CITATION: Carney v Council of the NSW Bar Association [2010] NSWADT 86 DIVISION: Legal Services Division FIRST APPLICANT Niall M Carney SECOND APPLICANT Christopher Adamson PARTIES: FIRST RESPONDENT Council of the New South Wales Bar Association SECOND RESPONDENT Niall M Carney FILE NUMBER: 062033, 072031 HEARING DATES: On the papers SUBMISSIONS CLOSED: 22 January 2010 DATE OF DECISION: 8 April 2010 BEFORE: Karpin A - ADCJ (Deputy President); Robberds L QC- Judicial Member; Bubniuk L - Non-Judicial Member CATCHWORDS: Award of costs - only if fair to do so. Administrative Decisions Tribunal Act 1997 LEGISLATION CITED : Administrative Decisions TribunalAmendment Act 2008 Victorian Civil and Administrative Tribunal Act 1987 CASES CITED: Vero Insurance Limited v Gombac Group Pty Limited [2007] VSC 117 APPLICANT J Horowitz, barrister for Niall M Carney REPRESENTATION: C Adamson in person RESPONDENT G Gregg, barrister ORDERS ORDERS: (i)The Applicant, the Bar Council and Mr Adamson bear their own costs of the interlocutory proceedings which took place prior to 18 March 2009; (ii) Mr Adamson pay the Applicant's costs of the application made by Mr Adamson on 18 March 2009 to re-open the proceedings; and (iii)The Bar Council pay 80% of the Applicant's costs of the balance of the proceedings. REASONS FOR DECISION 1 On 3 November 2009 the Tribunal made an order that the decision of the Council of the New South Wales Bar Association (the Bar Council) made on 30 November 2006 that Niall Matthew Carney (the Applicant) be reprimanded, be set aside. The Tribunal made no order as to costs except that it granted leave to any party to list the matter before the Tribunal within 14 days on the question of costs. 2 On 23 November 2009, the Tribunal made orders for the filing and serving of written submissions on the question of costs, together with any case materials relied upon by the parties. The Tribunal indicated that it proposed to deal with the question of costs without the need for further appearances before the Tribunal. Leave was granted for any party wishing to make oral submissions to file and serve an application by 4 December 2009. No such application was received. 3 The Applicant subsequently sought costs orders against the Bar Council and Mr Adamson pursuant to section 88 of the Administrative Decisions Tribunal Act 1997 (ADT Act). 4 There is no dispute between the parties that section 88 of the ADT Act is the relevant section which is applicable to the application for costs (ADT Act, Schedule 5 Part 11, cl 43 (2) (i)). 5 The Applicant relies upon section 88 (1A) (c) (d) and (e) of the ADT Act for his application for costs against the Bar Council. 6 Section 88 of that Act relevantly provides: 1 Each party to the proceedings before the Tribunal is to bear the party's own costs in the proceedings, except as provided by this section. (1A) Subject to the rules of the Tribunal and any other Act or law, the Tribunal may award costs in relation to proceedings before it, but only if it is satisfied that it is fair to do so having regard to the following: … (b) whether a party has been responsible for prolonging unreasonably the time taken to complete the proceedings, (c) the relative strengths of the claims made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law, (d) the nature and complexity of the proceedings, (e) any other matter that the Tribunal considers relevant. 7 Subsection 88 (1A) was inserted into the ADT Act by the Administrative Decisions Tribunal Amendment Act 2008. In his Second Reading Speech the Attorney General, Mr Hatzistergos stated that the amendment to section 88 was modelled on the provision contained in the Victorian Civil and Administrative Tribunal Act 1987 (Hansard, Legislative Council, 24 September 2008, page 9876). Section 109 of the Victorian Civil and Administrative Tribunal Act is, for present purposes, in almost identical terms to subsection 88 (1A) of the ADT Act. 8 In Vero Insurance Limited v the Gombac Group Pty Limited [2007] VSC 117, Gillard J considered the operation of section 109 of the Victorian Act. In paragraph 20 his Honour stated: [20] In approaching the question of any application for costs pursuant to s109 in any proceedings in VCAT, the Tribunal should approach the question on a step by step basis, as follows – (i) The prima facie rule is that each party should bear their own costs of the proceeding. (ii) The Tribunal may make an order awarding costs, being all or a specified part of costs, only if it is satisfied that it is fair to do so. That is a finding essential to making an order. (iii) In determining whether it is fair to do so, that is, to award costs, the Tribunal must have regard to the matters stated in s 109 (3). The Tribunal must have regard to the specified matters in