New South Wales Supreme Court CITATION : Thurai Rajah Lawyers v Villanueva & Anor [2001] NSWSC 597 CURRENT JURISDICTION: Common Law Division FILE NUMBER(S) : SC 13385 of 2000 HEARING DATE(S) : 6 July 2001 JUDGMENT DATE : 18 July 2001 Thambipillai Thambithurai Thurairajah T/as Thurai Rajah Lawyers (Plaintiff) PARTIES : v Valdemar Villanueva and Patricia Isabel Villanueva (Defendants) JUDGMENT OF : Master Malpass LOWER COURT Costs Assessment JURISDICTION : LOWER COURT 90649/00 FILE NUMBER(S) : LOWER COURT Leonard S Hattersley JUDICIAL OFFICER : COUNSEL : N/A (Plaintiff) Mr W Ward (Defendants) SOLICITORS : Thurai Rajah Lawyers (Plaintiff) Rowan - Solicitors (Defendants) CATCHWORDS : Appeal against determination of costs assessor - no appealable error of law - decisions made prior to referral to costs assessor - incidental powers. Legal Profession Act 1987, Pt 11, s 175, Divis 6, s 208, s 208A, s 208D, s 208E, s 208F, s 208J, LEGISLATION CITED : s 208JAA, Subdivis 4A, s 208KA, s 208KB, Subdivis 4B, s 208L, s 208M. Brierley v Anthony Charles Reeves T/as Kaplan Reeves & Co & Ors [2000] NSWSC 305. CASES CITED : Croker v Commissioner of Taxation [2001] NSWSC 188. Casaceli v Morgan Lewis, Alter and Anor [2001] NSWSC 211. DECISION : See Paragraph 32. THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION MASTER MALPASS WEDNESDAY 18 JULY 2001 13385 of 2000 THAMBIPILLAI THAMBITHURAI THURAIRAJAH T/as THURAI RAJAH LAWYERS v VALDEMAR VILLANUEVA & ANOR JUDGMENT 1 The plaintiff is a solicitor. He acted for three members of the Villanueva family (including the defendants) in respect of certain conveyancing work. The defendants are father and daughter. 2 He rendered bills of costs to the defendants. One was rendered to the first defendant (in the sum of $12,973.44). One was rendered to the second defendant (in the sum of $11,266.26). Largely, there was duplication of charges for the same services. 3 An application for assessment of costs was made to the court. It was accompanied by payment of a fee (in the sum of $129.73). The application was brought in respect of both bills. The application was referred to a costs assessor (Mr Hattersley) by the Proper Officer. 4 The parties were legally represented. A considerable volume of communication passed between the Costs Assessor and the parties (including general submissions from the plaintiff). The Costs Assessor made a determination on 1 December 2000. He delivered a statement of reasons. 5 The application was brought on the basis that there had not been a costs agreement. The plaintiff relied on costs agreements. Ultimately, the Costs Assessor proceeded with an assessment of only one of the bills (the bill rendered to the second defendant). The Costs Assessor found that there had been failure to make disclosure in accordance with s 175 of the Legal Profession Act 1987 (the Act). He found that the relevant terms relating to costs and charges were unjust within the meaning of s 208D. He proceeded to assess the costs of the legal services under Division 6. He determined the costs payable in an amount of $3,502.27. 6 The plaintiff proceeds on a Summons filed on 27 December 2000. It seeks to challenge the determination and have it set aside. The Summons contains a statement of grounds relied upon. What this contains is relatively unhelpful. It does little more than inform that the Costs Assessor erred in law in construing Pt 11 of the Act. At least, this revealed that proceedings had been brought pursuant to s 208L. 7 Before proceeding further, it is convenient to briefly refer to the scheme provided by the Act enabling challenge to be made to what has been done by a costs assessor. 8 Subdivision 4A of the Act makes provision for a review of a determination by a panel. Section 208KA provides that a party to an assessment who is dissatisfied with a determination of a costs assessor, may, within 28 days after the issue of a certificate, apply to the Proper Officer of the Supreme Court for a review of the determination. Section 208KB provides that if an application for a review is duly made, the Proper Officer is to refer the application to a panel. Subdivision 4B makes provision for appeals. The provisions of s 208L and s 208M are to be found in that subdivision. Section 208L enables an appeal against a decision as to a matter of law arising in the proceedings to determine the application for assessment. Section 208M enables the granting of leave to appeal where there has been a determination. 9 The Act does not define either "decision" or "determination". However, the Act does draw a distinction. Section 208L has application only where there has been a "decision" in the relevant sense. Apart from references to a "determination", the word "determine" also appears in the Act. There are references to "determination" in relation to an application for assessment of costs (ss 208A and 208F). Such a determination requires the issue of a certificate (s 208J) and it has to be accompanied by inter alia a statement of reasons (s 208JAA). The term "determine" appears in a number of sections (inter alia ss 208A, 208D, 208E and 208F). Sections 208D and 208E empower a costs assessor to determine the matters referred to therein. 