interest. The resources of the parties, and of the Court, were taxed enormously by a matter that was simply not worth its costs. For instance, Ms Ng's evidence discloses that the expert evidence in this matter cost the plaintiff some $828,000 – despite the plaintiff ultimately abandoning that evidence and approaching her closing submissions and the appeal on the basis of the defendant's expert evidence on loss. The Court should not encourage litigation that has the effect of requiring parties to incur disproportionate expenses in a commercial controversy. Here, that issue was a matter of the appellant's making – were it not for the fact that … she had approached the Court with an eye-watering (and overambitious) claim for $142m plus interest, it is highly unlikely that the parties would have been put to the expense that they were put to. The appellant's conduct and claimed costs here is insufficiently disproportionate to deny her the entirety of her costs, unlike the Plaintiff in Jones v Sutton. However, some discount to the ordinary costs order should be applied to account for the enormous disproportion between her claimed costs and her success. Garrett and Renauf's proposed discount of 20% to party and party costs is a reasonable attempt to strike that balance between acknowledging the appellant's very limited financial success while also recognising the vast disproportion between that limited financial success and the costs of obtaining it. 1. Patersons made substantially the same points. Patersons added that Mrs Anderson's case on loss "fluctuated markedly": on the pleadings, at trial and on appeal, with a loss of a commercial opportunity case only being advanced in closing at the trial, and that not only had Mr Halligan's expert reports been rejected by the primary judge, they were also effectively abandoned by Mrs Anderson, who instead handed up an aide memoire on quantum on the last day of the trial in closing submissions. Patersons submitted that "[a] significant amount of [Mrs Anderson's] costs must have been devoted to Mr Halligan's evidence directed to the critical issue of quantum", which was apparent from the $828,778.43 in expert fees spent, of which approximately half appears to be payments to him. 2. Patersons also invited this Court to make an evaluative judgment on this issue: It may be accepted that in complex commercial trials issues of quantification of loss may evolve throughout the course of the proceedings and be subject to refinement, even significant refinement. It is respectfully submitted that the degree of fluctuation and change in the appellant's position of loss went beyond the typical forensic refinement across a complex proceeding and contributed to materially higher costs. 1. PPB made much the same submission, but went further in two respects. First, PPB made the additional complaint that Mrs Anderson made extensive use of junior counsel, saying that "there is little reason to treat counsel's fees different than those of solicitors when considering contingencies on a costs assessment. To allow no discount to counsel's fees in this case would permit an unjustified advantage to the appellant simply because she chose to have counsel perform work which in other matters might be performed by solicitors." 2. Secondly, PPB developed at length the submission that the costs incurred in preparing Mr Halligan's and Mr Wist's reports were "wasted costs". This is developed at paragraphs 17-25 of PPB's written submissions, where the main points include the criticisms made by the primary judge especially at [1475], the ultimate rejection of Mr Halligan's reports at [1504] and the reiteration of her Honour's statement at [1504] that "ironically" Mrs Anderson ultimately relied on the calculations prepared by Mr Hall (the respondents' expert). PPB concluded: The appellant's conduct of her loss case at trial, through Mr Halligan, was unsatisfactory, and the fact that she was able to find in her opponents' evidence an admissible opinion on which to hand her case (and salvage a mere $1.59 million out of a $140.9 million claim) does not diminish the waste of time and costs which resulted from Mr Halligan's evidence. The Court should find that the appellants' costs of preparing Mr Halligan's evidence were wasted costs. 1. PPB's ultimate submission is that this Court should apply an additional discount of either 20% or 30% (one of those percentages may be a typographical error) to the lump sum which the active respondents should be ordered to pay. 2. It is best to deal with PPB's "wasted costs" submission first. Although framed in the language of "wasted costs" it is clear that no application is being made pursuant to s 99 of the Civil Procedure Act. We understand the gravamen of the submission to be that the costs of preparing Mr Halligan's evidence should not be regarded as recoverable as part of Mrs Anderson's party/party costs. 