Bailey's Bills of Costs, Re [1993] QSC 253 [1994] 1 Qd R 576

0 TRANSCRIPT OF PROCEEDIN (Copyright in this transcript is vested in the Crown. Copies thereof must not without the written authority of the Director, State Reporting Bureau.) '· SUPREME COURT OF QUEENSLAND CHAMBERS KIEFEL J OS No 724 of 1993 IN THE MATTER OF THE COSTS ACT'OF 1867 and IN. THE MATTER OF TONY BAILEY ESQUIRE'S BILL OF COSTS and IN THE MATTER OF AN APPLICATION BY ROBERT WING FONG CHAN AND· MRS CHAN BRISBANE . . DATE 25/08/93 JUDGMENT ·~ . j' . J ~(f 1 -- 1 of 15 -- 250893 dbm (Kiefel J) HER HONOUR: In this matter, I propose to order that with respect to what has been referred to as the second bill that the respondent be ordered to deliver a signed bill pursuant to The Costs Act, and I also propose to order that what have been called the third and fourth bills, although I would appreciate • 10 some assistance with identifying them properly, be referred to the Taxing Master for taxation.. I do not propose to make any order concerning taxation of the first bill. I publish my reasons. The orders will be that with respect to the bill for the period from 5 February 1992 to 5 March 1992, that the respondent deliver a signed bill pursuant to The Costs Act of 1867. Further order that the bill for services rendered on 1 May 1992 and the bill for services rendered for the period from 30 April 1992 to 19 May 1992 be referred for taxation. 20 c; 30 Further order that the' parties' costs of and incidental to the 40 (_) application be their costs in the taxations to follow. 50 60 JUDGMENT 2 -- 2 of 15 -- IN THE SUPREME COURT OF QUEENSLAND Before Justice Kiefel () 0 Delivered From December 1991 O.S. No. 724 of 1993 IN THE MATTER OF The Costs Act of 1867 - and - IN THE MATTER OFTONY BAILEY ESQUIRE'S Bill of Costs - and - IN THE MATTER OF an application by ROBERT WING CHAN and MRS CHAN 1993. to May 1992 the Respondent, () Mr T. Bailey, acted as solicitor for the male applicant in relation to certain criminal charges. He says he also acted on the instructions of Mrs Chan concerning some property Q matters. In that period he prepared a series of bills charging Mr Chan for services rendered and costs incurred. I am concerned with four of such bills, which I shall shortly identify. In the event that the bills are held to be bills complying with the requirements of the Costs Act of 1867, the respondents' solicitor argues that any reference to taxation is barred, by reason of the time which has passed since payment of the bills. Alternatively, if I were not satisfied -- 3 of 15 -- 0 0 0 0 2 that payment of the bill had taken place, it is submitted there are not "special circumstances" to warrant reference (ss.25 and 33 of the Act). The first bill refers to professional services and costs incurred on behalf of Mr Chan between 11th December 1991 and 5th February 1992. The total of the bill is $19,202.04 of which part appears to represent services rendered to two other persons who are referred to in a document entitled "Irrevocable Indenturing" dated 7th January 1992 and executed by Mrs Chan. On dates prior to the conclusion of the period billed amounts of $3000 and $10,000 were received into the trust account of the solicitor. An amount representing the balance of this bill, $6202.04 was paid in on 12th February 1992. The bill contains four columns. It sets out the date the service is said to have been provided or a cost incurred, specifies the service or cost, refers to the time engaged or the length of a document prepared, .details the basis or rate of charge and in the right-hand column concludes the charge for each item. The pages contain sub-totals which are carried forward. The other three bills are in the same form and contain the same detail of costs and charges. The second bill concerns the period from 5th February 1992 to 5th March 1992 and totals $15,977.39. Between the payment on 12th February 1992 and the date this bill was raised in the trust account statement, 12th March 1992, further sums of $7000 and $25, 000 were paid in. This bill differs from the others in that the copy exhibited is not signed by the solicitor. He does not assert that the original was. -- 4 of 15 -- 0 0 0 0 ----------- 3 The third and fourth bills referred to in the summons are said to be "dated" 6th March 1992 and 1st May 1992. Some pages of a bill commencing with the date of 6th March 1992, are exhibited to the affidavit of the cost assessor, Mr Garrett. There is another bill of 1st May 1992 being part of exhibit B to Mr Crowley's affidavit which appears to recite corrections to earlier bills. It is likely that the latter bill referred to and amended that of 6th March 1992. The total of the bill. of 1st May is $8592.43. Another bill dealing with the period 30th April 1992 to 17th May 1992 adds $9120.22 to the amount owing. The total of these two amounts is