By Katie O’Brien:
Mirus Australia Pty Ltd v Wilson [2023] NSWSC 1432 (24 November 2023)
On the instruction of Kennedys, Rose Legal Costing prepared a review application on behalf of Mirus Australia Pty Ltd (Mirus), the paying party in an ordered costs assessment. The result of this was that the original determination was reduced by 42%. Despite the reduction achieved, we advised Kennedys to appeal the review panel determination to the Supreme Court on a point of law, pursuant to s 89 of the Legal Profession Uniform Law Application Act 2014 (NSW) (the Act). The reason for this was that, in the opinion of Rose Legal Costing, the review panel had erred in concluding that they did not have the power to order that one party pays the other’s legal costs of a review.
This was due to the combined effect of the sections 78 and 85 of the Act:
78 Costs of costs assessment of ordered costs
(1) Subject to any order or rules of the court or tribunal concerned, a costs assessor is to determine the costs of an assessment of ordered costs and by whom they are payable.
85 Conduct of Reviews
(2) The review panel has, in relation to the application for review, all the functions of a costs assessor in relation to the assessment concerned and is to determine the application, subject to this Part and the costs assessment rules, in the manner that a costs assessor would be required to determine an application for costs assessment.
Background to appeal
In 2020, Simon Wilson (Mr Wilson) commenced a costs assessment against Mirus. At first instance, the Costs Assessor awarded Wilson the sum of $222,259.66 including interest and Mr Wilson’s costs of the assessment in accordance with section 78 of the Act.
Review Application
Rose Legal Costing prepared an Application for Review on behalf of Mirus Australia. Based on the strength of the application, the Review Panel set aside the cost assessor’s determination, substituting their own determination of the costs payable by Mirus in the sum of $128,715.93.
Judgment
Campbell J noted the appeal was one of public importance as it concerned a question of law of general significance involving the interpretation of the Act and that panel appeared to apply the maxim of ‘the expression of one thing is the exclusion of the other’, failing to take into account section 85(2) of the Act.
Campbell J found in favour of Mirus Australia and our interpretation of the Act, stating that “power conferred upon the costs assessor by s 78 is picked up by s 85 and that this is confirmed by the mandatory requirements of s 88” [para 80].
At paragraph 85, his Honour stated:
“In my opinion a review panel has power on the determination of a review not only to determine the costs of a first instance assessment of ordered costs and by whom they are payable, but also the costs of the assessment carried out on review and by whom they are payable by dint of the provisions to which I have referred. I should say that in my opinion affirmation of the costs assessors determination of itself involves an assessment in a manner of a costs assessor.”
What it means
Many review panel determinations had previously opined that they had no power to make such an award, precluding parties from recovering their legal costs, even in a successful application. This decision takes away any doubt in this regard.
This is an important decision for clients involved in an ordered costs review applications as, if conducted properly, they should be able to recover most of the legal costs from the opposing party for seeking a review.
If you have any further questions in regard to the judgment or any other legal costs query, contact Katie today on 02 8089 3167 or email katie@rose-lawyers.com.