Diamond Conway Lawyers v Hale

1. [1]

   By their summons, the plaintiffs (Diamond Conway or the firm), seek review pursuant to s 93B(3) of the Legal Profession Uniform Law Application Act 2014 (NSW) (LPULAA) and Uniform Civil Procedure Rules 2005 (NSW) (UCPR), r 49.19(1) of a decision of the Manager, Costs Assessment (the MCA). That decision extended the time under s 198(4) of the Legal Professional Uniform Law (NSW) (LPUL) for the First Defendant, Mr Timothy Stuart Hale SC, to make a costs assessment application (Costs Assessment Application). In the alternative, the firm seeks judicial review of that decision pursuant to s 69 of the Supreme Court Act 1970 (NSW).

Background

1. [2]

   The following matters appear to be common ground.

2. [3]

   Mr Hale is a barrister. As such, he is a “law practice” for the purposes of the LPUL: see s 6(1). The plaintiff firm is also a “law practice”. The plaintiff retained Mr Hale to appear, leading two junior barristers, for two companies which were clients of the firm at a five-day hearing in the Supreme Court of Queensland in Brisbane. In those proceedings the Australian Securities and Investments Commission (ASIC) sought, and ultimately obtained, orders winding up the two companies pursuant to s 461(1)(k) of the Corporations Act 2001 (Cth): Australian Securities and Investments Commission v Gognos Holdings Ltd & Anor [2017] QSC 207; (2017) 123 ACSR 110 (the ASIC proceedings). Those orders were made on 25 September 2017. Although the orders were stayed pending the outcome of an appeal, upon dismissal of the appeal the stay terminated on or around 3 August 2018. The two companies were deregistered in September 2023.

3. [4]

   It is not disputed that Mr Hale appeared at the hearings and provided legal services for that purpose. Mr Hale rendered three tax invoices for the legal services he provided in connection with the matter. The first and third were paid. The second has not been paid. It is this invoice which is the subject of the Costs Assessment Application.

Relevant legislation

1. [5]

   In circumstances in which Mr Hale says he was given certain assurances that the invoice would be paid with interest (see below), he did not apply to have the legal costs the subject of the second invoice assessed until 28 April 2025. That was many years after the 12 month period specified in s 198(3) of the LPUL expired.

2. [6]

   Section 198 relevantly provides (emphasis supplied):

3. [7]

   By reason of Table 2 in s 11(3) of the LPULAA, the “designated tribunal” referred to in s 198(4) is the second defendant, the MCA (see the definition of “designated tribunal” in s 6 of the LUPL). Section 198(4) was thus the source of the MCA’s power to extend the time limit for submitting an application for the assessment of costs beyond the 12 months provided for in s 198(3).

4. [8]

   Various submissions made to the MCA and in this Court require some familiarity with the statutory regime for costs disclosure. It is convenient to note the following.

5. [9]

   By s 174(1)(a), a law practice must “provide the client with information disclosing the basis on which legal costs will be calculated in the matter and an estimate of the total legal costs”.

6. [10]

   Section 175 provides:

7. [11]

   In the present case, ss 174(1)(a) and 175(1) applied directly to Diamond Conway, which was in a direct relationship with its clients. Those provisions did not apply directly to Mr Hale.

8. [12]

   However, s 175(2) did apply directly to Mr Hale. It required him to “disclose to [Diamond Conway] the information necessary for [Diamond Conway] to comply with subsection (1).” That is to say, the information necessary for the firm to disclose to the client, in relation to Mr Hale, “the basis on which legal costs will be calculated in the matter and an estimate of the total legal costs”. In the District Court proceedings referred to below, there is a live dispute between the firm and Mr Hale as to the requirement that the firm disclose an estimate of Mr Hale’s costs to the clients — in particular, as to whether s 175(2) required Mr Hale to disclose his own estimate to the firm. It is common ground that he did not disclose an estimate.

9. [13]

   Section 178(1)(c) provides:

Circumstances leading to the Costs Assessment Application

1. [14]

   The circumstances leading to the Costs Assessment Application are the subject of detailed affidavits Mr Hale made on 6 December 2024 and 29 May 2025 in the District Court proceedings referred to below. At least the first of those affidavits formed part of his Costs Assessment Application. Both affidavits, together with a further affidavit of Mr Hale in the District Court proceedings made on 27 October 2025, were put before me without any limitation on their use. None of these affidavits was challenged or sought to be contradicted by evidence. In summary, Mr Hale deposed to the following matters. Save as identified below, I have proceeded on the basis that those matters are not in dispute before me: see Tcpt, 20 April 2026, 9.27-10.28.

   1. (1)

      Mr Hale had had a longstanding professional association with Diamond Conway. He had also had a longstanding professional association with Mr Michael Zwar, solicitor, before Mr Zwar came to practise at the firm. That association continued once Mr Zwar was at the firm.

   2. (2)

      Shortly after receiving an email from Mr Zwar on 5 May 2017, Mr Hale had a conversation by telephone with Mr Zwar in which Mr Zwar asked him to appear for the two companies in the ASIC proceedings. Mr Hale informed Mr Zwar of his proposed daily and hourly rates and asked Mr Zwar whether he was content with the rates. Mr Zwar said that he was.

   3. (3)

      On 12 May 2017, Mr Hale’s personal assistant sent an email to Mr Zwar attaching a fee disclosure. The fee disclosure contained the same daily and hourly rates as had been discussed in the telephone call, but gave no estimate of the total fees. At no time did Mr Zwar or anyone else on behalf of the plaintiff firm ask Mr Hale for more details about the terms of his retainer or the amount that he proposed to charge.

