Beckwith v Pedler [2000] VSCA 86

Court of Appeal (Vic)|2000-05-24|Before: PHILLIPS, CHARLES and BUCHANAN, JJ.A.

Costs - Order inter party for costs as between solicitor and client - Taxation of solicitor's bill compromised - Whether solicitor entitled to any more for costs as between solicitor and own client - Whether difference between the two modes of taxation - Whether solicitor retained more than he was entitled to - Client's action to recover surplus - Supreme Court Act 1986 ss.61, 64: R.S.C. Chapter I Rules 63.30, 63.59, 63.61.

In the course of the Supreme Court litigation, the trial judge, Hampel, J., made an interim order on 9 June 1993 that the executors pay the plaintiff's costs on a solicitor-client basis. On 16 December 1993 his Honour made a further order finally disposing of the matter and ordering that the executors pay the plaintiff's costs from 9 June, again on a solicitor-client basis. Accordingly, Mr. Beckwith had a bill of costs drawn up in taxable form claiming $173,714.41 (including $106,095.10 for disbursements) and proceeded to taxation. The hearing commenced before the Taxing Master on 20 January 1995, and certain amounts were taxed off as the parties worked their way through the bill. The hearing was adjourned to 14 March but, before it resumed, the matter was settled by the parties and on 14 March 1995 the Taxing Master allowed costs by consent in the sum of $132,000, all up. Mr. Beckwith received this sum on or before 27 March 1995.[1]

On 16 August 1996, the plaintiff commenced this proceeding in the County Court claiming that the solicitor had received $223,923.02 for costs, that he was entitled only to $132,000 for costs and that he was obliged therefore to pay or to repay to the plaintiff the difference of $91,923.02. In a defence, delivered on 10 September 1996 and somewhat surprisingly labelled "Draft", the solicitor admitted to having been paid $223,923.02 but claimed that he was entitled to retain it, pursuant to his retainer. He alleged that he had delivered to the plaintiff four bills (the first three being interim bills) and that all had been duly paid. The solicitor claimed in his defence that the plaintiff could not now have those bills taxed, as he was out of time under s.74(9) of the Supreme Court Act 1986. (In this proceeding we are concerned with that Act before amendment by the Legal Practice Act 1996[2] and the relevant sections, as we shall see, were in the main ss.61 and 64.)

Because it bears on what followed, we set out in list form the four bills which the solicitor said, in his defence, had been sent to the plaintiff and which, he asserted, had been paid. According to the pleading, the bills were "served" on these dates[3] and for these lump sums:

It can be seen from the plaintiff's statement of claim that the addition of these four sums was the source of the allegation by the plaintiff that the solicitor had received $223,923.02 for costs. It may be doubted, however, whether it was correct to assume (as the pleader for the plaintiff appears to have done and the pleader for the defendant, too, may have done in the defence before its amendment) that, because these four bills - or such amounts - were paid, the solicitor therefore received the total of them all, as though each was wholly additional to the others. As will be seen, one of the principal questions debated at trial, and before us, was how far the fourth and final bill, in giving credit for $173,540.28, thereby gave credit for the first two sums of $30,000 and $11,448.03. At trial the fourth bill was in evidence: it was Exhibit G. The first two bills were never sighted.

On 22 October 1997, pursuant to leave granted, the plaintiff delivered an amended statement of claim alleging that the plaintiff was obliged by the terms of the retainer to pay to the solicitor his costs on a solicitor-client basis, in accordance with Rule 63.59 of Chapter I of the Rules; that $132,000 had been agreed (upon the compromised taxation) after the plaintiff had been advised by the defendant that this was a fair and reasonable sum for costs to be paid on a solicitor-client basis; and that in all the circumstances, the solicitor was estopped from claiming any more by way of costs from the plaintiff.

The trial commenced on 4 May 1998 at Mildura and ran for four days. Written submissions followed. As Mr. Tracey described to us, the trial was beset with difficulties and at the outset appeared headed for disaster. The pleadings were not completed and discovery had not been finalised when the trial commenced; neither party appears to have known just what the other's case was; and it might in retrospect have been better all round if the matter had been adjourned to enable the parties to bring some order into what must have seemed to the judge to be chaos. But the plaintiff, given the opportunity of an adjournment, instructed his counsel to proceed.

