Langbein v Mottershead Investments Pty Ltd (No 2)

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judge: STEWART J
• Judgment Date: 19 February 2020
• Neutral Citation: [2020] FCA 188
• Date: 19 February 2020

FEDERAL COURT OF AUSTRALIA

Langbein v Mottershead Investments Pty Ltd (No 2) [2020] FCA 188

Appeal from:	Mottershead Investments Pty Ltd v Aircraft Support Industries Engineering Pty Ltd (in liquidation) and Ors [2019] FCCA 1375
File number:	NSD 1157 of 2019
Judge:	STEWART J
Date of judgment:	19 February 2020
Date of publication of reasons:	24 February 2020
Catchwords:	PRACTICE AND PROCEDURE – security for costs of appeal – respondent’s application for increase in security previously ordered – provision for costs of senior counsel – previously rejected – no change in circumstances justifying reopening previous decision – fact of appellant briefing senior counsel not relevant change in circumstances – application dismissed
Legislation:	Federal Court Rules 2011 (Cth) Sch 1, 3
Cases cited:	Langbein v Mottershead Investments Pty Ltd [2019] FCA 1619 Lumley Life Ltd v IOOF of Victoria Friendly Society (unreported, Federal Court of Australia, 23 April 1992, Case No. G354/1989) Stanley v Phillips [1966] HCA 24; 115 CLR 470
Date of hearing:	19 February 2020
Registry:	New South Wales
Division:	General
National Practice Area:	Commercial and Corporations
Sub-area:	Commercial Contracts, Banking, Finance and Insurance
Category:	Catchwords
Number of paragraphs:	21
Counsel for the Appellant:	J T Johnson
Solicitor for the Appellant:	JT Law
Counsel for the Respondent:	S Bell
Solicitor for the Respondent:	Terrett Lawyers

ORDERS

		NSD 1157 of 2019
BETWEEN:	MARK CALVIN LANGBEIN Appellant
AND:	MOTTERSHEAD INVESTMENTS PTY LTD ACN 119 740 304 Respondent

JUDGE:	STEWART J
DATE OF ORDER:	19 FEBRUARY 2020

THE COURT ORDERS THAT:

1. The respondent’s interlocutory application filed on 11 February 2020 is dismissed.

2. The costs of the interlocutory application referred in Order 1 are costs in the appeal.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

(Delivered ex tempore)

STEWART J:

1. This is an interlocutory application in an appeal from the Federal Circuit Court. The respondent in the appeal previously applied for security for costs for the appeal. See Langbein v Mottershead Investments Pty Ltd [2019] FCA 1619. I ordered that the appellant give security for the respondent’s costs in the appeal in the sum of $30,000. That security was subsequently furnished.

2. The respondent now applies to increase that sum by a further $15,750. That additional sum has the following elements.

3. First, the respondent seeks the sum of $3,150 in respect of costs thrown away by an amended notice of appeal filed by the appellant. The respondent contends that the amended notice of appeal entirely replaces the first notice of appeal, which has now become redundant. On the Court granting leave for the amended notice of appeal to be filed, an order was also made that the appellant pay the costs thrown away.

4. The respondent seeks to justify the sum claimed with reference to the costs of a solicitor and of junior counsel conducting correspondence, conferences and attendances amounting to five hours each. That time is not sought to be justified in any further way. It is not explained how that time was spent.

5. In my experience, it is common for a notice of appeal to be amended, and even to be amended in a form that results in an essentially new notice of appeal. The amended notice of appeal was filed at a time prior to the appeal books or submissions being prepared. Notice of it was also given some months before a notice of contention was filed. In the circumstances, it is not apparent what work the respondent reasonably undertook in relation to the original notice of appeal that became wasted on the filing of the amended notice of appeal, or why that work is not covered by the original estimate of work in respect of which an amount of security for costs has already been awarded.

6. In those circumstances, I am not persuaded that an increase in security for costs on account of the amended notice of appeal is justified. Of course, that does not prevent such costs as are properly claimable being claimed on taxation in due course, regardless of the outcome of the appeal.

7. Secondly, the respondent seeks the sum of $12,600 in respect of senior counsel. Previously I disallowed the costs of senior counsel in addition to junior counsel from the respondent’s schedule of estimated costs on the appeal on the basis that I was not satisfied that it was justifiable to brief senior counsel.

8. The respondent seeks to reopen that issue on the grounds that the appellant has now indicated that it will brief senior counsel – what is sauce for the goose is sauce for the gander is the approach that is urged on me.

9. Costs as between party and party are defined in Schedule 1 to the Federal Court Rules 2011 (Cth) (FCR) as being only the costs that have been “fairly and reasonably incurred”. Further, Schedule 3 to the FCR in item 16.1 provides that an amount may be allowed for counsel’s fees according to the circumstances of the case. That amount may be assessed by reference to the National Guide to Counsel Fees.

10. In Lumley Life Ltd v IOOF of Victoria Friendly Society (unreported, Federal Court of Australia, 23 April 1992, Case No. G354/1989) Lockhart J said the following with regard to the costs of senior and junior counsel (at 4):

The Federal Court is at the threshold of new Commonwealth law and there are very few contested cases which have come before me for hearing in nearly 13 years on this Bench where the attention of senior counsel would not have been justified. This is a s 52 case and the legal principles which govern s 52 are generally well-established, but there are still grey areas which will call for future decisions of principle. The factual issues in the present case were complex and legal issues were not easy. There was no novel point, but there were points of importance and there was a volume of material to be handled in the case. It is true that the total claim for damages by Lumleys was $137,000, but the basic case was over an injunction and the injunction of course was the only matter in issue in the interlocutory proceedings. It is true that only one counsel was briefed by Lumley, namely, junior counsel, but that says nothing as to whether it was proper for IOOF (or Lumley for that matter) to retain two counsel. The taxing officer erred in principle in not allowing senior counsel’s fees.

11. Lockhart J referred to Stanley v Phillips [1966] HCA 24; 115 CLR 470 with regard to the principles governing counsel’s fees on taxation. At that time the rule was that senior counsel could not appear except if accompanied by a junior so the question of the justification for briefing senior counsel was sometimes expressed in terms of whether it was justified that two counsel (i.e. a senior and a junior) were briefed. Relevant considerations are nevertheless...