Sunfield Resources Pty Limited v Waratah Resources Limited [2014] NSWSC 788

Supreme Court New South Wales

Medium Neutral Citation: Sunfield Resources Pty Limited v Waratah Resources Limited [2014] NSWSC 788 Hearing dates: 6 June 2014 Decision date: 06 June 2014 Before: Ball J Decision: See paragraphs 19 and 20 of this judgment Catchwords: COSTS - application by third party to recover its costs of complying with subpoena issued by plaintiff - UCPR r 33.11 - whether costs incurred reasonable Legislation Cited: Uniform Civil Procedure Rules 2005 (NSW) Cases Cited: Franklins Pty Ltd v Endeavour Holdings Pty Ltd [2013] NSWSC 1204 Frontier Assets Pty Ltd v Fishburn [2011] NSWSC 334 Re Dovico; Ex parte Mayne Wetherall Solicitors [2012] NSWSC 822; (2012) 265 FLR 445 A Pty Ltd v Z [2007] NSWSC 999 Category: Costs Parties: Global Resources Limited Pty Limited (ABN 89 145 362 312) (Applicant) Sunfield Resources Pty Limited (ABN 69 078 949 247) (Plaintiff) Representation: Counsel: W O'Brien (Authorised Officer of Applicant) BK Lim (Plaintiff) Solicitors: W O'Brien (Authorised Officer of Applicant) W&H Lawyers Australia (Plaintiff) File Number(s): 2013/385839 Publication restriction: Nil

EX TEMPORE Judgment 1Before me is an application to recover the costs of complying with a subpoena served by the plaintiff, Sunfield Resources Pty Limited, on a third party, Global Coal Resources Pty Limited (the Costs Applicant). The Costs Applicant has provided a detailed statement of costs incurred in complying with the subpoena. Those costs may be divided into a number of categories. 2First, there are the costs of considering the subpoena and corresponding with the party who had issued the subpoena. In the course of that correspondence, the Costs Applicant maintained that the subpoena was too wide and sought either to narrow the scope of the subpoena or to have the subpoena set aside by the party issuing it. Ultimately, the Costs Applicant sought legal advice both in relation to the scope of the subpoena and in relation to the question whether the subpoena should be set aside. 3There was then correspondence between those solicitors and the solicitors who had issued the subpoena concerning the scope of the subpoena and, eventually, its scope was narrowed by agreement. The second category of costs claimed by the Costs Applicant is the legal fees incurred by the Costs Applicant in obtaining the advice to which I have referred. 4Third, there are the actual costs of producing documents in response to the subpoena. The Costs Applicant has made a claim for $1,650 in relation to that activity. That amount has been calculated at the rate of $150 per hour for 11 hours. 5Fourth, the Costs Applicant has claimed the costs of copying the documents to be produced in response to the subpoena at the rate of $1.50 per page. This includes the costs of printing some coloured pages. 6Fifth, the Costs Applicant has claimed the costs of travelling to Sydney in order to produce the documents to the court. Again, those costs have been calculated at the rate of $150 per hour for travel time. 7Sixth, the Costs Applicant has claimed a sum of $3,000 in respect of "future costs". It is apparent that those future costs relate primarily to the costs of the application before me. 8Seventh, the Costs Applicant has claimed an amount for GST. It is not disputed that GST will be payable, although there is a question whether GST should be regarded as being included in any of the amounts claimed. 9The general principle is that a costs applicant should be entitled to recover its reasonable costs in complying with a subpoena: Uniform Civil Procedure Rules 2005 (NSW) (UCPR) r 33.11. That may include the reasonable costs of obtaining legal advice in relation to the subpoena where the terms of the subpoena are unclear or where there may be other difficulties in complying with the subpoena: see Franklins Pty Ltd v Endeavour Holdings Pty Ltd [2013] NSWSC 1204 at [9] per Pembroke J; Re Dovico; Ex parte Mayne Wetherall Solicitors [2012] NSWSC 822; (2012) 265 FLR 445 at [54] per Young AJ; A Pty Ltd v Z [2007] NSWSC 999 at [45] per Brereton J. 10However, the Costs Applicant is not entitled to recover the costs associated with challenging the validity of the subpoena. Those costs are not costs incurred by the Costs Applicant in complying with the subpoena: see Frontier Assets Pty Ltd v Fishburn [2011] NSWSC 334 at [40] per Harrison J. 11In this case, it was reasonable for the Costs Applicant to obtain legal advice in relation to the subpoena; and that legal advice resulted in a narrowing of the subpoena. 12Mr Lim, who appeared for the plaintiff, submitted that part of the legal costs were incurred by the Costs Applicant in seeking advice in relation to resisting, rather than complying with, the subpoena. In the context of this case, however, it is difficult to draw that distinction since one of the matters on which a subpoenaed party may be entitled to obtain legal advice is the width of the subpoena and how the subpoenaed party should deal with the subpoena given its width. 13Having regard to the amount of legal costs involved, I do not think it is unreasonable that the Costs Applicant be permitted to recover all the legal costs that it incurred in obtaining advice in relation to this subpoena. 14I also think that it is reasonable for the Costs Applicant to recover the sum of $1,650 associated with the actual costs of producing the documents. It appears that the company on whom the subpoena was served is a small private company that is engaged in providing services which could be described as being, in their nature, professional services of a contracts broker. In my opinion, the rate of $150 per hour for the person who is effectively the managing director of that company is not unreasonable. 15The Costs Applicant is also entitled to recover reasonable photocopying or printing costs. However, I think the claim at the rate of $1.50 per page is excessive and that a more reasonable rate would be $1 per page. 16The Costs Applicant is also entitled to recover the actual costs incurred in coming to Sydney to produce the documents. The actual costs for this purpose - the costs of purchasing any relevant train ticket or incurring any other actual expenses of travel - does not include an hourly rate for that travel. It was unreasonable for the Costs Applicant to seek to deliver the documents personally when other arrangements could have been made for their delivery. 17The other claims for costs are not reasonable. In particular, I do not think that the Costs Applicant is entitled to any amount in respect of future costs. Those future costs appear to relate to the costs of the current application. If the Costs Applicant wishes to pursue those costs, they are a matter for assessment which should not be included in the current application. 18Lastly, in my opinion, the amounts that I have referred to as being reasonable amounts should be regarded as GST inclusive amounts and, consequently, no separate amounts should be allowed for GST. 19The parties have agreed that, in the light of the conclusions I have reached, the Costs Applicant is entitled to recover the sum of $4,629.35, in respect of the Costs Applicant's costs of complying with the subpoena issued by the plaintiff. Consequently, I order that the plaintiff pay the Costs Applicant that amount. 20Each party enjoyed a degree of success. In those circumstances, each should bear its own costs of today.