what has been referred to in the proceedings as the "payment" of the third and fourth bills on 28th May 1992. On 19th May 1992 the applicants' new firm of solicitors wrote to the respondent. The terms of the letter show that they had received the trust account statement of 1st May 1992. Two bills, that of 12th March (the second bill) and that of 1st May 1992 were said to be disputed and taxation was required. Agreement was subsequently reached whereby on payment of the sum of $17, 712.65 the applicants' files and personal property were released. Mr Crowley says the terms of the agreement were that the sum was to be held pending taxation of Mr Chan's bill of costs. By that I take it that he refers to taxation of the bills then paid. The trust account receipt of the respondent described the sum received as for "costs and outlays pending taxation of the account". That same day Mr Bailey wrote asking which amounts were said to be in dispute "so that we might transfer the undisputed amounts , if any, to our general account" . On 1 0 th June 1 9 9 2 the applicants' solicitors attempted to have the bills lodged -- 5 of 15 -- 0 0 4 for taxation. They were rejected, it is said, apparently on the basis that they were not lodged within 'one month from delivery and were not in a form acceptable for taxation. On 12th June 1992 the respondent again requested details of the i terns said to be in ·dispute. On 24th June 1992 he wrote again, adding this time that if he was not provided with a date for taxation: "we will proceed on the basis that the bill is no longer to be contested and we will transfer the subject funds to our general account in accordance with the duly executed trust account authority, executed by Mrs Chan." The trust account authority was in the following terms: "Re Police Matter I/We, Robert Wing Fang Chan hereby authorise and direct you to retain in or deduct from your Trust Account any monies held on my/our behalf in your Trust Account for the purpose of paying costs and outlays payable by me/us or payable by yourselves as my/our Solicitors on my/our behalf to any Government Department or other person or persons in respect of the abovementioned matter, and such costs and outlays may be drawn by you at any time prior to or after finalisation." 0 It was signed only by Mrs Chan. ~he respondent transferred that amount to his general account on 25th June 1992. 0 Whether they are Bills under the Costs Act The importance of this question is of course that if they are not held to be bills in compliance with the Costs Act (No. 20, 1867) ( Qld) ("the Costs Act") questions as to payment and effluxion of time do not arise. The applicants' arguments concerning the four bills may be stated shortly. With respect to the second bill it is said not to comply with the requirement of signature in s.22 of the Costs Act. The respondent does not assert that there was a -- 6 of 15 -- 0 0 0 0 ~------~ 5 signature, but argues that payment overcomes that requirement: see in Re Sutton [1883] 11 Q.B.D. 377. Some cases suggest that payment or other such acts may be evidence of waiver of the requirement of signature or of adoption of the bill as that of the solicitor: see Oliver - Law of Costs (1960) p.22; Halsbury 4th ed. Vol.44 para 171. I shall deal with this in relation to the later question as to payment. With respect to all of the bills, the applicants submit that they must be in a form required by the Rules of the Supreme Court for taxation. In accordance with the then requirements of Order 91 rule 47 they omitted to include columns for taxing off and for settling out the item numbers. Further, the columns were not vertically ruled. That submission equates the requirements of the Costs Act with those of the Rules from time to time. Section 22 of the Costs Act provides that a solicitor shall not commence an action for recovery of "fees, charges or disbursements" until the expiration of one month after the solicitor has delivered, posted to or left with the person to be charged a "bill of such fees, charges and disbursements" "which bill shall be subscribed by such attorney in his proper handwriting . 11 Section 23 deals with service. It provides that the solicitor need not in the first instance provide the contents of the bill delivered ·but that it is sufficient that the solicitor prove that a bill of fees, charges or disbursements subscribed by the solicitor was delivered or sent. The proviso to that section is that the other party, that is to \ -- 7 of 15 -- 6 say the person to be charged, may show that the bill which was delivered, sent or left was not one complying with the Act. By s. 24 "an appointment for taxation of the same may be obtained as of course and without order of a Judge" upon the application of the party chargeable "by such bill" if the application is made within the month. It goes on to provide: "And thereupon such bill and the demand of such attorney executor administrator trustee or assignee shall be taxed and settled by such officer without any money being brought into court." 