WENTWORTH v WENTWORTH SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL PRIESTLEY, CLARKE JJA AND GROVE AJA 23 November 1995, 21 February 1996 [1996] NSWCA 552 Taxation of Costs — reconsideration of taxation — review of reconsiderations — party/party costs — solicitor/client costs — costs of preparation for trial Right to appeal — waiver — estoppel — election Costs — fixed sum of costs — costs in a specific sum — proportion of costs This appeal is concerned with the taxation of costs which were awarded in Family Provision Act proceedings between Katherine Wentworth (KW) and her brother Peter Wentworth (PW) in 1991. In those proceedings, Bryson J made certain costs orders, the effect of which were that PW would pay KW's costs on a party/party basis. These orders were later affirmed by the Court of Appeal. In the meantime, KW had filed a bill of costs for an amount of approximately $800,000, the taxation of which was conducted by Taxing Officer Howe. After an extended and complicated taxing process, both parties requested a reconsideration of the taxation. Matters were complicated even further, as during the course of the taxation, numerous applications concerning the taxation process were made by KW to Master McLaughlin. These applications were heard during 1994, prior to the conclusion of the reconsideration. In late 1994, the Master heard three specific notices of motion issued by KW, seeking: (1) the issue of an interim costs certificate; (2) prerogative relief to quash determinations of the Taxing Officer; and (3) review of specific matters. None of the matters in the notices of motion sought a review of the reconsideration by the Master under SCR Pt52 162. In December 1994 the Master expressed certain statements of principle and made a number of orders which culminated in him sending the proceedings to another Taxing Officer who was to complete the taxation in accordance with the rulings of the Master. Deputy Registrar Irwin completed the taxation and issued a certificate without reasons in May 1995. In August 1995 Master McLaughlin delivered further reasons for judgment, in which he held that Deputy Registrar Irwin's certificate was an entirely valid certificate of taxation and judgment of the Court, that there were no grounds for any challenge to the certificate and that his (the Master's) role in the review process was concluded. Both parties sought leave to appeal. PW sought to challenge a number of orders made by the Master, while KW was seeking to take objection to some of the rulings of Deputy Registrar Irwin as well as challenging certain aspects of the Master's decisions. Furthermore, KW submitted to the Court that PW should not be granted leave on the ground that he had lost his right to appeal by waiver, estoppel or some similar doctrine of law. The Court held that the Master had made a number of errors of principle, particularly in his failure to appreciate the distinction between party/party and solicitor/client costs, which meant that the orders of the Master and the certificate of taxation issued by Deputy Registrar Irwin (which was based on those orders) should be set aside, and ordered that a review of the reconsideration by Mr Howe should start afresh. The Court also held that PW had not lost his right to appeal, and allowed the cross-appeal. HELD: (1) incidental costs of applications for interim relief - In his reasons of 16 December 1994, the Master was wrong to conclude that certain reserved costs orders of Bryson and Powell JJ, made in relation to a series of applications for interim relief 2 UNREPORTED JUDGMENTS by the plaintiff, related only to the costs of the actual hearings on the particular days, rather than to all costs of the plaintiff which could be treated as being associated with or incidental to the hearings on those days. (2) Costs for preparation of trial - In holding that the Taxing Officer had erred in failing to allow the whole of the costs expended by the plaintiff once he had determined that fees additional to the brief fee were allowable for preparation, the Master made two fundamental errors, namely: (a) The Master failed to observe and maintain the distinction between party/party and solicitor/client costs and erroneously applied the rule applicable to solicitor/client costs. Under 1r23(2) the only costs allowable are those which are necessary and proper for the attainment of justice or for defending the rights of any party and no more (party/party costs). Under r33 all costs are allowable except those which have been unreasonably incurred or are of an unreasonable amount (solicitor/client costs). Qantas Airways Ltd v Dillingham Corporation and Ors (Rogers J, unreported, 14 May 1987); Stanley v Phillips (1966) 115 CLR 470; Prudential Finance Ltd v Davender Nominees P/L [1992] 1 VR 468; Re Malleson, Stewart, Stawell and Nankiville [1931] VLR 125; and Cachia v Haines (1994) 179 CLR 403. (b) The Master reversed the onus of proof - the onus of demonstrating that the claimed cost is necessary and proper lies on the person bringing in the bill, that is, KW. Slingsby v Attorney-General [1918] 236; Ash Street Properties Pty Ltd and Ors v Pollnow and Ors (unreported, NSW Court of Appeal, per Handley JA, 26 October 1992); Prudential Finance Ltd v Davender Nominees Pty Ltd [1992] VLR 125; Records Ltd v Ian Cameron Wallace Ltd [1983] 1 Ch 59; and Schweppes Ltd v Archer (1934) SR 178. (3) allowance for travel - The Master was incorrect in regarding the absolute right of a party to be represented by a solicitor of her choice as including an absolute right to have that solicitor's charges for travel expenses, where they practice a considerable distance from the Court, paid in a party/party taxation whether or not they were necessary or proper. Whether a party will be allowed additional costs will depend on whether they have discharged the onus of proof and shown that they were necessary and proper expenses. (4) waiver, estoppel, election - PW had not lost his right to appeal by reason of any of the doctrines relied on by KW. (a) Although the legal representatives of PW indicated at various times that there was no present intention to appeal, that could not have constituted a waiver of a right to appeal. It was no more than an expression of present intention. Crane v Colonial Mutual Fire Insurance Co Ltd (1920)28 CLR 305; Grundt v Great Boulder Pty Gold Mines Ltd (1937) 59 CLR 641 (b) Neither could a case of election be made against PW. That doctrine only applies where a party elects to take advantage of one or two rights which are inconsistent with each other in the sense that one can only be enjoyed upon the exclusion of the other. An indication by PW that he would not appeal did not mean that his right to appeal, or to seek leave to appeal, was extinguished. Sargent v ASL Developments Ltd (1974) 131 CLR 634; Rampton v Cassin (unreported, NSW Court of Appeal, 25 September 1995). (c) It was not open to KW to rely on the doctrine of estoppel. No representations were made to KW, nor was there any evidence that PW's statements of intention to the Master were acted on by KW to her detriment, nor would it be unconscionable to permit PW to maintain the appeal in the circumstances. (5) Fixed sum of costs - It was not appropriate for the Court to order that PW pay a proportion of KW's costs or that PW pay costs in a specific sum. The exercise of the power to award only a proportion of costs will almost universally be within the province of the trial judge, and an appellate court should only be disposed to make a special order when it has sufficient information to make an order which is fair and just between the parties. The court should also only make an order that a party pay a specific sum by way of costs when it is considered that it could do so fairly between the parties. Here the lack of URJ WENTWORTH v WENTWORTH (Priestley JA) 3 available machinery and materials to conveniently determine what was a fair and just sum by way of costs was an impenetrable barrier. ORDERS (1) KW's appeal be upheld with no order as to costs; (2) PW's cross-appeal be upheld with no order as to costs; (3) The orders of Master McLaughlin made 10 and 24 February, 15 and 20 March and 10 August 1995 and the certificate of taxation of Mr Irwin be set aside; and (4) The proceedings be remitted to the Equity Division for the proper determination of the Review. Priestley JA All the facts and materials necessary for an understanding of the conclusions the court has come to in the appeal and cross appeal in this case are set out in the reasons of Clarke JA which I have had the benefit of reading in draft. With all respect to Master McLaughlin, he either took, or was responsible for, two steps in the course of his review which were in my opinion contrary to established rules, and have the result that the orders he made, against which both parties were given leave to appeal, must be set aside. The first of these steps was that discussed by Clarke JA under the heading "Costs of Preparation for Trial". I agree with what Clarke JA says under that heading. It may be that the distinction between party and party costs and solicitor and client costs produced somewhat anomalous results over the years, particularly if considered in light of the idea that a party obtaining a costs order in litigation against another party, on a party and party basis, was said to be entitled to some kind of indemnity, but the distinction between the two types of costs order, and the way they were to be taxed, was very solidly entrenched, and widely understood by all concerned with the taxation of costs. The reasons of Bryson J in regard to the costs orders he made, which were the subject of taxation in this case, show plainly, in my opinion, that he was intending to make and did make costs orders in favour of Ms Wentworth on a party and party basis in the long accepted sense of that term. Master McLaughlin's opinion had the effect of giving a very significantly different meaning to Bryson J's costs orders from what he in my opinion intended and ordered, in the proper exercise of his discretion. The second step for which Master McLaughlin was responsible, which in my view was wrong, and is very important in undermining the validity of the final orders he made on the review, was that Deputy Registrar Irwin (and the Master) gave no reasons for either the increases allowed in Mr Howe's taxed bill, or the refusal of the further increases sought by Ms Wentworth. This was a breach of the relevant rules of court, and a denial of what both parties were entitled to expect. These two matters by themselves, in my opinion, make the orders proposed by Clarke JA inevitable. For the reasons given by Clarke JA I do not see any acceptable basis for this court's short-cutting of the review procedure, much as I would like to have found some reasonable basis for doing so. Both parties made many more submissions to the