   4. (4)

      (As to the preceding two paragraphs, it should be noted that Mr Hale’s assertion that he provided costs disclosure on 12 May 2017 is denied on the pleadings in the District Court. I will proceed on the footing that the questions (a) whether Mr Hale served any costs disclosure on or about 12 May 2017 (or at all), and (b) whether that disclosure met the statutory requirements, are in issue. But I note that there is no evidence to support the firm’s denials.)

   5. (5)

      Between 12 May 2017 and 20 February 2018, Mr Zwar instructed Mr Hale to appear for the two companies in the ASIC proceedings, including an appeal to the Queensland Court of Appeal. Mr Hale rendered three tax invoices with respect to the legal services he provided in acting for the companies.

   6. (6)

      Before sending the second invoice, which related largely to work done in connection with the proceedings at first instance, Mr Hale had spoken with Mr Zwar and discussed the proposed figure. Mr Zwar said the figure was reasonable and that Mr Hale should send a tax invoice for that amount.

   7. (7)

      At various times in February and March 2018, Mr Zwar said that he did not have sufficient funds to pay Mr Hale’s fees as well as those of the two juniors who had been retained. Mr Zwar said on a number of occasions: “there is no suggestion of me having your invoices assessed. They are reasonable. They will be paid. I would just ask that you wait until I get more funds in. You will be paid interest.” As a consequence, Mr Hale did not press for immediate payment and told Mr Zwar that the juniors should be paid first.

   8. (8)

      In a number of conversations over the following period, Mr Hale raised the outstanding fees with Mr Zwar. Mr Zwar confirmed that Mr Hale would be paid, saying words to the effect: “There is no doubt that you’re entitled to be paid those fees. There is no dispute about the bill. You will be paid. Please hold on as we try and get money from the client.” (The reference to “the client” was apparently to one of the former directors of the two companies.) Mr Hale also sent various memoranda of outstanding fees and emails to Mr Zwar chasing up the outstanding fees in 2019, 2020, 2021 and 2023.

   9. (9)

      On 21 December 2023, Mr Hale wrote to Mr Zwar referring to what he described in his affidavit as “the limitation period expiring on 14 February 2024”. He stated that unless payment was received by the end of January 2024 he would have no alternative but to commence proceedings. Mr Hale and Mr Zwar had many conversations leading up to 14 February 2024, in which Mr Zwar said, “You are entitled to be paid. There is no dispute about that”.

   10. (10)

       Mr Hale filed a statement of claim in the District Court of New South Wales on 8 February 2024. The eleven defendants were the ten members of the firm, and Mr Zwar. The claim alleged that the failure to pay the invoice was a breach of a retainer entered in or about May 2017 on the terms of Mr Hale’s letter of 12 May 2017 (including the rates contained in that letter).

   11. (11)

       At the request of Mr Zwar, Mr Hale delayed service of the statement of claim for almost 6 months.

   12. (12)

       On 2 September 2024, the firm and Mr Zwar filed defences in the District Court proceedings. This was the first occasion on which the service of Mr Hale’s fee disclosure of 12 May 2017 was put in issue, or that a limitation defence was raised (alleging that Mr Hale’s cause of action accrued at the latest on 25 September 2017 when judgment was handed down in the ASIC proceedings).

   13. (13)

       Paragraph 9 of the firm’s defence expressly pleaded s 178(1)(c):

   14. (14)

       On 14 October 2024, Mr Hale’s solicitors made an open offer in writing to Diamond Conway, offering “to have the tax invoice assessed rather than litigate the matter”. That offer was not accepted. On 25 October 2024 Mr Hale’s solicitors sought a response to the offer. No response was received.

   15. (15)

       On 25 November 2024, Mr Hale filed replies to the defences in the District Court proceedings. Among other things, he pleaded various estoppels arising out of representations made to him by Mr Zwar.

   16. (16)

       On 7 February 2025, Mr Hale’s solicitors again referred in correspondence to the 14 October 2024 offer; again no response was received.

   17. (17)

       On 3 April 2025, Mr Hale’s solicitors were served with the firm’s notice of motion in the District Court proceedings, seeking orders that Mr Hale’s claim be summarily dismissed. (The grounds were that the claim had been brought after expiration of the relevant limitation period, and/or on the ground that, as the firm had alleged at par 9 of its defence, Mr Hale could not maintain the proceedings under s 178(1)(c) of the LPUL.)

   18. (18)

       On 7 April 2025, Mr Hale’s solicitors wrote to the solicitors for the firm, again referring to the 14 October 2024 offer and asserting that a costs assessment was “clearly the simplest and cheapest means of resolving the cost dispute”. The firm’s solicitors replied the same day, insisting on their entitlement to have their notice of motion heard.

   19. (19)

       As noted above, Mr Hale made the Costs Assessment Application on 28 April 2025.

   20. (20)

       On 30 May 2025, Mr Hale filed a notice of motion in the District Court proceedings seeking orders including that the proceedings be stayed pending determination of the Costs Assessment Application.

2. [15]

   Both notices of motion were heard by Habib SC DCJ on 26 August 2025. His Honour gave judgment promptly on 2 September 2025, relevantly:

   1. (1)

      refusing the firm’s application to have the proceedings summarily dismissed;

   2. (2)

      refusing Mr Hale’s application for a stay; and

   3. (3)

      granting Mr Hale leave to file an amended statement of claim.

3. [16]

   On 12 September 2025, Mr Hale filed an amended statement of claim. Among other things, this pleading added causes of action for damages in statutory misleading or deceptive conduct.

