Court of Appeal Supreme Court New South Wales Medium Neutral Citation: Marshall v Prescott (No 2) [2013] NSWCA 292 Hearing dates: On the papers Decision date: 04 September 2013 Before: McColl JA; Barrett JA; Ward JA Decision: 1. Set aside Order (4) made by Bellew J on 29 August 2012 and in lieu note that there is no order as to the costs of the claims for privilege determined by his Honour. 2. Order that the costs of the second, third and fourth respondents of and incidental to the appellants' application for leave to appeal against costs orders made by Bellew J on 29 August 2012 be paid by the appellants. 3. Note that there is otherwise no order as to costs in respect of the proceedings in this Court. [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.] Catchwords: COSTS - review of costs order at first instance where appeal allowed in part - costs of appeal where appeal allowed in part only - no matter of principle Cases Cited: James v Surf Road Nominees Pty Ltd (No 2) [2005] NSWCA 296 Marshall v Prescott [2013] NSWCA 152 Category: Consequential orders Parties: Margaret Lesley Marshall (First Appellant) Kim Neil Marshall (Second Appellant) Michael Prescott (First Respondent) GIO General Limited (Second Respondent) GIO Workers Compensation (NSW) Limited (Third Respondent) The Partners TurksLegal - (Fourth Respondent) Representation: Counsel: C J Bevan/E W Young (Appellants) D J Russell SC (Second, Third and Fourth Respondents) Solicitors: Turner Freeman Lawyers (Appellants TurksLegal (Second, Third and Fourth Respondents) File Number(s): CA 2012/287040 Decision under appeal Citation: [2012] NSWSC 992 Date of Decision: 2012-08-29 00:00:00 Before: Bellew J File Number(s): SC 2009/297404 Judgment 1THE COURT: This matter was decided on 6 June 2013: Marshall v Prescott [2013] NSWCA 152. The active parties were the appellants and the second, third and fourth respondents ("the respondents"). The outcome was that: (a) the appellants were refused leave to appeal in respect of the costs orders made by the primary judge (Bellew J); (b) the appellants were unsuccessful in their challenge to the judge's decision on privilege questions as they related to subpoenaed documents 13, 14, 15 and 17; and (c) the appellants were successful in their challenge to the primary judge's order upholding privilege claims in respect of subpoenaed document 20. 2It is now necessary to decide: (a) whether the costs order made by the primary judge should be varied in light of the result on appeal; and (b) what order should be made as to the costs in this Court. 3In accordance with directions, written submissions on costs were filed by the appellants and the respondents. 4The primary judge approached the question of costs of the matters determined by him in relation to the subpoenaed documents on the footing that, as his Honour put it, "the entirety of the privilege claims have been resolved in favour of the GIO and against the plaintiffs" (the reference to "the GIO" was a reference to the respondents). His Honour therefore made an order as follows (Order (4)): "I order that the plaintiffs pay the costs of the GIO in respect of the claims for privilege." 5Given the outcome on appeal, the judge's statement as to the result on the privilege claims holds good only as to four of the five disputed documents. 6The appellants say that the question of revision of the costs order below should be approached by reference to what are said to have been distinct questions arising with respect to the privilege issue - whether documents 13, 14, 15 and 17 were subject to legal professional privilege; whether those same documents were subject to common interest privilege; whether document 20 was subject to an "extension" of the types of privilege just mentioned; and where the onus of proving loss of the claimed privilege lay. 7That, however, would introduce a level of refinement and analysis that is neither warranted nor helpful. A more practical and realistic approach recognises that documents 13, 14, 15 and 17 (letters from a particular firm of solicitors) together raised one set of issues in relation to privilege and that document 20 (a litigation funding agreement) raised another set of issues; that neither set of issues was in any relevant sense weightier than the other; and that each side succeeded as to one set of issues. 8That being so, an appropriate re-exercise of the discretion as to costs of the privilege claims at first instance is that there should be no order as to the costs in respect of the claims for privilege. 9In relation to the costs of the appeal as it related to the privilege issues, it is the respondents who seek to dissect the matter into components and to propound the relevance of distinct elements for costs purposes. They point to the fact that the appellants advanced 21 grounds of appeal and failed on 19 of them; that the appellants, in their summary of argument, put forward seven relevant questions and failed on all seven; and that the Court, having inspected the five relevant documents, decided that only one of them was not protected by privilege. 10It follows, the respondents say, that, on principles referred to in James v Surf Road Nominees Pty Ltd (No 2) [2005] NSWCA 296, the appellants should pay a very large proportion of the respondents' costs of the appeal and the respondents should pay a very small proportion of the appellants' costs of the appeal. Figures of 90 per cent and 10 percent are put forward. 11The appellants say, on this aspect, that there were only two issues in relation to privilege - whether documents 13, 14, 15 and 17 were protected; and whether document 20 was protected. On that basis, it is submitted, the costs of the appeal as it relates to the privilege matters, should be allowed to rest where they have fallen, so that there is no order as to costs. 12Consistently with what is said above as to the costs at first instance in relation to the privilege matters, the appellants' submissions should be preferred. 13It remains to consider the question of costs as it relates to the appellants' unsuccessful application for leave to appeal against costs orders made by the primary judge. Leave to appeal was refused in the course of the hearing before this Court; and the reasons for that refusal were included in the reasons published on 6 June 2013. 14The appellants contend that their failure in this respect should be regarded as offset by the grant of leave they obtained in relation to the privilege issue, so that there should be no order as to the costs of the application for leave to appeal as a whole. 15There is, however, no basis for separating out costs of the application for leave to appeal as it related to the privilege questions. The issues relevant to leave were subsumed in the substantive issues concerning privilege. No distinct issue arose in relation to the leave question as it related to the privilege issues. 16The preferable approach, therefore, is to regard the application for leave to appeal on the costs questions as a distinct matter and to treat the leave aspect relevant to the privilege issues as part and parcel of the privilege issues as a whole. 17On that basis, there should be a separate order dealing with the costs of the application for leave to appeal on the costs questions and it should be an order that the appellants pay the respondents' costs. 18The orders and notations are therefore as follows: 1. Set aside Order (4) made by Bellew J on 29 August 2012 and in lieu note that there is no order as to the costs of the claims for privilege determined by his Honour. 2. Order that the costs of the second, third and fourth respondents of and incidental to the appellants' application for leave to appeal against costs orders made by Bellew J on 29 August 2012 be paid by the appellants. 3. Note that there is otherwise no order as to costs in respect of the proceedings in this Court. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 04 September 2013