In opening his case, plaintiff's counsel relied first upon the admissions made by the solicitor in his defence of 10 September 1996. He then tendered a number of documents in the Court Book and closed his case without calling any oral evidence. In particular, the plaintiff did not go into the witness box. When it was pointed out by the judge that the defence had been filed before the statement of claim had been amended and was scarcely responsive thereto, leave to file an amended defence was given and the plaintiff requested further and better particulars. Both amended defence and particulars were duly supplied, but the solicitor now departed substantially, and significantly, from the earlier pleading. He no longer admitted to receiving $223,923.02 for costs: instead he admitted only that he had received $186,336.49 for costs, a sum to which he claimed again that he was entitled, pursuant to his retainer.

On the second day of the hearing, plaintiff's counsel re-opened his case, saying that it was still "disarmingly simple". In the absence of any special agreement in writing (as to which see s.64 of the Supreme Court Act), the solicitor was entitled, counsel said, to no more than $132,000, being the amount agreed upon as payable for solicitor-client costs on the compromised taxation. Counsel accepted that a question had now arisen "as to quantum" (meaning the amount received by the solicitor for costs) but, he contended, the plaintiff was entitled to recover at least the sum of $54,336.49 - being the difference between $132,000 and the admitted amount of $186,336.49. Counsel claimed that the plaintiff was also entitled to any further sum that he could prove the solicitor had received for costs, over and above that admitted sum of $186,336.49.

Thus there were two main issues to be resolved at the trial: how much had the solicitor received for and on account of costs and how much, according to the terms of his retainer, was the solicitor entitled to have for costs for his acting in the plaintiff's litigation?

As for the first, his Honour's findings rested in large part upon Exhibit G, the fourth of the four bills said by the solicitor in his first pleading to have been delivered to the plaintiff and duly paid. That bill, which was dated 12 May 1995, sought payment of $8,934.71 (as set out in paragraph [4]). It commenced by claiming for costs the total sum of $173,714.41, according to the bill of costs prepared for the earlier taxation (Exhibit J in this trial). From that, a number of payments on account were deducted by way of credit, totalling $173,540.28 (which, it may be observed, is said to have been the amount of the third of the four bills set out in paragraph [4]). After credit was given for $173,540.28, there was still $174.13 owing. To that, Exhibit G added further sums claimed as disbursements "not included in bill prepared for taxation", bringing the total to $4,895.06. This, with a further account for professional costs of $4,039.65, made up the total claimed in Exhibit G of $8,934.71 - an amount which, according to the evidence, was promptly paid by the plaintiff. (The date 26 June 1995 was given in the statement of claim as the date of payment by the plaintiff.)

Because Exhibit G allowed credit for $173,540.28 and because the further bill for $8,934.71 was apparently paid, the judge concluded, in his reasons for judgment, that the solicitor had received, at the very least, $182,474.99 for costs (the total of the third and fourth of the four bills set out in paragraph [4]). But, said his Honour, Exhibit G made no allowance for the earlier payments of $30,000 and $11,448.03 (being those sums paid, according to the solicitor's first pleading, against the first two interim bills). Being satisfied by certain answers given by the solicitor in cross-examination that these two sums of $30,000 and $11,448.03 had indeed been paid, the judge concluded that the solicitor had received for costs the total sum of $223,932.02 (which is the total of the four bills set out in paragraph [4]). Accepting, apparently, the correctness otherwise of Exhibit G, the trial judge concluded that the plaintiff was entitled to be repaid the sums of $30,000 and $11,448.03 on the ground that he had not been given credit for these payments in Exhibit G. To this his Honour added a further sum of $2,583.40 on the ground that there had been some double-claiming in Exhibit G and Exhibit J and, together, these three sums ($30,000, $11,448.03 and $2,583.40) made up the amount of $44,021.43 for which his Honour gave judgment in favour of the plaintiff.[4] The solicitor appeals, contending that the judgment was given in error, that nothing was due for repayment to the plaintiff, and that the plaintiff's claim against him ought to have been dismissed.

