Allen v O’Donnell & Anor (No 2) [2021] QSC 149 (2021) 8 QR 293
SUPREME COURT OF QUEENSLAND
CITATION: Allen v O’Donnell & Anor (No 2) [2021] QSC 149
PARTIES: BLAISE ANTHONY ALLEN
(plaintiff/applicant)
v
MATTHEW THOMAS O’DONNELL
(first defendant/first respondent)
RACQ INSURANCE LIMITED
ACN 009 704 152
(second defendant/second respondent)
FILE NO/S: SC No 919 of 2019
DIVISION: Trial Division
PROCEEDING: Application
ORIGINATING
COURT:
Supreme Court at Rockhampton
DELIVERED ON: 23 June 2021
DELIVERED AT: Rockhampton
HEARING DATE: 14 June 2021
JUDGE: Crow J
ORDER: 1. The Second Defendant provide the Plaintiff with a copy
of its Costs Agreement with its solicitors Cooper Grace
Ward together with any copies of any variations to that
Agreement from the time of its original instructions to
Cooper Grace Ward to date of this application
CATCHWORDS: PROCEDURE – CIVIL PROCEEDINGS IN STATE AND
TERRITORY COURTS – COSTS – GENERAL MATTERS
– NATURE OF COSTS: INDEMNITY DOCTRINE –
GENERALLY – where the plaintiff received judgment in his
favour but the judgment amount did not exceed the defendant’s
mandatory final offer – where the plaintiff is liable for the
defendant’s costs from the date of the exchange of final offers
– where the plaintiff contends that the cost agreement between
the second defendant and its solicitors (“costs agreement”)
may contain provision for stage-based assessments therefore
the actually liability under the costs agreement may be less
than what it is as assessed on a standard basis – where the
defendant deposes that the “total” of the actual costs and
outlays exceeds the amount as assessed on a standard basis –
where the plaintiff seeks the disclosure of the costs agreement
so as to determine whether the indemnity principle has been
offended – whether the costs agreement ought to be disclosed
PROCEDURE – CIVIL PROCEEDINGS IN STATE AND
TERRITORY COURTS – COSTS – OFFERS OF
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COMPROMISE OR OFFER TO SETTLE OR CONSENT TO
JUDGMENT PURSUANT TO RULES – GENERALLY –
where the plaintiff is liable for the defendant’s costs from the
date of the exchange of final offers – where the plaintiff wishes
to make an offer to settle costs pursuant to r 733 of the Uniform
Civil Procedure Rules 1999 (Qld) – where the plaintiff
contends that without access to the costs agreement it cannot
know the liability as between the second defendant and its
solicitors and therefore is not in a realistic position to make an
offer – whether the costs agreement ought to be disclosed
Uniform Civil Procedure Rules 1999 (Qld) r 702, r 733
Cook v Pasminco Ltd [2000] 107 FCR 44; [2000] FCA 1819,
cited
Dyktynski v BHP Titanium Minerals Pty Ltd (2004) 60
NSWLR 203; [2004] NSWCA 154, cited
Harold v Smith (1860) 157 ER 1229, cited
King v King [2012] QCA 81, applied
Kuek v Devflan (2011) 31 VR 264; [2011] VSCA 25, applied
Shaw v Yarranova Pty Ltd [2011] VSCA 55, applied
Wentworth v Rogers (2006) 66 NSWLR 474; [2006]
NSWCA 145, applied
COUNSEL: S J Deaves for the plaintiff
G J Robinson for the second defendant
SOLICITORS: Grant & Simpson for the plaintiff
Cooper Grace Ward for the second defendant
[1] This application has its genesis in personal injuries proceedings brought by the
plaintiff/applicant, Mr Allen, following a motor vehicle accident which occurred on
6 January 2015.
[2] In April 2021, I gave judgment for approximately $2.5m in favour of the plaintiff,
however, the judgment amount did not exceed the defendant’s mandatory final offer.
