Cost Law Commentary

Expert witnesses in security for costs

Cost Lawyers are increasingly engaged as expert witnesses in security for cost applications, applications for assessment of costs on a gross sum basis, and disciplinary proceedings. In my experience, there are some special considerations for litigators engaging a cost lawyer as an expert.  They are generally the same considerations regarding engaging any expert, but sometimes are overlooked, perhaps because the involvement is the engagement of another lawyer, as it treated like the engagement of counsel.

The following matters should be considered:

  • It should be made clear that the Cost Lawyer is being engaged as an expert, with the relevant expert witness guidelines provided.
  • The questions to be addressed by the expert should be clearly articulated in the letter of engagement.
  • The limits of expertise of the Cost Lawyer should be considered.  Not all Cost Lawyers practice in every area of litigation.  For example, one who specialises in personal injury work may not be qualified to express an opinion on the reasonableness of the work projected to be undertaken in an intellectual property dispute or shareholder class action.
  • The Cost Lawyer is unlikely to have expertise to express an opinion about the merits of the application itself, nor is this likely to be a matter appropriate for the expert in any event, but rather is a matter for submissions and for the Court.
  • The information and materials provided to the Cost Lawyer may be subject to production to the Court or other parties.  Particularly where security is being sought for past work, consideration must be given as to what information is made available to the Cost Lawyer, having regard to possible issues of privilege.  This was considered in Strategic Financial and Project Services Pty Ltd & Anor v Bank of China Ltd & Anor[1], where the defendants were ordered to produce redacted versions of invoices which had been provided to their expert witness in a security for costs application, for the purpose of provision to the plaintiffs’ expert.

Care should be taken to ensure the Cost Lawyer understands his or her role is as an independent expert, rather than as an advocate.[2]  It can be difficult for a lawyer, who is often an advocate, to adopt the neutral position required on an independent expert.

Similarly, it is not to the role of the expert to provide advice about the merits of the substantive application and how it should be conducted.  However, it is appropriate for the expert to advise of instructions, further materials or information required to prepare their report.

[1] [2012]FCA 327

[2] Sunland Waterfront (BVI) Ltd & Anor v Prudentia Investments Pty Ltd & Ors (No 4) [2013] VSC 669