Principally, the solicitor contends, as appellant, that the judge erred in concluding that he had failed to give the plaintiff due credit for the earlier sums of $30,000 and $11,448.03. The solicitor claims also that he was denied natural justice when the judge refused to allow him to introduce into evidence his trust account records which, it is said, would have disclosed that both those sums had in fact been credited to the plaintiff, as required. We deal with these points in turn but before doing so we deal with the further sum of $2,583.40 which was included in the judgment.

In respect of this sum, too, the appellant asserts error, but that error was established quite simply before us. In his reasons for judgment the judge found that two of the items in Exhibit J (for drawing and engrossing the bill of costs and which together totalled $2,583.40) were duplicated by an additional claim for $3,601.60 (a disbursement for the costs of taxation) contained within the fourth and final bill which was Exhibit G. The solicitor submitted that in reaching that conclusion, which had been no part of the plaintiff's case, the judge had himself embarked upon some sort of informal taxation of the solicitor's bills, a step which the plaintiff had not sought and which the judge was not entitled to take. In argument, Mr. Hayes frankly accepted that there was no evidence to support the judge's conclusion that $2,583.40 had been claimed more than once, that the matter had never been canvassed at trial and that the possibility of double-claiming had not been raised by the plaintiff in his pleading or otherwise. He therefore conceded, very properly if we may say so, that to the extent at least of $2,583.40 the judgment was in error.

On the more difficult issue concerning the supposed failure by the solicitor to allow credit to the plaintiff for the sums of $30,000 and $11,448.03, Mr. Hayes sought to support the judgment on three bases. First, he submitted that by his first pleading the solicitor had admitted receiving payment of the sum of $223,923.02, a sum which could not on any view be justified for costs incurred in the litigation. Secondly, he submitted that in cross-examination the solicitor had admitted payment by the plaintiff of the four bills identified in the solicitor's first pleading and had admitted receipt of $223,923.02. Thirdly, he relied upon Exhibit G itself to support the claim that the sums of $30,000 and $11,448.03 had not been brought to credit, to the disadvantage of the plaintiff - and it is correct that Exhibit G makes no express reference to those two sums as such.

The first argument, based upon the early pleading, can be quickly put to one side. True it is that in his first defence the solicitor alleged that the three interim bills, together with the fourth and final bill, were delivered to the plaintiff and were paid by him. The four amounts do total $223,923.02 but, as we earlier suggested, whether it is correct to total them without making allowance for the earlier payments as interim only is an altogether different matter. In Exhibit G (the fourth of the four bills) the sum of $173,540.28 has been allowed in credit and it is interesting, at least, to note that the three amounts of $132,000, $30,000, and $11,448.03 total something very close to $173,540.28; the difference is less than $100. Whatever the significance of that, it cannot simply be assumed, by reference only to payment of the four bills, that each is wholly cumulative upon the others, particularly as the first three bills were described as "interim". Nevertheless, the defendant did by that early pleading, allege positively that the plaintiff was obliged to pay, and had paid, the sum of $223,923.02 for professional costs and disbursements. The difficulty for the plaintiff is this: that when plaintiff's counsel sought to rely upon these allegations as admissions, his Honour promptly pointed to the need for an amended defence and, when that was delivered, the defendant's case was changed so substantially as to deprive the plaintiff of the advantage of the earlier "admissions". He could no longer sensibly rely upon them.

The plaintiff's second argument turned on answers given by the solicitor in cross-examination. In short, what was put in cross-examination was that the solicitor, seeking from his client much more than $132,000, had sent him a series of bills "totalling approximately $223,000". To that the solicitor replied that "I have to accept your figures for that. I don't know the ...". Counsel persisted: "But you sent him four bills didn't you?". The solicitor agreed that he had sent four bills, that the four bills were those mentioned in the earlier defence, that he himself had been responsible for the preparation of that document and had carefully examined it before it was filed, and that he was satisfied, before it was filed, "that it was truthful and accurate". Counsel's argument, both at trial and before us, was that these answers in cross-examination amounted to an in-court admission by the solicitor that he had received the total sum of $223,932.02 for costs, as indeed had been asserted in the defence before its amendment. We have said already why that conclusion does not follow simply from the sending of the four bills and their payment, and in our opinion the answers given in cross-examination do not advance the plaintiff's case. The amended defence was plainly inconsistent with the earlier pleading about the amount received and to that extent at least it is implicit that the earlier pleading had been drawn in error. The solicitor's answer that he was indeed "satisfied that it was truthful and accurate" must be taken to relate to the time of filing, and that is how the question was posed. We reject the plaintiff's second argument.

