Bird v Stonham trading as John Stonham & Co. Lawyers

Introduction

1. This proceeding has its genesis in events that occurred over 12 years ago. The plaintiff is the mother of a boy who was expelled from his school in 2007. This understandably caused much pain and distress in the plaintiff and the rest of her family; all the more so because, it appears, the expulsion generated a deal of negative local publicity. The plaintiff and her husband remonstrated with the school, and its headmaster, but to no avail.
2. A few months later, the plaintiff and her husband decided that they would not let the expulsion decision stand. They commenced a suit in the Supreme Court of New South Wales (Equity Division) to overturn it. They lost. Aside from that natural disappointment, they felt badly let down by their solicitor; who they believed was an expert in education law. When that solicitor presented the plaintiff and her husband with his bill, they were outraged at the amount of the expense; particularly as it seemed to them to grossly exceed the estimate of costs that they had been provided with. They decided not to pay it all.
3. What has followed since then has been a continuous cycle of litigation, in different courts, in which the plaintiff has steadfastly maintained her position of doing all that she could to avoid payment of the bulk of her solicitor's fees. For present purposes, the litigation principally comprised a professional negligence suit against her former solicitor in the Supreme Court of New South Wales (Common Law Division). When that finally failed (after an appeal was dismissed in July 2014), in 2016, the plaintiff commenced this proceeding: another professional negligence suit. This time it was against her solicitor who acted for her in that unsuccessful professional negligence suit against the former solicitor in the Supreme Court.

Factual background

1. Most of the factual background is not contentious.
2. In March 2007, the plaintiff's son was expelled from Broughton Anglican College in Campbelltown.
3. In June 2007, having made some enquiries of the Law Society of New South Wales, the plaintiff retained Mr David Ford, of the law firm, Emil Ford & Co. They understood that he was an expert in 'education law'. The plaintiff brought a proceeding against the school in the Equity Division of the Supreme Court of New South Wales, however that proceeding was unsuccessful. Her proceeding was dismissed on 7 December 2007 [1] . She incurred a substantial costs liability to the College.
4. By January 2008, the plaintiff had received her solicitor's, Emil Ford's, bills of costs amounting to the sum of approximately $100,000. This amount significantly exceeded a costs estimate that she had received. Having received some advice from a local solicitor, Mr Mullaly (who she had previously used) she decided to pay no more than the sum of nearly $36,000.
5. The plaintiff was very disappointed in the way that Mr Ford had conducted the proceeding in the Equity Division before Einstein J. She had in fact issued a professional conduct complaint against Mr Ford; although that complaint was dismissed after an investigation.
6. In September 2008, the plaintiff was served with originating process from Emil Ford in a proceeding commenced in this Court, by which Emil Ford sued her to recover the legal fees outstanding (being approximately $70,000). She defended that proceeding (retaining Brydens Lawyers as her solicitor and Mr Terry Morahan of Counsel) and on 12 June 2009, she succeeded in persuading the Court [2] that since costs had not been assessed and there was some issue about the adequacy of Emil Ford's disclosure about costs, it was inappropriate for judgment to be made against her. The plaintiff enjoyed a signal success, and obtained a costs order for her successful defence of this earlier proceeding in this Court.
7. Counsel for the defendant emphasises that, during the course of this earlier proceeding in this Court (the period between September 2008 and June 2009), consideration had been given by the plaintiff and her Counsel, Mr Morahan, to bringing a defence by way of set-off to the former solicitor's claim for unpaid fees; with such defence being based upon a claim of professional negligence against Emil Ford. The plaintiff said in cross-examination that the initial defence in the earlier proceeding in this Court did indeed contain, as a defence, a claim of professional negligence. She said that her local solicitor, Mr Mullaly, was "disgusted" that her former solicitor would even contemplate commencing the proceeding against the school. Mr Mullaly had encouraged the plaintiff to use her complaint against the former solicitor as a defence to the former solicitors claim for unpaid fees.
8. However, that set-off defence was not pursued. It appears that, following the involvement of Mr Wheelahan QC (sometime between September 2008 and 2009) this professional negligence claim was removed from the plaintiff's defence, because of the anticipated quantum of such claim (thought to exceed more than $750,000), and possibly for other reasons, it was better not to risk a finding from this Court which might lead to some (issue) estoppel defence brought against her should she later proceed with the professional negligence claim in the Supreme Court. At any rate, it was more appropriate to have the professional negligence claim heard in the Supreme Court.
9. The significance of all of this, for present purposes, Counsel for the defendant emphasised, is that even as at 2008, and well before Mr Stonham came into the picture, a professional negligence claim by the plaintiff against Emil Ford, was 'on the radar'. Council also emphasised that notwithstanding the combined involvement of Mr Wheelahan QC, Mr Morahan of Counsel and solicitors from Brydens' Lawyers, no one regarded the professional negligence claim as hopeless and, to the contrary, the plaintiff was actively encouraged to pursue it; if only at a later point in time.
10. Eventually, in September 2009, Emil Ford applied to the Supreme Court of New South Wales to have its costs of acting for the plaintiff in the Equity Division proceeding assessed. On or about 4 May 2010 Emil Ford obtained an assessment of its costs. Although I was informed that her solicitors (Brydens) were considering an appeal from this costs assessment, nothing came of this and Emil Ford recovered a judgment certificate against her for the sum of $58,940.22. That judgment was registered against the plaintiff and her husband in the Local Court of New South Wales.