As such, the plaintiff is liable for the second defendant’s costs from 17 December
2019 (the day on which offers were exchanged) on a standard basis.
[3] Rather prudently, the plaintiff has attempted to formulate a written offer to settle the
costs liability pursuant to r 733 of the Uniform Civil Procedure Rules 1999 (Qld)
(“UCPR”). As is shown by the correspondence exhibited to the affidavit of Mr Smith
filed 2 June 2021,1 the plaintiff has requested from the second defendant a copy of
the costs agreement between itself, that is, RACQ Insurance Limited (“RACQ”), and
their solicitors, Cooper Grace Ward (“CGW”).
[4] The rationale espoused by Mr Smith for the plaintiff in that correspondence is that to
properly formulate any offer to settle costs, the plaintiff must be in a position to
understand the liability as between the second defendant and their solicitors. The
second respondent has refused to supply the costs agreement. The plaintiff now seeks
1 Exhibit SRS2 to the affidavit of Stephen Robert Smith filed 2 June 2021.
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an order from the court that the second defendant provide to the plaintiff a “copy of
its Costs Agreement with its solicitors Cooper Grace Ward together with any copies
of any variations to that Agreement from the time of its original instructions to Cooper
Grace Ward to date of this application.”2
[5] In the application’s supporting affidavit, Mr Smith deposes that costs agreements
between CTP insurers and their solicitors could contain provisions for stage-based
assessments and payments of costs and outlays which may result in the liability of the
insurers to its solicitors for a given period being less than the costs assessed on the
standard basis for that period. Mr Smith asserts that the plaintiff seeks the costs
agreement as it may assist him in negotiating or arriving at an appropriate offer to
settle the costs.
[6] Following the filing of the application, the second defendant filed their costs
statement pursuant to r 705 of the UCPR. The costs statement claimed costs of
$150,205.24, outlays of $188,448.27 for a total of $338,653.51.3 The plaintiff, with
the costs application having been filed by the defendant, persists with the applicatio n
to have access to the costs agreement and associated documents on what now appears
to be a two-pronged basis:
(a) Firstly, and as above, to table an appropriate offer to settle the costs pursuant
to r 733; and
(b) Secondly, absent the documents it is impossible for the plaintiff to determine
whether or not the indemnity principle may be offended in this particular case.
[7] Mr Cockburn for the second defendant has deposed that the indemnity principle has
not been offended insofar as the “total legal costs and outlays” payable by RACQ to
CGW exceeds the amount contained in the costs statement.4
The Indemnity Principle
[8] The indemnity principle has been a feature of the common law for over 150 years. In
Harold v Smith (1860) 157 ER 1229,5 Bramwell B said:
“Costs as between party and party are given by the law as an indemnity
to the person entitled to them; they are not imposed as a punishme nt
on the party who pays them, nor given as a bonus to the party who
receives them. Therefore, if the extent of the damnification can be
found out, the extent to which costs ought to be allowed is also
ascertained. Of course, I do not say that there are not exceptional cases
in which certain arbitrary rules of taxation have been laid down; but,
as a general rule, costs are an indemnity, and the principle is this, –
find out the damnification, and then you find out the costs which
should be allowed.”
2 Plaintiff’s application filed 2 June 2021.
3 Costs Statement filed 3 June 2021.
4 Affidavit of Brady Campbell Cockburn filed 14 June 2021.
5 Harold v Smith (1860) 157 ER 1229 at 1231.
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[9] More recently, the Court of Appeal of the Supreme Court of Victoria in Shaw v
Yarranova Pty Ltd [2011] VSCA 55, per Redlich and Mandie JJA explained the
indemnity principle in these terms:6
“[8] An order for costs against the unsuccessful litigant aims to
provide the successful party with some level of indemnity for the
legal costs the successful party would not have incurred had it
not been necessary to uphold his or her rights in court. Such an
order does not entitle the successful litigant to recover more than
he or she has paid or is liable to pay to his or her own lawyer.
