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[2025] NSWSC 953
General information, not legal advice.
Supreme Court of NSW
2025-08-21
McGrath J
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Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: All is 1 Pty Ltd t/as Banga Legal v Townsend [2025] NSWSC 953
Hearing dates: 15 August 2025
Date of orders: 21 August 2025
Decision date: 21 August 2025
Jurisdiction: Equity - Applications List
Before: McGrath J
Decision: Law firm to be restrained from acting for defendant
Catchwords: LEGAL PRACTITIONERS – Solicitors – Conflict of interest and duty – whether firm should be restrained from acting for defendant – whether former consultant solicitor possessed confidential information of and about plaintiffs – solicitor’s knowledge of litigation strategies, personality and vulnerabilities – professional and personal relationship between solicitor and plaintiffs – solicitor subsequently employed by firm acting for defendant – risk of forensic advantage – where solicitor likely to be witness – whether fair-minded reasonably informed member of community would regard proper administration of justice as requiring firm to be prevented from acting – freedom of party to retain solicitor of choice – HELD – restraint granted
Cases Cited: Byrne v Production Magic Pty Ltd [2012] ACTSC 6
Kallinicos v Hunt (2005) 64 NSWLR 561; [2005] NSWSC 1181
Li v Jin Lian Group Pty Ltd [2018] NSWSC 479
Mitchell v Burrell [2008] NSWSC 772
Re Edgecliff Car Rentals Pty Ltd (deregistered) [2017] NSWSC 244
Spincode Pty Ltd v Look Software Pty Ltd (2001) 4 VR 501; [2001] VSCA 248
Category: Procedural rulings
Parties: All is 1 Pty Ltd t/a Banga Legal (First Plaintiff)
Samir Banga (Second Plaintiff)
Jessica Townsend (Defendant)
Representation: Counsel:
M Zammit (First and Second Plaintiff)
P Brozek (Defendant)
Solicitors:
Azadi Lawyers (First and Second Plaintiff)
Solve Legal (Defendant)
File Number(s): 2025/00119763
Publication restriction: Nil
This application brings two countervailing principles into direct clash: the freedom of choice of a party to have a particular solicitor act for them in proceedings and the right of the opposing party to restrain that solicitor from acting for that party.
The application is brought by the plaintiffs, ALL IS 1 Pty Ltd (trading as Banga Legal) and Samir Banga (the principal solicitor at Banga Legal), by notice of motion filed 11 July 2025 to restrain Solve Legal Pty Ltd (trading as Solve Legal) from acting for the defendant, Jessica Townsend (a former employed solicitor at Banga Legal), in these proceedings.
On 28 March 2025, Banga Legal and Mr Banga commenced the proceedings by filing the summons seeking to restrain Ms Townsend on an interlocutory and final basis from disclosing confidential information in breach of alleged contractual and fiduciary duties owed by Ms Townsend to Banga Legal.
Solve Legal currently act as the solicitors for Ms Townsend in these proceedings.
The basis on which Banga Legal and Mr Banga say that Solve Legal should be restrained from acting for Ms Townsend is that Cameron Shamsabad formerly worked as a consultant solicitor at Banga Legal, during which he came into possession of confidential information about Mr Banga, and he was subsequently employed as a solicitor by Solve Legal acting for Ms Townsend in these proceedings.
For the reasons set out below, I have determined that Solve Legal should be restrained from continuing to act for Ms Townsend in these proceedings.
d. You must only use confidential information for Banga Legal’s benefit and in the proper performance of your obligations under this agreement;
e. You agree you will never disclose or divulge any confidential information without Banga legal’s prior written consent. This includes during and after your contract ends.
The “confidential information” included, but was not limited to, “all intellectual property and business processes that you learn in Banga Legal” (cl 1 on page 2) and “information contained in a document, or any software that is the property of the employer and which is by its nature confidential to us and/or our business and/or to any of our customers” (cl 5(a) on page 4).