10 In this case, the plaintiff has not sought to take advantage of the review process provided by Subdivision 4A. Instead, there has been a direct approach to the court pursuant to s 208L. 11 Whether or not such a course is open to a party where there has been a determination may be an arguable question. It may be thought that the terms of the Act throw up some ambiguity as to whether or not sections 208L and 208M provide remedies that offer an alternative to a review in the case of a determination. Some reference to these matters was made in Croker v Commissioner of Taxation [2001] NSWSC 188 and Casaceli v Morgan Lewis, Alter and Anor [2001] NSWSC 211. 12 Whatever be the position, the review process is provided by the Act as an effective procedure for challenging a determination by a costs assessor. It can be used to ventilate questions of law and/or of fact. It was intended that it afford the parties an informal, expeditious and less expensive process which was not a proceeding in this Court. 13 Generally speaking, it seems to have been intended as the primary avenue of challenge to a determination and so as to relieve this Court of the workload that had been borne for some years in dealing with applications by way of appeal from determinations of costs assessors. Hitherto, this seems to have been the practice followed by dissatisfied parties. However, recently, there have been a number of cases where the court has been approached under either sections 208L or 208M in circumstances where a party has failed to apply for a review within time. 14 The question of the availability of s 208L as a remedy in this case was raised but not argued. Accordingly, for present purposes, I shall proceed on the assumption that the court can grant relief under the section. However, before leaving this matter the observation should be made that where there has been a determination, the plaintiff's failure to utilise the review process may be a relevant circumstance in the consideration of whether or not relief should be given under either of sections 208L or 208M. 15 Section 208L provides a limited avenue of challenge. It is restricted to a decision as to a matter of law in the sense prescribed therein. The mere demonstration of error as to a matter of law does not necessarily mean that the plaintiff is thereby entitled to relief. The plaintiff bears the onus of satisfying the court that the decision itself should be disturbed. In my view, the plaintiff has failed to discharge that onus. 16 Detailed written submissions were put before the court on behalf of the plaintiff. A view could be taken that none of them fell within the "statement of grounds". These were supplemented by lengthy oral submissions. Numerous complaints were made as to what was done by the Costs Assessor. It is not necessary to expressly deal with each and every one of them. However, I shall do so in relation to certain of them. 17 One area of complaint concerned the amount of the sum paid by way of application fee. It is the contention of the plaintiff that a further sum of $112.66 should have been paid so as to satisfy the statutory requirements for the making of an application. Complaint was also made that the Costs Assessor had no power to amend the application. Neither of these matters seem to have been raised with the Costs Assessor. 18 The Costs Assessor of his own motion seems to have taken the view that each bill should have been the subject of a separate application. Accordingly, he invited the solicitor for the applicants in the application to accede to an amendment of the application so that the assessment would proceed as an assessment only of the bill rendered to the second defendant. For the purpose of facilitating the application, the solicitor agreed to the deletion of the first defendant's claim from the application. The Costs Assessor took the view that the parties had acceded to this approach. The plaintiff now contends that he did not do so. 19 Exhibit A contains material that was before the Costs Assessor. It seems to me, when regard is had to that material, it was open to the Costs Assessor to take the view that the parties had acceded to his invitation. The plaintiff did not raise any protest and appears to have gone along with an assessment of one bill only. This was a course that was not adverse to his interests. Even if a different view were to be taken on this matter, it does not seem to me to lead in a direction which may assist the plaintiff in this appeal. 20 In substance the Costs Assessor merely proceeded to conduct an assessment in relation to part of the application. It was conceded that this was of course open to the Costs Assessor. Accordingly, it is unnecessary to pursue the question of the powers he had in relation to amendment of the application. 