The Bankruptcy retainer

1. The plaintiff spoke to the defendant for the first time on or about 14 May 2010, by telephone. She had come to him on a recommendation from Mr Mullaly. The defendant took some handwritten contemporaneous notes of that telephone conversation. From this conversation, the defendant developed a general understanding of the legal concerns. Amongst other things, he came to understand that the lawyers and barristers acting for her in the early proceedings in this Court (commenced by Emil Ford) had told her that she could bring further proceedings. He also understood that she had been told by Emil Ford that if its costs had not been paid, the firm would likely serve a bankruptcy notice upon her. He was informed that he could speak to Mr Terry Morahan of Counsel in order to get a better understanding of the issues. At about midday on the same day, the defendant spoke to Mr Morahan.
2. In early June 2010, the plaintiff approached the defendant, generally seeking his assistance for her response to the bankruptcy notice. She had separate conferences with the defendant, on 4 and 7 June 2010. As to the first of these conferences, on 4 June, the defendant recalls that the purpose of the conference was to him to provide legal advice regarding the bankruptcy issue. There was some urgency to that matter.
3. When she saw him again on 7 June, the plaintiff had only just (ie the day before) been served with a bankruptcy notice. On that day, the defendant recalls being supplied with a bundle of correspondence, from both Brydens and Mullaly Mylott Solicitors. They had a conversation about how she could respond to the bankruptcy notice.
4. The defendant wrote a letter to the plaintiff on 9 June 2010. The letter summarized the contents of the advice, or advices, spoken about at the conferences on 4 and 7 June 2010. The gist of this was that following her receipt of the bankruptcy notice, the plaintiff had 21 days to either pay the debt, make an arrangement to the creditor's satisfaction for settlement of debt, or to file an application to set aside the notice. He confirmed the plaintiff's instructions to proceed to make an application to set aside the bankruptcy notice on the basis that she had a counterclaim of greater value, being a professional negligence claim. The letter also referred to the defendant having contacted Mr Morahan to discuss the professional negligence claim.
5. Under cross-examination, the plaintiff accepted that she had informed the defendant that she could not afford to be bankrupted (mainly due to professional reasons). She also accepted that he had indicated that the best option was for her to pay the debt, but that she was not in a position to pay the debt at that time. She said that over the course of the next 21 days, the defendant had sought to explore with the creditor whether a compromise of the debt or some other arrangement could be made but, during the course of that period, the creditor did not wish to compromise. She accepted, ultimately, that her only real option, having regard to her preferences and circumstances, was to consider bringing an application to set aside the bankruptcy notice. For this, she accepted, she needed an offsetting claim. She said that she recalled informing the defendant of such a claim which, she also accepted, she had had in her mind for two years.
6. She also acknowledged, during the course of her cross examination that it was wrong for her to allege, as she had in her pleading, that the defendant had not provided alternatives to the bankruptcy proceeding commenced on her behalf. She also effectively abandoned the allegation that the commencement of a professional negligence suit was done without reasonable prospects of success: she admitted that she understood that such a claim "had legs" and could have succeeded.
7. The plaintiff later accepted in cross-examination that in 2010, her previous familiarity and experience of litigation led her to understand that the losing party usually is required to pay the winning party's costs; those costs may need to be assessed in order to be enforceable; and once the assessment process was completed, a costs certificate could be the subject of a judgment and capable of being enforced.
8. She said that she had not been advised by the defendant that if a proceeding was on foot and went to trial, a Judge might prefer Mr Ford's version of events over her own; or, alternatively, the Judge may disbelieve her evidence even if she had written proof of a course of events which, because of the omissions of her legal representative, was not put before the Judge. The plaintiff was challenged on this evidence, by reference to her previous experience of several proceedings. It was put, specifically, that it must have been obvious to her that Schmidt J would have to decide upon whether her version of events should be accepted or that of Mr Ford's evidence of events. She said that this was not apparent to her until the hearing had progressed when, according to what she said, Mr Ford was saying things which she did not accept were true.
9. Attached with this letter of 9 June 2010 was a costs agreement and standard cost disclosure. The costs agreement relevantly identified the work to be performed as follows: "Act on your behalf in bankruptcy proceedings by Emil Ford & Co Solicitors including but not limited to: I. Briefing Counsel (Mr Terry Morahan) to advise and appear on your behalf; II. Prepare and file application in Federal Magistrates Court to set aside the bankruptcy notice; III. Attend on your behalf at all court appearance; IV. Prepare your matter for hearing, attend hearing, and instruct Counsel upon hearing of your application.
10. On 15 June 2010, the plaintiff signed and therefore retained the defendant for the provision of legal services in relation to the bankruptcy notice (the Bankruptcy Retainer).
11. In connection with the defence of this bankruptcy proceeding, the plaintiff received some advice, at about this time, about the commencement of a suit for professional negligence against the firm, Emil Ford, arising from its handling of the unsuccessful litigation against the school that had commenced in 2007.
12. At about this time she mentioned to the defendant she had a set off claim against Emil Ford in the sum of approximately $23,000; which sum represented the costs order that she had obtained in her favour in the earlier proceeding in this Court involving Emil Ford.
13. Between 15 June and 25 June 2010, the defendant prepared the application to set aside bankruptcy proceedings, including the drafting of the application and supporting affidavit of the plaintiff. On 25 June 2010 the application to set aside the bankruptcy notice was filed in the Federal Magistrates Court.

The lead up to the plaintiff's commencement of the professional negligence suit against Emil Ford