The MCA’s Decision and the costs assessor’s Determination

1. [17]

   Mr Chris Wall, costs assessor, was assigned the Costs Assessment Application. He referred the matter to the MCA to determine the question whether the costs assessment should proceed out of time.

2. [18]

   On 16 September 2025, the MCA gave his decision to allow the costs assessment to proceed out of time (the Decision). The Decision was sent to the parties that day. It will be necessary to return to aspects of the Decision below. But the following points should be noted.

   1. (1)

      The MCA described the delay as “substantial” and “significant”, which “does not support the request for an extension”.

   2. (2)

      After referring to the parties’ submissions, the MCA said that the “cost applicant explains the delay in electing to initiate Court proceedings to pursue recovery of payment for their outstanding invoices.” The MCA referred to the fact that “issues concerning adequate and complete costs disclosure” had been raised between the parties, and observed that applying for a costs assessment was a “perhaps necessary approach”. That part of the Decision should be read as acknowledging, and indeed accepting, Mr Hale’s evidence as to the representations that were made to him and the time at which he first became aware that the firm was taking a point as to the adequacy of Mr Hale’s cost disclosure.

   3. (3)

      The MCA referred to the firm’s submissions, including:

   4. (4)

      The MCA’s dispositive reasoning as to “what is just and fair in the circumstances” was as follows:

3. [19]

   On 3 October 2025, Mr Wall notified the parties that he had completed his assessment. It appears that no copy of the Certificate of Determination was sent to any party before 16 October 2025. Mr Kieran Allan Pulley, solicitor for Diamond Conway, deposes that he did not receive the Determination until 27 October 2025, when it was attached to an affidavit of Mr Hale. The Determination specified the costs assessed, including interest, in a total amount of $148,743.96.

The summons in this Court

1. [20]

   On 3 November 2025, Mr Pulley sought instructions to apply for a review of the MCA’s Decision.

2. [21]

   The firm filed its summons on 8 December 2025, seeking orders that the MCA’s Decision extending time be set aside. It is notable that the summons did not seek any relief directed to the Certificate of Determination, i.e., the costs assessment itself. The assumption that appears to stand behind the present application is that if the MCA’s Decision extending time is set aside, the assessment itself would be liable to be set aside. When I raised this matter in the course of argument with counsel for the firm, he confirmed that what was sought to be set aside in this proceeding was the MCA’s Decision extending time rather than the costs assessment itself: Tcpt, 20 April 2026, 5.4-14. No point was taken on behalf of Mr Hale that the proceedings lacked utility.

3. [22]

   As noted above, Diamond Conway seeks relief on two alternative bases. First, by a combination of s 93B(3) of the LPULAA and UCPR, r 49.19(1). Alternatively, pursuant to s 69 of the Supreme Court Act.

4. [23]

   As to the former, s 93B of the LPULAA relevantly provides:

5. [24]

   As explained by Basten J in Voicu v The Owners-Strata Plan No 1624 [2020] NSWSC 296 at [15], s 93B engages UCPR r 49.19(1), which provides:

6. [25]

   Rule 49.20(1) provides that an application for review of the decision of a registrar is to be instituted by filing a notice of motion. However, that assumes that there is already a proceeding on foot in the court in which to file a notice of motion. In the present case there was no such proceeding on foot and it was appropriate to commence proceedings by way of summons seeking the relevant relief. See Voicu at [18]-[19].

7. [26]

   By r 49.20(2), the notice of motion (or, in this case, the summons) must be filed within 28 days after the material date. By r 49.20(5), the material date is the date of the decision — in this case, 16 September 2025. That means the summons was required to be filed no later than 14 October 2025. It was not in fact filed until 8 December 2025: some eight weeks late. However, by r 49.20(4), the Court may extend time under subrule (2) at any time. In its summons, the firm seeks such an extension. Mr Hale opposes it.

8. [27]

   As to the alternative basis under s 69 of the Supreme Court Act, r 59.10(1) provides that a proceeding for judicial review of a decision must be commenced within three months of the date of decision. To the extent that relief is sought pursuant to s 69, the summons was filed within time. However, it was made clear at the hearing of the summons that the s 69 aspect of the summons was very much a fall-back, pursued only in the event that no extension of time was granted with respect to the r 49.19 aspect: Tcpt, 20 April 2026, 6.36-7.32, 9.19-25. That is understandable, given the differences in the scope of the alternative bases of review.

9. [28]

   If the current proceedings were determined by way of judicial review under s 69 of the Supreme Court Act, the firm would only be entitled to relief if it could establish jurisdictional error or error of law on the face of the record.

10. [29]

    The scope of review pursuant to r 49.19 is far broader. The relevant principles were summarised by Ball J in Bond Legal Pty Ltd v Bhetwal; Bond Legal Pty Ltd v Subedi [2025] NSWSC 314 at [14] as follows:

11. [30]

    Robb J said in UTSG Pty Ltd v Gwynvill Properties Pty Ltd [2017] NSWSC 558 at [33]-[35]:

12. [31]

    At a practical level in a given case, the distinction between the proposition that the court may exercise its powers regardless of error and the proposition that there must be a basis shown for setting aside, or varying, the decision or orders of the registrar may be a fine one. But in the circumstances of this case the application of these principles gives rise to no difficulty. As will be seen, there was no error in the MCA’s Decision, and, considering the matter afresh, I reach the same conclusion as the MCA.

