APC Marine Pty Ltd v The Ship "APC Aussie 1" [2011] FCA 679 (1 June 2011)

Last Updated: 20 June 2011

FEDERAL COURT OF AUSTRALIA

APC Marine Pty Ltd v The Ship “APC Aussie 1” [2011] FCA 679

Citation:		APC Marine Pty Ltd v The Ship “APC Aussie 1” [2011] FCA 679
Parties:		APC MARINE PTY LTD (ACN 119 763 012) v THE SHIP "APC AUSSIE 1” and T-D JOINT VENTURE PTY LTD (ACN 124 308 685) v APC MARINE PTY LTD (ACN 119 763 012)
File number(s):		VID 234 of 2009 VID 244 of 2009
Judge:		BROMBERG J
Date of judgment:		1 June 2011
Legislation:		Federal Court Rules O 62 rr 42, 44, 46(5), Schedule 2
Cases cited:		Australian Coal and Shale Employees Federation v Commonwealth [1953] HCA 25; (1953) 94 CLR 621 House v The King [1936] HCA 40; (1936) 55 CLR 499
Date of hearing:	1 June 2011
Place:	Melbourne
Division:	GENERAL DIVISION
Category:	No Catchwords
Number of paragraphs:	16
VID 234 of 2009
Counsel for the Applicant:	Ms K Thomas
Solicitor for the Applicant:	Fisher Jeffries
Counsel for the Respondent:	Ms A Austin
Solicitor for the Respondent:	Baker & McKenzie
VID 244 of 2009
Counsel for the Applicant:	Ms A Austin
Solicitor for the Applicant:	Baker & McKenzie
Counsel for the Respondent:	Ms K Thomas
Solicitor for the Respondent:	Fisher Jeffries

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION	VID 234 of 2010

BETWEEN:	APC MARINE PTY LTD (ACN 119 763 012) Applicant
AND:	THE SHIP "APC AUSSIE 1" Respondent

JUDGE:	BROMBERG J
DATE OF ORDER:	1 JUNE 2011
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

1. The applicant’s notice of motion of 28 April 2011 be dismissed.
2. The applicant pay the respondent’s costs of the motion.
   

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION	VID 244 of 2009

BETWEEN:	T-D JOINT VENTURE PTY LTD (ACN 124 308 685) Applicant
AND:	APC MARINE PTY LTD (ACN 119 763 012) Respondent

JUDGE:	BROMBERG J
DATE OF ORDER:	1 JUNE 2011
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

1. The respondent’s notice of motion of 28 April 2011 be dismissed.
2. The respondent pay the applicant’s costs of the motion.
   

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION	VID 234 of 2009

BETWEEN:	APC MARINE PTY LTD Applicant
AND:	THE SHIP "APC AUSSIE 1" Respondent

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION	VID 244 of 2009

BETWEEN:	T-D JOINT VENTURE PTY LTD Applicant
AND:	APC MARINE PTY LTD Respondent

JUDGE:	BROMBERG J
DATE:	1 JUNE 2011
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

INTRODUCTION

1. By notice of motion dated 28 April 2011 filed in each of these proceedings, APC Marine Pty Ltd ("APC") seeks a review of a decision of a Deputy District Registrar of the Court ("the Taxing Officer"), made on 31 March 2011 ("the decision"). The decision is a reconsideration decision made pursuant to O 62 r 42 of the Federal Court Rules. Pursuant to O 62 r 44 of the Rules, APC seeks the review of the decision in relation to:

(1) the allowance made for general care and conduct; and

(2) the awarding of the costs of taxation in favour of the respondent.

2. T-D Joint Venture Pty Ltd (“T-D Joint Venture”) is the respondent to each motion.
3. For the reasons that follow I have determined to dismiss the motion filed in each proceeding.

THE LEGAL PRINCIPLES

4. The general principles applicable on judicial review of a taxing officer’s decision are not in contest. Those principles were considered in Australian Coal and Shale Employees Federation v Commonwealth [1953] HCA 25; (1953) 94 CLR 621 at 627-629. Where, as in this case, the discretion of the taxing officer is challenged and no error of principle is raised, the court will not generally interfere unless the discretion has been exercised in a manner which is manifestly wrong. Where the question is one of amount only, the court will only interfere “in an extreme case”: Australian Coal and Shale at 629.
5. As Kitto J recognised in Australian Coal and Shale at 627, discretionary error is to be identified by reference to House v The King principles set out in House v The King [1936] HCA 40; (1936) 55 CLR 499 at 504-505. Discretionary error will be found where the decision maker has acted upon a wrong principle, given weight to extraneous or irrelevant matters, failed to give weight or sufficient weight to relevant considerations, mistaken the facts or where the result is so unreasonable or plainly unjust that it is open to infer that there has been a failure to properly exercise the discretion.

THE ALLOWANCE FOR GENERAL CARE AND CONDUCT

6. APC complains that the Taxing Officer allowed for general care and conduct twice the maximum of the National Guide to Discretionary Items in Bills of Costs (“the Guide”) for Item 41 of Schedule 2 of the Rules, in circumstances that did not warrant either:
   • an allowance in excess of that commonly allowed (being 20%); or
   • such an excessive mark-up.
7. Item 41 of Schedule 2 of the Rules provides that:

If the case or circumstances warrant it, an allowance may be claimed under this item, in addition to any other item that appears in this scale, for general care and conduct (if appropriate) including the following:

(a) the complexity of the matter and the difficulty and novelty of questions raised;
(b) the importance of the matter to the party and the amount involved;
(c) the skill, labour, specialised knowledge and responsibility involved in the matter on the part of the solicitor;
(d) the number and importance of the documents prepared or perused, without regard to length;
(e) the time taken by the solicitor;
(f) research and questions of law and fact.

