Costs
Unincorporated law firm – In-house lawyer rule
In Birketu Pty Ltd v Atanaskovic [2025] HCA 2(5 February 2025) (Birketu), the High Court dismissed an appeal from the Court of Appeal of the NSW Supreme Court.
The High Court in Birketu was required to resolve the position as to the right to recover legal costs of employed solicitors. This decision represents an important clarification of the law and overruled the Victorian Court of Appeal decision in United Petroleum Australia Pty Ltd v Herbert Smith Freehills [2020] VSCA (United Petroleum) (at [8]).
The High Court considered the question of recovery of costs in Bell Lawyers Pty Ltd v Pentelow [2019] HCA 29 (Bell Lawyers).There are two exceptions:
- the “Chorley exception”, where a self-represented solicitor can recover fees for work undertaken on their own behalf
- the “in-house lawyer rule” or “in-house solicitor rule”, where a litigant can recover fees for legal work undertaken by an employed lawyer on their behalf (at [18]).
A self-represented litigant has no right to recover legal costs of litigation (at [18]). This is also the position for a principal of a firm who represents the firm in litigation.
Mr Atanaskovic and Mr Jepps are the only two partners in the law firm Atanaskovic Hartnell (AH), an unincorporated legal practice (at [3]). AH successfully sued former clients Birketu Pty Ltd and WIN Corporation Pty Ltd for recovery of fees and costs. In doing so, AH claimed the amount of about $500,000 in fees for work done by an employed solicitor (at [5]).
At first instance in the NSW Supreme Court, Brereton JA applied United Petroleum finding for the appellants, which was subsequently overturned by the Court of Appeal.
The High Court held:
“To adopt the approach preferred by the Victorian Court of Appeal in United Petroleum and by Brereton JA and Ward P in the present case, and thereby to deny the entitlement of a litigant solicitor or unincorporated law firm to recover costs of work done by their employed solicitors, would be to depart from the application of the general common law principle” (at [27]).
Migration
Injunctions – Unlawful non-citizen
In Minister for Immigration and Multicultural Affairs v MZAPC [2025] HCA 5 (5 March 2025), the High Court by majority dismissed an appeal from the NSW Supreme Court, with costs.
The respondent, an unlawful non-citizen in detention in Australia, sought a declaration that a commonwealth officer had exceeded their powers by declining to refer to the Minister for Immigration and Multicultural Affairs (Minister) a request under s195A of the Migration Act 1958 (Cth). The respondent also sought an injunction in the Federal Court of Australia to restrain the Minister from removing them from the country, pending the outcome of their case.
The Minister unsuccessfully appealed the matter to the Full Court, which dismissed the appeal thereafter to the High Court.
The High Court cited the decision in Tait v The Queen [1962] HCA 57 and held:
“The principle apposite to the present case is the power of a court to protect the integrity of its own processes by ensuring its capacity to effectively exercise its jurisdiction invoked in a proceeding pending before it” (at [25]).
Criminal law
Mental impairment – Supervision orders
In KMD v CEO (Department of Health NT) [2025] HCA 4 (27 February 2025), the High Court unanimously allowed an appeal from the Court of Criminal Appeal of the Northern Territory (NTCCA) (at [1]). The appellant appeared in person.
In 2013, KMD was charged with offences, found unfit to be tried and then subsequently found not guilty by reason of mental impairment (at [10]). Where a court makes such a finding, it is required to declare that either the accused is liable to supervision or to be released unconditionally pursuant to the Criminal Code Act 1983 (NT) (Code). Such a restriction on liberty must be kept to a minimum, pursuant to s43ZM of the Code.
In addition, pursuant to s43ZN(2)(a), the Court must consider two reports from a psychiatrist or other expert.
Under the Code, a non-custodial supervision order (NCSO) allows the subject to live in the community, in contrast to a custodial supervision order (CSO).
In 2014, KMD was placed on a CSO with periodic reviews, undertaken in 2017 and 2021, which confirmed the CSO. The primary judge commenced a third periodic review in November 2021 (at [11]). The consultant psychiatrist for the NT’s Department of Health Mental Health team gave evidence that KMD refused to be assessed by them (at [13]). The primary judge published a preliminary decision in September 2022 and made orders for certain reports to be filed, noting that, although there was a risk of KMD in the community, whether KMD posed a risk to the community or to themselves would depend on the supports within the community (at [12]).
Having not been satisfied that KMD posed a serious risk either to themselves or the community, on 7 July 2023 the primary judge revoked the CSO and made a NCSO (at [16]).
The CEO successfully appealed to the NTCCA, in part on the grounds that the finding was “not reasonably open” based on the evidence (at [17]).
KMD appealed to the High Court, which held that KMD was under no obligation to comply with the medical assessment:
“While it may be informative for a review of a CSO, and even in the best interests of persons such as KMD to cooperate with experts whose reports inform a review, nothing in those provisions or any other provision of Pt IIA [of the Code] makes such cooperation a prerequisite to the preparation of their reports, much less the conduct of the review under s43ZH” (at [25]).
The effect of the High Court’s decision was to set aside the Court of Appeal’s orders, setting aside the CSO. The NCSO was restored, subject to a stay of 14 days.