court, both in writing and orally, than, as things have turned out, it is necessary to deal with. This is because for the reasons I have already mentioned, and for the additional reasons explained by Clarke JA, with which I generally agree, the orders of Master McLaughlin on the review must be set aside, and a further review conducted, upon the accepted principles, and in accordance with the rules. I agree with the orders proposed by Clarke JA. 4 UNREPORTED JUDGMENTS Clarke JA This judgment is concerned with the latest chapter in a saga between Katherine Wentworth (KW) and her brother Peter Fitzwilliam Neville Wentworth (PW). BACKGROUND FACTS On 11 August 1989 KW filed a summons in the Equity Division seeking provision pursuant to s7 of the Family Provision Act 1982 (the Act). A trial of the issues arising from that summons took place before Bryson J in April and May 1991, lasting 19 days. On 14 June 1991 his Honour delivered his principal reasons for judgment in which he concluded that KW was entitled to an order for provision under the Act. Formal orders were made on 28 June 1991. There was apparently then a hearing concerning costs and on 9 August 1991 Bryson J delivered further reasons for judgment dealing with orders for the costs of the proceedings before him. The orders made were as follows: (1) That PW pay KW's costs of the proceedings. (2) That KW pay PW's costs reserved on 10 December 1990 and 30 January 1991. (3) That KW pay PW's costs of the hearing on 27 June 1991. I pause here to mention that the intent of his Honour's first order was that PW would pay KW s costs on a party/party basis. This appears clear from page 4 of Bryson J's reasons in which he said: "The plaintiff's (KW's) submissions alternatively asked that she be awarded costs on the solicitor and client basis. I am not prepared to depart from the ordinary basis on which costs are awarded." Both parties appealed from the orders of Bryson J and in its orders, made on 3 March 1992, disposing of the appeals the Court of Appeal affirmed the above costs orders made by Bryson J. Meanwhile on 21 February 1992 KW filed a bill of costs claiming costs in the sum of $774,866.30. This claim was later amended so that the total sum claimed was increased to approximately $813,000.00. The taxation of those costs was conducted by Taxing Officer Howe and, after the issue on 6 April 1992 of an interim certificate in respect of uncontested claims within the bill of costs, the contested hearing commenced on 31 July 1992. During the taxation process (which occupied 175 1/2 hours and involved the parties appearing before Mr Howe on 38 separate occasions) Taxing Officer Howe issued three interim certificates (including the certificate issued before the commencement of the contested hearing) in the sums of $112,659.26, $48,202.67 and $30,000.00 respectively and delivered two sets of reasoning. The officer also made various determinations and, on 24 September 1993, ordered KW to pay PW's costs of the taxation except for two days. KW had, prematurely, filed a notice of motion on 8 October 1993 requesting a reconsideration (it was premature because a Certificate of Taxation had not yet been issued). This motion was stood over for hearing with a notice of motion filed by PW, also requesting a reconsideration and a further notice of motion by KW for later determination by the Taxing Officer. The taxation formally concluded on 15 April 1994 when Mr Howe certified KW's costs at $280,624.81 and the costs of the taxation, which he had ordered KW to pay at $56,691.24. He then embarked on the reconsideration which had been sought by both parties. On 16 August 1994 Mr Howe published his reasons for reconsideration and on the same date he issued his final certificate of taxation in the sum of $264,236.60. He also ordered KW to pay PW's costs of the reconsideration. URJ WENTWORTH v WENTWORTH (Clarke JA) 5 While the taxing process was still being completed before the Taxing Officer KW made seven applications to Master McLaughlin relating to matters concerning the taxation process. These applications involved 18 days of hearing before Master McLaughlin between 11 February 1994 and 11 August 1994 (that is, before the conclusion of the reconsideration) and they resulted in at least ten published reasons for judgment which were characterised by the Master as directions to the Taxing Officer. On 19 August 1994 the learned Master allocated dates for the hearing of three specific notices of motion issued by KW. They were: (a) Motion filed 10 August 1994 seeking the issue of an interim costs certificate; (b) Motion filed 9 September 1993 seeking prerogative relief to quash determinations of the Taxing Officer; and (c) Para(4) of motion filed 8 October 1993 seeking a review of specific matters. (Those matters are set out at 5 of the appeal book.) None of the matters in the notices of motion heard by the Master sought, in terms, a review of the reconsideration by the Master under Pt52 r62 Supreme Court Rules. Indeed the only motion with which the Master dealt which was filed after the issue of the certificate of taxation following the reconsideration sought the issue of an interim costs certificate. On 16 December Master McLaughlin delivered his reasons for judgment on the issues and motions he had identified on 19 August. In these reasons he expressed a number of principles of taxation which he considered were applicable and stood the proceedings over for further hearing in the new year. On 2 February 1995, 10 February 1995 and 24 February 1995 the learned Master gave further directions and on 15 March 1995 the Master, in private chambers in the absence of the parties, made the following orders: (1) The plaintiff's (KW's) bill of costs be remitted for completion of the taxation to a Taxing Officer to be designated by the Prothonotary for such purpose (such Taxing Officer not to be the same Taxing Officer who conducted the original taxation thereof.) (2) The aforesaid taxation to be conducted conformably with orders and directions of 2 February 1995, 10 February 1995 and 24 February 1995 and conformably with reasons for judgment of 16 December 1995. In conformity with those orders KW's bill of costs was remitted for further consideration by Deputy Registrar Irwin who, on 5 May 1995, issued a document entitled "Certificate of Taxation" in which he taxed and allowed the costs at $463,038.46. He also stated that the above amount included the sums, to which I have previously referred, which were allowed in interim certificates issued by Taxing Officer Howe. On 10 August 1995 Master McLaughlin delivered further reasons for judgment, dealing with a number of notices of motion, in which he held that Deputy Registrar Irwin's certificate was an entirely valid certificate of taxation and judgment of the Court; that there were no grounds for any challenge to the certificate of taxation and that he was functus officio in what he then described as the review process. Following the publication of Master McLaughlin's reasons on 10 August 1995 both parties sought leave to appeal to this Court. In broad terms PW sought to challenge a number of the orders made by Master McLaughlin whereas KW was seeking to take objection to some of the rulings of Deputy Registrar Irwin. In the event the Court of Appeal granted both parties leave to appeal without defining 6 UNREPORTED JUDGMENTS the precise issues which could be ventilated on the appeal. There is, however, one matter to which the court adverted which should be mentioned. KW had submitted to the court that PW should not be granted leave on the ground that he had lost his right to appeal by waiver or some similar doctrine of law. Mahoney AP, with whom the other judges agreed, said that if the plaintiff wished to make that assertion it was necessary for her to file a notice of motion seeking the appropriate relief. A notice of motion raising this issue was duly filed. Because of the multiplicity of proceedings and the many orders and determinations made it is, I believe, important that I set out those portions of the notices of appeal which define the orders appealed against. KW first filed her notice in which she said: "The appellant appeals from the determination of the taxation of her bill of costs by the issue of a final certificate upon review, in an amount of $463,038.46 on 5 May 1995 by Registrar Irwin, such a certificate being issued in the conduct of the review by Master McLaughlin of the plaintiff's bill of costs pursuant to the orders of Master McLaughlin of 15 March 1995 (the certificate of taxation being issued pursuant to the order for costs in this matter made by his Honour Justice Bryson on 9/8/91 as confirmed by the Court of Appeal on 6/3/92)." There then follow approximately 21 pages of grounds of appeal which range far beyond Mr Irwin's determination and challenge aspects of the Master's decisions. For his part PW, in his notice of cross-appeal, states that he appeals from all the decisions and orders of Master McLaughlin including the Master's adoption of the document entitled "Certificate of Taxation" purportedly issued by Deputy Registrar Irwin on 5 May 1995. He identifies those orders and decisions as being made on 16 December 1994; 2, 10 and 24 February 1995; 15 and 20 March 1995, 5 May 1995 and 10 August 1995. There then follow about ten pages of grounds which also challenge Mr Irwin's determination and the notice concludes with the orders sought including an order that the Master's orders be set aside. So far as I can see the Master made a large number of orders some of which were interlocutory and were not in truth the subject of PW's challenge and it is regrettable that there was not a closer definition by both parties of the precise matters which were being challenged. This is not unimportant in the context of a claim that PW has waived or somehow lost his right to appeal. Because it is clear to me that the rules governing the taxation of costs and the review of reconsiderations by Taxing Officers have not been observed by the parties it is important that I identify them at the outset. THE TAXING RULES The rules relevant to the present proceedings concerning the taxation of costs are to be found in Pt52 of the Supreme Court Rules and were those in existence before the amendments effected by Amendment 267 published in the Government Gazette on 2 October 1992. The particularly relevant section of that Part commences at r50A in Division 7 and continues until the end of the Division. It is unnecessary to delve into the intricacies of these rules, which are quite complicated, but in broad outline they are to the following effect: (a) Initially they provide for the filing of a bill of costs and the making of objections to any items in the bill; (b) The giving of an appointment date where a notice of objection is filed or an alternative procedure whereby a party disaffected by the Taxing Officer's indicated