determining the question, and by reason of para (e) the Tribunal may also take into account any other matter that it considers relevant to the question. The order sought against the Bar Council 9 The Applicant's submissions included the following: (i)Rule 35 of the Barristers' Rules is not directed to affidavits filed in Court. As such the Bar Council's case against the Applicant was misconceived from the very start; (ii) the filing of the application for a review in the Tribunal did not cause the Bar Council to pause and give proper consideration to the merits of its decision. To the contrary, the Bar Council proceeded to vigorously defend the proceedings without recognising at any stage that its defence had no tenable basis in law; (iii) the Applicant was compelled to commence these proceedings to remedy the injustice caused to him by the Bar Council's improperly made decision. In such circumstances the Bar Council should be ordered to pay the Applicant's costs. 10 The Bar Council's submissions included the following: (i) mere success in a review application does not take the question of costs outside the general rule expressed in section 88 that each party is to bear the party's own costs in the proceedings; (ii) the Applicant bore the onus of establishing something unusual or different about the case to take the matter out of the ordinary course; (iii) putting aside the fact that the conduct of the Applicant and of Mr Adamson, would justify a costs order in favour of the Bar Council, the Applicant had failed to discharge that onus; (iv) the particulars of the grounds of review provided by the Applicant did not assert that Rule 35 had no application. That was something which only occurred to the Applicant after the filing of his written submissions prior to the commencement of the hearing. The question whether rule 35 had any application at all was mentioned for the first occasion during the opening address by counsel for the Applicant; (v) the evidence given by the Applicant to the Tribunal which the Tribunal accepted and which had a bearing upon its decision was not available to the Bar Council in the form of Murray submissions. The Bar Council's submissions gave as an example that the Tribunal found that before the Applicant handed the affidavit to the Magistrate, he had formed the intention to tender it but was prevented from doing so because the Magistrate adjourned the hearing and gave directions for the filing of further affidavits and submissions (23.2.09 T67/37 – 46 and the transcript of the proceedings in the Local Court of 18 January 2006 at pages 14 and 15); and (vi) judged prospectively, it was open to the Bar Council to accept the view expressed in the PCC report of 6 November 2006, that the Applicant breached Rule 35. Further, it was open to the Bar Council at the time to resolve that in the circumstances before it there was a reasonable likelihood that the Applicant would be found by the Tribunal to have engaged in unsatisfactory professional conduct. The "reasonable likelihood" question referred to in section 537 (2) of the Legal Profession Act 2004, must be judged prospectively, not with hindsight provided by the evidence given at the hearing or the findings of the Tribunal based upon such evidence and inferences drawn therefrom. 11 The Applicant's submissions in reply included the following: (i) the only question for the Tribunal was whether it was fair to award the Applicant his costs; (ii) where the Applicant had spent almost three years fighting the Bar Council in order to overturn a decision that was wholly misconceived from the outset, it was indeed fair that the Bar Council pay the Applicant's costs; (iii) the fact that the Applicant did not succeed on all of the arguments raised by him during the course of the proceedings should not preclude him from obtaining an order for costs; (iv) in response to the Bar Council's submission that the reasonable likelihood question referred to in section 537 (2) of the Legal Profession Act 2004 must be judged prospectively, at the time of its decision, the Bar Council had all the information it needed in order to conclude that the conduct of the Applicant could not possibly have constituted a breach of Rule 35; (v) the Bar Council failed to give these most serious matters the proper consideration they deserved; and (vi) when the Applicant filed his application for a review, the Bar Council was obliged to give proper consideration to whether the review proceedings should be defended. What is fair 12 The Professional Conduct Committee came to the view that the Applicant had breached Rule 35 of the Barristers' Rules and more particularly subparagraphs (b), (c) and /or (d) of Rule 35. 