Miles v Slack (No 2)

The plaintiff appealed against two decisions of the Local Court of New South Wales relating to costs matters under the Legal Profession Uniform Law (NSW) and the Legal Profession Uniform Law Application Act 2014 (NSW) (“LPULA Act”).

On 11 July 2022, I published my judgment where the first appeal against the decision of Milovanovich ALCM was upheld and the second appeal against a decision of van Zuylen LCM was dismissed: Miles v Slack [2022] NSWSC 926.

On the first appeal, I held that the operation of s 86 of the LPULA Act meant that the force and effect and operation of certificates made by a Costs Assessor (that is, the “Form C3” and “Form C4A” certificates) were suspended when the plaintiff made an application to the Review Panel: at [109]-[111]. This statutory suspension of the Costs Assessor’s determination affected the ability to obtain a judgment of a Court by the filing of the costs certificate. I concluded that the judgments entered upon the filing of the certificates were irregular and could have been set aside under r 36.15 of the Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”): at [115]-[118].

I found that the learned Magistrate made two errors of law, namely, that the reasons of the Magistrate were inadequate in circumstances where the issue was real and live, and that the Magistrate erred in finding that there was no utility in setting aside the judgment and thus erred in his exercise of discretion in refusing to set aside the judgment. The relevant parts of my consideration are extracted as follows:

On the second appeal, I found that the plaintiff had available the procedural step of seeking examination notices from the costs certificates made by the Review Panel (that is, the “Form C7” and “Form C8” certificates) and to obtain judgment in the Local Court for the amount payable. These certificates did not confront the same difficulties as the Form C3 and Form C4A certificates and there was nothing irregular in filing them. I held at [141]-[145] as follows:

In relation to the second basis for the challenge to van Zuylen LCM’s decision, I rejected the plaintiff’s contention that set-off was available under s 96 of the Civil Procedure Act 2005 (NSW) (“CPA”) because there are not “two or more judgments of the same court”: at [153].

In relation to set-off under s 21 of the CPA, I found that the requirement in equitable set-off for mutuality was satisfied because the proceedings involve the same parties: at [154]-[156]. However, I concluded that set-off was not available at [156]-[159] as follows:

I concluded that the plaintiff had not demonstrated an error of law on the part of van Zuylen LCM’s decision and the second appeal should be dismissed.

The issue of costs and proposed orders were reserved and the parties filed written submissions on those issues.

The written submissions of the defendant can be summarised as follows:

The written submissions of the plaintiff can be summarised as follows:

I turn to the first issue of costs. There is a broad discretion as to costs: CPA s 98. The general rule is that costs follow the event: UCPR r 42.1. However, the Court has a discretionary power to depart from the general rule where there has been disentitling conduct: Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11 at 88 [40] (Gaudron and Gummow JJ).

In Galati v Deans (No 3) [2018] NSWSC 1861, Ward CJ in Eq (as her Honour then was) summarised at [17]:

In Commonwealth of Australia v Gretton [2008] NSWCA 117, Hodgson JA (with whom Mason P agreed) observed at [121] that:

That observation was cited, with apparent approval, by the Court of Appeal in Heath v Greenacre Business Park Pty Ltd [2016] NSWCA 34 at [98] (Gleeson JA with whom Macfarlan and Leeming JJA agreed).

I agree with the submission of the defendant that there has essentially been one “win” for the plaintiff for the first appeal and one “win” for the defendant for the second appeal. However, I reject the submission of the defendant that the plaintiff only had a “technical victory”. If the appeals in this case had been heard separately, the general rule would militate that the plaintiff be awarded his costs for the first appeal and the defendant be awarded their costs for the second appeal.

The instant case is distinguishable because the two matters were heard together, represented by the same legal representatives and there is, at the very least, an intertwining of the issues insofar that the “Form C3” certificate was relevant to both appeals.

When I consider the proceedings as a whole, neither party can be said to be successful. There is, therefore, no basis for an order for costs in favour of either party by reference to that event: Sabouni v Revelop Building and Developments Pty Ltd [2021] NSWSC 123 at [8] (Black J). I reject the plaintiff’s submission that he has “absolutely and substantially” won the proceedings because I have found that judgments may be enforced against him on the basis of the certificates made by the Review Panel.

I also note that the mere fact that the Court’s judgment may possibly guide decision-making for lower courts is not a reason to award costs to a party. This is because it is inherent in the functions of this Court, being an appellate court from decisions of the Local Court, to provide guidance to the Local Court as to questions of law.

Although unnecessary to decide, I wish to make some remarks about the plaintiff’s behaviour in his correspondence to the legal representatives of the defendant. The correspondence that is before me and the allegations made by the plaintiff in his written submissions against the defendant’s solicitor and counsel are grossly improper, aggressive, abusive and, in some ways, scandalous. They are wholly inappropriate and should be admonished. Had it been necessary to decide, I would have been minded to not award costs or reduce the award of costs to the plaintiff on the basis of his conduct.

I now turn to the appropriate orders to be made. Apart from costs, the only issue contended by the parties were the orders to be made for the second appeal.

In my view, the defendant’s submission that this Court should declare “that the three review certificates [Form] C7 2020/00346848, [Form] C8 2020/00346819 and [Form] C3 2020/00297573 remain extant and are effective” or “that…the Defendant is entitled to enforce the Examination Orders 2020/00[3]46848, 2020/00346[4]19 and [Form] C3 2020/00297573” is misconceived.

As I indicated in my judgment at [134], the judgments obtained with respect to Form C3 should be set aside. The Form C3 certificate is not effective. It remains suspended under s 86 of the LPULA Act. There is therefore no basis for examination orders to be made under that certificate. Therefore, there is no basis for those declarations sought in that respect to be made.

The declaration sought by the defendant in relation to matter number 2020/315254 is not a matter that is before this Court on appeal. The defendants did not explain why a declaration should be made in relation to that matter. It is therefore not appropriate to make the declaration sought.

For these reasons, the Court makes the following orders in relation to the first appeal:

In relation to the second appeal, the Court makes the following orders: