Practitioners should be aware of the recent decision of Thompson v Cavalier King Charles Spaniel Rescue (Qld) Inc [2024] QSC 197 which concerned disputes about a costs assessment process involving the assessment of costs between parties to litigation and the entitlement to claim privilege over documents, while still claiming costs associated with those documents.
Muir J expressed support for a process whereby if a party having their costs assessed elects to disclose privilege documents to a costs assessor, these documents must also be provided to the party liable to pay those costs. If this party exercises their right to non-disclosure of privileged documents, the costs assessor will have to decide any contested items on the evidence before him, without drawing adverse inferences from the failure to produce the privileged documents.1
Her Honour reached this conclusion despite noting “(t)he preservation of both confidentiality and legal professional privilege in cases where documents have been provided to the costs assessor is crucial to the principles of procedural fairness”,2 and despite section 79 of the Civil Proceedings Act 2011 (Qld), which provides privilege continues despite disclosure to a costs assessor.
In relation to this provision, Muir J contented, at paragraph 13, that it “appears to be more relevant perhaps to solicitor-client costs assessments where both parties have seen the privileged material and therefore disclosure of the material to the costs assessor does not constitute a waiver of privilege.
Her Honour also made reference to rule 720(2)(b) of the Uniform Civil Procedure Rules 1999 (Qld) which requires that the procedure adopted by the costs assessor must be consistent with the principles of natural justice.
In making these findings, her Honour confirmed the views of the High Court of Australia in Giannarelli v Wraith (No 2) (1991) 171 CLR 592 in relation to how privilege is dealt with in the costs assessment process.
Muir J concluded that “the outcome may be imperfect but the rules of natural justice triumph”3 and found that unless there is an informal agreement between the parties, aka, ‘information asymmetry’ (which was not the case here), then the principles of natural justice should be upheld, meaning that a party is entitled to see what the other is using to base their claims for costs on.4
Some practice suggestions are:
(a) Consider the context for the order / right to claim costs. Is it an interlocutory order, are there related proceedings, are there any appeals pending/likely or is it part of a series matters or alternatively has the matter concluded? Practitioners need to ensure that when they deliver documents to the costs assessor, any privileged documents are removed.
(b) Consider whether you can prove the claim for costs other than by producing the document.
Footnotes
1 Thompson v Cavalier King Charles Spaniel Rescue (Qld) Inc [2024] QSC 197 at paragraph 23.
2 Ibid at paragraph 12
3 Ibid at paragraph 21
4 Ibid at paragraphs 17 and 18.
This article was contributed by QLS Principal Policy Solicitor Kate Brodnik and Litigation Rules Committee members Paul Garrett and Tony Deane.
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