1. In late June, the plaintiff and the defendant attended a conference at Mr Morahan's Chambers. Under cross-examination, the plaintiff accepted that she understood him to be experienced with handling professional negligence cases. The defendant recalls Mr Morahan drafting a pleading intended for use in a professional negligence claim. Occasionally, Mr Morahan asked questions of the plaintiff. At the conclusion of the conference, the defendant recalls asking the plaintiff for her instructions for him to convert the draft pleading had been prepared by Mr Morahan into the appropriate court form. The plaintiff accepted, under cross-examination, that she had accepted Mr Morahan's advice to put the draft pleading into proper form and filed in the Supreme Court as a matter of urgency and gave instructions to the defendant that to implement this advice.
2. The defendant said that, on the basis of the instructions he had received from the plaintiff and from Mr Morahan, he was satisfied that the professional negligence claim which the plaintiff want to bring against Emil Ford: (a) had sufficient prospects of success, for the purposes of section 347 of the (then) Legal Profession Act; and (b) provided a proper and necessary foundation, as an offsetting claim, for the plaintiff to set aside the bankruptcy notice in the Federal Magistrates Court. The plaintiff agreed that she intended that the statement of claim should be deployed for the dual purposes of applying to set aside the bankruptcy notice and for recovering damages in a separate proceeding.
3. On 25 June 2010 an application to set aside a bankruptcy notice and a supporting affidavit (from Ms Byrd) was filed in the Federal Magistrates Court. The supporting affidavit attached, among other things, a draft statement of claim intended for filing in the Supreme Court of New South Wales. This draft pleading was in identical terms to the handwritten pleading prepared by Mr Morahan in his chambers.
4. On 13 July 2010, the plaintiff commenced a professional negligence suit against Emil Ford in the Common Law Division of the Supreme Court of New South Wales. Subject to two additional particulars of alleged breach of retainer, the statement of claim was also in identical terms to the handwritten pleading prepared by Mr Morahan in Chambers.
5. In about the middle of July 2010, the defendant says that he received limited instructions from the plaintiff in respect to the professional negligence proceedings. At this point, he says, instructions were limited to attending to the physical act of drafting a statement of claim, whose content was dictated to him by Mr Morahan of Counsel, and filing it. According to the defendant, he was not required to advise on the prospects of success of the professional negligence claim or to take steps in relation to its prosecution.
6. On 30 August 2010, Federal Magistrate Raphael made orders to set aside the bankruptcy notice, with an order that Emil Ford pay her costs as agreed or assessed. In the reasons for the order, Raphael FM indicated, amongst other things, that he found that the professional negligence proceedings in the Supreme Court of New South Wales had reasonable prospects of success.
7. The plaintiff accepted that she was delighted with the defendant's contribution to bringing about that result. Notwithstanding this, she accepted that she had not paid his bill issued on 2 September 2010, which bill comprised a sum of $11,000 for his fees in acting for her in the bankruptcy proceeding; even though the amount charged corresponded with the estimate that he had provided. In cross-examination, the plaintiff put to the defendant that through 2017, she and the defendant were negotiating an arrangement whereby she might pay some of his fees by cash, and some by the defendant acquiring some furniture from her fledgling furniture business in Camden. But no agreement was put before me on the matter of his fees and the defendant indicated that he informed the defendant to direct further enquiries to him through his lawyers after she had brought this proceeding against him.
8. The defendant's 'bankruptcy retainer' had come to a successful end.

Acting for the plaintiff in the professional negligence proceeding

1. In cross-examination, the plaintiff elicited from the defendant the range of his expertise and experience with professional negligence litigation and litigation generally, prior to 2010. The defendant said that he had been involved in two or three actions against solicitors; as well as actions against general practitioners, orthopaedic surgeons and dentists. He explained that he had had involvement in CTP insurance litigation and had worked with the tort law group at Marsdens' Lawyers. He said he had appeared in the Local Court, the Supreme Court and the New South Wales Court of Appeal; as well as other tribunals. He was also involved in one special leave application to the High Court (although could not recall whether that had occurred prior to 2010).
2. The plaintiff accepted that from September 2010 to November 2011, the defendant acted for her, in at least some informal and undocumented capacity, in her professional negligence claim.
3. On 7 December 2010, the plaintiff received a Calderbank offer from Emil Ford, on the basis that all outstanding issues and costs would be resolved by the plaintiff paying $33,000 to Emil Ford. This offer was rejected.
4. On 23 March 2011, Emil Ford served an offer of compromise whose terms were that there would be verdict for Emil Ford and each party would pay their own costs of the proceedings. This offer was rejected.
5. In June 2011 the plaintiff spent two days working with the defendant to prepare her main affidavit in the Supreme Court proceedings in which she had instituted her professional negligence claim. By then she had prepared several affidavits relating to the circumstances of such claim. She accepted that she had the opportunity of inserting such evidence as she thought would support her claim and understood her affidavit would be relied upon and read by the Judge (should the proceeding run to trial). She knew that this was her opportunity to tell her side of the story; and that it was a very important document. Nevertheless, the plaintiff says that she omitted to include important information. During the opening address, the plaintiff identified the 'missing' information as comprising part of a transcript of an interview between Mr Ford and herself, dated 18 or 19 June 2007 as well as an article that had been prepared by Mr Ford, titled 'Investigating the Investigators'.
6. Under cross-examination, the plaintiff was challenged as to why she made no enquiry of the defendant as to why at least this article had not been included in her affidavit: it was an article of substantial length. But the plaintiff said that she did not notice the omission in an affidavit whose volume was already thick.
7. In her cross-examination of the defendant, the plaintiff referred the defendant to communications with him, prior to and even after the date, when she had sworn her affidavit, providing an electronic link to Mr Ford's 'Investigating the Investigators article'. The defendant did not recall receiving these messages.
8. The plaintiff challenged the defendant as to his evidence in his affidavit that the plaintiff's affidavit included all the evidence she had provided to him and did not recall excluding anything that she wanted included. She put to him that the contents of an affidavit that she had prepared on 9 May 2012 had not been included in her primary affidavit of June 2011.
9. Such retainer as the defendant had to act for the plaintiff in relation to the professional negligence proceeding was terminated on or around 1 December 2011. At that point, the plaintiff retained Marsdens as her solicitors. Marsdens briefed Mr Andrew McSpeddon as Counsel. The plaintiff confirmed that Marsdens lawyers had also indicated that her professional negligence claim had reasonable prospects.
10. At least two significant matters occurred whilst Marsdens was acting for the plaintiff.
11. First, on 6 March 2012, the plaintiff received a comprehensive written memorandum of advice by Mr McSpeddon, of Counsel (the 'McSpeddon Memorandum'), regarding the prospects of success with her professional negligence suit against Emil Ford. This was after conducting a conference a few days before (1 March) that lasted for four hours. Essentially, Counsel's view was that although her case had sufficient prospects so as to enable it to be certified, she did not have a strong case. At this point, the plaintiff said, in cross examination, that she still believed her claim have reasonable prospects, but accepted that she understood the chances of success were slim. She added that what was of some importance to her from Mr McSpeddon's advice was his recommendation for further amendments to her pleading. I will return to the McSpeddon Memorandum below.
12. Secondly, the plaintiff said that Marsdens had procured an agreement with the defendant's lawyers to informally produce, or allow for inspection of the defendant's files in the Equity Division proceeding. But instead of a solicitor from Marsdens inspecting the documents, the plaintiff herself attended the solicitor's offices, at some point around April or May 2012. The plaintiff said that it was only after the decision of Schmidt J was delivered that she appreciated that pages of a transcript of interview between herself and Mr Ford in June 2007 were missing from the two lever arch files of documents that Mr Ford relied upon (presumably as exhibits) in the affidavit he prepared for the Supreme Court proceedings.
13. Marsdens acted for the Plaintiff until about April or May 2012. Marsdens did not attend to filing an application for the amendments to her pleading. From March until April or May 2012, the plaintiff said that her concern was to obtain access to inspect Ford's files; which were located at the Newcastle premises of the firm Mullane & Lindsay. It appears as though the plaintiff took it upon herself to conduct that inspection rather than rely upon a solicitor. That being so, she accepted that 'the buck stopped' with her in identifying relevant documents from those files which she could use in the proceeding. Eventually, copies of those identified documents were passed on to Marsdens.
14. Instead of attending to amendments of her pleading, as Mr McSpeddon had recommended, the plaintiff says that she was busy preparing two affidavits. She prepared separate affidavits on 9 and 10 May 2012. This was, she said, done without the assistance of Marsdens. She described the latter affidavit as representing all the evidence that she wanted to put in which had not been included in her earlier affidavit. However, this latter affidavit, she later said, was not permitted to be used by direction of Registrar Bradford, of the Supreme Court.
15. Under cross-examination, the plaintiff was asked whether she ever informed her Counsel at trial, Mr Baran, whom, she said, was aware of or had a copy of the article, of the need to separately tender it so as to make certain that it was put before the judge. She did not do so. She denied that the reason for not doing so was because it was not important.
16. For the next three months or so, the plaintiff represented herself, although it appears that she may have received some background assistance from Mr Mullally, her local solicitor. On 22 June 2012 she received a copy of a long letter prepared by Mr Mullally and sent to the former solicitors' lawyers. In that letter, an offer of settlement was put on her behalf, that the former solicitors pay her the sum of $750,000, inclusive of costs and interest.