The third argument advanced by plaintiff's counsel was based simply on Exhibit G. It is true, as we have said, that Exhibit G makes no specific reference to the amounts of $30,000 and $11,448.03, but none the less the question is whether they have been brought to account within the credit given for the total of $173,540.28. Exhibit G sets out how that last and third sum has been calculated and it seems to us to relate wholly to disbursements. In other words, Exhibit G is not setting out the credits by reference to amounts received into the trust account; rather it is setting out credits for sums paid out of the trust account on behalf of the plaintiff.

This point can probably be made best by reference to the sum of $132,000 which was presumably received into the trust account on behalf of the plaintiff when it was paid on or before 27 March 1995, shortly after the inter partes taxation was concluded by consent on 14 March 1995. In Exhibit G credit is given for four sums against the dates 27 March, 5 April, 21 April and 22 April 1995 respectively, and together they total $132,000. It seems not unreasonable, therefore, to assume that credit is there being given for the sum of $132,000 received by the solicitor, for the plaintiff and for costs. That credit is being given not by including in Exhibit G the receipt as such of $132,000 (a sum which is otherwise not mentioned in Exhibit G) but by allowing credit for the disbursements made out of that sum which otherwise must have been held in the trust account. And if that be the treatment of the $132,000, why should it not also be so in relation to the sum of $30,000 and the sum of $11,448.03? According to the documents, the first, the sum of $30,000, was received by the solicitor when the plaintiff directed him to retain that sum out of the proceeds of the mortgage of a certain property[5]; and the second, the sum of $11,448.03, was the difference between a larger sum received by the solicitor for the plaintiff and the payment thereout of a smaller sum at the direction of the plaintiff.[6]

In short, we think that Exhibit G does not even purport to set out amounts received into the trust account. What it sets out are disbursements paid on behalf of the plaintiff where the plaintiff is properly to be given credit therefor against the charges being raised and in the bill being rendered. As pointed out earlier, it is probably no coincidence that the sum of $30,000, $11,448.03 and $132,000 is not far short of the total sum of $173,540.28, for which credit is expressly and very plainly given in Exhibit G. Mr. Hayes sought to make something of the letter accompanying Exhibit G, in which it was said that Exhibit G consists, inter alia, of "a statement of all moneys passing through our trust account to date". But that does not advance the plaintiff's case; Exhibit G may well be taken to include "a statement of all moneys passing through [the solicitor's] trust account to date" if (as we think happened) all such moneys have, in the meantime, been applied in disbursements for which credit is being duly given in Exhibit G. (Anyway, if it matters the reference to "all moneys" cannot be read literally; it must be read in context and taken to mean everything relevant to the solicitor's claim for costs in the Supreme Court litigation. What was otherwise passing through the solicitor's trust account for this client was not explored at trial; and whether some part of the amounts that were here in question were diverted to other matters was not explored either.)

For these reasons, we reject the three grounds upon which the plaintiff sought to sustain the conclusion of the trial judge that the solicitor had not brought to credit in favour of the plaintiff for sums of $30,000 and $11,448.03. In our view, it was not shown that those sums were paid to the solicitor over and above the sum of $173,540.28 for which credit was given in Exhibit G; nor was there any other evidence to support that they had been left out of account in that fourth and final bill. The onus was on the plaintiff to establish that the solicitor had received more than was his due and, contrary to the judge's finding, in our opinion he did not establish that the solicitor had received the additional sums of $30,000 and $11,448.03 for which, it was held, he must now account.