21 In any event, the powers of the Costs Assessor were not the subject of full argument. Whilst there is no need to dwell on the matter, it may assist to observe that it could be expected that Parliament intended a costs assessor to have those incidental powers which are necessary to enable him to perform the statutory functions of a costs assessor. 22 One of the statutory requirements for the making of an application for assessment of the bill rendered to the second defendant was payment of the prescribed fee within time. It is not said that the sum paid was less than the fee prescribed for the making of an application for assessment of this bill or that it was not paid within time. The Costs Assessor did not assess the other bill. 23 The plaintiff sought comfort in what was decided in Brierley v Anthony Charles Reeves T/as Kaplan Reeves & Co & Ors [2000] NSWSC 305. In my view, that decision does not assist the plaintiff in the present case. In Brierley the question in issue was whether or not the Costs Assessor was able to deal with the application by reason of the fact that the application had been made out of time. 24 In that case there was a challenge to the Costs Assessor proceeding with the assessment. In the present case, the plaintiff did not make such a challenge. He submitted to the assessment process. Indeed, at one stage he exhorted the Costs Assessor to make an early determination. 25 The Act requires that the application contain a statement by the applicant that there is no reasonable prospect of settlement of the matter by mediation. As I understand what was being put, it was sought in some way to invalidate the application on the basis that there was no factual foundation for the statement made in the application that there was no reasonable prospect of settlement of the matter by mediation. This does not seem to have been a matter which was agitated before the Costs Assessor. It does not seem to me to be a matter which can be ventilated in an appeal under s 208L. In any event, the material gives rise to a strong inference that there was certainly no reasonable prospect of settlement between the parties (by mediation or otherwise). 26 It needs to be stressed that decisions made concerning the form of the application and the payment of the prescribed fee were not decisions made by the Costs Assessor or made in the proceedings to determine the application. These decisions were made prior to the referral of the application to him for assessment. 27 Complaint was made in relation to inter alia the findings made concerning the costs agreement and disclosure. It suffices to say that I am of the view that the findings made by him were open on the material. 28 Numerous complaints have been made which fall within the category of procedural irregularity and denial of natural justice. In my view, none of these contentions have been sustained. The assessment proceeded over many months. The plaintiff had a reasonable opportunity to make submissions. The Costs Assessor repeatedly sought response to matters put by him to the plaintiff. Rather than provide that response by way of submission, the plaintiff seems to have obstinately stuck to a misconceived (and sometimes oblique) course of refusing to do so until he had obtained a reply or a reply to matters that he wanted answered by the Costs Assessor. This led the Costs Assessor to set deadlines for the making of all further submissions. The plaintiff simply made no attempt to meet those deadlines and squandered the further opportunities given to him. Ultimately, the Costs Assessor came to the making of the determination on 1 December 2000. 29 For completeness, I should mention that although relief under s 208D (which deals with unjust costs agreements) had not been sought in the application, it was later raised during the course of the assessment. Thereafter the plaintiff was given reasonable opportunity to deal with it (including to make submissions on the matter). 30 Complaint was ventilated as to comments made by the Costs Assessor during the course of the assessment. These are identified in paragraph 20 of the written submissions. An example was a preliminary observation concerning the nature of the work performed by the plaintiff ("appear to be fairly straightforward conveyancing work"). The comments were not an expression of a final view. They were made to direct the plaintiff's attention to matters which were of concern to the Costs Assessor. The plaintiff was then given a reasonable opportunity to respond in respect of each comment. I am not satisfied that there is any substance in any of these complaints. 31 For completeness, I should also mention two other matters. The Costs Assessor had access to and read the relevant solicitor's file. He had regard to his personal experience (as he was entitled to do under s 208). 32 The Summons is dismissed. The plaintiff is to pay the costs of the Summons. The Exhibit may be returned. ********** Last Modified: 07/19/2001 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.