New retainer agreement with the plaintiff

1. On or about 2 August 2012, the defendant entered into a new retainer agreement with the plaintiff in relation to the professional negligence suit. The plaintiff accepted that at this point she had had no complaint against the defendant. She said that she was happy that he took up the case again and that she had informed him of Mr McSpeddon's advice. She accepted that at about this time, she believed that the defendant possessed all the necessary expertise and experience in relation to her professional negligence proceeding such that he could give appropriate advice.
2. At this point, the professional negligence proceeding had been listed for hearing, to commence later in November that year; and all the evidence was in. The trial was only three months away. Mr Baran of Counsel was briefed, although it is not precisely clear when.
3. Around 2 August 2012, the plaintiff had informed the defendant that she was unable to rely upon further or new evidence after having served her evidence in reply. This, the plaintiff had identified as an affidavit from her dated 10 May 2012. Following questioning from myself, the plaintiff accepted that it was likely that although Registrar Bradford, of the Common Law Division, had ordered that she not rely upon this particular affidavit, or any further affidavit more generally, this was unless the court had granted leave for her to do so. She also indicated that her Counsel later briefed for trial, Mr Baran, was aware of the content of her affidavit of 10 May 2012.
4. The plaintiff also challenged the defendant as to why he did not follow the advice of Mr McSpedden, of Counsel. The defendant took this 'advice' to mean taking steps to apply to further amend her pleading. The defendant said that he had not specifically read this memorandum of advice but, at this point, a hearing was imminent, he was instructed to prepare the case for hearing and that there was a concern as to the plaintiff's on-going capacity to fund the litigation.