Mr Banga says that he supervised Mr Shamsabad on numerous matters. Mr Banga also states that he and Mr Shamsabad worked closely together and discussed appropriate litigation strategy in the preparation and execution of legal matters. Mr Banga said that this extended to obtaining advice from counsel, the issuing of subpoenas, which witnesses would be used, what defences raised and what potential legal points arose. Mr Banga said that Mr Shamsabad “was very much aware through this experience of how I deal with matters”. There was no contradicting evidence from Mr Shamsabad to any of these matters.
Mr Banga also said:
My wife and I have entertained Mr Shamsabad and his wife at our home for dinner, drinks and to discuss family and other matters. Mr Shamsabad also attended my engagement party. Mr Shamsabad was able to observe me and my wife’s personalities including our vulnerableness and [reactions] to certain matters.
Mr Banga is married to Mansheel Gill, who Mr Banga anticipates will be a witness in these proceedings.
From October 2022, Ms Townsend also worked at Banga Legal, initially as a volunteer and then as a solicitor on contract until 5 December 2024, before taking a permanent position from 6 December 2024 to 29 January 2025.
In February 2023, Mr Banga assigned Ms Townsend to act for him in a sensitive private matter (Private M****atter). Ms Townsend was responsible for briefing counsel and appearing in court on the Private Matter.
Banga Legal and Mr Banga allege that, in the course of acting for Mr Banga in the Private Matter, Ms Townsend disclosed details of the Private Matter to various persons, including current employees of Banga Legal.
On 8 August 2022, after Mr Shamsabad ceased working for Banga Legal, Mr Shamsabad commenced to be employed as a solicitor at Solve Legal. The principal of Solve Legal is Kyle Kutasi, holding the position of Legal Practitioner Director. Solve Legal has 11 employed solicitors in addition to Mr Kutasi. One of the employees of Solve Legal is Pawel Brozek.
In about March 2024, Mr Kutasi had a conversation with Mr Shamsabad in which Mr Shamsabad said he had been contacted by Ms Townsend who wanted to obtain some employment law advice in relation to her employment at Banga Law as a contractor. Mr Kutasi told Mr Shamsabad that he could “go for it” in acting for Ms Townsend, which I infer to be in his position as a solicitor at Solve Legal. Mr Kutasi said that as Mr Shamsabad had effectively introduced Ms Townsend to Solve Legal and Mr Shamsabad was keen to work on the matter, Mr Kutasi saw no reason why he should not. Ms Townsend then continued to consult with Mr Shamsabad intermittently.
On 28 March 2025, Banga Legal and Mr Banga filed the summons commencing these proceedings.
Mr Shamsabad then worked as a solicitor at Solve Legal for Ms Townsend in these proceedings, including by:
appearing with Mr Kutasi at the hearing of the interlocutory application on 3 April 2025;
being involved in negotiations with the counsel for Banga Legal and Mr Banga regarding the interlocutory application; and
being copied into correspondence about the proceedings.
Mr Shamsabad was also sent emails by Ms Townsend providing copies of emails sent by Shirin Razi of Adazi Lawyers (the solicitors for Banga Legal and Mr Banga) to Ms Townsend in relation to the Private Matter. The communications between Ms Townsend and Mr Shamsabad may mean that Mr Shamsabad will be a witness in these proceedings.
On 3 April 2025, during a recess in the hearing of the interlocutory application before Kunc J, Mr Kutasi and Mr Shamsabad met with counsel and the solicitors for Banga Legal and Mr Banga to seek to negotiate the terms of a proposed undertaking. During those negotiations, Mr Kutasi told those counsel and solicitors to “fuck off”. Before Kunc J, Mr Kutasi admitted to saying these words and apologised for doing so.
The foregoing authorities establish the following:
• During the subsistence of a retainer, where the court’s intervention to restrain a solicitor from acting for another is sought by an existing client of the solicitor, the foundation of the court’s jurisdiction is the fiduciary obligation of a solicitor, and the inescapable conflict of duty which is inherent in the situation of acting for clients with competing interests [Prince Jefri].
• Once the retainer is at an end, however, the court’s jurisdiction is not based on any conflict of duty or interest, but on the protection of the confidences of the former client (unless there is no real risk of disclosure) [Prince Jefri].