The rule limits the successful party’s right to indemnification to
the ‘necessary or proper’ costs incurred to obtain justice in the
case. The costs are usually confined to those that the successful
party ‘was primarily and potentially legally obliged to pay to his
solicitor’. Hence the existence and scope of the successful
litigant’s duty to pay his or her own solicitors is central to the
ability to recover costs.
[9] As this case and the recent decision of this Court in Kuek v
Devflan Pty Ltd & Anor illustrate, an unsuccessful party may
wish to investigate the scope of the successful party’s obligation
to pay their solicitors’ costs by reference to the retainer of the
successful party’s solicitors. As it was known that MAB
Corporation had paid or was intending to pay all or part of the
respondents’ costs, the applicant endeavoured to obtain
documents before Wood AsJ for the purpose of establishing that
the respondents had no liability to the solicitors who acted for
them, or had a liability that was less than might be calculated
by a standard party/party taxation. Relying upon the decision
of Beach J in Kuek v Devflan Pty Ltd and the New South Wales
Court of Appeal in Dyktynski v BHP Titanium Minerals Pty Ltd,
the applicant sought production of ‘relevant retainer letters,
costs agreements, invoices, proof of payments of invoices and
actual costs paid.’ He submitted before Wood AsJ that the
respondents should be required ‘to provide evidence of the
terms of the retainer outlining the circumstances and any
limitations on the fees or liabilities the defendants may have to
their solicitors and actual costs paid by them’, so as to establish
their liability to pay costs to their solicitors in amounts at least
as great as the amounts of the costs the applicant had been
ordered to pay pursuant to the costs orders.
[10] Wood AsJ accepted that production of retainer letters and any
costs agreements may be justifiable but refused to direct the
respondents to produce bills or invoices rendered or other proof
of payment. He thus ordered that the respondents produce any
relevant document and any costs agreement that established the
method of calculation of legal fees in relation to acting for the
respondents in the substantive proceedings. In response to that
order the solicitors for the respondents advised Wood AsJ that
6 Shaw v Yarranova Pty Ltd [2011] VSCA 55 at [8].
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there were no such documents, save for actual bills or invoices
rendered as proof of payment, noting that the production of
those documents was not required. Following that advice, the
applicant renewed his request for the production of invoices and
receipts for payments. Wood AsJ again refused to so order and
in his reasons for confirming on review the taxation figures
stated –
At the hearing on 27 April 2010 the defendants
confirmed that there were no documents that fell within
the description of the order of 19 February 2010. By
default therefore the liability of the defendants for legal
costs performed on their behalf is on the Supreme Court
scale. The taxation took place on that basis and therefore
there is nothing to suggest the indemnity principle has
been offended.
[11] Beach J concluded that Wood AsJ was correct to have required
the respondents to produce any relevant document and any costs
agreement that established the method of calculation of the
relevant legal fees and was also correct in refusing to order the
production of invoices and receipts. Beach J considered that a
flexible and reasonable application of the indemnity princip le
did not mandate a fishing exercise by the unsuccessful party in
the hope of finding something in the successful party’s
documents that would displace the right to indemnity when
there was presently no evidentiary foundation to do so.”
(Emphasis added.)
[10] The position in Queensland is also couched in very similar terms. In King v King
[2012] QCA 81, Chesterman JA with whom White JA agreed, said:7
“[7] An order for costs operates as an indemnity to a successful party
in litigation. Costs are awarded to recompense a successful
party in respect of what it cost to bring or defend successful
proceedings. A corollary is that the unsuccessful litigant is not
required to pay any more than the costs incurred by his
successful opponent. See Oshlack v Richmond River Council
(1998) 193 CLR 72. Before the right to indemnity can arise the
successful litigant must be under a legal liability to his solicitors
to pay costs. Another corollary is that if a successful litiga nt’s
lawyers act for him without charge he is not entitled to an order
for costs. There is nothing to indemnify him against. See
McCullum v Ifield [1969] 2 NSWR 329 at 330 cited by Santow
JA in Wentworth v Rogers (2006) 66 NSWLR 474 at 486.”