manner of dealing with specific items may request an appointment. URJ WENTWORTH v WENTWORTH (Clarke JA) 7 (c) Where an appointment date is given the interested parties may attend upon that date and make submissions on the contested items and the Taxing Officer shall give his or her decision in respect of each of those items; (d) A Taxing Officer may refer any question arising in a taxation for the direction of the Court; (e) A Taxing Officer may make interim and final certificates; (f) A party disaffected by a Taxing Officer's decision to allow or disallow the whole or part of any item may apply to the officer by motion for him or her to reconsider his or her decision. The party seeking a reconsideration should also file and serve a statement of objections complying with r60(5); (g) On a reconsideration the parties are not permitted to raise any objection not appearing in the statement referred to in (f) without the leave of the Taxing Officer; (h) Upon a reconsideration the Taxing Officer shall give his certificate in accordance with his or her decision on reconsideration and, if requested to, his reasons for that decision; (i) Where a Taxing Officer has given a certificate on the reconsideration, supported by the reasons requested by a party, the Court shall, on application, review the decision of the Taxing Officer on the reconsideration; (j) R62(4) and R62(5), which are significant, provide: "(4) On the review, unless the Court by order otherwise directs - (a) further evidence shall not be received; and (b) a party shall not raise any ground of objection not either stated in a statement of objection or raised before the Taxing Officer. (5) Subject to sub-R(4), on the review, the court may: (a) exercise all the powers and discretions of the Taxing Officer in relation to the subject matter of the review; (b) make orders for the alteration of the certificate; (c) make orders for the remission of any item to the same or any other Taxing Officer for taxation; and (d) make such other orders as the nature of the case requires." It should be observed that there is no power in the rules for a party to appeal from a decision of the Taxing Officer - the only methods of challenging his or her decisions are by reconsideration and review. In both those procedures the court, although retaining a discretion, is concerned only with objections to specific items which are set out in a notice filed under Pt52 r60(4). Furthermore, it is only those decisions made following a reconsideration which are subject to review, although the court may exercise its discretion under r62(4) to enable a wider challenge. I should also mention in passing that the rules do not detract from the inherent power of the court (that is the judges) to review a Taxing Officer's decision for the Court always retains to itself power to supervise and control the authority which it delegates to its Taxing Officers. (See Garrard v Email Furniture Pty Ltd (1993) 32 NSWLR 662 at 680-1; Cockatoo Dockyard Pty Ltd v Atamain (New South Wales Court of Appeal, 11 August 1995, unreported.) Having regard to the detailed procedures in Division 7 of Pt52 of the Supreme Court Rules the occasions for the exercise of the inherent power could be expected to be rare. In the present case it can safely be put to one side as both the Taxing Officer and the Master were exercising their functions pursuant to the power contained in the rules and no appeal was made to the inherent power of the court. 8 UNREPORTED JUDGMENTS It seems to me that the rules provide a relatively straightforward procedure for the orderly disposal of taxations under which a Taxing Officer is obliged to carry out a taxation and, upon request, a reconsideration of that taxation. Upon that reconsideration it is necessary for the Taxing Officer, if requested, to give reasons for his or her decision on reconsideration. Where a taxation is reconsidered, and a decision given supported by reasons, a party is entitled to seek a review of the decision by the Court. In both a reconsideration and a review a party is, subject to the discretion of the person reconsidering or reviewing the decision, confined to objections stated in a statement of objection (filed on the reconsideration) or raised before the Taxing Officer during the reconsideration. It should be emphasised that the rules do not provide for the review of a taxation. A very specific procedure is laid down involving a reconsideration by the Taxing Officer and the review is, subject to the discretion of the court, concerned only with the Taxing Officer's reconsidered decision on specific items to which objection had been taken. In accordance with the procedure laid down in the rules Taxing Officer Howe conducted a taxation over 38 days concluding, upon the assessment of the costs of the taxation, on 15 April 1994. Before the completion of the taxation KW had filed a notice of motion requesting a reconsideration. In 1994 PW himself sought a reconsideration and KW filed a further notice of motion (I assume with added objections) again seeking a reconsideration. Accordingly Mr Howe carried out a reconsideration and on 16 August 1994 gave his decision on the reconsideration. At the same time he gave his reasons for that decision. A certificate of taxation was also issued bearing the same date. Although the taxing procedure before the Taxing Officer had not been concluded until 16 August KW had filed notices of motion returnable before Master McLaughlin on 8 October 1993 and 9 December 1993. The earliest of those notices of motion sought a review of specific aspects of decisions apparently made by Mr Howe during the course of the taxation. There is no copy of the notice of motion of 9 December 1993 in the appeal papers but it would seem from the learned Master's reasons of 16 December 1994 that orders were sought that determinations made by Taxing Officer Howe on 28 January 1993, 9 June 1993 and 24 September 1993 be quashed. The notice of motion filed on 10 August 1994 sought, according to the Master's judgment, orders that Taxing Officer Howe determine specific matters and issue an interim certificate. When the Master came to deal with the matters before him on 16 December he observed that the three notices of motion to which I have directed attention were before him and pointed out that he had not embarked upon a review of the Taxing Officer's decision on the reconsideration and that he proposed to limit himself to the matters which were properly before him. The Master then considered a number of matters raised in the various notices of motion including the correctness of various determinations made by the Taxing Officer before he had finally determined his taxation or embarked upon a reconsideration. An example of the type of matters considered was a complaint made by KW about a determination made by the Taxing Officer on 9 June 1993 relating to the costs of preparation of trial. It is not presently clear to me what jurisdiction the learned Master was exercising in determining whether that determination was correct or not. As I have sought to point out there is a simple and orderly procedure for the taxation of costs and the reconsideration and review of any taxation. That procedure does not include any provision for the challenging of decisions made URJ WENTWORTH v WENTWORTH (Clarke JA) 9 during, and as part of, a taxation which would ultimately be reflected in the final decision and certificate of taxation. Where a party complains that a decision announced during the course of the taxation is wrong it is not open to it under the rules to challenge that decision. On the contrary it is required by the rules to await the conclusion of the taxation and then to seek a reconsideration of the taxation. It is only in that way that, the inherent jurisdiction apart, it can challenge the determination. KW did not do this. Instead she filed a number of pointless applications all of which should, in my opinion, have been summarily dismissed by the Master. Unfortunately, the Master initially appears to have entertained them although in his reasons of 16 December 1994 the Master indicated that some of the questions with which he was dealing were also relevant to a review although he had not identified a notice of motion seeking a review of the decision or the reconsideration. In the light of what later transpired I will need to return to these reasons. On 2 February 1995 the Master directed the parties to bring in short minutes to give effect to the judgment of 16 December 1994 and on 10 February 1995 he made orders which, I assume, reflected those short minutes. Apart from dealing with specific matters to which I find no need to refer he made the following orders in relation to para4 of the notice of motion filed 8 Oct 1993: "4. Determine that the costs for preparation for trial by senior and junior counsel and solicitor are not limited to any period of preparation other than the period of preparation which was in fact performed by those legal representatives of the plaintiff. 5. Order that the review of the determination of the Taxing Officer made on 24 September 1993 concerning the costs of the taxation of the plaintiff's bill of costs stand adjourned to a date to be fixed, for further consideration. 6. Note that, in respect of the items which were challenged on the grounds that they were not necessary and proper within Pt52 r23 of the Supreme Court Rules, the defendant does not dispute that each of those items was performed. 7. Order that, in respect to the items which were challenged on the ground that they were not necessary and proper within Pt52 123 of the Supreme Court Rules the review of the determination of the Taxing Officer be conducted at a time and in a manner to be directed by the Court. 8. Determine that, in respect to the items of travelling which were challenged on the grounds that they were not necessary and proper within Pt52 123 it was in general necessary and proper for the plaintiff's solicitor to attend at Court and conferences. 9. Order that the matter stand adjourned to a date to be fixed for the purpose of determining the arithmetical calculations and adjustments to the plaintiff's bill of costs, in light of and consequent upon the following determinations:" He also dismissed the other two notices of motion and made consequential costs orders. None of the notices of motion dealt with in these orders sought, in terms, a review under SCR Pt52 r62. On 24 February 1995 the Master ordered that: "1. The further conduct of the review of the reconsideration of the Taxing Officer be performed in the light of the material provided by the parties pursuant to the orders made by Master McLaughlin... and without the necessity for the attendance by the parties or their respective legal advisers." 