13. [32]

    It was not suggested that (provided an extension of time was granted pursuant to r 49.20(4)) there was any basis on which the firm could obtain relief pursuant to s 69 if it failed pursuant to r 49.19 in the circumstances of the present case. To the contrary, I understand that the alternative argument based on s 69 is pressed only if I decline to grant an extension of time pursuant to r 49.20(4): see, in particular, Tcpt, 20 April 2026, 9.19-25. As I have decided that it is appropriate to grant an extension of time (see below), it is unnecessary to consider s 69 further.

14. [33]

    A further matter should be noted about the summons. Mr Zwar, who is separately represented as the 11th defendant in the District Court proceedings, is not a party to the present proceedings. He will get the practical benefit of any success the firm may have (i.e., in having the MCA’s Decision set aside), and no relief directly affecting his interests is otherwise sought. The parties were in agreement that Mr Zwar was not a necessary party to these proceedings.

Extension of time pursuant to r 49.20(4)

1. [34]

   Mr Hale opposes the grant of an extension of time to apply for review of the MCA’s Decision pursuant to r 49.19. In Tomko v Palasty (No 2) (2007) 71 NSWLR 61; [2007] NSWCA 369 at [55], Basten JA identified four factors of general relevance in cases in which an extension of time is sought:

   1. (1)

      the length of the delay;

   2. (2)

      the reason for the delay;

   3. (3)

      whether the applicant has a fairly arguable case, and

   4. (4)

      the extent of any prejudice suffered by the respondent to the application.

2. [35]

   His Honour also acknowledged at [56] that there might be other factors relevant to the grant of an extension of time in particular cases.

3. [36]

   As to the first two matters identified in Tomko (delay and the reasons for it), counsel for Mr Hale submitted in writing that not only was the summons some eight weeks out of time (by reference to the material date, being the date of the MCA’s Decision), it was also seven weeks after the 16 October 2025 Certificate of Determination of Costs. She pointed out that the firm had provided neither submissions nor evidence explaining the delay, or otherwise advancing reasons as to why the Court would extend time.

4. [37]

   As to those issues, in oral argument, the firm argued that “the fundamental point … which determines the rights and obligations of the parties” was Mr Wall’s costs assessment (rather than the MCA’s extension of time): Tcpt, 8.17; see also 8.41-46. The firm relied on Mr Pulley’s evidence that he had not seen Mr Wall’s Determination of Costs before 27 October 2025, and that he sought instructions to apply for a review of the MCA’s Decision on 3 November 2025. The process of taking instructions then took a period of about four weeks, which the firm submits was “short”.

5. [38]

   Counsel for Mr Hale submitted that that explanation of the delay amounts to taking a forensic decision to wait until the outcome of the Costs Assessment Application before deciding whether to challenge the MCA’s Decision to extend time. There is some force in that submission. On the other hand, it is understandable that (particularly given the amounts in issue) parties who were already defending proceedings in the District Court might hesitate to commence a new substantive proceeding in the Supreme Court in order to challenge the MCA’s Decision, which itself did no more than permit the costs assessment to proceed.

6. [39]

   As to the third matter in Tomko, Mr Hale did not suggest that the firm lacked an arguable case for review pursuant to r 49.19. Particularly given the very long period (more than half a decade) for which the MCA extended time in favour of Mr Hale, I accept that the firm had an arguable case for review.

7. [40]

   As to the fourth matter in Tomko, counsel for Mr Hale accepted that she could not point to any prejudice that the delay in this case, a matter of weeks, had caused Mr Hale beyond that which is to be presumed (citing Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541; [1996] HCA 25): Tcpt, 34.45-35.6.

8. [41]

   On balance, the four matters identified in Tomko, and particularly the absence of any substantial prejudice to Mr Hale, tend to point, if only slightly, in favour of granting an extension of time.

9. [42]

   The firm also relies on two other matters. First, “the importance of this application and the summons”: Tcpt, 9.13-14. I understand that to be a submission that if the firm is able ultimately to set aside the costs assessment, that will give it a significant forensic advantage in defending the District Court proceedings. I accept that that is so, and that it tends in favour of granting an extension of time pursuant to r 49.20(4). (However, the other side of that coin is the corresponding forensic disadvantage to Mr Hale if he were unable to have his costs assessed — a matter which will be relevant to the question whether it was just and fair for Mr Hale’s application for assessment to be dealt with after the 12 month period in s 198(4).)

10. [43]

    Secondly, the firm points to the fact that its application pursuant to s 69 was brought within time and would have to be determined in any event if no extension were granted: Tcpt, 9.14-15. That is a not insignificant practical consideration. In the way in which the firm advances its case, it attempts to rely on all of the same matters under s 69 as under r 49.19. That means that if no extension of time were granted pursuant to r 49.20(4), it would still be necessary, in order to dispose of the summons, to consider all the same arguments, but subjecting them to a further layer of scrutiny in order to determine whether they established jurisdictional error or error of law on the face of the record. The potential sterility of that exercise is a further reason for granting an extension of time pursuant to r 49.20(4) in order for those arguments to be determined on their merits.

11. [44]

    That being so, I will make an order pursuant to r 49.20(4) extending the time for filing the summons until 8 December 2025.

The grounds in the summons

1. [45]

   The summons identified five grounds of review. However, the argument the firm ultimately advanced departed significantly from the terms of the grounds. It is convenient to deal with the firm’s arguments grouping the grounds as follows.

Grounds 1 and 2

1. [46]

   Counsel for the firm accepted at the hearing of the summons that Grounds 1 and 2 travel together: Tcpt, 51.45:

   1. (1)

      Ground 1: the MCA “erred by allowing the extension of time as it was not ‘just and fair’ to do so.”

   2. (2)

      Ground 2: the MCA erred in law because “[t]he application of s 198(4) was misapplied and incorrectly interpreted by the decision maker.”