[11] In King v King,8 Chesterman JA further considered the NSW case of Wentworth v
Rogers and said:9
7 King v King [2012] QCA 81 at [7].
8 [2012] QCA 81.
9 King v King [2012] QCA 81 at [8]–[9].
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“[8] In Wentworth the court considered a cost agreement to the same
effect as the applicant’s. The point of present significa nce,
whether it gave rise to a liability against which the applicant is
entitled to an indemnity by way of a costs order, was discussed
but was not critical to the result. Different views were
expressed. The nature of the contingencies which might arise in
costs agreements and their consequences on the need for an
indemnity, by way of a costs order against that liability, was
discussed most fully by Basten JA. His Honour said (504):
‘As a matter of logic, it may seem curious that an order
of the Court, which arguably should not be made unless
there is a legal liability, should be relied upon as the
justification for its own existence. On the other hand, it
would be surprising if the long-standing practice by
which lawyers appear in Australian courts on a
“speculative” basis or “no win/no fee” basis, was based
on a misconception, and did not allow for a costs order
from which fees could be recovered, in the event of
success. However, the conflict is more apparent than real.
As noted by Millet LJ in Thai Trading Co … conditio na l
fee agreements gave effect to the principle that “there is
nothing improper in a lawyer acting in a case for a
meritorious client who to his knowledge cannot afford to
pay his costs if the case is lost”. As his Lordship
continued … “Not only is this not improper; it is in
accordance with current notions of the public interest that
he should do so.”
Once that practice was accepted, it was equally
appropriate to formalise the arrangement in contractual
terms which would provide that the lawyer would accept
a reduced fee in full settlement of his or her account, or
would waive his or her right to require payment, in the
event that the proceedings were unsuccessful. In each
case, there is an immediate and quantifiable obligatio n
imposed on the client when the retainer is created, the
contingency operating as a condition subsequent.’
[9] His Honour drew a distinction between that kind of contractual
arrangement and that, like the present, in which a client has no
obligation to pay his own lawyers unless and until an order is
made by a court that he recover costs from an opponent in
litigation. Basten JA said (505):
‘Although it may seem arbitrary to insist that, for the
purposes of the indemnity principle, there must be a
contractual entitlement to charge fees, subject to a
condition subsequent, rather than an entitlement which
arises as a result of a successful outcome, there are
reasons why that is not so. First, as appears from the costs
agreements presented in the present case, a successful
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outcome will usually involve not merely obtaining a
costs order, but actual recovery of costs. It is not possible
to make the existence of a right to charge dependent on
recovery of the moneys from which the charges would
be paid. That would be to take the circularity noted …
one step too far.’
[10] The circularity ‘noted’ was explained by his Honour (at 500):
‘If the entitlement to recover costs from another party to
the proceedings is dependent upon the legal liability to
pay those costs to one’s legal advisors, but the obligatio n
to pay is contingent upon establishing a right to recover,
the circularity is readily apparent. However, if, as in the
present case, the obligation to pay depends not on a right
to recover an identifiable amount of costs, but on the
actual recovery of those costs, there may be no extant
legal obligation to be indemnified even when a costs
order is made.’”
[12] Chesterman JA, with whom White JA agreed, noted that in Wentworth v Rogers
Santow JA expressed differing views from Basten JA. Santow JA preferred a view
that conditional costs agreements of both kinds ought to be regarded as giving rise to
a liability to pay sufficient to justify the indemnity afforded by a costs order.