• After termination of the retainer, there is no continuing (equitable or contractual) duty of loyalty to provide a basis for the court’s intervention, such duty having come to an end with the retainer [Prince Jefri; Belan v Casey; Photocure; British American Tobacco; Asia Pacific Telecommunications; contra Spincode; McVeigh; Sent].
• However, the court always has inherent jurisdiction to restrain solicitors from acting in a particular case, as an incident of its inherent jurisdiction over its officers and to control its process in aid of the administration of justice [Everingham v Ontario; Black v Taylor; Grimwade v Meagher; Newman v Phillips Fox; Mitchell v Pattern Holdings; Spincode; Holborow; Williamson v Nilant; Bowen v Stott; Law Society v Holt]. Prince Jefri does not address this jurisdiction at all. Belan v Casey and British American Tobacco are not to be read as supposing that Prince Jefri excludes it. Asia Pacific Telecommunications appears to acknowledge its continued existence.
• The test to be applied in this inherent jurisdiction is whether a fair-minded, reasonably informed member of the public would conclude that the proper administration of justice requires that a legal practitioner should be prevented from acting, in the interests of the protection of the integrity of the judicial process and the due administration of justice, including the appearance of justice [Everingham v Ontario; Black v Taylor; Grimwade v Meagher; Holborow; Bowen v Stott; Asia Pacific Telecommunications].
• The jurisdiction is to be regarded as exceptional and is to be exercised with caution [Black v Taylor; Grimwade v Meagher; Bowen v Stott].
• Due weight should be given to the public interest in a litigant not being deprived of the lawyer of his or her choice without due cause [Black v Taylor; Grimwade v Meagher; Williamson v Nilant; Bowen v Stott].
• The timing of the application may be relevant, in that the cost, inconvenience or impracticality of requiring lawyers to cease to act may provide a reason for refusing to grant relief [Black v Taylor; Bowen v Stott].
[20] … I do not accept that the mere circumstance that a solicitor will be a material witness, even on a controversial matter, of itself justifies restraining the solicitor from continuing to act. As Windeyer J pointed out in Scallan v Scallan [2001] NSWSC 1078, it is, for example, not unusual for instructing solicitors in contested probate proceedings to give evidence of facts relevant to instructions for and execution of a Will. Similarly, in contested conveyancing proceedings, it is not unusual for solicitors who have acted on the conveyance to continue to act in the proceedings for specific performance or rescission and to give evidence in those proceedings. Accordingly, despite r 19 of The Law Society of New South Wales Professional Conduct and Practice Rules, which imposes a professional obligation (as distinct from a private right), I do not accept that in every case where a solicitor acting for a party is a material witness even on a controversial matter, the Court will restrain the solicitor from continuing to act. Although some observations of Campbell CJ in Chapman v Rogers; ex parte Chapman [1984] 1 Qd R 542 at 545, may go somewhat further, the cases indicate — as Campbell CJ did in that case itself — that the line is crossed only when the solicitor has a personal stake in the outcome of the proceedings or in their conduct, beyond the recovery of proper fees for acting, albeit that the relevant stake may not necessarily be financial, but involves the personal or reputational interest of the solicitor, as will be the case if his or her conduct and integrity come under attack and review in the proceedings. The presence of such circumstances will be a strong indication that the interests of justice — which in this field involve clients being represented by independent and objective lawyers unfettered by concerns about their own interests — require the lawyer to be restrained from continuing to act.