10 UNREPORTED JUDGMENTS This, and the previous O.5 are puzzling orders for in December 1994 the Master had indicated that, while he appreciated that most of the matters presently before him would also be relevant in the conduct of a review, he was limiting himself to the determination of the precise notices of motion before him. Whatever be the true position it would seem from the orders made on 10 and 24 February that the learned Master regarded himself by that date as having embarked upon and being part way through a review of either the Taxing Officer's original or reconsidered decision. This view is further supported by the order that the Master made on 15 March that KW's bill of costs be remitted for completion of the taxation to a Taxing Officer other than Mr Howe. (See SCR Pt52 r62(5)(c).) In his reasons for decision upon a notice of motion filed by KW given on 20 March 1995 the Master said: "Subsequently, the Taxing Officer conducted a reconsideration of the taxation. The plaintiff then sought a review of that reconsideration. The review proceedings have come on for hearing before me. On 16 December 1994 I delivered my reserved judgment on various matters of principle which were raised in that review. I then stood the matter over to 2 February for the purposes of enabling the parties to consider the matters of principle set forth in that judgment." Whether or not that statement is entirely consistent with what the Master had said in December 1994, it is clear beyond argument that by this stage the Master considered that a review had been sought, that he had expressed his opinion on a number of matters of principle which arose in the review and that until 15 March he was deliberating on the question of the manner in which the review should proceed. If that is a correct understanding of what occurred it would seem to me that in making the orders which the learned Master made on 20 March he had carried out his review and that he was quite right when he said, in August 1995, that he had no further functions to carry out in the exercise of that power. Unfortunately the Master did not identify the notice of motion filed subsequent to the completion of the reconsideration which, I assume, led him to conduct a review nor did he particularise the items which were the subject of the review. This is not unimportant for in his orders of 15 March he did not identify what items, to which objection had been taken, the Taxing Officer was to consider. THE MASTER'S REASONS OF 16 DECEMBER 1994 EFFECT OF COSTS ORDERS MADE BY BRYSON J ON 9 AUGUST 1991 In addition to the order that the defendant pay the plaintiff's costs of the proceedings Bryson J ordered: (1) That the plaintiff pay the defendant's costs reserved on 10 December 1990 and on 30 January 1991; (2) That the plaintiff pay the defendant's costs of the hearing on 27 June 1991. The Court of Appeal did not interfere with Bryson J's exercise of discretion and those orders remain. Mr Howe concluded in his reconsideration that these three orders were not simply for "costs of the day" but covered all the costs "of and incidental to" the respective applications which were before the court on the nominated days. The Master, who dealt with these questions in his reasons of 16 December, observed that as a consequence of that approach "the Taxing Officer taxed off the plaintiffs bill of costs, all costs of the plaintiff which could be treated as being associated with or incidental to the hearings on those three days including the totality of the costs for interim maintenance to which those appearances related". The Master took a different view. He considered that the URJ WENTWORTH v WENTWORTH (Clarke JA) 11 costs reserved by Powell J on 10 December 1990 and 31 January 1991 (it appears that 30th was a misprint) related only to the costs of the actual hearings which took place on that occasion. Similarly, the Master concluded that Bryson J's own order of 27 June 1991 related only to the actual hearing of the application made by KW to Bryson J on 27 June 1991 and he expressed the opinion that the other costs associated with those applications were payable by PW. PW challenges these conclusions, contending that the Taxing Officer's interpretation of the orders and their effect is to be preferred. In resolving these issues it is necessary, as the Master observed initially, to determine what costs were reserved in December 1990 and January 1991 and to what costs Bryson J was referring in his orders. In his reasons of judgment of 9 August 1991, which preceded the actual orders made, Bryson J said: "The plaintiff made a series of applications for interim relief, on which she obtained no interim relief and in some cases costs were reserved. The written submissions sent to me identify only two instances where costs were reserved; Costs relating to the plaintiff's application for interim relief were reserved by Powell J on two occasions when such applications came before him, namely, on 10 December 1990 and on 30 (should be 31) January 1991. It was not necessary for the plaintiff to make those applications in order to establish her claim for final relief. She achieved nothing by making them." These observations support the stand taken by Mr Howe that Bryson J intended that PW recover all the costs of the applications which were before the court on those two dates. Nonetheless the order actually made required KW to pay the defendant's costs which were reserved on 10 December 1990 and 30 January 1991 on both of which days the court was dealing with KW's application for interim relief. The Master, who examined Powell J's judgment, concluded that on 10 December Powell J was dealing with the hearing of an application to fix a date for the hearing of the application for interim maintenance and that the costs order which was made at that time related only to the appearance before the court for the fixing of the date. The Master records that the Associate's record of proceedings contained the following entry: "Application to.......date. Judge gives reason for declining application. Costs reserved." Having regard to those facts I have concluded that the Master's view that the costs referred to on that date were the costs of the application to appoint a date is the preferable view and that PW's costs are limited in the way the Master suggested. I do not, however, agree with the Master that KW was herself entitled to any costs in respect of the application for interim maintenance for reasons which I will set out later. The order made on 31 January 1991 is in a different category. KW had made an application for interim maintenance. She sought to have it dealt with during vacation. Cohen J, sitting as vacation judge, refused her application and stood the substantive application for an interim order over to 31 January 1991. For reasons which do not appear the notice of motion did not proceed on 31 January but was adjourned generally with liberty to any party to restore on two days notice to the other. Prima facie, the application having been adjourned to 31 January it was necessary for PW's legal representatives to prepare for a hearing and to attend at Court on that date. They did appear and Powell J reserved the costs. His order - 12 UNREPORTED JUDGMENTS "costs reserved" - effectively reserved the costs associated with the hearing on 31 January, including the costs of the preparation for the hearing on that day. No doubt, if the proceedings on the motions had ultimately come on for hearing the judge who finally dealt with it would have made an appropriate costs order which included the reserved costs. That does not, however, affect the view I have expressed. Accordingly, I am of opinion that the Master was wrong to accord to the order made by Powell J such a limited effect. I appreciate that the terms of the order were terse and that there is room for argument either way. Any doubt that I might feel upon the matter is resolved upon a consideration of the order made by Bryson J and the reasons for that order. It is patently clear to me that Bryson J did not consider that he was making a costs order solely in respect of an application for an adjournment on 31 January or any such limited purpose. He was seeking to achieve, by his costs order, the result that KW paid PW the wasted costs of the application for interim relief which she had bought and not persevered with - a result which is consistent with the principle. I agree with the Taxing Officer's approach to this order and the Master was wrong to depart from it. Even if that view be wrong there is no basis for the Master's conclusion that the costs KW had wasted by her application for interim relief should be paid by PW. The Master regarded these as payable under the general costs order but this cannot be correct. The rule is correctly set out, in my opinion, in "Taxation of Costs between Parties" (Saddington) at 155: "The costs of all interlocutory proceedings, which are not otherwise provided for, are costs in the cause [Pugh v Kerr, 8 Dow] 218]. This rule of practice does not extend to the costs of proceedings which are collateral to the cause (cf Mummery v Campbell, 2 Dowl 798) and must be read as being limited to cases where the party succeeding in the cause also succeeds in the interlocutory proceedings." It is clear to my mind that KW was not entitled to any costs of the application for interim relief under the general costs order. The consequence of this conclusion is that the Taxing Officer's approach to the order of 10 December, which I have concluded was wrong, does not affect the amount of costs payable to or by PW. The third order in contention related to the defendant's costs of the hearing on 27 June 1991. Ihave already set out the costs order but it is helpful to quote from a portion of Bryson J's reasons as follows: "The defendant asked that the plaintiff pay the costs of an application before me on 27 June 1991 when the plaintiff asked me to depart from directions I had earlier given relating to the settlement of my orders. The defendant should recover the costs of the application on 27 June 1991." I take it to be clear that PW was entitled to recover the costs of and incidental to that application and not simply to the costs of appearing in court on that day. Further, the effect of the order is to deny KW, contrary to the Master's opinion, the right to any costs associated with the motion. EFFECT OF COSTS ORDER MADE BY WADDELL CJ IN EQ ON 16 JULY 1990 On 13 June 1990 PW made an application to Waddell CJ in Eq seeking an order that no further subpoenas be issued at the request of KW without the leave of a judge. Additional orders were sought. At the conclusion of the hearing on that day Waddell CJ in Eq reserved his decision. His Honour published his reserved judgment on 25 June 1990 and made a number of orders. He did not deal URJ WENTWORTH v WENTWORTH (Clarke JA) 13 with the whole of the notice of motion but stood the remaining part of it over for hearing on 16 July 1990. On that date his Honour received evidence and