3. Considerably more than what is advanced in PPB's submissions needs to be established in order to make good the submission that the preparation of reports by Mr Halligan amounts to time and money wasted for which the unsuccessful respondents should have no liability to indemnify Mrs Anderson. Much of the primary judge's strong language reflects her unsatisfactory view of Mr Halligan as a witness. That assessment may merely have reflected a very effective cross-examination. Other matters may have contributed, but without more it is difficult to see how that can bear materially upon the recoverability of the costs of preparing his evidence. What is absent from PPB's submissions is any articulated basis for concluding that at the time Mrs Anderson's money was being spent on preparing Mr Halligan's reports, her lawyers should have appreciated that that was not useful to the preparation of the case. As Mrs Anderson submitted, the fact of the matter is that the rationale underlying one aspect of Mr Halligan's evidence is reflected in the judgment she has obtained. 4. PPB's submission based on Mr Wist's evidence is much less developed than the criticisms made of Mr Halligan. We reject it for the same reasons: PPB has failed to establish that the costs of preparing his evidence should never have been incurred. 5. We turn to the more general submissions that there should be a further global discount in the order of 20% (or more). Substantially for the reasons given by Mrs Anderson in her submissions in reply, we are unpersuaded that a further discount should be applied by reason of the relative size of the judgments in favour of Mrs Anderson. In substance, this amounts to a submission to depart from the usual rule in UCPR r 42.1 that costs follow the event, and we are unpersuaded that Mrs Anderson's limited ultimate success warrants taking that course. As Mrs Anderson points out, the defendants at trial denied the validity of the assignment, maintaining that position until midway through the appeal. At trial and on appeal the defendants/respondents denied liability, causation, and loss. Only on the sixth day of the appeal did Patersons, alone out of the respondents, accept that in the event that breach and causation were made out, there might be loss in the range of $800,000 to $1,600,000, as opposed to nil as previously contended. 6. Mrs Anderson established that a dishonest and fraudulent breach of duty caused loss to the Ashington companies in a substantial multimillion dollar sum, for which all of the active respondents were liable to account. The active respondents point to no decision where the power to depart from the usual rule has been exercised in such a case. The cases on disproportionality on which the active respondents rely, such as Jones v Sutton (No 2) [2005] NSWCA 203 ($5,000 damages after 17 day hearing), are well removed from the present. 7. Finally on this issue, we are unpersuaded that a special order should be made because, so it is said, Mrs Anderson's case on loss fluctuated more widely than is usual and for that reason "contributed to the magnitude of costs". On this issue, the respondents bear the onus and the submissions advanced (which resemble those made at length on the appeal to the effect that Mrs Anderson's submissions went beyond her case) are insufficient to do so. Different discount for disbursements? 1. Contrary to PPB's submission, we see no basis for treating the fees charged by junior counsel differently, as if they were employed solicitors, because they did work which might have been done by an employed solicitor if Mrs Anderson had retained a larger firm. The evidence of Mrs Anderson's solicitor is: MTP strategically briefed Counsel early in the proceedings to provide to the appellant better value for money given the reasonable hourly rates of Counsel relative to their experience. 1. The affidavit explained that one counsel who charged $500 per hour had been a solicitor in South Africa for 12 years before coming to New South Wales, where he practised as a solicitor for a further eight years before joining the Bar in 2004. One junior counsel who undertook a deal of the work throughout most of the preparation and running of the trial and appeal commenced with an hourly rate of $220 plus GST which by the time of the appeal had risen to $340 per hour plus GST. Those rates compare very favourably with the rates of solicitors at the firm (and indeed at first the second mentioned junior counsel's rate was only slightly more than some of the firm's paralegals). 2. We are of the view that the use of junior counsel diminished the costs incurred by Mrs Anderson. This is a case where junior counsel were equally or more experienced than the solicitor and charged lower rates, and so to that extent, the active respondents will gain a benefit from Mrs Andersons' "efficient use of the resources of the junior Bar": see April Fine Paper Macao Commercial Offshore Ltd v Moore Business Systems Australia Ltd (2009) 75 NSWLR 619; [2009] NSWSC 867 at [26]-[27]. We see no reason in effect to penalise Mrs Anderson for that choice and to impose a discount as if she had retained a firm of solicitors. In short, we see no proper basis for departing from the ordinary treatment of junior counsel's bills. 