…
[25] … There are suggestions in some of the cases that where one solicitor in a firm is disqualified from acting, it need not invariably follow that the others are also disqualified. In Bahonko v Nurses Board of Victoria (No 3) [2007] FCA 491, Middleton J restrained an employed solicitor from continuing to act in a matter, but held that the firm by which she was employed was still at liberty to act. In Scallan, the solicitor who was a potential witness was a consultant to the firm (although he had been before then the firm’s longstanding senior partner), but that does not advance the matter very far, because no injunction was granted in any event. It is notable that, in both of those cases, it was an employed solicitor whose conduct was in question, albeit in Scallan one who had been recently a senior partner. Against that, most cases point to the view that, in this respect, the law treats a firm of solicitors as a single entity, so that if one partner is disqualified, the firm should not act [Chapman v Rogers; ex parte Chapman, 545; Bowen v Stott [2004] WASC 94, [66] (firm restrained from acting where one partner was likely to be a material witness); Kooky Garments Ltd v Charlton, 590 (cited with approval in Afkos Industries Pty Ltd v Pullinger Stewart (a firm) [2001] WASC 69, [15])]. In principle, given the incidents of the relationship of partnership (involving utmost good faith and loyalty between the partners), and those of solicitor and client (requiring any partner in a firm to do all in his or her power and use all knowledge and information available to them, including to their partners, to assist the cause of the client), it is difficult to see how, where one partner is disqualified, it could be acceptable for another partner in the same firm to continue to act.
[10] As to the claim of breach of confidence, it is useful to recall some basic principles. The elements of an action for breach of confidence are: first, identification with specificity, and not merely in global terms, of the information claimed to be confidential; second, the information which forms the basis of the confidence must have the quality of confidentiality; third, the confidential information must be disclosed in circumstances which impose on the recipient an obligation to respect the confidentiality of the information; and fourth, there is an actual or threatened misuse of that information by the recipient, without the consent of the plaintiff: Smith Kline & French Laboratories (Aust) Ltd v Secretary, Department of Community Services & Health (1990) 22 FCR 73 (Smith Kline & French) at 87 (Gummow J), citing Corrs Pavey Whiting & Byrne v Collector of Customs (Vic) (1987) 14 FCR 434 at 443 . See also Coco v AN Clark (Engineers) Ltd (1969) RPC 41 at 47; Interfirm Comparison (Australia) Pty Ltd v Law Society of New South Wales [1975] 2 NSWLR 104 at 117.
[11] With respect to the obligation of confidence, it is relevant to enquire whether the information was disclosed or imparted for a limited purpose: Castrol Australia Pty Ltd v EmTech Associates Pty Ltd (1980) 33 ALR 31 at 46; Ackroyds (London) Ltd v Islington Plastics Ltd (1962) RPC 97 at 101 and 104. Where information has been imparted for a limited purpose, the obligation is not to use or disclose that information for any other purpose. The obligation of confidence is imposed where the circumstances show that the recipient knew or ought to have known that the information was imparted for a limited purpose: Smith Kline & French at 95–96; Half Court Tennis Pty Ltd v Seymour (1980) 53 FLR 240 at 255; Coco v AN Clark (Engineers) Ltd at 48; Mense v Milenkovic [1973] VR 784 at 801.
[12] One further matter should be mentioned. JLG drew attention to the remarks of Hayne J in Farrow Mortgage Services Pty Ltd (in liq) v Mendall Properties Pty Ltd [1995] 1 VR 1 at 5 that:
Although it is necessary to be acutely conscious of the fact that the court is asked to interfere with the right of a litigant to be represented by the solicitor of the litigant’s choice, it is not necessary to conclude that harm is inevitable (or well nigh inevitable) before acting to restrain a possible breach of the duty that a solicitor owes to clients and former clients to keep confidential information given to the solicitor in confidence and not use that information against the interests of the client who gave it to the solicitor. …It is enough to say that I consider that injunction should go if there is a real and sensible possibility of the misuse of confidential information.
In Re IPM Group Pty Ltd [2015] NSWSC 240 at [33], Black J, after referring with approval to these remarks in Farrow Mortgage Services v Mendall Properties, went on to observe that the test of a real and sensible possibility of the misuse of confidential information was followed in Dealer Support Services Pty Ltd v Motor Trades Association of Australia Ltd [2014] FCA 1065 at [34] (Beach J). Mills Oakley and Mr Li did not dispute that this was the appropriate test in the present case.