Chesterman JA preferred the view of Basten JA, stating “when properly analysed
there is no obligation on the applicant to pay costs until a costs order is made, and a
costs order cannot be made until there is a liability in the successful litigant to pay his
own lawyer’s costs”.10
[13] As was noted in Dyktynski v BHP Titanium Minerals Pty Ltd (2004) 60 NSWLR 203,
it may be that the agreement between a successful litigant and their solicitors is
ultimately to the benefit of their adversary. In this regard, Mason P, with whom
Davies A-JA said,11 “[a]lternatively, if the solicitor-client agreement caps the amount
of costs recoverable, this enures to the benefit of the client's adversary.”
[14] In Kuek v Devflan, Hansen JA said:12
“[59] The common thread running through these cases is the
proposition that the receiving party cannot recover costs from
the paying party in circumstances where the receiving party is
not liable to his or her own lawyers. That is logically so because
a party cannot seek indemnification where there is no loss. In
the present case, the applicant does not claim that the
respondents have no liability to pay their lawyers. Rather, he
says that the extent of the liability is limited because of the
special arrangement whereby the lawyers agreed to act for a
reduced fee. As to this type of case, in Wentworth v Rogers
Basten JA stated:
10 King v King [2012] QCA 81 at [13].
11 Dyktynski v BHP Titanium Minerals Pty Ltd (2004) 60 NSWLR 203 at 205 [7].
12 Kuek v Devflan (2011) 31 VR 264 at 280-281 [59].
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The principle does not apply only to the case in which
the party has no financial obligation at all to his or her
lawyer. It must also operate in the case where the lawyer
has agreed to appear at a reduced fee, below that which
might, in the ordinary course, be recoverable …”
(Footnotes omitted; Emphasis added.)
[15] In the present case, it is not alleged by the plaintiff that there was no legal obligatio n
between RACQ and CGW, but rather that a stage-based costs agreement may exist,
which would provide for reduced fees (less than the standard amounts under the
UCPR) at certain stages of the proceedings, therefore resulting in the indemnity
principle being infringed, at least for that period.
[16] As noted by Basten JA in Wentworth v Rogers,13 the indemnity principle applies in
cases, not only where there was no legal obligation at all, but also in cases where there
was a reduced liability.14
[17] The second defendant submits that any consideration of the indemnity principle as
grounds for ordering the production of the costs agreement is irrelevant, because,
firstly, any complaint by the plaintiff about their liability for costs is essentially a
complaint about the quantum of costs which ought to be addressed under the
appropriate provisions of the UCPR, and secondly, that the indemnity princip le
applies to the “totality” of the costs as opposed to, as is put by the plaintiff, “stages”.
Quantum of costs
[18] A party on whom a cost statement is served may, within 21 days, file an objection to
the statement detailing any objections and specifying the reason for and the basis of
the objection.15 I do not accept the defendant’s characterisation of the application as
essentially a matter dealing with the quantum of a costs statement. The application to
have the cost agreement procured was filed prior to the cost statement being filed.
The plaintiff’s current complaint is not with the amounts as assessed under the cost
schedules of the UCPR nor, necessarily, with the billing practices of CGW, but rather,
the allegation is that under the cost agreement, RACQ may not have been liable (for
at least a time between 17 December 2019 and present) on a full-fee basis. This
complaint cannot be addressed by appealing the cost statement produced by a cost
assessor who’s only consideration was the cost schedules; the liability under the cost
agreement as between RACQ and CGW is relevant and ought to be investigated.
Totality of costs
[19] On the totality of costs point the defendant further submits that:16
“[10] Any suggestion that the Second Defendant may have been
charged less by its solicitors for some component of the work
than an amount provided under the scale for that component is
irrelevant. The indemnity principle applies to the totality of
13 Wentworth v Rogers (2006) 66 NSWLR 474.
14 Wentworth v Rogers (2006) 66 NSWLR 474 at 498 [103].
15 Uniform Civil Procedure Rules 1999 (Qld) r 706.
16 Exhibit 2 to the hearing of 14 June 2021.
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costs incurred by a litigant when compared with the totality of
costs as assessed in accordance with UCPR 702(2) which
provides:
‘When assessing costs on the standard basis, a costs
assessor must allow all costs necessary or proper for the
attainment of justice or for enforcing or defending the
rights of the party whose costs are being assessed.’”