3. On the other hand, we do not accept Mrs Anderson's submission that there should be no discount for counsel's fees. Patersons said that that approach too generously favours Mrs Anderson, drawing attention by way of example to Broadway Plaza Investments Pty Ltd v Broadway Plaza Pty Ltd; In the matter of Combined Projects (Arncliffe) Pty Ltd (No 3) [2021] NSWSC 1537 where disbursements were discounted by 10% and then a further 10% was deducted for contingencies. Patersons also noted that Mrs Anderson's solicitor's disclosure advised that they anticipated being able to recover 90%-100% of disbursements. Ms Garrett and Mr Renauf say there should be a 10% reduction for disbursements. The evidence of PPB's solicitor is that "it would be appropriate that a 10% discount be applied to disbursements, counsel's fees, and third party fees". PPB refers to The Berry Rural Co Operative Society Ltd v Sepak Industries Pty Ltd (No 4) [2018] NSWSC 1902 where a 20% discount was applied to the defendant's costs without differentiation between solicitor's and counsel's fees. 4. In her submissions in reply, Mrs Anderson contends that the relatively low hourly rates of counsel produce the result that "a significant discount is already inherent in the amounts sought to be recovered", that counsel's rates were otherwise reasonable and consistent with the complexity of the case, and that there is no warrant for discounting any of the other disbursements. 5. A party who seeks a gross sum costs order must be content with a broad brush approach. Mrs Anderson seeks an order without any evidence from a costs assessor. While we would acknowledge the force in her submissions in the efficiencies in preparing the case through the deployment of junior counsel, Mrs Anderson has failed to justify the absence of any discount on the disbursements incurred. On the other hand, the active respondents' criticisms that Mr Halligan's expert reports are to be regarded as "wasted costs" are largely answered by the role they played in the final judgment. Doing the best we can, and drawing together the criticisms expressed in relation to the expert witnesses, we would discount all of the disbursements by 10%. 6. Since Mrs Anderson's total disbursements at first instance and on appeal exceed $4,100,000, that is a discount exceeding $410,000. Deduction for ATE Costs 1. Mrs Anderson did not seek to recover any of the ATE Costs from the costs to which she is entitled against the active respondents. Interest on costs 1. Submissions were exchanged on the appropriate method of calculating interest on costs, which led to a concession by Mrs Anderson in her submissions in reply that her methodology had been too generous. 2. Mrs Anderson's calculations initially proceed on the bases that (a) interest was calculated as if the entirety of the payment was made on 1 January in the relevant year of the invoice, and (b) even where Mrs Anderson accepted that she was not entitled to the entirety of the amounts she paid (for example, the 25% reduction on solicitor's professional fees) she should nonetheless obtain interest on the full amount she has paid. 3. However, in reply, Mrs Anderson conceded that interest should not be calculated on the basis she originally propounded, and offered to assume that each invoice was paid on 30 June of the relevant year, which on average will neither advantage nor disadvantage her. She maintained that no discount should be applied to reflect recoverability, on the basis that "the appellant is out of pocket in those amounts from the date of payment, and given that amounts paid are significantly less than the total costs incurred, in aggregate they will comfortably exceed the quantum of costs to be recovered". 4. We disagree. Costs are a partial indemnity. Mrs Anderson accepts that she is not entitled to a full indemnity for the costs she has actually paid to her solicitors for professional fees, and we are of the same view in relation to disbursements. The basis for allowing interest in addition to costs is that to the extent Mrs Anderson is entitled to a partial indemnity for costs, that partial indemnity should extend to the time value of money for the period between the payment of that amount of the costs to which the partial indemnity extends and the time the partial indemnity is given. There is no sound basis to contend that the active respondents should pay Mrs Andersons' costs calculated by reference to 75% of her solicitor's professional costs, but also pay interest calculated by reference to 100% of those same professional costs. 5. Had Mrs Anderson pressed her claim for a gross sum costs order, we would have seen no reason, in the absence of the parties' agreement, for interest not to be calculated exactly. The "broad brush" approach to costs reflects the fact that exactitude in determining the recoverable costs is both expensive and illusory. But that provides no justification for not calculating interest with precision. The parties have spent an eight digit amount of money on costs of the litigation. They must have spent hundreds of thousands of dollars on the defendants' application for a gross sum costs order before that process was stopped pending appeal by this Court. There is a finite number of payments of costs that were made, and even if no existing spreadsheet of costs lends itself to the calculation, it is a straightforward task by a junior person which requires no legal training to calculate interest on 75% or 90% of the professional costs and disbursements over the relevant period. If not agreed, that calculation should be done (we note that both PPB and Mrs Anderson's submissions in reply contemplated the calculation of interest being left to the parties after delivery of the present reasons). Interlocutory costs orders 1. As noted above, Mrs Anderson, Ms Garrett and Mr Renauf were agreed that a deduction of $336,535.81 should be made to reflect adverse interlocutory costs orders. PPB said that the deduction should be $486,553.81. 