[29] Mr Emmett accepted that neither he, nor Eugene or Angela, could point to any particular information that Mr Brown might have about Eugene’s and Angela’s “litigious character and tendencies” that Mr Brown could use to their disadvantage. However, Mr Emmett submitted, I think correctly, that this highlights, and is not an answer to, the problem. Eugene and Angela cannot know precisely what advantage Mr Brown might have, having observed them in their litigious context to which I have referred. Ward J (as her Honour then was) said (albeit in somewhat different circumstances) in Cleveland Investments Global Ltd v Evans [2010] NSWSC 567 at [4] “that is the very forensic disadvantage on which [they rely] for this application”.
[30] I see this as a powerful factor favouring restraint of Mr Brown from further involvement in the proceedings.
Banga Legal and Mr Banga submit that the court should exercise its inherent jurisdiction to restrain Solve Legal from acting for Ms Townsend on the following three grounds:
The professional and personal relationship between Mr Banga and Mr Shamsabad has provided Solve Legal (deemed to share the knowledge of its former solicitor, Mr Shamsabad) with a forensic advantage over Mr Banga. Mr Shamsabad gained confidential information while employed at Banga Legal, including insights into the personality, vulnerabilities and “litigious character” of Mr Banga. Even if not tied to specific details, such knowledge constitutes a forensic advantage.
Mr Shamsabad is likely to be called as a witness. His potential evidence, particularly concerning confidential information allegedly imparted by Ms Townsend, creates a conflict for Solve Legal in continuing to act.
The animosity displayed by Solve Legal’s principal, Mr Kutasi, towards the legal representatives of Banga Legal and Mr Banga during negotiations over the proposed undertaking. This undermines the impartiality required of legal representatives in the conduct of litigation.
Ms Townsend submits the motion should be dismissed because the application is procedurally defective as Solve Legal is not a party, improperly seeks to restrain an entire firm not simply Mr Shamsabad, and relies on an alleged conflict involving Mr Shamsabad, who neither acted for Banga Legal or Mr Banga, did not possess any confidential information, nor remains employed at Solve Legal.
Ms Townsend states that the threshold for restraining solicitors is high and requires specific confidential information or a real risk of misuse, which Mr Townsend says Banga Legal and Mr Banga have not identified. Ms Townsend argues that mere acquaintance or prior employment does not establish a conflict of interest.
Ms Townsend submits that no one at Solve Legal has personal knowledge of the matter, and the alleged prospect of witnesses or breaches of professional conduct rules is unfounded.
It is true that Solve Legal is not named as a party to motion. It is also the case that where the interests of third parties are affected by an application they should be made party to it, be given notice of it and be heard in respect of it. But in the present case, there is no injustice to Solve Legal because it was put on notice of the application, appeared at the hearing through their employed solicitor Mr Brozek, led evidence and made submissions opposing it.
Turning to the merits of the application, it is clear that while engaged as a contractor for Banga Legal, Mr Shamsabad acquired information about the personality, vulnerabilities and litigation strategies of Mr Banga. In addition, the social contact that Mr Shamsabad had with Mr Banga and his wife, Ms Gill, means that he also acquired information about her personality and vulnerabilities. Applying the reasoning in Edgecliff Car Rentals, I consider that the information acquired by Mr Shamsabad to be confidential to Mr Banga and Ms Gill. To the extent that the confidential information was about Mr Banga Legal, it is likely that Mr Shamsabad was bound by the obligation of confidentiality he owed to Banga Legal not to use or disclose it.
Banga Legal and Mr Banga are not seeking to make a claim of breach of confidentiality against Mr Shamsabad so it is not necessary for me to determine that all of the elements of such a claim as stated in Li are made out. Instead, I am dealing with the circumstances in which the court will restrain officers of the court from acting in conflict when in possession of confidential information.
As an employed solicitor of Solve Legal, Mr Shamsabad has acted for Ms Townsend for a considerable period of time (March 2024 to July 2025), both in providing advice to her in advance of the proceedings and during the proceedings. In the circumstances of these proceedings, Mr Banga has broad claims which centre on the Private Matter (involving issues very personal to him), Mr Banga is likely to be a witness in his own case and Ms Gill is likely to be a witness for Banga Legal and Mr Banga. It appears to be self-evident that the confidential information is likely to have been of potential use by Mr Shamsabad for the benefit of Ms Townsend, giving her a forensic advantage in these proceedings. I consider it should be inferred that there is a serious risk that Mr Shamsabad would have utilised that confidential information about Mr Banga and Ms Gill for the forensic benefit of Ms Townsend during the period in which he was acting for her.
