By Darius Self 
Navigating Complex Legal Cost Assessments – Insights from the Gregg v PwC Case[2024] NSWCA 111 (10 May 2024)
Legal Costs Consultant at Rose Legal
Mr Gregg instructed our firm to prepare the full itemised bill of costs and to advise through the assessment. This culminated in a total allowance of $245,895.02 plus interest in the sum of $18,578.38 totalling $264,473.40 against a total claim of $290,425.40, representing a recovery of 84.66% for this ordinary basis costs assessment.
Background to case
Mr Gregg was a Partner in PwC’s Research and Development team, responsible for advising clients in relation to the federal Research and Development Tax Incentive scheme. On 28 May 2023, Mr Gregg was given written notice that a written Recommendation that he be required to retire had been made. The following day, PwC issued a public apology, noting that nine unnamed partners had been stood down. His Honour Hammerschlag in Eq noted in his judgment that it could safely have been inferred that Mr Gregg was one of the nine directors.
Mr Gregg instructed Giles George, one of the foremost firms specialising in reputational risk, who successfully argued that the Recommendation did not meet the requirements of the Partnership Agreement and accordingly that he was entitled to declaratory relief. Mr Gregg was also awarded his costs on the ordinary basis.
Costs Assessment
Rose Legal received instructions from Giles George to initially prepare an itemised Bill of Costs on behalf of Mr Gregg. This was prepared following our usual in-depth review of the entirety of the files relating to the proceedings and included pre-emptive submissions within the application justifying the reasonableness of the costs claimed, thereby reducing the need for further extensive submissions to be prepared later in the assessment.
Objections put forward by PwC
Several objections were put forward on behalf of PwC, including, inter alia:
a. Lack of particulars as to the items within the Bill.
b. Costs claimed being outside of the scope of the order, notably work regarding the direction to take special leave.
c. The use of Counsel and the fees claimed.
Lack of particularisation
No less than 6 pages were attributed to this objection, and brief submissions in response were prepared to rebut these arguments. The assessor ultimately disagreed with the Costs Respondent, noting as follows:
“In the response, Mr Gregg submitted there were only three such objections, items 257, 288 and 292, and in respect of those items correctly pointed out that a significant level of detail was provided.”
The assessor went on to note that this objection was not made out.
This goes to show the importance of preparing a Bill of Costs with sufficiently detailed items to ensure your client recovers as much of the law firm’s costs as possible and to avoid becoming entrenched in such arguments on assessment.
Costs purportedly outside the scope of the order
Again, the assessor agreed with our submission that such costs were inextricably linked with the overall proceedings. The assessor agreed as to the submission that “there must have been seen to be a correlation and connection between the special leave direction and the attempt to obtain reasons for the recommendation“.
It is useful to note that this is a common argument in inter partes assessments, so it is essential to have a proper understanding of these principles and supporting case law to ensure maximum recovery without overextending the claim for costs.
PwC had also argued that the question of the partnership agreement and the ‘tax scandal’ were two separate issues and Mr Gregg should not recover costs in dealing with aspects of the latter. Our submission in response was to point out supporting case law as well as explaining that the two issues were inextricably linked given the approach adopted by PwC, to which the assessor agreed.
Our submissions also ensured that costs incurred after the date of the judgment were also recovered (again subject to the usual rules as to whether they were fair and reasonable).
A useful additional point made by the assessor was that costs should not be assessed with the benefit of hindsight, as this is not something that a solicitor would have the benefit of at the time the work was done. While there is no clear precedent on this point within Australia, there does exist clear authority within England and Wales in the case of Francis v Francis and Dickerson [1955] 3 All ER 836. This is an important consideration when dealing with any costs assessment or taxation within Australia.
Expert Guidance for Your Legal Costs Challenges
If you have an order for costs, or a determination and would like advice on how to maximise recovery for your client, get in touch today. Equally, if you have a costs issue in any jurisdiction, we would be happy to have a free initial discussion with you on how we may assist.
At Rose Legal, we specialise in:
– Legal costs assessments for complex cases
– Costs negotiation strategies
– Dispute resolution for legal costs
– Advising on high legal fees and potential reductions
Whether you’re in Sydney, Melbourne, or anywhere in Australia, our team of expert costs lawyers and consultants are here to help you navigate the complex world of legal costs.
Note: NSW assessments are not a court proceeding and are not precedents. Consequently, the details of the assessor have been omitted from this article as assessors apply their discretion on a case by case basis and each costs determination is not meant to be used as a precedent for future case.
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About the Author:
Darius Self is a seasoned Legal Costs Consultant at Rose Legal, with extensive experience in legal cost assessments and dispute resolution. Based in Sydney, Darius specialises in helping our clients navigate complex cost issues, maximize recoveries, and ensure fair billing practices across various legal disciplines. His expertise in handling high-profile cases like Gregg v PwC demonstrates Rose Legal’s commitment to excellence in the field of legal costs consultancy.