0 After the expiration of the month the court or a judge may refer "such bill" "to be settled and taxed by such officer as aforesaid . 11 . . . 0 Where that application is made inter alia after the expiration of twelve months from delivery of the bill, no such reference is to made "except under special circumstances to be proved to the satisfaction . of the Supreme Court or a Judge thereof to whom the application for such reference shall be 0 made''. By s. 33, where payment of the bill has been made that shall not preclude the court from referring the bill for 0 taxation "if the special circumstances of the case shall in the opinion of such Court or Judge appear to require the same 11 but provided further that the application be made within twelve months after payment. The last paragraph of s.26 provides that it is lawful for a Judge "in any case" "to make such order for the delivery by any attorney . . . of such bill as aforesaid . 11 These provisions are drawn from the Statute of 6 & 7 Vie., (1843) C.73, and for the most part s.37. This was the I -- 8 of 15 -- 0 0 0 0 7 culmination of a series of enactments initially having the purpose of restricting an attorney's rights to an action on the bill of costs and later providing for taxation of them: see Lush's "Practice of the Superior Courts of Law" 1 865, 3rd ed. Vol. 1, pages 276-7. In the same volume (page 291) the author expresses the view that if the items were specified "and the bill contains sufficient materials to enable the party chargeable to obtain advice as to the taxation it will be sufficient" referring to Philby v. Hazle (1868) C.B., N.S. 647. See also Keene v. Ward [1849] 13 Q.B. 1359. To similar effect, and in the context of a lump sum bill, was the decision of Mann J. in Malleson, Stewart, Stawell and Nanki vell v. Williams ( 1930) V. L. R. 41 0, referred to with approval in both Currie v. Robinson (1968) Q.W.N. 25 and Re Walsh Halligan Douglas' Bills of Costs (1990) 1 Qd. R. 288, 293. Some of the early cases also refer to the bill being so framed and drawn as to enable the client then to proceed to have it taxed (Philby v. Hazle supra per Erle CJ and Williams J). In. Wilkinson v. Smart (1876) 33 L.T. 573; 24 W.R. 42; it was held that the object of the statute was that "the bill should be made out as therein directed, with a view to taxation" and inferentially that the requirement of fees, charges and disbursements enabled the Taxing Master to proceed with taxation. The reference in these cases to framing or preparing a bill for taxation, should not however be read as requiring the form and content of bills for taxation to comply with any -- 9 of 15 -- 0 0 0 8 Rules of Court. At the time they were decided there do not appear to have been Rules requiring for example columns, rulings, the Rules following the Judicature Act 1875 in Kennedy and Raikes "The New Practice". By December 1885 when rule 19H was added to Ord. 65 (see The Annual Practice (1893) Snow, Burney and Stringer Vol. 1, p.1068) the requirements were to put the charges and disbursements in separate columns and for each column to be "cast". Later other columns were required, e.g. a column for the Master to tax off items (see the appendix to Order 65 in the 1902 yearly volume). The bills in this case were all delivered prior to the recent amendments to Order 91. Then, Order 91 rule 47 provided that a bills of costs was to be prepared with six columns. Bills as between solicitor and client were to be prepared as nearly as possible in the same manner as if they were one between party and party. Rule 48, which does not permit additional ~Iteration to bills except by direction of the taxing officer, contains a separate reference to the circumstance where an additional alteration is allowed in a bill of costs "between a solicitor and his client". One of the bill of costs under the Costs Act is such a bill. The difference in the description of the bills in Rules 47 and 48 might be thought to support the view that bills between the solicitor and his/her [own] client chargeable under the Costs Act are not the subject of Rule 47. But in any event I do not think the answer to the requirement of the form and content of a bill under the Act is found in the Supreme Court Rules. \ -- 10 of 15 -- 0 9 In my view a bill under the Costs Act is required to set out fees, charges and disbursements as separate items and in as much detail as is necessary to inform the client in the sense referred to. When those requirements are fulfilled (together with the requirement of subscription by the attorney) it is that b~ll which is able to be taxed. There is no additional requirement that the bill conform to the