2. [47]

   As I understood the argument advanced in support of these grounds, Ground 2 does not raise any distinct issue of statutory construction. Instead, these grounds amount to an invitation to the Court to exercise its discretion to intervene on the basis that it should come to a different ultimate conclusion (that it would not be just and fair to allow the extension of time) from that reached by the MCA. Given the nature of r 49.19 review, it was open to the firm to adopt that approach.

3. [48]

   The following may be noted by way of overview of s 198(4).

4. [49]

   First, “the delay” and “the reasons for the delay” are mandatory relevant considerations which must be taken into account. Those are also the first two of the four factors of general relevance in Tomko. The third factor in Tomko — a fairly arguable case for assessment of costs — may well be undemanding where, as here, a barrister seeks an assessment of costs payable by their instructing solicitors on account of legal services provided. But the fourth factor, the extent of any prejudice suffered by the respondent to the application for costs assessment, is likely to be highly relevant.

5. [50]

   Secondly, subs 198(4) requires an overall evaluative assessment of the question whether it is just and fair to allow the extension of time. Although that language is very general, the considerations that may be relevant to the assessment are limited by the scope, object and purpose of the rule. Counsel for the firm referred to (and in some respects distinguished) Bond Legal at [13], where Ball J discussed some of the matters that may be relevant (albeit in the context of an application for costs assessment made by a client):

6. [51]

   Where the application for costs assessment is made by a barrister claiming against their instructing solicitors, the corresponding considerations would be (1) why, given that the barrister should be taken to have been aware of the right to seek costs assessment, that avenue was not pursued in a timely manner (that is, the reason for the delay); (2) whether there is evidence that the legal costs were incurred in the course of providing legal services on the instructions of the solicitors (that is, an arguable case for assessment); and (3) the solicitors’ reasons for not paying the bill (whether in whole or in part) and opposing the extension (which will include any matters of prejudice). I agree that the power to extend time should not be approached on the basis that it should be allowed unless the firm of solicitors can show actual prejudice; but I note that that is not this case.

7. [52]

   It was not suggested here that there were any relevant considerations beyond the length of the delay, the explanation for it, the parties’ competing assertions of prejudice, and a question as to the utility of the extension of time.

8. [53]

   In submitting that it was not just and fair for Mr Hale’s application for assessment to be dealt with after the 12 month period, the firm relied on what it submitted were:

   1. (1)

      the great length of the delay (in the order of half a decade);

   2. (2)

      the lack of adequate explanation for the delay, particularly in circumstances where Mr Hale must be taken to have been aware of the right to seek costs assessment;

   3. (3)

      prejudice, both presumptive and actual: the loss of the ability to recover Mr Hale’s fees from the firm’s ultimate clients (which were wound up and ultimately deregistered), and having to confront a multiplicity of proceedings; and

   4. (4)

      (at least in the alternative) the lack of utility in granting the extension of time to have Mr Hale’s costs assessed.

9. [54]

   As to the first and second factors, the length of the delay is undoubtedly a very weighty factor in favour of the firm. However, all but the last several months of that period are powerfully explained by the uncontested material as to the representations that Mr Zwar made to Mr Hale, to the effect that the firm accepted that he was entitled to be paid, that his costs were reasonable, and that the firm did not require those costs to be assessed. Undoubtedly, Mr Hale should be taken to have been aware of his right to apply for a costs assessment. But so long as he was operating on the basis of Mr Zwar’s assurances, he had no reason to exercise that right. Indeed, had he exercised that right, he may have been criticised for doing so in circumstances where he had every reason to understand that the firm accepted that it was liable to pay his second invoice in full.

10. [55]

    It is true that, as the firm submitted, from the time the defences were filed in the District Court proceedings on 2 September 2024, Mr Hale was on notice that the firm’s position (and Mr Zwar’s) was that Mr Hale’s claim was not maintainable in the absence of a costs assessment. Mr Hale’s explanation is that in the period of almost eight months after the defences were filed before he filed the Costs Assessment Application on 28 April 2025, he was endeavouring to obtain the firm’s agreement for him to pursue costs assessment instead of the District Court proceedings — a proposal with which the firm did not engage. The explanation is far from perfect, particularly given that Mr Hale was not seeking merely to obtain the firm’s agreement to a costs assessment. Instead, he was seeking in effect to have the firm agree to be bound by the outcome of a costs assessment, in which his position was that the limitation issue which the firm had pleaded in the District Court proceedings would not be available as a defence as such.

11. [56]

    On the other hand, it is significant that the firm was unable to point to any prejudice that it suffered in the period between 2 September 2024 and 28 April 2025, other than that which is to be presumed. The particular points of prejudice to which the firm pointed (discussed below) had all occurred long before 2024.

12. [57]

    It might also be noted that s 198(4) provides for a period of 12 months in which to seek a costs assessment. The provision in effect assumes that 12 months should ordinarily afford sufficient time for a prospective applicant to realise that a costs assessment is necessary and to make an application. But in this case, given that Mr Hale had sought and obtained approval of the quantum of his second invoice before he issued it, and given the assurances made to him after he issued it, for the whole of the initial 12 month period he had good reason to think that costs assessment was unnecessary. The period of almost 8 months after it became apparent to him on 2 September 2024 that the firm was insisting that his costs were not recoverable because they had not been assessed is not out of proportion with the 12 months for which s 198(4) provides.

13. [58]

    In any event, as the parties rightly submit, it is necessary to have regard to the period of delay as a whole, and to consider the reasons for the whole period of delay. Viewing the matter as a whole, although the period of delay is very lengthy, the reasons for the delay are reasonable. That is a matter tending in favour of the Decision the MCA reached.