2. Those costs (ie, the additional $250,000 or $400,000) followed motions heard on 20 and 25 June 2019 when Mrs Anderson unsuccessfully contested applications for security for costs and to set aside subpoenas. Senior and junior counsel appeared on those motions for Mrs Anderson, Ms Garrett and Mr Renauf, with junior counsel appearing for Patersons and PPB. PPB's solicitor calculated Mrs Anderson's costs of these motions and her liability to pay the costs of the active respondents as requiring an adjustment of $400,000. 3. That submission is based on PPB's solicitor's evidence that PPB incurred some $65,000 in professional fees and $24,000 in counsel fees in relation to those applications, that Mrs Anderson incurred $59,000 in counsel fees, and estimates that she incurred $74,000 in professional fees, and the assumption that Patersons and Ms Garrett and Mr Renauf (the latter two were treated collectively) also incurred $89,000 in professional fees and counsel fees. $89,000 x 3 + $59,000 + $74,000 = $400,000, rather than the $250,000 estimated by Ms Garrett and Mr Renauf. 4. The solicitor's affidavit is expressed to calculate the actual costs incurred on the motions. But the deduction for the adverse costs order which Mrs Anderson must make is not by reference to the actual costs of the successful parties on those motions, but by reference to the recoverable costs on assessment. Applying the same approach that has been applied elsewhere, that reduces solicitors' professional fees by 25% and counsel's fees by 10%. The result is approximately additional costs of $320,000. 5. The position then is that it was common ground a further adjustment needs to be made. Ms Garrett and Mr Renauf suggest at least $250,000. Mrs Anderson accepts it should be $250,000. PPB adduces evidence which, when appropriately discounted, results in approximately $320,000. Mrs Anderson did not respond to that evidence. 6. Doing the best we can, an additional $300,000 should be allowed for the interlocutory costs orders adverse to Mrs Anderson. (We note that PPB's evidence of its own costs gives confidence to the conclusion that Mrs Anderson's solicitor's professional costs are fair and reasonable, despite the redaction of the invoice descriptions.) Costs of the seventh and eighth respondents 1. Mrs Anderson said that she should be entitled to the costs of the seventh and eighth respondents, being the Ashington companies (which were in liquidation), which she has paid pursuant to an indemnity given by her. 2. The evidence is that part of the consideration for the assignments obtained by Mrs Anderson was her assuming an obligation to indemnify and keep indemnified the liquidator against any costs he might incur in relation to the claim litigated in the proceedings. The respondents obliged Mrs Anderson to join the assignor companies in liquidation, and then sought and obtained discovery from those companies. The liquidator was separately represented, and his legal fees amounted to $140,156.61. Six of the eight invoices included a 20% discount, and Mrs Anderson has applied a further 10% discount to those. In the case of the two undiscounted invoices, Mrs Anderson has applied a discount of 25%. All the invoices save the most recent have been paid by Mrs Anderson. She claims $127,023.85, representing a discount of the liquidator's solicitor's professional fees (and 100% of his disbursements), plus interest of $26,409.71, amounting to a total of $153,433.56. 3. Mrs Anderson submitted that "[t]here is little doubt that, absent the indemnity as a result of which those costs have already been paid by the appellant to the liquidator, the seventh and eighth defendants would have been entitled to seek those costs from the other defendants". She relied on what was said by Ball J in Australian International Academy of Education Ltd v Dr Nirmal Taluja (No 2) [2011] NSWSC 880 at [11]: The second defendant was joined in the proceedings because of the position taken by the first defendant that the agreement for lease and the assignment of the agreement for lease from the second defendant to the plaintiff was invalid. It was proper for the plaintiff to join the second defendant in those circumstances. Given that, it would be appropriate to make a Sanderson order in favour of the second defendant: see Sanderson v Blyth Theatre Co [1903] 2 KB 533. 1. She said that where the costs were relatively small, where the invoices were in evidence, and where there was a substantial discount for contingencies, it was appropriate that these costs be included in the gross sum costs order. 2. Ms Garrett and Mr Renauf submitted that Mrs Anderson ought not be able to recover the costs of the seventh and eighth defendants. In effect, they said that until and unless a Sanderson order is made, there could be no basis on which Mrs Anderson was entitled to claim those costs. PPB on the other hand accepted that those costs should be included. 3. In reply, Mrs Anderson said it "would represent a triumph of form over substance, and encourage wasteful expense, to require a separate application to be made for those costs". Alternatively, she said that the Court should order the active respondents pay the seventh and eighth respondents costs in a gross sum assessed at $153,433.56. 