It is therefore unnecessary to deal with the solicitor's additional claim that he was denied natural justice by reason of the judge's refusal to permit him to introduce into evidence his trust account records or to allow a witness to be called to tender the computer entries in the defendant's trust records. On this issue we would merely observe that the argument that the solicitor had failed to credit the plaintiff with the two sums of $30,000 and $11,448.03 emerged at trial only during argument between the judge and plaintiff's counsel after the defendant had left the witness-box. (The plaintiff, it will be recalled, did not himself give evidence.) Had the tender of the trust account records been permitted, the giving of the relevant evidence could have been completed, as Mr. Hayes was disposed to think, in less than an hour. Argument at trial over the admissibility of these records, the tender of which was hotly opposed by plaintiff's counsel, lasted for more than two hours. Had the plaintiff been disadvantaged by the admission into evidence of these records, a short adjournment, if necessary at the solicitor's cost, would presumably have cured any such disadvantage readily enough. In these circumstances, had we not otherwise been minded to accept the arguments of the solicitor in this appeal, we would have found it difficult to say that the judge was not obliged to give the solicitor the opportunity of tendering these additional records, for the purpose of establishing that the two amounts said not to have been credited to the plaintiff had indeed been so treated in the solicitor's records. Indeed, given that the plaintiff was close to alleging dishonesty on the part of the solicitor, it is at least surprising that the attempt by the solicitor to provide the very evidence that would presumably have resolved the issue was so strongly opposed.

The other main issue at trial was to determine the terms, relating to costs, on which the solicitor had in fact been retained to act for the plaintiff in the Supreme Court litigation. As already mentioned, for present purposes the relevant provisions were ss.61 and 64 the Supreme Court Act 1986 before its amendment by Act No.35 of 1989. The plaintiff contended that the solicitor was entitled only to "solicitor-client costs", there being no other agreement which might satisfy s.64 of the Supreme Court Act; that the solicitor had prepared a bill for taxation on the basis of solicitor-client costs (as indeed had been ordered in favour of the plaintiff in the litigation conducted by the solicitor); and that, having compromised the taxation of that bill at $132,000, the solicitor must now be entitled to no more than that sum, for both disbursements and profit costs.

This argument was rejected at trial and in our opinion it is flawed at more than one point. We put aside altogether the question of any special agreement for the payment of costs. Section 64 required that such an agreement be in writing and it is common ground that there was no writing here. The trial judge considered that an oral agreement could none the less be relevant in this proceeding because the solicitor was not presently seeking to tax his bill against the client, but we say nothing of that; for in our view it does not become relevant. More to the point is the submission that the solicitor was entitled only to "solicitor-client costs". When elaborating on this, it became clear that plaintiff's counsel meant by this expression solicitor-client costs determined in accordance with Rule 63.59 and 63.61, and thus far we would agree. It was not in dispute that, wanting any special agreement otherwise, s.61 entitled the solicitor to his costs on the conditions there provided, which included the provision of a bill in taxable form; and if taxed, that bill would be taxed in accordance with Part 6 of Order 63 of Chapter I, which includes Rules 63.59 and 63.61.

The next step, however, in the plaintiff's submission was to equate the entitlement of the solicitor to such costs as against his client with the client's entitlement to costs on a solicitor-client basis under the orders made by Hampel, J. The judge made two orders in the litigation which was conducted by the solicitor for the plaintiff against the executors of the deceased estate and, together, these two orders gave the plaintiff all his costs of the proceeding as against the other parties, the executors. The bill upon which the solicitor then proceeded to taxation (Exhibit J) was headed "COSTS OF THE PLAINTIFF TO BE TAXED AS BETWEEN SOLICITOR AND CLIENT PURSUANT TO THE ORDERS OF MR JUSTICE HAMPEL MADE THE 9TH DAY OF JUNE 1993 AND 16TH DAYS OF DECEMBER 1993" and the plaintiff submitted that this bill therefore marked the limits of the entitlement of the solicitor to solicitor-client costs for all purposes, not only as against the other parties to the litigation but also as against his own client. But in our opinion the two situations cannot be so simply equated.

It cannot be denied that the Chapter I of the Rules which came into force on 1 January 1987 sought to simplify such questions of costs: see for example Rule 63.28.[7] But the distinction between solicitor-client costs and solicitor-own client costs persists.[8] For example, when the plaintiff obtained in the litigation an order for taxation of his costs on the basis of solicitor and client Rule 63.30 was called into play. When the solicitor taxes a bill against his own client, it is Rules 63.59 and 63.61 that come into play. It is true that Rule 63.30 is in like terms to Rule 63.61(1), but the first is called into play on a taxation between opposing parties and the second on a taxation as between the solicitor and his own client. That very difference may lead to very different results on taxation, as Phillips. J.A. pointed out in Re National Safety Council of Australia Victorian Division (No.2)[9] at 518. What is reasonable in the one set of circumstances may not be all that is reasonable in the other. Further, the very different provision made by Rule 63.61(2) on a taxation between the solicitor and his own client cannot be ignored.

