Atanaskovic v Birketu Pty Ltd [2023] NSWCA 312

Atanaskovic v Birketu Pty Ltd [2023] NSWCA 312

By majority, the Court held that in New South Wales, partners of an unincorporated law firm who obtain a costs order in their favour are entitled to recover costs with respect to work done by solicitors employed by the partnership. This is because the statutory definition of 'costs' includes 'remuneration', and nothing in the relevant principles or statutory text excludes remuneration for work done by employed solicitors from recoverable costs. The employed solicitor rule is an application of the general indemnity principle and is not limited only to corporations or government entities. The contrary Victorian Court of Appeal decision was not followed.

Jurisdiction
Australia
Judgment Date
15 December 2023
Procedural Posture
Appeal / Court of Appeal Final Judgment
Outcome
Appeal allowed by majority (Kirk JA, Simpson AJA; Ward P dissenting). Leave to appeal granted if necessary. Orders of the primary judge were set aside and substituted with dismissal of the summons with costs in favour of the defendants. The first and second respondents to pay the appellants' costs of the appeal.
Legal Topics
['self Represented Litigants' 'recoverability of Costs' 'employed Solicitor Rule' 'chorley Exception' 'professional Costs' 'civil Procedure Act Interpretation' 'indemnity Principle' 'unincorporated Law Firms' 'costs Orders']
['costs' 'civil Procedure'] ['self Represented Litigants' 'recoverability of Costs' 'employed Solicitor Rule' 'chorley Exception' 'professional Costs' 'civil Procedure Act Interpretation' 'indemnity Principle' 'unincorporated Law Firms' 'costs Orders']

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Procedural Posture

Appeal / Court of Appeal Final Judgment

Legal Issues

  1. 1 ['Whether partners of an unincorporated law firm can recover costs for work done by employed solicitors of that firm in litigation involving the partners.' 'Interpretation of the employed solicitor rule and its applicability to law firm partnerships post Bell Lawyers v Pentelow.']

Ratio Decidendi

By majority, the Court held that in New South Wales, partners of an unincorporated law firm who obtain a costs order in their favour are entitled to recover costs with respect to work done by solicitors employed by the partnership. This is because the statutory definition of 'costs' includes 'remuneration', and nothing in the relevant principles or statutory text excludes remuneration for work done by employed solicitors from recoverable costs. The employed solicitor rule is an application of the general indemnity principle and is not limited only to corporations or government entities. The contrary Victorian Court of Appeal decision was not followed.

Court Disposition

Appeal allowed by majority (Kirk JA, Simpson AJA; Ward P dissenting). Leave to appeal granted if necessary. Orders of the primary judge were set aside and substituted with dismissal of the summons with costs in favour of the defendants. The first and second respondents to pay the appellants' costs of the appeal.

Orders

  • ['If leave be necessary, grant leave to appeal.' 'Appeal allowed.' "Set aside the orders made by the primary judge on 26 October 2022 and in lieu thereof make the following orders: (a) The summons filed on 2 August 2022 is dismissed; (b) The plaintiffs are to pay the defendants' costs." "The first and second...