Supreme Court Rules from time to time. Indeed, if a client is within time the Taxing Master in my view does not have a discretion to refuse to accept a bill drawn under the Costs Act, given the provisions of s.24. In a circumstance where there was not Q sufficient description, the client might challenge the bill 0 0 under s.24 of the Costs Act, and s.26 would permit the court to order delivery of a bill complying with the Act, and which bill would then be taxed. Here all the bills contain sufficient particulars. They set out separately the fees, charges· and disbursements. Subject to the question as to the lack of signature affecting the second bill, I propose to make a declaration that they are bills under the Act. Payment/Special Circumstances Within the terms of s.33 of the Costs Act, if application is not brought within twelve months after payment of the bill there is no power to refer the bill to taxation. It has been said, following the words of the section, that time runs from the date of payment to the date of filing of the summons (Sayer v. Wagstaff (1844) 5 Beav. 415; 49 E.R. 649). Whether ,\ -- 11 of 15 -- -------- --- ------------------------- CJ 0 0 0 -- 12 of 15 -- '• 11 view. That is probably correct. It does however seem to me that what the sections require and the cases refer to is some discernible need for taxation. An explanation of delay of itself may not be sufficient. The need for taxation will usually require a consideration of the bill itself or circumstances which throw light upon the charges within the bill and the appropriateness of taxation. The first bill could not have been delivered prior to 5th 0 February 1992. Prior to that time the sum of $13,000 had been paid to the solicitor's trust account, towards costs to be ascertained. However, I can only infer that it was following () receipt of the bill that the third amount, $6202.04, was paid since that is the exact amount to make up the b~lance of the bill. The applicants do not assert that payment of this amount was meant otherwise than as a final payment of the bill as delivered. There is nothing in the cost assessor's affidavit to suggest any overcharging or indeed any query 0 concerning this bill. It is notable that in the letter of 19th May 1992 the applicants' new solicitors did not question 0 this bill at all. Although I consider it more than likely that the bill could be taken as paid, there would not in any event be anything approaching special circumstances to warrant a reference. The second bill is somewhat different. Not only is payment of it (which I take to be 12th March 1992 by reference to the trust account statement) alleged, that payment is said to overcome the lack of signature to the bill. The "payment" is however constituted by an appropriation from the two -- 13 of 15 -- , " "\ 12 deposits of $7000 and $25, 000 paid in prior to the bill. Those amounts could only be said to have been paid on account. It is not a case where it could be shown that the person to be charged, Mr Chan, agreed to the appropriation to the general account nor to the solicitor's continued retention of the moneys. The trust account statement showing the appropriation bears only the date of 1st May 1992. The agreement to transfer is said to be constituted by the authority signed not 0 by Mr Chan but by his wife. There is no suggestion that the provisions of s.B of the Trust Accounts Act 1973-8 have been 0 complied with and rather everything points to the contrary. The requirement of signature is not therefore overcome. I propose to order that a bill be delivered, signed by the solicitor as required by s.22. The third and fourth bills fall into a another category. The sum of $17,712.65, which can only be taken as the final Q "payment" of the bills was an appropriation on the same basis as the second bill. Further, it was "paid" only on the condition that the bills be taxed and cannot in my view then constitute a payment of the bills under the Act. Indeed, I note that, in any event, the application was filed within twelve months, so that in any event consideration could be given to whether any "special circumstances" exist. In this case the delay in bringing the application has to an extent been explained. There are items which are capable of challenge. Whilst they are not of great magnitude in-monetary terms having regard to the total amounts of the bills, I do not think that should operate as a bar and there appears to be -- 14 of 15 -- n 0 0 0 13 a proper basis for some challenges. In this circumstance it seems to be appropriate to consider as part of the circumstances that there was an agreement for taxation. I am prepared to order that these bills be referred for taxation. I will discuss the form of the orders to be made, and clarify the reference to the third and fourth bills and hear submissions as to costs. -- 15 of 15 --