(Original emphasis. Footnotes omitted.)
[20] The defendant’s submissions is perhaps better understood, when one takes the
reference to r 702 of the UCPR as an implied comparison to r 703 of the UCPR (which
deals with an assessment of costs on an indemnity basis), which requires a cost
assessor to have mind to any cost agreement between a party and a party’s solicito rs.
[21] However, the defendant did not direct me to any cases which considered that the
indemnity principle only applied to the totality of costs. The cases as analysed above
show that the liability as between a party and their solicitor is essentially a question
of contractual interpretation and that where there was no “immediate and quantifiab le
obligation imposed on the client”,17 there could be no liability for which the
successful party could be indemnified from. Furthermore, the principle may apply in
scenarios where “the lawyer has agreed to appear at a reduced fee, below that which
might, in the ordinary course, be recoverable”.
[22] In my view, if a cost agreement provides that for a certain time period (or other period
specified in reference to other events) that the party’s lawyers will act for reduced
fees (or some other form of reduction), then the liability as between the two is
similarly reduced such that the party cannot be “indemnified” for a liability that never
existed, per se. Further, it stands to reason, in my view, that the liability ought to be
assessed pursuant to whatever conditions exists under the costs agreement; if the fees
are reduced for one period and then increased the next, then likewise, the liability
increases or decreases.
[23] With respect, r 702 of the UCPR is concerned with the mechanics by which a cost
assessor is to act when directed to assess costs on a standard basis and is not relevant
to determining whether the indemnity principle has been offended.
[24] It is logical and in line with the above authorities that if, for example, a period of
several months, the financial obligation between a client and their solicitors was of a
reduced fee, then it could equally be expected that that reduced fee would be the cost
recoverable, not the standard costs as would be assessed under the schedules to the
UCPR.
Circumstances in which production should be ordered
[25] As a general rule, a costs agreement does not attract legal professional privile ge.
Lindgren J said in Cook v Pasminco Ltd [2000] 107 FCR 44:18
17 Wentworth v Rogers (2006) 66 NSWLR 474 at 504.
18 At [47].
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“[47] In my opinion, generally, an agreement between solicitors and
their prospective client as to the terms of retainer of the
solicitors does not attract either kind of legal professiona l
privilege mentioned: the agreement is not created for the
dominant purpose of the giving or receiving of legal advice or
of being used in existing or anticipated legal proceedings. A
costs agreement is a bundle of mutual and reciprocal
commitments between intending solicitor and client. It is
entered into by parties whose interests are, at the time, generally
opposed. Generally speaking, the solicitors are entitled to
negotiate the terms of the agreement in their own interests. Once
it is appreciated that a costs agreement is an agreement between
persons who are about to enter into the relationship of solicitor
and client, there is no obvious reason why such an agreement,
as a class of document, should be the subject of legal
professional privilege.”
[26] Of course, that is not an unyielding rule, as an agreement may contain material that
expressly or impliedly conveys legal advice, however, there is no evidence before the
court that such issue arises in this case.
[27] In considering circumstances in which production of a costs agreement should be
ordered, Redlich and Mandie JJA said in Shaw v Yarranova Pty Ltd:19
“…The principles governing an application for an order that
documents be produced are not different from those governing
applications for access to documents produced in answer to a
subpoena…”
[28] Their Honours went on to identify that in situations such as this, an applicant must
identify a legitimate forensic purpose for which access is sought and establish that it
is “on the cards” that the documents will materially assist his case.20
[29] What is now for determination is whether the evidence put before the court is
sufficient to warrant the court ordering that the costs agreement between the RACQ
and CGW is disclosed. As the cases demonstrate, the material must show that the cost
is agreement is sought for more than just a fishing expedition,21 but need only be
“sufficient to suggest” that the assessed costs are greater than the actual liability.22
[30] In a case such as the present, the evidence will be limited. The applicant party will be
attempting to produce evidence about a document which they do not have in their
possession.