The plaintiff's receipt of settlement offers - up to and during the trial

1. The defendant's affidavit sets out, in detail, matters concerning attempts to settle the professional negligence proceeding. The plaintiff accepted that she had the opportunity to carefully consider the evidence of these attempts at settlement and indicate if she disagreed with it. In the event, she did not.
2. It was essentially put to her in cross-examination and she agreed, that she was wanting to receive a large sum of money against Emil Ford; which was large enough to enable her to clear her debts including earlier judgements as well as providing some recompense for the psychological damage that she had received throughout the preceding years. She had in mind the sum of about $1 million; although she was amenable to the suggestion of Mr Mullally to reduce her expectations and make the offer of $750,000 back in June 2012.
3. On 10 August 2012, Emil Ford served another offer of compromise, on the basis that there be verdict for Emil Ford with each party to pay their own costs of the proceedings.
4. In November 2012, the Defendant obtained further verbal advice about the prospects of the suit from Mr David Baran, of Counsel. The Plaintiff said in her primary affidavit that Mr Baran had remarked upon several omissions from the Plaintiff's pleading.
5. The plaintiff put to the defendant in cross-examination that a week or so prior to the commencement of the hearing, he had told the plaintiff that he would not represent her and was going to quit. The defendant did not recall saying those things.
6. On 26 November 2012, the date when the hearing commenced, the plaintiff provided written instructions to the legal representatives to put an opening offer to the defendant put in for the sum of $400,000 plus costs (whilst acknowledging that the defendant may reject that offer and put a counter offer).
7. On 29 November 2012 and 30 November 2012, there was further correspondence between the plaintiff and her lawyers about offers of settlement that were made. On 29 November 2012, the plaintiff authorised her legal representatives to reject the defendant's offer of settlement. The content of the handwritten note of the instructions of 29 November 2012 indicated that she authorised them not to make an offer of $250,000 inclusive of costs in the understanding that should she be unsuccessful she would be liable to pay the defendants costs which may well exceed $100,000, together with a judgement registered against her in the local Court of $60,000. She provided written acknowledgement or confirmation that these instructions were contrary to the advice of her counsel, Mr Baran and her solicitor, the defendant. She also acknowledged in writing that despite these risks she wished to proceed with the proceeding.
8. There was controversy about the accuracy of the handwritten note of 29 November 2012. In his affidavit, in relation to the subject matter of the discussions of settlement on 29 November, the defendant (at paragraph 106) said that he recalled that he was instructed to make a counter-offer in the amount of $250,000. But at the outset of his giving evidence in the hearing, the defendant said that this was a mistake and that he meant to say, in his affidavit, that he was "not" instructed to make such offer.
9. In her affidavit in reply, the plaintiff responded to what the defendant had said in his affidavit in this respect. She said (at paragraph 11 of her affidavit in reply) that what the defendant had said in his affidavit was true: that she had instructed him to make a counter-offer of $250,000. Under cross-examination, the plaintiff was vigorously cross-examined on this evidence. It was suggested that the balance of what appeared in the written note of that conversation made no sense if it was read in a way accepting that she had given instructions to make an offer for that sum.
10. To resolve this controversy, it is necessary to consider the events the following day.
11. In his affidavit, the defendant gave evidence of having received an offer for settlement from the defendant on day five of the hearing, being 30 November 2012. It was the only settlement offer from Emil Ford to the plaintiff which contained provision for payment of some money to the plaintiff. The defendant said that he had spoken with Mr Baran and recalled the latter telling him that "if we can settle this case, we should. We have seen the evidence and there is a high risk we will lose."
12. The defendant says he had a conversation with the plaintiff thereafter to the following effect, in terms which were generally accepted by the plaintiff, as follows: "Me: Vrede, Emil Ford has made an offer to pay you $50,000 inclusive of costs but the offer is also on the basis that all prior judgements and costs orders are waived. This is a good offer and you should accept it. It is also beneficial for you to have the judgement waived so that it won't affect your borrowing capacity in the future. Ms Bird: I don't want to settle, I want to continue with the case. Me: The case has been running for a few days, so we know what the evidence is. I have discussed the offer with Counsel and his opinion is that if the case can be settled it should be. There is an unacceptably high risk that we are going to lose this case. Counsel and I both think you should accept this offer. The offer is for $50,000 to be paid to you and removes the $60,000 you owe Emil Ford, so its value is really about $110,000. It also removes the risk that you will have to pay Emil Ford's adverse costs which are in the vicinity of $100,000-$200,000. The only thing you have left to pay at the end of this are my fees. I would be prepared to reduce my costs so that you will receive something out of this offer. I would be prepared to accept $30,000 for all of my costs, which is a significant reduction as I have acted for you in two proceedings that have both gone to hearing. Ms Bird: I can't accept the offer. It is not enough money. I won't be able to afford to pay out all my other debts. Me: It is your case so it is your decision, but my recommendation, and Counsel's recommendation, is that you should accept this offer because the risks are too high to continue. Ms Bird: I don't want to accept the offer. I want to continue with the ` case."
13. That day, the defendant obtained further written instructions from the plaintiff. The written instructions were as follows: first she understood that the defendant had made a counter offer of settlement the sum of $50,000 with the costs orders of both parties being waived and the judgement in the Local Court being set aside. She instructed her legal representatives that Counsel had advised that there was still an "unacceptably high risk" that the court would find that the defendant exercise reasonable care and this would lead to a verdict for the defendant and a substantial costs order (for him) in the vicinity of $100,000-$200,000. She acknowledged that, knowing this risk, she was instructing her legal representatives to proceed with the case and reject the defendant's offer.
14. The hearing of the professional negligence suit against Emil Ford commenced on 26 November 2012. It lasted for six days. She accepts that she was told by the legal representatives, being Mr Baran of Counsel and the defendant, that this was a difficult case; although, the plaintiff said that it was only towards the end of the hearing that she was concerned that Mr Ford was 'getting away with' saying things which she thought were untrue. She emphasised that it was more Mr Baran who emphasised the difficulties and that it was not until very late in the piece that the defendant began raising 'alarm bells'.

The trial judge's reasoning for rejecting the plaintiff's claim in the professional negligence proceeding

1. On 28 March 2013, the plaintiff's professional negligence suit against Emil Ford was dismissed in the Supreme Court of New South Wales (by Schmidt J) [3] .
2. At first instance in the professional negligence proceeding in the Supreme Court, the trial judge (at [1]-[5]) identified, as the plaintiff's central case against her former solicitor, Mr Ford, whether he negligently failed to advise, or warn, her that she had no real case against the school which expelled her son as a student, and its headmaster. Another way of raising the same point was her assertion that the proceeding in the Equity Division before Einstein J was 'manifestly hopeless'. Had such advice been given, she asserted that she would not have brought the proceeding and would have averted all the financial cost, publicity and personal strain that attended it. But, the plaintiff said in her evidence, she received negligent advice from Mr Ford to the effect that the school (a registered non-government school) was obliged to afford her son procedural fairness pursuant to a provision (s 47(h)) of the Education Act 1990 (NSW). If this evidence was accepted, it might constitute negligence by a positive act. She also said, in the double negative, that Mr Ford did not give her the impression that Mr Ford was advising her not to pursue court proceeding. If this evidence was accepted, it might constitute negligence by omission.
3. Separately, in terms reminiscent of what she seeks to do in this case with the defendant, the plaintiff argued that Mr Ford engaged in misleading or deceptive conduct in misrepresenting his experience and expertise in conducting litigation relating to 'education law'.
4. In her Honour's reasons for dismissing her claim, Schmidt J rejected all of these claims. Her Honour found that Mr Ford did not advise her that the school had breached s 47(h) of the Education Act ([37]-[58]). Her Honour also found that Mr Ford had repeatedly advised her to settle, such that she could not accept the plaintiff's evidence that she did not understand Mr Ford to be advising her not to pursue court proceedings ([59]-[73]. Her Honour also rejected her representation case about expertise and experience (at [74]-[82]).
5. Further in the reasons for judgment, her Honour rejected the proposition that the proceeding against the school and its headmaster was manifestly hopeless ([153], [214]); found that advocates' immunity applied to the work performed by Mr Ford ([167]-[180]); and found that the plaintiff did not make out the element of causation ([218]-[235]). Her Honour also made (provisional) findings about damages notwithstanding her conclusion that judgment was given for the defendants.
6. In her opening address in the hearing before me the plaintiff, who was unrepresented at this hearing, drew attention to adverse credit findings made against her by Schmidt J. She blames (entirely) the defendant, her solicitor in the professional negligence proceeding in the Supreme Court, for this outcome. She says that because of the way in which the defendant conducted the proceeding, relevant evidence was not put before the court. She impliedly asserts that if additional evidence had been before Schmidt J, then her Honour would not have made the adverse credit findings that she did; and that, moreover, it must follow that she would have won her case. These contentions require very close scrutiny to the findings of Schmidt J and the additional evidence that the plaintiff says should have been, but was not obtained or prepared by the defendant.

