Cost Law Commentary

Retrospectivity and Amendments to Victorian Supreme Court cost rules

Statutory Rule 142 of 2012 introduced significant amendments to the Supreme Court Rules relating to costs and a radically different scale of costs, including a scale of costs for counsel's fees.  The amendments and scale have effect from 1 April 2013. Rule 63.90 is headed ‘Transitional provisions’ and is in the following terms:

For the avoidance of doubt, these Rules, as amended by the Supreme Court (Chapter 1 New Scale of Costs and Other Costs Amendments) Rules 2012, apply to all things done or required to be done or omitted to be done on or after 1 April 2013 in, or in relation to, any proceeding in the Court, including the Costs Court (including all work and all amendments, applications and orders), regardless of the date of commencement of the proceeding.

The rule was considered by Sifris J in Jane v Bob Jane Corporation Pty Ltd & Anor (No 2)[1] (Bob Jane) and by Ass J Wood in Metlife Insurance Ltd v Montclare[2] (Metlife).

In both cases, it was argued that the amendments were procedural, and as such, had retrospective effect[3].  In Metlife, the applicant argued that, prima facie, an amendment had prospective effect only and a procedural amendment was only retrospective insofar as it did not change the legal character, or legal consequences of events, facts or transactions which occurred before the commencement of the amending enactment[4]

Ass J Wood referred to s 14(2)(a), (e) and (g) of the Interpretation of Legislation Act 1984 (Vic), providing that an amendment to a provision cannot affect any accrued right or affect any legal proceeding unless there is a clear contrary intention.

He held that the clear intent of Rule 63.90 was to “differentiate between events pre and post 1 April 2013”, and that the new rules were to apply to “all things done arising from orders made after 1 April 2013”.

The distinction draw by His Honour regarding things done arising from orders made after 1 April 2013 may be important, particularly in regard to disallowance of costs where a bill is reduced by more than 15% (see below for further discussion).

The Bob Jane decision looked at whether the new scale had retrospective operation.  Sifris J found that it did not.  The Metlife decision considered whether the new standard test of cost recovery applied to work undertaken prior to 1 April 2013.  Wood AssJ found that the old “necessary or proper” test applied to work undertaken pre 1 April 2013 with the new “reasonable” test applying to work after that date.

[1] [2013] VSC 467

[2] (unreported), 4 September 2013)

[3] Maxwell v Murphy [1957] HCA 7(1957) 96 CLR 261; Victrawl Pty Ltd v Telstra Corp Ltd [1995] HCA 51(1995), 183 CLR 595; Rodwayv R [1990] 169 CLR 515

[4] Ku-Ring-Gai Municipal Council v Attorney General (NSW) [1957] 99 CLR 251; Fisher v Hepburn Ltd [1960] 105 CLR 188