[31] Here, the evidence for the plaintiff is the deposition of Mr Smith that it is “not
uncommon” for stage-based cost agreements to exist between CTP insurers and their
solicitors.23 Conversely, the defendant put forward evidence that the “total” legal
19 Shaw v Yarranova Pty Ltd [2011] VSCA 55 at [26].
20 Shaw v Yarranova Pty Ltd [2011] VSCA 55 at [26], citing Alastor v R (1983) 154 CLR 404.
21 Shaw v Yarranova [2011] VSCA 55.
22 Kuek v Devflan (2011) 31 VR 264 at 283-284 [70].
23 Affidavit of Stephen Robert Smith filed 2 June 2021.
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costs and outlays actually payable by the second defendant are less than what has
been assessed in the costs statement.24
[32] The submissions on behalf of the respondent focussed greatly on the lack of evidence
which the applicant could point to as to positively say whether the indemnity princip le
had been infringed. Counsel for the second defendant points to depositions made by
Mr Cockburn of CGW acknowledging that second defendant “cannot profit from the
costs orders” and “can assure you [the plaintiff] that there is no factual basis
whatsoever for your concern.”25 In this regard, a deposition that the cost agreement
between RACQ and CGW was not a stage-based agreement would have been more
informative.
[33] In Kuek v Devflan,26 Hansen JA said:
“[66] In my view, none of these matters relied on by the judge,
considered alone or in combination, established that the
respondents’ liability to their lawyers was in an amount equal to
or greater than the amount allowed by the Taxing Master on the
party/party bill. As ground 12 in the proposed notice of appeal
states, there was insufficient evidence to enable the judge to
make such a finding. The solicitor’s expression of opinion in the
letters was merely that. By accepting it at face value, the judge
effectively allowed the respondents’ solicitor to decide whether
the indemnity principle had been breached, rather than the
court determining the matter on proper materials. There was
sufficient in the retainer letters referred to to [sic] indicate that
the respondents’ lawyers would charge, and had charged,
reduced fees, indeed that the solicitors were charging on a basis
considered appropriate for a Magistrates’ Court case. Thus, a
real issue arose as to whether the respondents’ liability to their
lawyers exceeded the party/party costs claimed.”
(Emphasis added.)
[34] While evidence in favour of the plaintiff is limited, the court must also be careful, as
Hansen JA noted, of simply accepting the assertion of the defendant’s solicitors that
the indemnity principle is not breached. Whether the indemnity principle has been
breached is something which can only be tested by a party or a court upon the proper
materials.
[35] Further, as I stated above the mere fact that the total cost assessed does not exceed
the actual amount charged, does not necessarily mean the indemnity principle has not
been breached where the costs order is for a defined period.
[36] In my view, Mr Smith’s evidence is “sufficient to suggest”27 that the assessed costs
may be greater than the actual liability, such that a breach of the indemnity princip le
is “on the cards”.28 Therefore, I order that a copy of the Costs Agreement between
24 Affidavit of Brady Campbell Cockburn filed 14 June 2021.
25 Exhibit 2 to the hearing of 14 June 2021.
26 Kuek v Devflan (2011) 31 VR 264 at 282 [66].
27 Kuek v Devflan (2011) 31 VR 264 at 283-284 [70].
28 Shaw v Yarranova Pty Ltd [2011] VSCA 55 at [26].
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RACQ and its solicitors CGW together with any copies of any variations to that
Agreement from the time of its original instructions to CGW to date of this applicatio n
be provided to the plaintiff.
[37] I will hear from the parties as to the costs of this application.
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Official source: https://www.sclqld.org.au/caselaw/QSC/2021/149