14. [59]

    The third factor on which the firm relied was prejudice to it. I accept that some prejudice is to be presumed where an extension of time is sought, and that the nature of the prejudice may be unknown: see Taylor at 551 per McHugh J. But in the present case the firm relied on what it submitted were two matters of actual prejudice, namely, (1) the loss of the ability to recover Mr Hale’s fees from the firm’s ultimate clients, and (2) being forced to face a multiplicity of proceedings.

15. [60]

    As to the first point, it is for the firm to establish the prejudice of which it complains. It is true that the firm’s two client companies were wound up and ultimately deregistered. But it is difficult to see how the firm was in any real sense prejudiced by Mr Hale’s delay in applying to have his costs assessed after the 12 month period for which s 198(3) provides. The second invoice was issued on 14 February 2018. The period of 12 months did not end until February 2019. But the orders that the two companies be wound up were made on 25 September 2017 (before the second invoice was even issued) and the stay of those orders terminated on or around 3 August 2018 (six months before the 12 month period expired). In those circumstances, it is not obvious how the firm suffered any actual prejudice by reason of Mr Hale’s delay.

16. [61]

    There is no direct evidence (nor evidence from which to infer) that if, for example, Mr Hale had applied to have his costs assessed within the 12 month period (i.e., no later than February 2019), the firm would or could have taken some step to recover those fees from the two companies which it did not otherwise take. Nor is there any evidence that the client companies were in a position in February 2019 (or at any earlier time) to meet whatever claim the firm might have had against them to recover Mr Hale’s fees.

17. [62]

    The probabilities are very much against the firm’s claim of prejudice. The proceedings in which Mr Hale appeared were proceedings in which ASIC sought the very outcome which the firm now asserts occasioned it prejudice: the winding up of the companies. It is not in dispute that Mr Hale was retained by Diamond Conway, nor that he appeared at the hearings in Brisbane. Nor is it in dispute that under the retainer, the party responsible for paying Mr Hale’s fees was Diamond Conway, rather than the firm’s clients. Nor is there any suggestion that, for example, the firm’s liability to pay Mr Hale’s fees was contingent on recovery of those fees by the firm from its clients. Nor is it disputed that at all times until Mr Hale commenced the District Court proceedings, the firm (via Mr Zwar) acknowledged that it was liable to meet Mr Hale’s fees.

18. [63]

    In those circumstances, (a) the firm should be taken to have expected to be responsible for meeting Mr Hale’s fees, whether or not it was able to recover those fees from its clients; (b) the firm should be taken to have anticipated the risk that its clients would be wound up; and (c) in the absence of any evidence to the contrary (for example, as to a step the firm could have taken but did not), it should be further inferred that the firm in fact took such measures as were practically open to it to recover Mr Hale’s fees from the client companies. In those circumstances, it is improbable that Mr Hale’s delay caused the firm actual prejudice in recovering Mr Hale’s fees from the clients. It is far fetched to suggest that, in the counterfactual world in which Mr Hale had applied to have his costs assessed within the 12 month period in s 198(3), Diamond Conway would have taken some step to recover Mr Hale’s fees from the client companies which it did not in fact take in reality. That being so, it is difficult to see how the firm could have suffered any prejudice in this respect by reason of Mr Hale’s delay in seeking to have his costs assessed thereafter.

19. [64]

    (As to what is “just and fair” more generally, it should not be overlooked that it was the firm, not Mr Hale, which had a direct relationship with the client companies. Mr Hale was not in a position to secure payment of his fees directly from the client. It was Diamond Conway that was liable to Mr Hale for his fees. If the firm wished to protect itself against the risk that the client companies might be wound up, it should have put arrangements in place (such as holding monies on trust) to ensure that the clients met Mr Hale’s fees. That was so from the outset. The firm’s failure to do so would appear to be the real reason why it has been unable to recover Mr Hale’s fees from the client companies, rather than his delay in seeking assessment.)

20. [65]

    As to the second point of claimed prejudice, the firm submits that the extension of time exposed it to prejudice in that it was required to face two processes at the same time: the proceeding in the District Court and the costs assessment. There are at least two difficulties with this argument.

21. [66]

    First, that situation — assuming that it was prejudicial — was not prejudice brought about by Mr Hale’s delay. If he had sued in the District Court and also applied to have his costs assessed within the 12 month period, the firm would have been in the same situation.

22. [67]

    Secondly, as to what is “fair and just”, the fact that there were two processes on foot was a consequence of the positions adopted by the firm itself in resisting Mr Hale’s claim to be paid.

    1. (1)

       As to the application for costs assessment, it was the firm which alleged in par 9 of its defence that Mr Hale’s claim was not maintainable because his costs had not been assessed. It is true that in the District Court Mr Hale was entitled to argue that his May 2017 fee disclosure met the obligations imposed on him by s 175(2), such that s 178(1)(c) was not engaged. But if that argument failed (or if he was unable to prove service of his fee disclosure, which the firm had put in issue), the firm’s position in the District Court was that Mr Hale’s claims in (at least) contract and quasi-contract were not maintainable because his costs had not been assessed. It is hardly surprising in those circumstances that Mr Hale would initiate a second process to have his costs assessed.

    2. (2)

       As to the District Court proceedings themselves, it appears to be common ground that the limitation defence asserted by the firm in the District Court proceedings was not available to it as a defence as such in the costs assessment process, and that for that reason it was appropriate that Mr Hale’s claim be addressed in the District Court: Tcpt, 35.38-36.5; 54.13-17.