4. There appears to be no dispute about the fact of payment, or the amount which has been paid, or the entitlement of Mrs Anderson to seek a Sanderson order for the costs incurred by reason of the respondents' insistence that the seventh and eighth respondents be joined in respect of a point which was abandoned on appeal in circumstances described at [227]-[229] of this Court's principal judgment. 5. It was plain to all active respondents that Mrs Anderson explicitly sought an order that part of the costs they should be ordered to pay her would reflect the costs she has in fact paid pursuant to her indemnity to the seventh and eighth respondents. Other than to point to the absence of a formal order to that effect, there is no opposition to that course. But the point of a gross sum costs order is to replace formal orders as to costs by an immediately enforceable quantified liability in the form of a judgment, thereby avoiding needless arid and expensive disputes concerning costs. If it were necessary to do so, we would treat Mrs Anderson's submissions as an application for an order that the active respondents pay her costs of indemnifying the seventh and eighth respondents, to which we accede. But no such order is necessary. The amount would have been incorporated into a gross sum costs order if Mrs Anderson had pressed for such an order. Other adjustments 1. First, Mrs Anderson accepted that only Ms Garrett and Mr Renauf should be responsible for the costs of a freezing order obtained against them. This is an amount of $73,448.81 plus interest of $2,093.39. 2. Secondly, PPB maintained that it did not contest the application for a gross sum costs order following the trial, and says that the $108,607.76 for Mrs Anderson's professional fees plus interest of $3,098.47 is not recoverable against it. 3. The background to this is as follows. The primary judge appointed a referee to determine the gross sum costs order of the successful defendants notwithstanding the pendency of Mrs Anderson's appeal, until on 30 August 2022 when that process was stayed on her application: Anderson v Canaccord Genuity Financial Ltd [2022] NSWCA 168. Basten JA explained at [99]: The proceedings have already been on foot for some six years. The orders sought to be stayed were finally determined some three months ago. The likelihood is that the appeal will be listed for hearing early in the new year. In these circumstances, the overriding principle of expeditious disposal of the appeal favours the parties focusing their attention on the forthcoming appeal. Accordingly, the Court will grant the stay with respect to those respondents who have not consented. 1. Mrs Anderson's solicitors opened a new file in relation to the defendants' applications for gross sum costs orders. In the period from February – July 2022, the firm issued eight invoices totalling $88,246.76, and counsel issued three invoices totalling $20,361. 2. PPB's submission relied on its solicitor's affidavit which states "As set out in paragraph 59 of the Ng Affidavit, the Appellant and [PPB] reached an agreed position in relation to [PPB]'s motion for such an order and consent orders were made. Accordingly, the costs of the applications are not recoverable against [PPB]". However, paragraph 59 of Ms Ng's affidavit explains that only on 21 June 2022, after the hearing on the gross sum costs order, and after the matter had been sent to a referee (including as to PPB's costs), was the settlement reached. No other basis was put forward to disentitle Mrs Anderson from recovering the costs incurred in the needless application for an order that she pay PPB's costs of trial in a gross sum. In any event, we have reviewed the Court's orders of 23 June 2022 which reflect the agreement with PPB that its costs in the amount of $1,400,000 be paid, and there is nothing in the order which would have disentitled Mrs Anderson from recovering her costs on this issue. 3. Finally on this point, Mrs Anderson acknowledged that she incurred additional costs in the last week of June until 30 August 2022 when this Court halted the process, but says they were $7,199.50, and said that in the scheme of things they do not warrant a separate deduction. But especially since there is already separate treatment of the costs of Ms Garrett and Mr Renauf in relation to the injunction proceedings, there would have been no reason not to make a separate alteration for an admittedly small component of Mrs Anderson's costs for which PPB cannot be liable. PPBs fallback submission 1. PPB submitted that in light of the substantial settlements with the other respondents, this Court should find that PPB's liability to pay the judgment had been discharged. The short answer to this is that, although Ms Anderson accepts that her claim for costs has been satisfied by amounts received by way of settlement, it has not been shown that she has recovered more than the judgment sum for which each of the active respondents is liable. 