In short, for any number of reasons a plaintiff's entitlement in litigation to his costs on the basis of solicitor and client cannot be equated with the solicitor's entitlement to costs on a solicitor-own client basis. That is not to say that in the litigation a special order might not be made to bring the former more into line with the latter[10]; nor is it to say that without any further or other order, the latter might not be the same as the former, if it so happens in a particular case. But if the costs to which a solicitor is entitled as against his client are the same as the costs to which the client, as a party to litigation, would be entitled were his costs to be taxed on a solicitor and client basis against the other party to that litigation, that will be the product of chance (in the absence of any order in the litigation bringing the two into line). To say that the two may in certain circumstances be like is far from equating the one entitlement with the other.

Plaintiff's counsel then had resort to the cross-examination of the solicitor in this case. As already described, the solicitor proceeded to tax costs pursuant to the orders made by Hampel, J. in reliance upon the bill which he had prepared and which became Exhibit J. In cross-examination, he was asked specifically on what basis that bill had been prepared: first he said on a solicitor-client basis and then he denied it, claiming it was prepared on a solicitor-own client basis. This demonstrated, said counsel, that the bill had in truth been prepared on a common basis, in which the solicitor himself had drawn no distinction between the plaintiff's entitlement to costs pursuant to taxation on a solicitor and client basis and the solicitor's own entitlement as against his client to costs on a solicitor and own client basis - and the former having now been fixed by compromise between the parties to the litigation at $132,000, that now marked the limit of the solicitor's entitlement against his own client.

So far as the cross-examination went, it would not be at all surprising, we think, if the bill which was Exhibit J had in fact been prepared on a solicitor-own client basis, in the sense that everything had been included and nothing excluded. The bill was prepared, we gathered, by an outside consultant and we do not know what instructions were given for its preparation. That the bill was broader rather than narrower is consistent with the solicitor's seeking on taxation to recover as much as he could for his client; and that amounts were taxed off, both in relation to profit costs and disbursements for counsel's fees and the like, does suggest that the bill, as prepared, was very favourable to the plaintiff. It may well be, as we say, that the bill was prepared on a common basis, being the broader of the two bases for taxation; but the submission that the solicitor is now confined, in his claim against his own client, to what was claimed by way of Exhibit J does not advance the plaintiff's case now unless the next step is also correct: that, having compromised the taxation at $132,000, the solicitor is now limited to that amount in this dispute with his own client.

Of course, once grant that there is a significant difference between the entitlement to costs on a solicitor and client basis as between opposing parties and the entitlement of a solicitor, as against his own client, to his costs on a solicitor and own client basis, and it does not follow that the one can serve to define the other. Nor does it follow, by logic alone, that because the solicitor compromised the taxation as between parties by agreeing on the sum of $132,000, the client cannot be required by the solicitor to pay any more than that. At this point, counsel submitted that the plaintiff had in fact been led to conclude that he was not liable beyond $132,000 by the solicitor's own conduct, in failing to make plain to him that, when the taxation was compromised, he might still be out of pocket for the sums not recovered from the other side. Counsel pointed to an early letter in which the solicitor had told the plaintiff that, if he was successful, in all probability his costs of the litigation would be met from the estate - but that was an early letter and went scarcely to the present issues. Subsequently, there were letters from the solicitor to the plaintiff advising on compromise of the taxation and warning that if the plaintiff himself held out for more than was offered, he might risk the costs of the taxation - but this correspondence was scarcely relevant to the present submission. Plaintiff's counsel pointed to the difficulties attending such questions of costs which could surely confuse any layman - but his client was scarcely a novice in this area, being a director of a firm involved in Mildura in real property development and having, it seems, more than one transaction handled by this very solicitor.

