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Federal Court costs quantification

Federal Court costs quantification

By Jill Grace

Finance 

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The lump-sum procedure set out in Costs Practice Note (GPN-COSTS) has been referred to in a recent judgment.

Snapshot

In a judgment dealing with an application for a lump-sum costs order the Federal Court referred to and endorsed the provisions of the lump-sum procedure set out in the Federal Court Costs Practice Note (GPN-COSTS) 25 October 2016 as a means of quantifying costs.

 

The Federal Court delivered judgment on 4 July 2017 in the matter of LFDB v SM (No 4) [2017] FCA 753 in which it considered, inter alia, the lump sum provisions of the Federal Court Costs Practice Note (GPN-COSTS) 25 October 2016.

The judgment is interesting from the point of view of not only preparation of submissions to the Court for a lump sum costs order but also in preparing a costs summary in support of obtaining an order as to quantum of costs by way of the lump-sum procedure set out in the costs practice note.

The questions arose in an interlocutory application by the respondent in the substantive proceeding in which she sought an order that the applicants pay a lump sum in the amount of $154,034.69 in respect of costs ordered by the Court on 9 February 2017.

The application was supported by three affidavits affirmed by her instructing solicitor, Damian Sturzaker, which provided information pursuant to the costs practice note. The affidavits included:

  • a description of the legal work undertaken by himself and various members of his team and their charge out rates
  • a description of the professional fees of Dr Isard SC who was retained to advise and appear for the respondent and a statement that his fees fell within the range of senior counsel set out in the National Guide to Counsel’s Fees.
  • a broad breakdown of the legal fees into categories of solicitors’ professional fees, counsels’ fees and other disbursements. Mr Sturzaker acknowledged that the rates charged by him were outside the scale but defended these having regard to the difficult model and complex issues raised concerning the legislation in the substantive proceedings.

The applicants to the action refuted the claims on a number of grounds. Those most relevant are set out here.

As to the criticism that Mr Sturzaker had not set out the actual or estimated number of hours spent, the judge said that there was no requirement under annexure A to the costs practice note to do so. The judge was satisfied that the costs summary provided by Mr Sturzaker was adequate for the particular purpose of this interlocutory application bearing in mind that the whole point of a lump sum costs order is to obviate the need for a detailed bill of costs.

The applicants’ submission that Dr Ward’s fees were higher than those in the national guide was accepted by the Court which found nevertheless that they were not unreasonable having regard to the complex and technical issues in the substantive proceeding as well as the wider history of the matter.

The Court considered that this was an appropriate case to make a lump- sum costs order which, taking into account all the matters raised, should be in the amount sought of $154,034.69. It is interesting to note that this sum comprised 75 per cent of total solicitor’s fees and 100 percent of disbursements, including counsel’s fees.

 

Jill Grace is director of Grace Costs Consultants.


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