heard argument, at the end of which he gave directions and made orders concerning subpoenas. The orders made included the following: "Order that the plaintiff pay the defendant's costs of 13 June 1990 and that the costs of today be costs in the proceedings." It could be said that the order may have been expressed more clearly. Nonetheless, my preferred view is that the effect of the order was that KW pay PW's costs of and incidental to the presentation of submissions on 13 June 1990 (that is, the costs of preparing for and attending in court on that date) and that the costs of preparing for and attending in court on 16 July were, in the light of Bryson J's final order, to be paid by PW. This conclusion differs from that expressed by the Master but whether that is a matter of consequence is not at all clear to me. The learned Master having expressed his view concluded with these words: "To the extent that the Taxing Officer has deprived the plaintiff of any costs associated with the hearing on 16 July I consider that the Taxing Officer was in error." What the Taxing Officer said in his reconsideration was that: "The plaintiff cannot claim - any of her costs for which the defendant has been granted costs." This is a correct statement and the Master has not identified any error on the part of the Taxing Officer. COSTS OF PREPARATION FOR TRIAL In his determination of 9 June 1993 Mr Howe said: "In accordance with the principles outlined in Prudential Finance Ltd v Davander Nominees P/L [1992] 1 VR 468, a decision of the Supreme Court of Victoria which, although not binding on this Court, is highly persuasive on the question in issue, the remuneration for preparation beyond that allowed for in a brief fee, and after considering the extensive submissions made by the plaintiff and hearing the argument by the defendant's representative, I make the following determinations - (1) That in proceedings No 3748/89 it is appropriate to allow remuneration for preparation beyond that which is included in the brief fee. Given the complexity, length and extent of the matter requiring preparation required in this case, (2) Six days, representing one day for each group of three days of the trial (excluding the first day for which an allowance for preparation is included in the brief fee) be allowed for counsel as further preparation. (3) The daily preparation fee to be determined as being five hours per day multiplied by the highly rate allowed as per scale for each counsel. (4) The solicitor be allowed half of the time outlined above as being necessary to attend on counsel and such time be at the hourly rate of $15.00 per hour as per Table 1 of Schedule G of the Supreme Court Rules." Before Master McLaughlin KW complained that this approach was erroneous. The Master referred to Pt52 123(2) of the Supreme Court Rules, the decision of Rogers CJ Comm D in AWA v Daniels (T/as Deloitte Haskins and Sells), (8 October 1992, unreported) and the Taxing Officer's expressed opinion that it was appropriate to allow remuneration for preparation beyond that which was included in the brief fee of counsel. He then went on to say: "That being so, I do not see how, consonant with the obligation created by Pt52 r23(2), it can be said that only six days of preparation of five hours a day for senior and junior counsel and one half that period for solicitor can, without any evidence, or any other basis 14 UNREPORTED JUDGMENTS to support it, be regarded as being the entirety of the costs as were 'necessary or proper' for preparation by the legal advisers. Once it be recognised as appropriate to allow remuneration for preparation beyond the preparation which the brief fee, in theory at least, is presumed to encompass, then, unless there be some evidence - or some other appropriate basis therefore - which justifies the reduction of the time for preparation then it seems to me to be self evident that the preparation which was in fact performed by counsel and by a solicitor in the matter was preparation both necessary and proper for the attainment of justice or for enforcing the rights of the plaintiff. In these circumstances, therefore, I consider that the apparently arbitrary, limitation by the Taxing Officer of the preparation which he considered counsel and solicitor were justified in performing has no basis, and is not consistent with the obligation ('shall be allowed all such costs as were necessary and proper') enshrined in 1r23(2)." For those reasons the Master concluded that the Taxing Officer was in error. In his reasons the Taxing Officer referred to the judgment of Fullagar J in Magna Alloys and Research Pty Ltd v Coffee (1982) VR 97 at 109 where his Honour said: "The taxing Master has a discretion to allow on party and party taxation a separate fee for preparation relating to facts or law or both, but that generally speaking he should allow it only in matters of great complexity or voluminous documentation." He also referred to the principles expressed in Davander (supra) and in particular the following principles which he drew from that case: "Once it is decided to allow a separate fee for preparation, the appropriate quantum is governed by: (a) The complexity and extent of the preparation; (b) The length of the preparation reasonably required; (c) The daily or hourly rate reasonably allowed to counsel." He allowed solicitor's fees as per Schedule G to the Supreme Court Rules 1970 and counsel's fees in accordance with scales which have been published for many years and of which it is said in the Supreme Court Practice: "The following scales are published as that which it is understood the Taxing Officers of the Supreme Court are prepared to allow on a party and party taxation." The Master held that the Taxing Officer erred in failing to allow the whole of the costs expended once he had determined that fees additional to the brief fee were allowable for preparation. In my opinion there are two fundamental errors in the Master's approach. First, he has failed to observe and maintain the distinction between party/party costs and solicitor/client costs; secondly, he has reversed the onus of proof. Dealing with the first point it is necessary to refer to Pt52 123(2) which reads: "On a taxation on a party and party basis there shall be allowed all such costs as were necessary or proper for the attainment of justice or for enforcing or defending the rights of the party whose costs are being taxed." This rule is to be distinguished from 133 which deals with costs allowed on a solicitor and client basis. The effect of that rule is that all costs incurred by the client should be allowed except those which have been unreasonably incurred or are of an unreasonable amount unless either the amount or the incurring has the approval of the client. Under 123(2) the only costs allowable are those which are necessary and proper and under 133 all costs are allowable except those which have been unreasonably incurred or are of an unreasonable amount. The difference between URJ WENTWORTH v WENTWORTH (Clarke JA) 15 the two has always been significant. In Qantas Airways Ltd v Dillingham Corporation and Ors (Rogers J, 14 May 1987, unreported, No 16537 of 1984) his Honour said (at 3): "Party and party costs are all costs that are necessary or proper for the attainment of justice or for defending the rights of any party and no more. Any charges merely for conducting litigation more conveniently may be called luxuries and must be paid by the party incurring them. Excluded from the category of entitlement are fees incurred through over caution or in payment of special fees to counsel or special charges or expenses to witnesses or other persons. Unfortunately, even absent over caution, the indemnity so provided has never been complete since there were always costs which could not properly be charged to the other party even though they were reasonably incurred by the successful party. The contrast was between 'reasonable' expenses and 'necessary' expenses." I agree with this statement which reflects my understanding of the practice of Taxing Officers in New South Wales for many years. (See also Stanley v Phillips (1966) 115 CLR 470, at 478 and 489; Davander (supra), at 474; Re Malleson, Stewart, Stawell and Nankiville, [1931] VLR 125, at 133-4 and Cachia v Haines (1994) 179 CLR 403, at 414.) The Master has, in my opinion, failed to observe the distinction and has erroneously applied the rule applicable to solicitor/client costs. On the second point it has been established that the onus of demonstrating that the claimed cost is necessary and proper lies on the person bringing in the bill, that is, KW. As Swinfen-Eady LJ said in Slingsby v Attorney-General [1918] P 236, at 243: "... and the burden is on the parties bringing in the bill of costs and claiming to be allowed the amount charged therein to show that the amount is fair and reasonable and ought to be allowed. It is not for the Registrar to allow the amount merely because it has been paid, or because the other side have not produced evidence to show that the charge is excessive." (See also Ash Street Properties Pty Ltd and Ors v Pollnow and Ors (New South Wales Court of Appeal, per Handley JA, 26 October 1992, unreported); Davander, at 476; and EMI Records Ltd v Ian Cameron Wallace Ltd [1983] 1 Ch 59, at 71.) These principles were applied by the Taxing Officer in his long and careful initial reasons. Nothing that appears in those reasons, nor in the later ones on the reconsideration, demonstrates that the Taxing Officer applied the wrong principle or failed properly to appreciate the task confronting him. It is pertinent in these circumstances to recall the principles which govern the conduct of a review of a determination by the Taxing Officer. They were laid down many years ago by Jordan CJ in Schweppes Ltd v Archer (1934) SR 178, at 183 and are as valid today as they were in 1934. The Chief Justice made it plain that a court has undoubted jurisdiction to review a Taxing Officer's decision even where an exercise of discretion only is involved but said that, as a matter of practice, where no principle is involved the court will in general interfere only with a discretion where it has not been exercised at all or has been exercised in a manner which is manifestly wrong and he added that where the question is one of amount only the court will only interfere in an extreme case. The Master did not find that there had been any error of principle on the part of the Taxing Officer in relation to the costs of preparation nor did he identify any proper basis for interfering with the Taxing Officer's discretion. The burden was cast upon KW to establish that the incurring of the expenditure and its amount 16 UNREPORTED JUDGMENTS were necessary and proper. The Taxing Officer's conclusion that it was appropriate to allow remuneration for preparation beyond that which was included in the brief fee to counsel imposed upon him a burden of determining what KW had shown to be necessary and proper. He embarked upon this task and expressed his conclusion. The Master took the view that unless there was evidence showing that some of the expenditure was not necessary then the whole should be allowed. In this he was both applying the wrong test and reversing the onus. He has, in this way, fallen into errors of principle and his judgment cannot stand. ALLOWANCE FOR TRAVEL Originally Mr Howe allowed the sum of $11,554.95 for travelling expenses incurred by KW's solicitor, Mr Russo, in attending court and conferences. On the reconsideration he said that he had determined the issue of travelling costs on the wrong principle. He identified that principle as "the necessity of a suburban solicitor required to attend court conferences/etc due to the complexity of the litigation". He went on to say that the correct principle to be applied: "... 