More importantly, all of this is speculation; the plaintiff himself did not go into the witness box and assert that he had been in some way misled by the solicitor, and without that evidence we would not be prepared to accept the argument, put from the Bar table, that the plaintiff was misled; nor, it appears, was the trial judge prepared to accept it. Estoppel was pleaded in the amended statement of claim, but the plaintiff himself gave no evidence in support of that plea and such evidence as there was is all to the contrary. If the plaintiff is correct, he was led to believe that he would not be liable for any further costs over and above Exhibit J, putting aside for the moment the compromise of that claim when the bill was taxed. The Taxing Master made his order on 14 March 1995 and two months later, on 12 May (according to the date on Exhibit G), the solicitor rendered a fourth and final bill to the plaintiff, which was paid by the plaintiff without demur (quite possibly on 26 June 1995). Such payment is quite inconsistent with the claim now made about the plaintiff's belief or understanding, and this very point was made by the solicitor in paragraph 9 of his amended defence, so that thereafter the plaintiff was at all times alive to it. The claim that the plaintiff was somehow misled by the solicitor cannot be accepted.

In substance in this proceeding the plaintiff set out to establish two things: first, that the solicitor was entitled to no more than $132,000 for costs, including disbursements, as against his own client, the plaintiff; and secondly that the solicitor was in fact retaining more than that sum and should now repay the excess. On the first, the plaintiff fails; for his case depended upon equating the solicitor's entitlement to solicitor-own client costs with the plaintiff's entitlement to solicitor-client costs according to Exhibit J and then holding the solicitor to the amount of the compromise reached with the other side over the taxation of Exhibit J. In his amended defence, the defendant conceded that he was retaining more than $132,000; he put it at $186,336.49. For the reasons given earlier, the plaintiff did not succeed in establishing that the plaintiff was retaining, relevantly, any more than this sum and it follows that the plaintiff should have failed at trial altogether.

One final word, however. At trial it would appear that the only basis for establishing the amount of the costs, including disbursements, to which the solicitor was entitled as against his client, lay in Exhibit G itself, which the trial judge appears to have accepted as the fourth and final bill. It is true that the sum which the solicitor admits retaining - which is $186,336.49 - exceeds the total of the credit allowed in Exhibit J and the amount claimed by means of Exhibit G - which is $182,474.99. But the difference between these two figures was not the subject of any specific attention at trial; no questions were put about the difference to the solicitor who might have explained it and no specific claim was made at any time to repayment of this difference. For all we can know, there are other sums due to the solicitor over and above those in Exhibit J and Exhibit G. As counsel made nothing of this point during argument, we do not think that we can act upon it; the difference just identified must remain one of the many questions never resolved by this confused and confusing piece of litigation. Of course, nor can it be assumed from the foregoing that Exhibit G - or indeed Exhibit J - would be necessarily unassailable were those bills or either of them to be taxed as between solicitor and own client, if that were now possible; this was not a dispute over the taxation of a bill of costs, as the trial judge observed, and if the parties have the desire and the stamina to pursue their dispute, at even further expense, they will have to do so in other proceedings, if such are open.

In the result, leave having been granted to the appellant on 17 May last to file an amended Notice of Appeal, the appeal should now be allowed, the judgment of 5 October 1998 set aside and in lieu judgment given for the defendant, with costs.

[3] According to para.9 of the plaintiff's statement of claim these were the dates on or before which these amounts were retained by the defendant, transferred from trust or paid in respect of costs: see also para.11 of the amended statement of claim.

[4] The discrepancy of $10 in the total is due to a slip in the reasons for judgment. Although the evidence referred to $11,448.03, his Honour sometimes referred to that sum as $11,438.03. The slip is only small and in the event, is of no consequence.

[7] see also Re National Safety Council of Australia Victorian Division (No.2) [1992] VicRp 34; [1992] 1 V.R. 485 especially at 513-4, 518-9.

[8] Armstrong v. Boulton [1990] VicRp 20; [1990] V.R. 215 at 222, National Safety Council [1992] 1 V.R. at 508

[10] This might be the result of an order for what are sometimes called in other jurisdictions "indemnity costs".

At a glance

Court

Decision date

Before

Source

Judgment (42 paragraphs)

Parties