23. [68]

    In the result, in the circumstances of this case, I do not consider the fact that there would be two processes addressing overlapping issues occurring at the same time to be a factor militating against the conclusion that it was just and fair for Mr Hale’s application for assessment to be dealt with after the 12 month period in s 198(3).

24. [69]

    As to the fourth factor referred to above, as I understood the submission, the firm’s primary position is that questions of utility are irrelevant: Tcpt, 15.21-23. If that is the submission, I reject it. Considerations of utility are self-evidently relevant.

25. [70]

    The firm’s alternative submission appeared to be that the extension of time to have Mr Hale’s costs assessed lacked utility. Again, the submission should not be accepted. The extension of time had utility because it permitted the costs assessment to occur, which in turn had utility for several reasons.

    1. (1)

       On the firm’s case in the District Court proceedings, Mr Hale’s primary claim in contract or quasi-contract was not maintainable unless his costs were assessed. While it is true that Mr Hale had alternative claims founded in estoppel and statutory misleading or deceptive conduct, those claims involved additional elements and complexities which were absent from the primary claim. It is also not inconceivable that at least the claims founded on estoppel might be barred as amounting to “proceedings for the recovery of … legal costs” within the meaning of s 178(1)(c): see Koutsourais & Anor v Metledge & Associates [2004] NSWCA 313 at [51] per Bryson JA; cf. at [11] per Hodgson JA. In those circumstances it can hardly be said that there was no utility in the MCA’s Decision to extend time. The costs assessment overcame a significant forensic disadvantage Mr Hale had been suffering in the District Court.

    2. (2)

       The firm’s argument as to a lack of utility appears to turn in large measure on its limitation defence in the District Court. If the limitation defence is well-founded, so the argument goes, Mr Hale’s primary claims in the District Court in contract and quasi-contract cannot be maintained regardless of any costs assessment. But that argument turns on an assumption — that the limitation defence is good — which is itself an issue in the District Court proceedings. The extension of time, and the costs assessment itself, have utility at least by preserving Mr Hale’s position in the District Court proceedings in the event that the limitation defence fails.

    3. (3)

       The firm also appeared to argue that there was no utility (or perhaps no additional utility) in the costs assessment process because “every issue between the parties is being ventilated” in the District Court proceedings in any event: Tcpt, 56.14-15. As I understood the argument it was that even if Mr Hale’s costs were not assessed (so as to engage, on the firm’s case, the prohibition on proceedings “for the recovery of … the legal costs” imposed by s 178(1)(c)), Mr Hale still had available claims in estoppel and misleading or deceptive conduct. But that would be far from the ventilation of “every issue”. The submission must again be rejected.

    4. (4)

       In any event, the Decision, and the assessment which it permitted to occur, had utility independently of the District Court proceedings. For example, it is at least arguable that in the circumstances of this case Diamond Conway has an ethical obligation to pay Mr Hale’s legal costs which have been assessed as fair and reasonable, whether or not the limitation period has expired.

26. [71]

    For his part, Mr Hale relied on:

    1. (1)

       Mr Zwar’s representations and assurances as explaining the long delay in seeking a costs assessment;

    2. (2)

       what Mr Hale submitted was the lack of any substantial prejudice to the firm occasioned by the delay; and

    3. (3)

       the prejudice to him if his costs were not assessed.

27. [72]

    The substance of each of those matters has been addressed above. Expressed in terms of prejudice, the same matters that demonstrate the utility of permitting Mr Hale’s costs assessment application to be dealt with after the 12 month period show the prejudice that he would have suffered if no extension were granted.

28. [73]

    Having regard to all the considerations discussed above, it was (and is) “just and fair” for Mr Hale’s application for assessment to be dealt with after the 12-month period in s 198(3). Ground 1 is not made out.

29. [74]

    There was no error in the ultimate conclusion the MCA reached in “[t]he application of s 198(4)”. Ground 2 is not made out.

30. [75]

    Given my conclusion as to Ground 1, it is not clear that there is any utility in considering the firm’s remaining grounds, which assert various errors of reasoning or process on the part of the MCA. On the assumption that any such error in the MCA’s Decision were made out, the error would make no difference to the disposition of the summons insofar as it relies on r 49.19. Exercising the s 198(4) power afresh after considering the material before me, I have concluded that it was (and is) just and fair for Mr Hale’s application for assessment to be dealt with after the 12-month period. That being so, the summons should be dismissed regardless of any error in the MCA’s Decision. Nevertheless, I will address the remaining grounds on their merits.

31. [76]

    I would add that, in light of my conclusion as to the merits reached under Ground 1 when dealing with the r 49.19 aspect of the summons, even if it had been necessary for me to address the s 69 aspect of the summons, and even if some reviewable error had been established, there would have been discretionary reasons for declining to grant any relief in the particular circumstances of this application.

Ground 3

1. [77]

   Ground 3, as formulated in the summons, is that the MCA erred in law or failed to apply mandatory statutory criteria because he failed:

2. [78]

   In argument, counsel for the firm explained that the argument in fact sought to be advanced under this ground went to “the balancing of the prejudice because that wasn't considered”: Tcpt, 52.6-7. Counsel submitted that this ground was the particularisation of an argument “[t]hat would still fall under the first ground”: Tcpt, 52.11-16. The firm complained that its arguments about:

   1. (1)

      provisions of the LPUL concerning costs disclosure (Tcpt, 52.20-23); and

   2. (2)

      “the duplication of proceedings” (Tcpt, 52.44-50),

3. [79]

   These submissions should be rejected.