1s the necessity to instruct a solicitor whose practice is located at Arcadia. Ms Wentworth lives at Bellevue Hill in Sydney's eastern suburbs. She initially instructed a city firm, then decided to change to a solicitor whose office is in the inner suburbs and, finally, to instruct the Arcadia solicitor. In her reply no necessity has been shown for these changes, nor for the requirement to instruct a solicitor at Arcadia. The costs incurred are, therefore, a solicitor and client charge and cannot be claimed on a party and party basis." He therefore disallowed the claim, originally allowed, of $11,554.95. The Master reversed that finding. He held that a party has an absolute right to the legal representative of her choice and that it was of no consequence that the solicitor chosen incurred significant travel expenses because he lived a long distance from the client and the court. The Master was, of course, correct to say that a client has an absolute right to retain the solicitor of her choice. The real question is, however, whether she is entitled to be reimbursed for the travelling costs charged by that solicitor - in circumstances where he practised a long way from the court - in a taxation on a party and party basis. The client will be entitled to recover those costs if it is proper to conclude that they were necessary and proper costs. This is a question of fact. The Taxing Officer made it clear that he based his decision upon the fact that KW had not sought to establish that it was necessary or proper to retain Mr Russo, particularly in the circumstance that she had previously retained other solicitors who would not have incurred those costs. His conclusion was, as I understand it, based on the onus of proof. KW had failed to discharge the onus. In my opinion the Taxing Officer's application of principle was not shown to be incorrect and there was no error of the type which attracts correction on review. Further the Master fell into error in regarding the absolute right of a party to be represented by a solicitor of her choice as including an absolute right to have that solicitor's charges paid in a party/party taxation whether or not they were necessary or proper. It is obvious that any party is entitled, for instance, to retain the highest charging solicitor in the State, but that does not mean that the party is necessarily entitled to recover more than the costs allowed in Schedule G for the services of that solicitor. Whether or not the party will be allowed additional costs will depend upon whether it has been shown that they were necessary and proper expenses. The Master was, in my opinion, in error. EFFECT OF PT52 R23 URJ WENTWORTH v WENTWORTH (Clarke JA) 17 I have already referred to this rule and expressed my opinion that the Master has misapplied it. However, in his reasons of 16 December the Master included a heading in the terms that I have set out above and in it referred to a complaint that KW made that the Taxing Officer had declined to permit her to present relevant evidence upon the taxation. The Master did not make any finding on this complaint but contented himself with saying that he was: "\.. of the view that in any instance where the defendant challenged whether or not an item had been performed, the Taxing Officer was required to allow the plaintiff, if she so wished, to present evidence with a view to establishing that the item had, in fact, been performed." That statement must be correct for, as I have earlier said, the onus is on a party claiming particular costs to establish that they were incurred and that they were necessary and proper costs. This will require the presentation of evidence in any instance where a challenge is mounted. KW has adverted in her written submissions to her claim that she was prevented from giving evidence and referred to a transcript which is not before this Court. However, that may be I am presently dealing with an appeal which has been brought from Master McLaughlin pursuant to SCR Pt60 rl17(f) in proceedings on an application for review of taxation of costs. That appeal concerns the challenges made by both parties to the review. There are no findings by Master McLaughlin in his reasons either supporting or rejecting KW's claim that she had been prevented from leading evidence. Nor, and this may be debatable, does it appear that KW has complained about the Master's failure to deal with her complaint. However, there can be no doubt that she made a serious complaint to the Master which hasn't been dealt with and this is relevant to the orders that this Court should make. COSTS OF THE TAXATION AND RECONSIDERATION In his reasons of 16 December the Master expressed the opinion that, because the Taxing Officer had made a number of errors, his costs order could no longer be treated as correct. He went on to say that "What order should be made in substitution for the Taxing Officer's order will, however, depend upon the ultimate consequence of my present taxation and the extent to which amounts taxed off by the Taxing Officer are, as a result of my present reasons, restored to the plaintiffs bill " For reasons which I have already given the Master was in error in most if not all of the instances in which he concluded that the Taxing Officer's orders could not stand. In these circumstances, the Master's orders and Mr Irwin's certificate of taxation (which was based on those orders) should be set aside. Consequently the review of Mr Howe's reconsideration will have to start afresh and Mr Howe's costs order will fall within the scope of that review. WAIVER, ESTOPPEL, ELECTION In her notice of motion KW has sought the following orders: (a) Insofar as PW contests the matters of principle determined on 16 December 1995 as being incorrect the notice of appeal be struck out as incompetent and a declaration that PW has waived his rights or is otherwise estopped from raising those matters on appeal; (b) Insofar as PW now contends that the Master did not have jurisdiction to make the orders of 15 March 1995 that the appeal relying on that contention be struck out as incompetent and a declaration that PW has waived his rights or is otherwise estopped from raising those matters on appeal. 18 UNREPORTED JUDGMENTS The particular paragraphs in PW's notice of appeal that KW seeks to have struck out are those numbered I(a), (b), (c), (e), 3-11, 17-19. In the circumstances that unless waiver or estoppel succeeds PW will succeed in his appeal in having the orders of Master McLaughlin set aside it is unnecessary for me to deal with the complaint that the Master erred in making the orders of 15 March 1995 in the absence of the parties. I will, therefore, confine my attention to the question whether PW has waived, or otherwise lost, the right to appeal against the Master's orders upon the grounds that the expressions of principle, which were contained in his reasons of 16 December and grounded his orders, were erroneous. KW's submissions on the issue whether PW should be allowed to maintain his appeal against the Master's expressions of principle are in writing and are as follows: "The matters of principle having been determined as a separate question and the Master having determined that he would not proceed further with the review if PW intended to appeal against his determination of 16 December 1995 and orders of 10 February 1995 and PW not having sought such leave to appeal within the time given to him for that purpose by the Master KW contends that PW is now: (a) Estoppel from either seeking leave to appeal against the determinations in principle or appeal against those determinations of principle and their application; (b) Has waived his rights to now appeal against the determinations of principle and has elected not to do so. It is, or may be, important to identify the facts upon which KW relies in support of her claims. In short they concern exchanges between the Master and PW's legal representatives in court and, on one occasion, out of court. The first exchange occurred on 24 February 1995 and was as follows: "MASTER: What is the situation about the foreshadowed appeal against my determination. MEEK: In terms of question of principle we contemplate an appeal. The question is whether the orders have been made interlocutory or not. As we understand the purpose of performing arithmetical calculations is so that the correction can be made to the certificate in that sense. It would be a form of final order from which an appeal could then be made. MASTER: I had thought from some comments made on the previous occasion that your client would have in contemplation challenging matters of principle upon which orders would be made by me in private chambers after I had received the drafts of the various orders the parties proposed. Those orders have now taken effect and one of those orders, the review O.7 is (read). I have not made any such direction and I specifically do not intend to make such a direction if there is some appeal that is contemplated against the various matters of principle referred to in the other orders. It seems to me it would be totally unnecessary and very time consuming and expensive exercise for the review of those items to be conducted and then afterwards for there to be an appeal which might have the effect of setting aside the principles upon which that review has proceeded. MEEK: We certainly contemplate an appeal in terms of the orders. The fact of the matter is we will probably need leave to do it. A decision can be made about that over the weekend. MASTER: As I understand an appeal from me is to a single judge. URJ WENTWORTH v WENTWORTH (Clarke JA) 19 MEEK: In relation to taxation matters on a review there is provision under Pt60 with a combination of r10 and rl17 to go direct to the Court of Appeal. MASTER: But you would need leave at this stage? MEEK: In a sense yes, because ultimately the review takes its final form in adjustment to the certificate of taxation. As yet that has not