13 The resolution of the Bar Council to reprimand the Applicant included that the disciplinary action against the Applicant be published on the website of the New South Wales Bar Association in terms which included the following: On 30 November 2006 the Bar Council considered a complaint made against Niall Matthew Carney that he breached New South Wales Barristers' Rule 35 (b), (c) and/ (d). 14 In final submissions, counsel for the Bar Council stated that the Bar Council was unable to refer to any evidence demonstrating a breach of Rule 35 (c) or (d). The Tribunal is of the view that that concession was correct. It has not been suggested to the Tribunal that when the Professional Conduct Committee made its recommendation to the Bar Council, it had evidence which was not available to the Bar Council to tender before the Tribunal. It therefore appears that when the Committee made its recommendation, there was no evidence to support the view which it expressed that the Applicant breached Rule 35 (c) or (d). The Tribunal is of the view that that fact is relevant on the question of whether it is fair to make an award of costs in favour of the Applicant. 15 The Tribunal is also of the view that the matters referred to in paragraphs 67 and 68 of its Reasons for Decision dated 3 November 2009 are relevant to the question whether it is fair for the Tribunal to award costs. The Tribunal is of the view that those matters considerably strengthened the claim of the Applicant and considerably weakened the claim of the Bar Council. 16 It would be incorrect to describe the proceedings as being straightforward. There was a degree of complexity involved in them and the Tribunal is of the view that that is a matter which the Tribunal can take into account in deciding whether it should award costs in favour of the Applicant. 17 By reason of these matters the Tribunal is satisfied that it is fair to award costs in favour of the Applicant. The question then arises as to what amount of costs should be awarded. 18 The Bar Council has made submissions that it has incurred costs due to failures of the Applicant and Mr Adamson to comply with directions and orders. 19 The Applicant responded to those submissions to the effect that most of the delays in complying with directions were as a result of: (i) the Applicant's concerns regarding the dissemination of sensitive information; (ii) difficulties in obtaining the Local Court file; (iii) confusion as to affidavits which were before the Local Court Magistrate on 18 January and 9 March 2006; (iv) issues as to the quality of copies of those affidavits; and (v) Mr Adamson's delays in complying with various directions led to delays by the Applicant in complying with subsequent directions. 20 The Tribunal deals with the costs of the interlocutory proceedings in paragraphs 21 – 30 below. The Tribunal is of the view that it should take into account the fact that the question whether rule 35 had any application to the facts was raised for the first time by the Applicant on the first day of the hearing (23.12.09 T9/4 – 8). Up to that point the Applicant was proceeding on other grounds and during the hearing of the application, argued other grounds, none of which brought about the setting aside of the decision of the Bar Council. In those circumstances the Tribunal is of the view that the Bar Council should not be required to pay all of the Applicant's costs. The Tribunal is satisfied that it is fair that an order should be made that the Bar Council pay 80% of the Applicant's costs of the proceedings. 21 The complexity of the interlocutory proceedings requires different orders be made in relation to those proceedings. 22 . The application for review was filed on 29 December 2006. There were 12 Directions hearings between that date and the hearing of the substantive proceedings on 23 and 24 February 2009. Many of those Directions hearings were lengthy. At all times the first respondent complied with orders and directions made by the Tribunal. Both the applicant and Mr Adamson failed to comply with orders and directions on some occasions. Mr Adamson failed to appear on two occasions. 23 The extensive litigation being pursued between Mr Adamson and Mr Ede, and the involvement of the applicant in some of those proceedings caused delay and the necessity for further Directions hearings which were not directly relevant to the proceedings for review. 