Aftermath to judgment at first instance

1. It is not clear what happened between the delivery of reasons for judgment in March and October 2013 as to the plaintiff's deliberations in bringing an appeal.
2. On 1 October 2013 (at 11:46am), the defendant sent an email to the plaintiff. It was marked "URGENT INSTRUCTIONS REQUIRED". It referred to an advice in conference that had been given by Mr Baran. The effect of that advice was that the appeal, as presently framed, was arguable and had merit; (but) it was a very difficult appeal, the prospects of success of the appeal were difficult and if the appeal was lost, she would face additional costs orders. The defendant noted in his email that the plaintiff had become quite emotional during the conference and had indicated to him that she wished to not proceed any further with the appeal stating "I've had enough". The defendant suggested that she think about the matter and her instructions further overnight and provide written instructions as to the appeal.
3. At 1:15pm the same day, the plaintiff sent an email response back to the defendant saying that she wanted to withdraw an appeal.
4. In cross examination, Counsel for the defendant put to the plaintiff that the attitude that she expressed in her email of 1 October 2013 was only fleeting; and that within the space of even a few hours, she had asked the defendant to enquire whether Mr Baran could represent her on an appeal. It appears as though there was some equivocation on Mr Baran's part, due to fee arrangements, and the defendant was also asked to consider the availability of Mr Morahan to appear in his stead. (Eventually Mr Baran did appear at the hearing of the appeal).
5. On 5 December 2013, Mr Baran of Counsel provided a written letter of advice to the defendant; which was passed on to the plaintiff the next day. This was to the effect that her prospects of a successful appeal were poor.
6. On 29 June 2014, the hearing of the appeal brought by the plaintiff (but not her husband) occurred in the Court of Appeal. On 28 July 2014, the plaintiff was unsuccessful in her appeal from the decision at first instance [4] .
7. The plaintiff commenced this proceeding on 14 June 2016. She amended her pleading on 1 November 2017 and it is that version of that pleading which is current.

The action in general law

1. The plaintiff now complains that the defendant acted negligently in providing advice and conducting the prosecution of her professional negligence suit against Emil Ford. Initially, she complained that the defendant negligently (and/or in breach of his retainer): 1. failed to advise her of alternatives to the institution of court proceedings in relation to the bankruptcy notice; 2. commenced, and continuing, the professional negligence suit when the proceeding had no prospect of success (this was said to be in contravention of s 345 of the Legal Profession Act) ; 3. failed to advise her of the risks of the proceeding; 4. failed to advise her of costs;
2. During the hearing however, the plaintiff abandoned complaints (a) and (b).
3. As to the complaint (c) during the hearing, the plaintiff also identified, with greater specificity, the risks of which she was not advised were two-fold. First, the risk that the trial judge might prefer Mr Ford's evidence to her own as to what had happened. Secondly, the consequences for the success of her claim if the defendant had not prepared her case competently in advance.
4. As to the complaint (d), on the matter of costs, the plaintiff explained that the case was, at bottom, all about a modest debt owed to Mr Ford (after taking into account her District Court costs order), and that she should have been advised that if she proceeded with a professional negligence suit against that firm she might be exposed to a significant cost liability to Ford in the event that she lost which was disproportionate to the modest debt.

The statutory action

1. A separate and additional complaint by the plaintiff is that the defendant misrepresented the extent of his expertise and experience in professional negligence (and bankruptcy) litigation to provide appropriate advice. This misrepresentation was said to be in contravention of the prohibition against misleading or deceptive conduct under s 18 of the Australian Consumer Law.
2. I note, in passing, that there has been a history during the course of this protracted proceeding as to the plaintiff's attempts to amend her pleading. After some vigorous debate and contention, it was common ground that the plaintiff's relevant pleading was her Amended Statement of Claim filed 1 November 2017.
3. At an early stage of the hearing before me, at the point where objections were made to the admissibility of parts of the plaintiff's affidavit evidence, I indicated that I was prepared to admit evidence relating to the conduct of the defendant after the proceeding had commenced as I considered that this was relevant to the statutory action for misleading or deceptive conduct. Essentially, I determined, that it would be relevant to falsify the alleged representation as to expertise and experience to provide advice that the defendant's conduct (including, but not limited to, the advice that he gave, or steps he took in the prosecution of the professional negligence claim) was not consistent with a person with the represented experience and expertise.
4. This ruling had the effect, as Counsel for the defendant acknowledged, that conduct by the defendant after the commencement of the proceeding and in furtherance of the plaintiffs prosecution of her claim could be considered on the question whether the defendants alleged representation was falsified and accordingly, constituted misleading or deceptive conduct. The plaintiff also submitted that the statutory misrepresentation claim was distinct from her claims under general law in that advocates immunity defence was not, she said, applicable to the statutory claim.
5. By this proceeding, the plaintiff claims damages under s 236 of the Australian Consumer Law. The plaintiff did not, by her pleading or otherwise, seek to distinguish what damages were recoverable under the general law claims from those which may be available under section 236 of the Australian Consumer Law.
6. The defendant denies liability, on various grounds, including principally the plaintiff's allegations of negligence against him. In his Defence, he specifically relies upon additional defences that: 1. the element of causation is not made out: she had advice prior to, and after the commencement of the suit, that the professional negligence proceedings had poor prospects of success or should not be continued but the plaintiff elected to continue notwithstanding such advice; that she had rejected settlement offers which, had they been accepted, would have put her in a more favourable position; and that adverse credit findings against her meant that even if the defendant acted as she said he should have, the result would not have been different; 2. contributory negligence (principally based upon the same copy matters relating to the causation ground); 3. advocates immunity; and 4. proportionate liability: the defendant says that the advices that the plaintiff received from Mr Morahan and (to a significantly lesser extent) Mr Wheelahan QC, in connection with a professional negligence claim, if negligent, caused the plaintiff the same loss or damage as any negligence found against the defendant; so as to make them 'concurrent wrongdoers'
7. The defendant also specifically pleaded a set-off of his unpaid legal fees against any award of damages made in the plaintiff's favour. These were said to be approximately $13,000, allowing for some disbursements.