occurred. MASTER: I do not envisage it would occur until the calculation of the matters that were challenged on the grounds of not being necessary and proper. MEEK: It might be the Court of Appeal takes the view until the certificate is altered the orders are in the nature of interlocutory orders. MASTER: What about an appeal to a single judge. You could certainly do that. Tam looking at this from a practical point of view. If there is to be some challenge to the questions of principle it seems to me that should be determined before we all embark upon a hearing irrespective of how the hearing would be conducted of hundreds if not thousands of matters challenged on the grounds of not being necessary and proper. If I am held eventually to be incorrect in the earlier matters of principle they will have to be gone into again. MEEK: While not wishing to cavil with some of the statements there are certain parts of the orders which are in the nature of discrete matters which basically have been dealt with. I had not appreciated you Master would not wish to embark on it until a final decision was made on the appeal. MASTER: On account of what was said on the previous occasion about the likelihood of the appeal on the question of principle I framed my order to accommodate that possibility. MEEK: That being the case a decision can be made very quickly and we can give an indication very early next week. MASTER: I think that would be desirable if done before I embark upon a consideration of the arithmetical calculations and decide what I am going to do about the matters of the arguments which are necessary. MASTER.... I do not wish anyone to embark upon a either parts of what will be a very time consuming exercise for anyone performing it. It is the likelihood that exercise is going to turn out to be totally unnecessary. MASTER: I am not deciding whether you need leave or you don't. All that concerns me is that some decision must be made reasonably soon about this possibly foreshadowed appeal and I won't repeat what I have earlier said about not wishing to proceed with the exercise of calculations if it is going to turn out that in the end has been a totally unnecessary exercise. I think a decision should be made promptly and I should be informed on Monday whether an appeal has been lodged." Later in his reasons for judgment of 20 March 1995 the Master said in relation to the question of appeal: "It had been foreshadowed on 2 February 1995 that the defendant (PW) proposed to appeal from my decision of 16 December. That foreshadowed appeal has not, however, been instituted. Indeed the time for the prosecution of an appeal has now lapsed, and the legal representatives of the defendant have expressly stated that no appeal is intended." He returned to the same subject in his reasons of 10 August 1995 saying: "I would, however, interpolate that there was on 2 February 1995 a suggestion on the part of the defendant that he proposed to appeal from my decision of 16 December 1994. The transcript of what occurred on 2 February 1995 and on 24 20 UNREPORTED JUDGMENTS February 1995 reveals a reluctance on my part to continue with the review procedure until some decision had been made by the defendant as to whether he proposed to appeal. On more than one occasion I referred to the fact that there would be a very considerable and unnecessary expenditure of the resources of the Court if the review procedure were to continue to its ultimate conclusion and the defendant were then to appeal against the decisions of principle which were reflected in my judgment of 16 March 1994." The Master then set out the part of his reasons of 20 March 1995 which I have earlier quoted and continued: "I gather that the defendant has in fact now instituted an appeal, or has sought leave to appeal, or has made an application for an extension of time in which to seek leave to appeal. Ido not make any comment concerning any appeal by the defendant but if the statement made in my judgment of 20 March 1995, which was an oral, ex tempore judgment made in the presence of the legal representatives of the defendant... the statement that the legal representatives of the defendant have expressly stated that no appeal is intended... is now to be said to be incorrect, I found it somewhat strange that nothing was said on that occasion, either whilst I was in the course of delivering the judgment, or if that be regarded as somewhat unmannerly, immediately at the conclusion of the judgment. I also have a recollection that a telephone message was received at my chambers at about that time from the solicitors for the defendant stating that no appeal was proposed by the defendant." Although I propose to consider the general thrust of the submission on a wider basis than was put by KW I am unable to accept that she has established the matters of fact upon which her claim is based. There is no doubt that the Master had expressed some disquiet about proceeding with a review if PW wished to challenge, at any stage, the expressions of principle which he had laid down in December 1994. However, that is a very different thing from saying that the Master had determined that he would not proceed further with the review if PW intended to appeal. If the Master had embarked upon a review, as both he and Mr Meek apparently thought that he had and as KW suggests in her claim for relief on the grounds of waiver, his obligation was to conclude that review. It is no part of the duty or function of a judicial officer to impose conditions upon the discharge of his duty in circumstances such as those which confronted the Master. He was faced with an application with which he had to deal. Unless extraordinary circumstances intervened which required the making of a special order the discharge of his duty required that he either decline to interfere with the Taxing Officer's determination or that he review it. Judicial officers are not concerned with whether there is an appeal brought from their determination. They are required to carry out their duties fearlessly and regardless of the prospects of appeals from their decisions. I appreciate that every judge or Master is concerned not only with the discharge of his or her duty but with the efficient discharge of that duty. I also readily accept that a judicial officer may perceive that it is more convenient that appeal processes be exhausted before additional expenditure is incurred in a particular proceeding. But whether a judge or master has that perception or believes that efficiency dictates that an appeal should be taken before, for instance, an inquiry takes place as to damages that judicial officer's duty is plain. That is to determine the application which is before him or her. I would go further. Not only is it no business of a judicial officer whether an appeal is brought from his or her determination but it is wrong in principle for URJ WENTWORTH v WENTWORTH (Clarke JA) 21 that officer to inquire of a party whether an appeal is to be brought or to demand that he or she be notified whether an appeal has been brought before he or she continues with the function he or she has undertaken. In the particular circumstances of this case discussions of appeal were singularly inappropriate. That is because all the orders made upon the review prior to 15 March 1995, at the earliest, were interlocutory. Indeed it may be debatable whether the orders of the 20 March were final but, if so, the previous orders were clearly interlocutory. Consequently, an appeal could only have been brought with the leave of this Court (s101(2)(e)). In Rampton v Cassin (New South Wales Court of Appeal, 25 September 1995, unreported) this Court expressed a flexible general rule pursuant to which applications for leave to appeal from interlocutory orders should be refused if it is open to the applicant to challenge the interlocutory order in an appeal from the final order. As it seems to me an appeal from any orders made by the Master prior to his order of 20 March (possibly prior to the issue of Mr Irwin's certificate) would have required leave and would, in the absence of unusual circumstances, have almost certainly failed. Although, I can appreciate the Master's concern for efficiency, his apparent belief that an appeal could be brought as of right to a judge at first instance, was, in the light of Pt60 r17(f), misplaced. The scheme provided by the Supreme Court Act and rules appears to be designed to ensure that all challenges to a review of taxation be subject to the grant of leave and this would apply with particular force to interlocutory orders made during a review. This is consistent with Mahoney JA's view (expressed in his judgment on the leave application) that even at the final stage an appeal from a Master on an application for review of taxation of costs could only be brought with leave pursuant to s101(2) of the Supreme Court Act. It is not necessary to express a final opinion on that point. The important consideration is that it is clear that prior to the final order in the review, which was either made on 20 March 1995 or on the issue of the certificate of taxation, an appeal could undoubtedly only be brought with leave. These circumstances do not support the contention of KW that PW waived his right to appeal. Waiver is an intentional act done with knowledge whereby a person abandons a right by acting in a manner inconsistent with that right (Crane v Colonial Mutual Fire Insurance Co Ltd (1920) 28 CLR 305 at 326; Grundt v Great Boulder Pty Gold Mines Ltd (1937) 59 CLR 641, at 658). Although the legal representatives of PW indicated, at various times, that there was no present intention to appeal from the reasons of 16 December that could not have constituted a waiver of a right to appeal. It was no more than the expression of a present intention and was not inconsistent with the notion that later, as a consequence of subsequent events, that intention might change. Further it should not be overlooked that PW did not intend at any stage to appeal from the order made on 16 December standing the matter over for further consideration. That was the only order made on that date which could possibly have been the subject of an appeal and, as it seems to me, the Master's questioning of PW's legal representatives seems to have proceeded upon the mistaken belief that PW could appeal from his reasons delivered on 16 December which had not been reflected in any order of the Court. I say 'mistaken belief' because there had been no relevant judgment or order made by the Court on 16 December which could have been subject to appeal pursuant to s101 of the Supreme Court Act. 22 UNREPORTED JUDGMENTS Nor do I consider that a case of election could be made against PW. That doctrine only applies where a party elects to take advantage of one of two rights which are inconsistent with each other in the sense that one can only be enjoyed upon the exclusion of the other (Sargent v ASL Developments Ltd, (1974) 131 CLR 634, at 641). Even if it be accepted for present purposes that in the period from December 1994 until June 1995 PW had indicated he would not appeal, his decision to follow that course did not mean that his right to appeal, or to seek leave to appeal, was extinguished. There was no reason why he could not assert his rights in the proceedings while at the same time reserving to himself a right to appeal, or to seek leave to appeal, at their conclusion. The fact that he gave an indication from time to time that at present he did not intend to appeal does not detract from that proposition. Parties regularly exercise their rights in the courts without prejudice to their right to challenge the final judgment of the Court upon the basis of a decision made at an earlier point of time. Indeed, Rampton proceeds upon the basis that the parties should not in the general run of cases seek to involve the Court of Appeal until a final order has been made. KW also relies on estoppel. This is not an appropriate case in which to discuss that complex subject in detail. No representations were made to KW. Nor is there any evidence that PW's statements of present intention made to the Master were acted on by KW to her detriment (a necessary ingredient of an estoppel). Nor could it be said that it would be unconscionable to permit PW to maintain the present appeal in the circumstances. The proceedings were, clearly enough, in a confused state and even the orders made remitting questions to a Deputy Registrar reflected a lack of attention to the content of the rules and the power of the Master. While this is presently of no moment (see s118(4)) the Master was obliged to complete the review either by making final orders or by remitting items for consideration by a Taxing Officer, which was what I perceive the Master was intending to do in this case. In these circumstances of confusion evidenced most clearly in passages in the transcripts, I would not conclude that any clear representation had been made which could found an estoppel. Even if those statements were capable of satisfying that element of an estoppel the lack of detriment, or inequity in permitting PW to appeal, would tell against an estoppel. For these reasons I would conclude that PW had not lost his right to appeal and that his appeal should be allowed. In his judgment granting leave to appeal Mahoney JA adverted to the high amount of the costs sought by KW. He referred in particular to the apparent disproportion between the issues litigated and the legal costs claimed; the multiplicity of the proceedings in relation to the taxation of costs; the effect which the requirements of due process have had upon the costs incurred by the parties and he expressed concern "with whether the court should consider that there is a limit to what it will order to be paid as costs". These observations led Mr Lindsay to submit that unless the court re-instated Mr Howe's orders it should exercise its powers under SCR Pt52 r6(2) to make an order that PW pay KW's costs in a specific sum. Alternatively, he contended that the court should order that PW be ordered to pay a proportion of the taxed costs. In my opinion it would not be appropriate to accede to these submissions. The position is that the costs were taxed and reconsidered by Mr Howe, a review of his reconsideration was sought and the orders made on the review will be set aside. Consequently, Mr Howe's determinations will remain in force but those which were the subject of the review which was sought remain to be reviewed. URJ WENTWORTH v WENTWORTH (Clarke JA) 23 In some, perhaps many, cases it may be appropriate for the court to make a costs order in a fixed sum rather than to order that they be taxed. In others a court may order that the circumstances require that a party be awarded only a proportion of its costs. The exercise of these specific powers will almost universally be within the province of the trial judge. This is not to say that an appellate court may not decide that it is appropriate that one of these alternative forms of order should be made. Of course it may but in general it will be a trial judge, who has seen and heard the case unfold, who will exercise these powers. As it seems to me an appellate court will be disposed to make a special order only when it feels that it has sufficient information at its disposal to make an order which is fair and just between the parties. Further, the occasion to make a proportionate costs order would arise, other than in exceptional cases, only on review of a trial judge's costs order. Here Bryson J's costs order was considered by this Court and allowed to stand. In these circumstances it is not open to the Court, in my opinion, to make an order that KW receive a proportion only of her taxed costs. The question of making an order that PW pay a specific sum by way of costs, or that a limit be placed on the costs payable involves different considerations. It would, no doubt, be convenient for the court to order payment of KW""s costs in a lump sum but the court would, I apprehend, only make such an order when it considered that it could do so fairly between the parties. In this case the considerations to which Mahoney JA adverted support the course pressed by Mr Lindsay - on the other hand the lack of available machinery and materials conveniently to determine what is a fair and just sum by way of costs stands, in my opinion, as an impenetrable barrier. For my part, I do not believe that I could attempt to assess an appropriate sum by way of costs with the materials available with any confidence at all. In these circumstances it would not be just to make such an order and I decline to do so. I would wish to add only this. The taxation of costs in these proceedings was extraordinary. It took an enormous amount of time and it is apparent, from the Taxing Officer's statements in dealing with the costs, that KW filed a grossly excessive bill and behaved in an exceptionable and unreasonable way during the taxation. The result has been a very lengthy and expensive process involving the taxation of costs, reconsideration of the taxation, review of the reconsideration and finally, appeals by both parties. The totality of costs incurred in this process must be very high indeed. Further, there were, as I earlier indicated, a great many applications brought (mostly by KW) which were premature. These undoubtedly increased the costs of the proceedings and they were directly responsible for much of the confusion which followed and which has made the resolution of this appeal so difficult. It is, in my opinion, important that parties should attend to the rules pursuant to which appeals and reviews are brought and should refrain from taking every opportunity to mount a challenge to a decision made during the course of a taxation or other similar legal proceeding. What has occurred in this case has meant that the court, and officers of the court, have been required to spend an excessive amount of court time in resolving one incidental aspect of litigation between two people. This approach to litigation imposes an undue burden on the Court. That is not to say that litigants are not entitled to take proper advantage of the procedures available in the court. It is, however, important that I make clear 24 UNREPORTED JUDGMENTS that the court should be astute summarily to reject premature and improper applications in order to protect the integrity of the court process and the functioning of the court generally. In my opinion PW has made good his claim that Master McLaughlin erred in his reasons and in his implicit (for he did not do so expressly) setting aside of the orders of Taxing Officer Howe. In my opinion PW's cross-appeal should be upheld and Master McLaughlin's orders of 10 February 1995 and 15 March 1995 and the certificate of Mr Irwin be set aside. Because Master McLaughlin's orders will be set aside it is not necessary or relevant to deal with KW s challenge to Registrar Irwin's certificate. Nor, in the circumstances, has it been necessary to deal with some of PW's submissions which challenge determinations of Registrar Irwin upon the basis, inter alia, that they did not arise in the Master's review. What is apparent is that the Master's review commenced in confusion and was never properly carried out. The resulting miscarriage of justice has affected both parties and although the Master was in error in his conclusions that Mr Howe's recommendation was flawed in substantial respects his failure to deal properly with matters which arose on the review, particularly the complaint that KW had been prevented from leading evidence, lead inevitably to the conclusion that justice requires that the review be conducted afresh. I would add this. The order made by the Master remitting the taxation to Mr Irwin, and requiring that no further evidence be given, was not only contrary to the rules but was inconsistent with the philosophy underlying the review of taxations - that is that where parties genuinely object to a ruling on items claimed they may require reasons for the conclusion and have the orders reviewed in the light of those reasons. The court, in reviewing the orders regarding specific items is required, as part of its judicial obligation, to give reasons. Here Master Irwin carried out his assigned function, dramatically affected the rights of the parties and yet gave no reasons at all. Further he appears to have gone well beyond the items the subject of the Master's consideration. In the result there could be only be a perception that justice may not have been done between the parties. I would propose the following orders: (1) KW's appeal be upheld with no order as to costs; (2) PW's cross-appeal be upheld with no order as to costs; (3) The orders of Master McLaughlin made 10 and 24 February, 15 and 20 March and 10 August 1995 and the certificate of taxation of Mr Irwin be set aside; and (4) The proceedings be remitted to the Equity Division for the proper determination of the Review. Grove AJA I have had the benefit of reading the judgment of Clarke JA in draft and I agree with the orders which he proposes for the reasons given. I also express my concurrence in the additional observations of Priestley JA. (1) KW's appeal be upheld with no order as to costs; (2) PW's cross-appeal be upheld with no order as to costs; (3) The orders of Master McLaughlin made 10 and 24 February, 15 and 20 March and 10 August 1995 and the certificate of taxation of Mr Irwin be set aside; and (4) The proceedings be remitted to the Equity Division for the proper determination of the Review. URJ WENTWORTH v WENTWORTH (Grove AJA) Counsel for the Appellant: In person Solicitors for the Appellant: Russo and Partners Counsel for the Respondent: GC Lindsay SC, MK Meek Solicitors for the Respondent: Dunhill Madden Butler