In those circumstances, I consider that there was an obvious conflict of interest for Mr Shamsabad in acting for Ms Townsend, yet he has done so for a considerable period of time. Mr Shamsabad has also worked alongside Mr Kutasi on the matter. The fact that Mr Shamsabad no longer works at Solve Legal does not alleviate the issue created by the fact that Mr Shamsabad acted with that conflict for so long.
For the reasons stated above, I propose to make the following orders:
Solve Legal Pty Ltd, by its officers, employees and agents, be restrained from acting for the defendant in these proceedings.
Solve Legal Pty Ltd, by its officers, employees and agents, be restrained from advising the defendant in relation to matters that are the subject of these proceedings.
Solve Legal Pty Ltd is to pay the costs of the plaintiffs in relation to the notice of motion filed 11 July 2025.
**********
All is 1 Pty Ltd t/as Banga Legal
Townsend [2025] NSWSC 953
(2005) 64 NSWLR 561
(2001) 4 VR 501
(1990) 22 FCR 73
(1987) 14 FCR 434
(1980) 33 ALR 31
(1980) 53 FLR 240
On 5 April 2025, Banga Legal and Mr Banga filed the amended summons seeking relief including orders restraining Ms Townsend from using or disclosing their confidential information, compelling its return and disclosure, suppressing certain information, and making declarations, awarding damages, and other relief.
On 29 April 2025, Ms Razi sent an email to Mr Kutasi requesting that both Mr Shamsabad and Mr Kutasi immediately cease acting for Ms Townsend on the basis of conflicts of interest.
On 29 April 2025, Mr Kutasi sent a letter to Ms Razi denying that there was any conflict of interest and stating that Solve Legal would continue to act for Ms Townsend.
On 11 July 2025, Banga Legal and Mr Banga filed the motion making the application to restrain Solve Legal from acting for Ms Townsend in the proceedings.
On 12 July 2025, Mr Shamsabad resigned from Solve Legal to take parental leave and then become a barrister.
On 15 August 2025, the hearing of the motion took place before me. Mr M Zammit appeared as counsel for Banga Legal and Mr Banga. Mr P Brozek of Solve Legal appeared for Ms Townsend.
As stated in Kallinicos, the court has an inherent jurisdiction to restrain solicitors from acting in a case as an incident of the inherent jurisdiction over its officers and to control its process in aid of the administration of justice. Kallinicos also tells me that the test I am to apply is whether a fair-minded, reasonably informed member of the public would conclude that the proper administration of justice requires that a legal practitioner should be prevented from acting, in the interests of the protection of the integrity of the judicial process and the due administration of justice, including the appearance of justice.
I have given due weight to the fact that Ms Townsend should not be deprived of the lawyer of her choice and the inconvenience and impracticability of requiring a lawyer to cease acting.
The mere fact that Mr Shamsabad may be a witness in the proceedings is not sufficient of itself to cause him or Solve Legal to be restrained: Mitchell, Brereton J at [20] and [25]. I have also placed no weight on the disgraceful conduct of Mr Kutasi during the recess in the hearing before Kunc J for which he apologised.
The real issue is the possession of confidential information by Mr Shamsabad. Having been in possession of the confidential information through its employee, Mr Shamsabad, it is too late to “unscramble the egg” of what parts of the confidential information Mr Shamsabad did or did not impart to other members of Solve Legal (including Mr Kutasi) before he ceased working for it. This is a powerful factor in favour of restraining Solve Legal from acting for Ms Townsend in these proceedings, even though Mr Shamsabad no longer works there. The appearance of justice is important in these circumstances.
In my opinion, a fair-minded, reasonably informed member of the public would conclude that, in these circumstances, the proper administration of justice, in the interests of protecting the integrity of the judicial process and due administration of justice, including the appearance of justice, requires that Solve Legal be prevented from acting for Ms Townsend.