2. Finally and for completeness, we note that PPB also submitted (again) that because Mrs Anderson's entitlement to costs considerably exceeded the relatively modest judgment she obtained, there would be no injustice in PPB not being held liable on the judgment. It is sufficient to note that we do not accept that submission. Apportionment between the active respondents 1. Patersons advanced a separate submission, based on Scripture Union v Prime Industrial Pty Ltd [2006] NSWSC 38 in which McDougall J considered the position at [30]-[41] and concluded (simplifying somewhat) that while the defendants were liable for the plaintiff's costs, as between the defendants, the first and second were jointly and severally liable for 76% of the costs, with the third defendant being liable for 24% of the plaintiff's costs. Patersons said that each of the four active respondents should be, as between themselves, liable for 25% of Mrs Anderson's costs, with Ms Garrett and Mr Renauf as between themselves being jointly and severally liable each for 25% of her costs. It is unnecessary to deal with that submission, which was not addressed by Ms Garrett or Mr Renauf, although we note that a discussion of the issues in an such an order may also be found in Queensland Bulk Water Supply Authority t/as Seqwater v Rodriguez & Sons Pty Ltd [2021] NSWCA 206 at [760]-[775]. Conclusion and orders 1. The applications by Ms Garrett, Mr Renauf and PPB to vary the judgment sum must be dismissed. 2. We are conscious that interest must continue to run from 7 December 2023 to date. There is a question about the rate at which interest should be calculated. The ordinary rates of pre-judgment interest are 2% per annum lower than post-judgment interest. The applications under UCPR r 36.16 were brought about by the fact that Mrs Anderson's settlement with Albany occurred less than 24 hours before judgment was delivered, and the time which it has taken for them to be determined has been extended by Mrs Anderson's settlement in May 2024 with Patersons. None of the active respondents can be treated as responsible for the delay brought about by those settlements. Although the applications have been unsuccessful, we think that the appropriate course is for Mrs Anderson's entitlement to interest for the time during which the r 36.16 applications have been made and determined to be determined at pre-judgment rather than post-judgment rates. The most transparent way to achieve this is separately to order, using the discretions conferred by ss 100 and 101 of the Civil Procedure Act, that interest on the judgment debt is to be calculated at pre-judgment rate between 7 December 2023 and today, and a post-judgment rate after today. For the same reasons, the active respondents should also have an entitlement within the next 28 days to pay the entirety of the amount including interest calculated up to today without incurring further interest at post-judgment rates, consistently with s 101(3) of the Civil Procedure Act. 3. We note that Mrs Anderson stated that both instalments from Patersons had been received, and extended to the "reimbursement of all costs, expenses and interest on costs incurred in this appeal, the trial below and the costs appeal brought by Mr Anderson (2022/00173413)", taking into account the earlier settlements with Acorn and Albany. Further, the following submission was advanced (submissions of 7 June 2024, paragraph 2): The appellant (and Mr Anderson) do not assert any further entitlement to costs against the remaining respondents (save in relation to their outstanding notices of motion to vary and/or set aside the Court's judgment). 1. It would appear to follow that the costs order made in favour of Mr Anderson against the first, second, third and fourth respondents in proceeding 2022/00173413 on 8 December 2023 should be set aside insofar as it extends to the active respondents. Although so far as we can see that was not expressly sought, that is probably a consequence of the timing of the settlement with Patersons. The orders this Court makes will set aside that order insofar as it extends to the active respondents. If any party wishes to be heard against that result, he, she or it may apply within the time specified by UCPR r 36.16. 2. On the costs of the applications involving the active respondents, we have rejected most of the submissions advanced by the active respondents. On the other hand, the active respondents have been put to the expense of responding to an application for a gross sum costs order which is no longer pressed. It is an unusual case where both sides have enjoyed a measure of success. But such success as the active respondents have enjoyed is largely attributable to the benefit that they will obtain by not being subject to an adverse costs order of the proceedings below or of the appeal as a result of Mrs Anderson's settlement with the other respondents. The active respondents have failed in respect of the notices of motion determined by this judgment. Costs should follow the event. 3. The Court makes the following orders in proceeding 2022/00048359: 1. Dismiss the notices of motion filed by the second, third and fourth respondents on 22 December 2023 with costs. 2. Order that the judgments entered on 7 December 2023 against Ms Garrett, Mr Renauf and PPB attract interest calculated at pre-judgment rates from that day until today, and at post-judgment rates thereafter. 3. Note that the post-judgment interest is not payable on the judgment debts if the amount is paid in full within 28 days from today. 4. Set aside order 4 made in proceeding 2022/00173143 by this Court on 8 December 2023 insofar as it applies to the second, third and fourth respondents. 5. The exhibits to be returned, and the parties have leave to uplift the submissions and affidavits containing information said to be confidential from the Court's file. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 08 July 2024