4. [80]

   First, the MCA undoubtedly considered the LPUL provisions concerning costs disclosure, and appears to have assumed in favour of the firm that adequate disclosure had not been made. The MCA said in the Decision that “[g]iven the existence of the current litigation regarding the same costs dispute, attention needs to be drawn to section 178 of the Act”, which was then set out. The MCA said:

5. [81]

   Secondly, the MCA was well aware of what he identified as “the existence of the current litigation regarding the same costs dispute”. The MCA specifically referred to the firm’s complaint that it was “already … in the process of defending themselves in multiple unmeritorious Court proceedings”.

6. [82]

   The firm submitted in this Court that the particular submission about prejudice with which the complaint in Ground 3 was concerned was that the costs assessor, Mr Wall, had decided that Mr Hale had given costs disclosure as required (Tcpt, 52.49-50). But that was an “issue that is live before the District Court and this finding, even though not binding, could potentially be persuasive and would be prejudicial because this is an issue that has been determined without the benefit of a final hearing and evidence”: Tcpt, 53.18-21.

7. [83]

   I reject that submission. First, it is not clear that this specific argument was advanced before the MCA (whose Decision preceded Mr Wall’s Certificate of Determination). Mr Pulley deposes at par 21 of his affidavit to having sent submissions to the MCA on the question “whether the assessment should be allowed out of time” by way of email on 12 September 2025. That email does not articulate the specific argument about duplicity of proceedings identified above.

8. [84]

   Secondly, as to the underlying merits of the point, as the firm’s submission in this Court acknowledged, whatever was said by the costs assessor is not binding upon a Judge of the District Court: Tcpt, 53.4-5.

9. [85]

   The substance of the “duplication of proceedings” point was addressed above in relation to Grounds 1 and 2. For the reasons already given, I do not consider it to be a factor militating against the conclusion that it was just and fair for Mr Hale’s application for assessment to be dealt with after the 12 month period. Ground 3 is not made out.

10. [86]

    In any event, as noted above, even if (contrary to my view) some error on the part of the MCA had been made out under Ground 3, that would make no difference to the disposition of the summons. My conclusion, reached afresh, is that it was just and fair for the Costs Assessment Application to be dealt with after the 12 month period.

Ground 4

1. [87]

   Ground 4 is: “Inadequate reasons/failure to engage with material submissions - The decision-maker erred by providing inadequate reasons. The absence of proper reasons constitutes an error of law on the face of the record.”

2. [88]

   On its face, this appears to be a ground directed to the s 69 aspect of the summons. In any event, in oral argument, counsel for the firm explained that this ground was pressed only in connection with “one submission” (Tcpt, 57.15), being a submission made by email to the MCA dated 12 September 2025. That email included the following submissions:

   1. (1)

      “There is no utility in conducting any assessment of costs regarding the quantification of same when the proper issues concern the Costs Applicant’s actual ability to recover those costs. In addition to the issue regarding limitation, the manner in which the Costs Applicant disclosed fees is entirely deficient and in breach of s 175(2) LPUL (including the fact that no estimate was provided and the purported disclosure was not made as soon as practicable, constituting a delay of 7 months).”

   2. (2)

      “This is aside from the fact that it is entirely unreasonable and an abuse of process for two simultaneous processes to be on foot in regard to the same costs.”

3. [89]

   The substance of both issues — the asserted lack of utility in the costs assessment and the existence of two simultaneous processes — has been addressed above. For the reasons already given, it was neither unreasonable nor an abuse of either process for the other to be on foot at the same time.

4. [90]

   To the extent that the complaint is that these arguments were not considered, the submission should again be rejected.

   1. (1)

      The MCA addressed the utility of the extension of time when he said that otherwise Mr Hale would be deprived of an opportunity to seek a determination of a reasonable amount to be paid for the legal services he provided. To the extent that the complaint about utility here is a more specific one, that the MCA failed to engage with the firm’s submissions about its limitation defence in the District Court, or with its allegation that Mr Hale had failed to make the required costs disclosure, the MCA referred to both matters. And the MCA addressed (i.e., “engaged with”) both matters when he correctly said that “[w]hether or not the Court proceedings are able to proceed is a matter for the Court. This costs assessment application is not a Court process.”

   2. (2)

      The MCA acknowledged the firm’s submission that “this costs assessment application … is a further attempt to pursue recovery of the same invoices”. That was plainly a reference to the submission above that it was “an abuse of process for two simultaneous processes to be on foot in regard to the same costs.” Again, the MCA engaged with that submission when he explained that the costs assessment process was an administrative one, not a Court process.

5. [91]

   Ground 4 is not made out.

6. [92]

   In any event, again, as noted above, even if the MCA had failed in some way to engage with an argument, in light of my conclusion under Ground 1, the disposition of the summons would be the same.

Ground 5

1. [93]

   Ground 5 is that the MCA:

2. [94]

   In light of Diamond Conway’s submission made in writing on 12 September 2025 referred to above, there was no basis for the allegation that the MCA denied the firm procedural fairness in the respects identified.

3. [95]

   Counsel for the firm confirmed in argument that the point sought to be advanced pursuant to this ground was only that in the second sentence, which he acknowledged was the same as Ground 4: Tcpt, 57.26-30.

4. [96]

   Ground 5 accordingly is not made out for the same reasons as discussed above.

Conclusion and orders

1. [97]

   None of the grounds advanced in support of the summons is made out. Considering the matter afresh on the material before me, I have concluded that it was just and fair for the Costs Assessment Application to be dealt with after the 12 month period in s 198(3).

2. [98]

   I make the following orders:

   1. (1)

      The time for filing the summons is extended until 8 December 2025.

   2. (2)

      The summons is dismissed with costs.