Issues

1. The parties handed up schedules of issues. The plaintiff's version was pitched somewhat more narrowly than the defendant's issues. The plaintiff identified the issues as being the extent of the defendant's prior experience in professional negligence proceedings and whether that experience was discussed with the plaintiff; the defendant's general experience of litigation in so far as it concerned the preparation of the case (including obtaining and preparing evidence); omissions in the defendant's preparation of the plaintiff's affidavit in the professional negligence suit in the Supreme Court and the delayed briefing of Counsel until a relatively short period before the commencement of the hearing.
2. The defendant identified the issues, more generally, as being: 1. What was the scope of the defendant's retainer? 2. did the defendant breach the terms of his retainer? 3. was the defendant negligent? 4. did the defendant engage in misleading or deceptive conduct? 5. did the defendant's conduct cause the plaintiffs loss and damage? 6. are the plaintiff's claims available having regard to advocates immunity? 7. if any negligence is established, is the plaintiff guilty of contributory negligence? 8. is a defence (or limitation on liability) of proportionate liability available to the defendant? 9. is the defendant entitled to set off, as against its own liability to the plaintiff, the plaintiffs liability to him for unpaid fees? 10. what is the quantum of any award of damages should be awarded to the plaintiff?

Advocates' immunity

1. l address this issue first, with some trepidation, given the division of opinion in the Court of Appeal, in its decision in Donnellan v Woodland [2012] NSW ConvR 56-307 as to whether the immunity defence should be considered in advance of consideration of breach of duty (or retainer), and, if the defence succeeds whether it is necessary to go on to consider the question of breach of duty [5] . As to the first of these matters, in my view, if the immunity is made out, it offers a complete defence to a claim in negligence and, in that sense, is effectively similar to some of the defences (such as the existence of obvious or inherent risks) to claims of professional negligence under the Civil Liability Act. In such a case the Court of Appeal has indicated (in cases decided more recently than Donnellan) the special defence should be determined first, if possible, before determination of the issue of breach [6] . As to the second of these matters, if I were to find that the immunity applies, I consider it appropriate to consider the issues of breach lest I am wrong in my opinion as to the immunity issue. As it turns out, for reasons that will be shown, it makes no difference to the outcome.

The parties' submissions

1. Save for reference to one decision of the Full Federal Court, being Sims v Chong [2015] FCAFC 80, which concerned the immunity defence and its applicability to the statutory cause of action she brings, the plaintiff made no submission as to whether advocates' immunity applied to her action for damages under general law.
2. Counsel for the defendant says that all the work performed by the defendant fell entirely within advocates immunity, from the filing of the statement of claim, to the preparation of evidence, to the briefing of Counsel and the representation of the plaintiff during the hearing of the proceedings before Schmidt J (and, subsequently, the appeal proceeding).
3. In D'Orta -Ekenaike v Victoria Legal Aid (2005) 223 CLR 1 the High Court reaffirmed the existence of an immunity from suit for advocates; and affirmed the description of the boundaries of the immunity that had been given by Mason CJ in Giannarelli v Wraith (1988) 165 CLR 543 at 559-60. The plurality indicated that the basis for the immunity was the protection of finality and certainty of judicial determinations. The plurality explained, in particular (at [73]), that it would cut across the principle of finality of judicial determinations if a disappointed client, trying to establish that the advocate's conduct has caused it to lose litigation, was able to impugn the result of the earlier litigation.
4. In Attwells v Jackson Lalic Lawyers Pty Ltd (2016) 259 CLR 1 and Kendirjian v Lepore [2017] HCA 13; (2017) 91 ALJR 508, the High Court revisited the question of identifying the boundaries of the immunity, in both cases, in the context of legal advice about offers of settlement. In both cases, majorities in the Court explained that the rationale for the immunity as attaching to the advocate's participation, as an officer of the Court, was the quelling of controversies by the exercise of judicial power. The test requires that the advocate's work bears upon the court's determination of the case [7] (at [46]).
5. To reiterate, the conduct of the defendant which is complained of by the plaintiff concerned the following subject matter. In her general law claim, in negligence or breach of retainer, the conduct could generally be characterised as a failure to advise, inform or warn: 1. of certain risks if she proceeded with a professional negligence claim; 2. of a prospective substantial cost liability should she lose.
6. As I have noted, it appeared to me that the defendant's conduct during the course of the proceeding, up to the trial was relevant to the plaintiff's statutory claim of misleading or deceptive conduct in that it might falsify the representation of experience and expertise to conduct professional negligence litigation. That being so, the plaintiff seeks to prove that the defendant engaged in misleading or deceptive conduct by making a false representation as to his experience and expertise in conducting professional conduct proceedings, by establishing that the defendant had: 1. not adequately prepared her primary affidavit of 20 June 2011, by: 1. omitting an article that Mr Ford had written, titled 'Investigating the Investigators'; and 2. not ensuring that the content of her affidavit of 9 May 2012 (in reply to Mr Stonham's evidence) had been contained in her primary affidavit of June 2011. 1. not adequately represented her interests in the course of the proceeding in a timely fashion, to such extent that Registrar Bradford would not allow her to rely upon an affidavit of 10 May 2012 at the hearing scheduled for November 2012, when that affidavit annexed documents that could advance her case; 2. not ascertained or made any or any adequate enquiry as to the whereabouts of a typed transcript of conversation between the plaintiff and Mr Ford on or about 17 or 18 June 2007.

Pre-litigation failures to warn, inform or advise

1. In my opinion, any omission by the defendant to advise, inform or warn about the risks of a suit and, especially, the costs consequences of such a suit should the plaintiff be unsuccessful, are not caught by advocates immunity but merely have an historical connection with the suit.