8. The Taxing Officer was well aware of the Guide. At [9] of his reasons for decision, the Taxing Officer said:

It should also be noted that the National Guide to Discretionary Items is merely a guide promulgated pursuant to O 62 r 46(5). It does not purport to bind taxing officers. Indeed, it states expressly that:

The guide is not, however, to be regarded as limiting the taxing officers’ discretion to allow higher or lower fees if it is considered appropriate. Similarly, the guide is not to be regarded as limiting the taxing officers’ discretion as to the methodology by which those fees are quantified.

Plainly, it is open to a taxing officer to grant an allowance for general care and conduct in whatever amount he or she considers appropriate. The range must not be seen as an inflexible one (see Titan v Babic (unreported, Federal Court of Australia, 11 October 1995, per Finn J)). The discretion must, of course, be exercised judicially.

9. The Taxing Officer was of the view that there were significant and urgent matters arising in each proceeding. In his view, those matters justified an allowance pursuant to Item 41 at the rate of 40%. That view was based on the observations made at [7] of the Taxing Officer’s reasons for decision which are in the following terms:

It is useful to note at the outset that in my opinion, there were significant and urgent matters arising in each proceeding. In VID 234/2009, APC sought a warrant for the arrest of the ship “APC Aussie 1” in connection with a claim for $1,725,000 plus interest or damages (see APC Marine Pty Ltd (ACN 119 763 012) v The Ship “APC Aussie 1” [2009] FCA 690 (“APC Marine”), at [1], and [17]). The charter rate for the ship appears to have been $75,000 per day (APC Marine at [9] and [20]). In VID 244/2009, TD sought and obtained an interlocutory injunction against APC in respect of the same ship. Both applications were filed on the same day; 9 April 2009. Both applications were heard and determined quickly. Although Ryan J noted that “[a]t the heart of the litigation is a straightforward question of whether the charter of the Ship has effectively been brought to an end” (APC Marine at [2]), this in no way derogates from either the significance or the urgency of the proceedings.

10. APC contends that there is manifest error in the Taxing Officer’s assessment of the nature of the litigation before Ryan J. It says that these proceedings were not any more significant or urgent than other cases that come before the Court. Secondly, APC contends that, if there was special significance or urgency, that was otherwise catered for by allowances in the Bills of Costs for:
    • the costs of a team of solicitors and counsel being assigned to the matter;
    • the involvement of both junior and two senior counsel; and
    • counsel generally charging fees for full days despite the appearances in court for part of the day.
      

APC seems to accept that a 20% allowance would have been appropriate. The monetary differential between a 20% allowance and a 40% allowance in this case is in the order of $3,000.

11. I am not satisfied that the Taxing Officer’s decision is infected by manifest error. APC has failed to demonstrate any discretionary error by reference to House v The King principles. I am not satisfied that the Taxing Officer failed to recognise the volume of work performed by counsel in determining the appropriate amount for general care and conduct of the solicitors. The Taxing Officer was aware of the Guide and recognised it correctly as a guide. The Guide, under a heading “Common Approach”, identifies that a percentage in the range of zero to 20% is commonly allowed, but also recognises that where a matter is of particular complexity, having regard to all of the considerations set out in Item 41, a percentage in excess of 20% may be allowed.
12. In my view, there is no manifest error demonstrated in the characterisation by the Taxing Officer of the proceedings as significant and urgent matters. In addition to the matters expressly relied upon by the Taxing Officer which I have set out above, I note the proceedings were effectively dealt with by a speedy trial which took place within a week of the commencement of the proceedings. The compact nature of the trial is clearly a matter which must have added urgency and complexity to the tasks required of the solicitors for both parties beyond that which would ordinarily attend a trial that was not conducted as speedily as was the case here.
13. Item 41 recognises that some matters that come before the Court will be more significant and more difficult than others. Matters involving complexity and urgency and which are to be regarded as significant will often justify the exercise of the taxing officer’s discretion to allow for higher fees. It is appropriate that considerations of that kind be dealt with on a case-by-case basis, utilising the specialist knowledge and expertise of a taxing officer. Manifest error is not demonstrated by a comparison with costs awarded in other cases, as APC has here contended. Further, the question here is one of amount only. This is not an “extreme case” in which the Court’s own assessment should cause the taxing officer’s exercise of discretion to be effectively set aside.

COSTS OF TAXATION

14. APC contends that the Taxing Officer should have exercised his discretion in awarding the costs of taxation in favour of APC, or alternatively by making no order as to the costs of the taxation. The basis of this contention is that the Taxing Officer erred in stating in his reasons for decision that he had not been provided with a history of costs negotiations and ‘in principle’ offers of settlement, when such correspondence was summarised and tabled at the taxation held on 15 September 2010.
15. The difficulty with this contention is that APC has put no evidence before me that the Taxing Officer had been provided with the material that APC now contends he was. Nor has that material been put before the Court. There is thus no evidentiary basis before me upon which I could come to the view that the Taxing Officer’s decision is infected by manifest error in this regard and nor do I have a basis to reconsider the question in the absence of that material.

CONCLUSION

16. For all of those reasons, I will dismiss APC’s notice of motion in each of the proceedings and order that the costs of T-D Joint Venture be paid by APC.
    

I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Bromberg.

Associate:

Dated: 15 June 2011