24 In all the circumstances the Tribunal has come to the view that pursuant section 88 (1) ADT Act, each party should bear their own costs of the interlocutory proceedings. The order sought against Mr Adamson 25 The Applicant seeks an order that Mr Adamson pay his costs of and incidental to Mr Adamson's application to re-open the proceedings, heard on 18 March 2009 and relies upon section 88 (1A), (b) and (c) of the Act. 26 The Applicant submitted that Mr Adamson unreasonably prolonged the proceedings and caused the Applicant to incur unnecessary costs by making the application to re-open the proceedings for the purpose of giving further evidence. It was submitted that the further evidence proposed to be led was in Mr Adamson's possession at the time of the hearing three weeks earlier and was evidence that Mr Adamson could have led during the hearing. It was submitted that Mr Adamson's application to re-open was therefore bound to fail, as it did. 27 Mr Adamson's submissions included the following: (i) the Tribunal had previously ordered that each party pay their own costs of Mr Adamson's application to be joined as a party. It was submitted that the Applicant's strenuous opposition to that application was without merit, was bound to fail and unreasonably prolonged the proceedings and caused Mr Adamson to incur unnecessary costs. In those circumstances it was only fair and just that the same order be made in relation to Mr Adamson's application to re-open. (ii) the application to re-open was made before judgment was handed down and having regard to section 73 of the ADT Act, was made in the honest belief that the normal rule against re-opening did not necessarily apply to the Tribunal; (iii) section 88 (1A) (b) of the ADT Act did not apply because the proceedings were not re-opened and the application did not unreasonably prolong the time taken to complete the proceedings; (iv) section 88 (1A) (c) of the ADT Act has no application because the application to re-open was not a "claim" within the meaning of section 88 (1A) (c). Furthermore the application to re-open did have a tenable basis; (v) section 88 (1A) (e) of the ADT Act has no application because there is no other reason making it fair to award costs to the Applicant; and (vi) there was no finding that the conduct of the Applicant was satisfactory and that is a reason why it would be unfair to order Mr Adamson to pay the costs of the application to re-open. 28 The Applicant's submissions in reply were to the following effect: (i) the Applicant's opposition to Mr Adamson's motion that he be added as a party had the beneficial effect of ensuring that Mr Adamson was not joined to the proceedings as a party at large (which would have had the likely effect of lengthening the proceedings), but rather as a party with a very limited role to play. Thus it was appropriate that each party pay his own costs of that application; and (ii) by contrast Mr Adamson was entirely unsuccessful on his application to re-open the proceedings, and should never have brought such an application. 29 The Tribunal notes the order made on 5 March 2008 pursuant to section 88 (1) ADT Act that each party pay their own costs in relation to Mr Adamson's application to be joined in the proceedings. That order reflected the result which permitted Mr Adamson to be joined as a party, but limited the scope of his right of appearance to a lesser role than that which he sought. 30 Mr Adamson's application to re-open proceedings made on 18 March 2009, was dismissed on the grounds that the material upon which Mr Adamson sought to rely was available to him at the time of the hearing; he had put no explanation before the Tribunal as to why he did not rely upon it at hearing; and the relevance of the material was unclear. The application was ill founded resulting in an unnecessary appearance before the Tribunal. Mr Adamson should pay the costs of the applicant arising from that application. Application to rely upon further affidavit of the Applicant 31 In the Applicant's written submissions on costs, the Applicant sought leave to rely upon an affidavit sworn by him on 4 December 2009. The affidavit was filed in the Tribunal on that day. The Bar Council opposes leave being granted and submits that the contents of the affidavit are irrelevant to the merits or otherwise of the costs application and should not be taken into account. 32 The Tribunal has not had the benefit of argument as to whether leave should be granted to rely upon this affidavit. In those circumstances and having regard to the finding made in paragraph 17 above, the Tribunal is of the view that it should refuse leave to rely upon the affidavit. Accordingly the affidavit has not been taken into account by the Tribunal on this application for costs. Orders 33 The Tribunal orders that : i)The Applicant, the Bar Council and Mr Adamson bear their own costs of the interlocutory proceedings which took place prior to 18 March 2009; ii)Mr Adamson pay the Applicant's costs of the application made by Mr Adamson on 18 March 2009 to re-open the proceedings; and iii)The Bar Council pay 80% of the Applicant's costs of the balance of the proceedings. 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.