Case: Harrison v Schipp [2002] NSWCA 213 ; (2002) 54 NSWLR 738
Outcome: applied
62 rule 4 confers what has been called an unlimited discretion, which of course must be exercised in a judicial manner. How the powers are to be used varies widely from case to case and each case must be decided on its own merits: Leary v Leary [1987] 1 WLR 72 at 76. The approach to be adopted to an application under Order 62 rule 4(c) has recently been described in Sony Entertainment v Smith (2005) 215 ALR 788 at 812-813. There Jacobson J quoted (at 813) with approval the following passage from the judgment of Giles J in Harrison v Schipp [2002] NSWCA 213 ; (2002) 54 NSWLR 738 at [22] : approach taken to estimate costs must be logical, fair and reasonable. The power should only be exercised when the Court considers that it can do so fairly between the parties, and that includes sufficient confidence in arriving at an appropriate sum on the materials available." See also Nine Films &amp; Television Pty Ltd v Ninox Television Ltd [2006] FCA 1046. The affidavits filed on behalf of Wrigley are directed to matters relevant to that passage from Harrison . They are those of Ian Stanley Pascarl, a partner of Wrigley's solicitors, and John Andrew Balmer, a JB Legal Costing Pty Ltd costs consultant retained by Wrigley. Mr Pascarl instances aspects of the Mahlab assessment of profit costs and disbursements that he considers excessive and unreasonable. He deposes: a detailed bill of costs and disbursements is drawn and served, Wrigley will not be in an informed position to properly and fairly challenge those items. The [Borham affidavit] does not provide any detailed breakdown of each item, and the cost charged for each item, by patent attorney Griffith Hack which charged a total of $220,000 to Cadbury (of which $170,000 is now claimed against Wrigley). Wrigley is entitled to be provided with that information and to vigorously test the need for, and reasonableness of, those charges." Mr Balmer challenges aspects of Ms Young's affidavit. I take just three out of some fifteen of those aspects: he challenges Ms Young's allowance for scientific research and time spent collating documents and a loading for care, skill and attention included in her cost assessment, and says Wrigley is unable to review these allowances without the benefit of a detailed bill, and should not be denied the right to taxation in order to establish and analyse the amounts hidden in the assessment; he says Wrigley needs to be able to question the terms of Cadbury's retainer of Griffith Hack and the nature of the patent attorney support provided, and to rigorously question whether work done and fees charged represent necessary party/party costs; and he claims there is no basis upon which to assume that taxed professional costs may differ by 10% to 15% from the costs calculated in Mahlab's assessment, and says it is for that reason that Cadbury requires a detailed bill in order to decide whether a taxation of Cadbury's costs should be pursued. Mr Balmer also takes issue with an aspect of Ms Borham's affidavit dealing with the retainer of Griffith Hack. The Wrigley deponents' claims and contentions are advanced in support of the view that there should be a taxation of Cadbury's costs. I must, however, bear in mind that of its nature, specification of a gross sum is not the result of a process of taxation or assessment of costs: Harrison at [22]. Rather a broader brush must be applied than would be appropriate on taxation. The present relevance of the Wrigley claims and contentions is that their existence, unresolved, has brought me to the clear view that I should not exercise the power to order a lump sum under Order 62 rule 4(c) because I am not satisfied that I can do so fairly between the parties, and with sufficient confidence that I would be arriving at an appropriate sum on a logical and reasonable basis, rather than selecting figures at random on the basis of an arbitrary preference for one expert's view over another's. See Sony Entertainment at [199]. In all but one of the cases collected in the appendix to Cadbury's written submissions the judge who fixed a lump sum was the trial judge who, having heard the evidence and watched the proceeding unfold, was in a much better position than I am to reach informed conclusions about the costs issues that are now in dispute. In the Harrison case, Giles JA, as a member of the Court of Appeal, had sat on an appeal in the matter, and on one later proceeding that had been removed to the Court of Appeal in which the costs order made on the appeal was challenged. His Honour was deputed by the Court of Appeal to hear a lump sum application that followed upon that Court's costs order. Thus his Honour had a similar advantage to that enjoyed by the trial judge in the other cases referred to in the appendix. Cadbury submitted that the following considerations pointed in favour of the award of a lump sum: the delay and expense involved in a taxation; Cadbury's assessments were prepared by an experienced costs consultant; those assessments have been reduced by Ms Young as appears in her affidavit; Ms Young's methodology has not been criticised; and if the matter were to proceed to taxation, the costs of Ms Young's assessments would be thrown away. I accept the first three considerations, but think the remaining two are overstated. In any event, I have taken all those matters into account in exercising my discretion. They have not persuaded me to depart from the view I have expressed at [9]. The appropriate course in this case is for there to be a taxation. Accordingly, in the exercise of my discretion, I decline to specify a lump sum pursuant to order 62 rule 4(c). The motion is dismissed with costs. I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Sundberg. Associate: Dated: 4 September 2006 Counsel for the Applicant: A J Ryan Solicitors for the Applicant: Mallesons Stephen Jaques Counsel for the Respondent: G Fitzgerald Solicitors for the Respondent: Blake Dawson Waldron Date of Hearing: 30 August 2006 Date of Judgment: 4 September 2006 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2006/1186.html