The preparation of the plaintiff's evidence during the conduct of the proceeding

1. As I have noted, this limb of the plaintiff' case relates to her statutory action only. There was nothing in her pleading of her general law claim which relied upon conduct that occurred after the professional negligence suit had been commenced. No further application was made to amend the pleading so as to permit the plaintiff to rely upon conduct by the defendant after the commencement of the suit in her actions for breach of retainer and/or negligence.
2. The preponderance of authority, in this state, is that advocates' immunity may, in principle, apply to actions for damages for statutory misleading or deceptive conduct [8] . As Ward JA (who delivered the leading judgment) said in Young v Hones, the immunity is one from suit; not from the cause of action(s) that a claimant might choose to select. In Sims v Chong [2015] FCAFC 80, the Full Federal Court allowed an appeal from an interlocutory decision, being a summary disposal of a proceeding in which, relevantly, the claimant alleged that a practitioner had engaged in misleading or deceptive conduct through the course of an inadequately drafted pleading. The Full Federal Court considered the Court of Appeal's decision in Nikolaidis, but it did not, however, refer to the Court of Appeal's decision in Young v Hones.
3. No submission was made, on behalf of either party, as to how these authorities may be reconciled or whether I should be invited to prefer the Federal Court's decision in preference to the decisions of the Court of Appeal that I have referred to. However, upon closer analysis, the Full Federal Court actually (at [[84]) indicated its agreement with the correctness of the Court of Appeal's decision in Nikolaidis: that is, it agreed that advocates immunity could be used to defend an alleged contravention of the prohibition against misleading or deceptive conduct. At issue in Sims was whether it might extend to an allegation of unconscionable conduct. Nevertheless, the Full Federal Court (at [95]) raised the question, without deciding, whether the reach of the immunity extends to circumstances where the advocate has misrepresented his or her skill or experience (in a way that might give rise to an action for statutory misleading or deceptive conduct). This is, as I have said, the question that the plaintiff wants decided in her favour in this proceeding.
4. If it was necessary to decide whether there was a conflict, I would consider myself bound by Young v Hones. In the light of the recent High Court authorities, it seems to me that the issue is not to be determined by how the cause of action is framed, but rather whether the boundary of the immunity is exceeded. That is to say, the question is whether the conduct that is to be characterised as misleading or deceptive must move the litigation in some way towards, or bears upon, a determination by a court. I would have thought that the decision in Sims may well be correct, and that an inadequately prepared pleading may arguably not fall within the immunity: it is only an expression of a party's claim (or defence) and absent, perhaps, any statement of admission, it would not ordinarily move the Court towards a determination of the litigation to 'quell' the controversy. Pleadings serve a basal purpose of identifying and crystallizing issues for a Court's determination.
5. In my view, a representation by a lawyer to a client, prior to the commencement of a suit, as to the person's expertise, experience or competence to conduct litigation should s/he be retained does not, per se, move the litigation towards any determination by a court even if it may influence a client to decide to commence litigation. It has only a historical connection with litigation; not a functional one. However, in order to establish that the representation is misleading or deceptive, its falsity, or misleading character may be established if, through the course of the retainer, the practitioner's conduct falls short of the expertise or experience that had been proclaimed. In this regard, the plaintiff relies upon events that post-dated the representation and, relevantly, events which occurred after the proceeding commenced. But by trying to establish the falsity of the representation, the plaintiff is, perforce, trying to prove acts or omissions by the defendant which, by their nature, do bear upon the Court's determination of a dispute. The preparation of affidavit evidence, and the plaintiff's evidence generally, is work that is performed out of court which bears upon the Court's determination of the case. The preparation of affidavit evidence, in complying with the practice for case-management that evidence for such a suit is to be given by affidavit, is functionally no different to an advocate leading evidence from a witness in Court. There would be little doubt that an advocate's conduct in leading evidence from a witness in court would fall within the immunity.
6. Any argument that there was other evidence that was available but which, because of the defendant's negligence, was not put before Schmidt J amounts, in my view to a collateral challenge to the findings of Schmidt J, which would undermine the principle of finality which, the High Court said in D'Orta-Ekenaike, lies at the heart of the immunity; as well as diminishing confidence in the administration of justice which is another, perhaps more subsidiary consideration (of public policy) that also lies behind the immunity. This is because it is necessary for the success of her case for the plaintiff to say that the findings made by Schmidt J, on such questions as to whether Mr Ford gave her advice that a provision of the Education Act was or may have been breached by the school, was wrong; albeit not because of any fault on the part of the trial judge.
7. It may be accepted that the conduct in failing to make enquiries about potential evidence, or conduct in causing such delay in the preparation of a client's case as to cause the Registrar to make an order preventing the reception of evidence may well have occurred long before a hearing. But ultimately, the conduct produces the same result - that relevant evidence is not put before the court. Accordingly, in my view these other complaints may also be said to affect the way a court may determine a case and thereby fall within the immunity. In my view, the comments of Gleeson CJ in Keefe v Marks (1989) 16 NSWLR 713 at 719 are apposite: ".. It does not seem to me that a plaintiff can circumvent the immunity simply by constructing allegations of damage in a manner which attempts to relate the harm suffered as a consequence of a (practitioner's) alleged negligence to that aspect of his conduct furthest removed from physically standing up and speaking in court."
8. Transposed to this context, that means that although it may well have been a long period before the evidence which the plaintiff sought to rely upon was ultimately to be presented to the Court, what mattered was the evidence which was ultimately presented; and it is artificial to posit that the immunity applies where a legal representative read the evidence in a court hearing, but does not cover a solicitor's steps in helping to prepare that evidence months before the Court hearing occurs.
9. For these reasons, the matters that the plaintiff needs to establish in order to prove her statutory action are such that they will bear upon the Court's determination of a dispute and will amounts to a collateral challenge to a court's findings. That being so, in my opinion, the defendant has made out its defence of advocate's immunity in connection with the statutory action.
10. As I have said at the outset of this section of the reasons, on the view propounded by Basten JA in Donnellan, my conclusions as to advocates' immunity should preclude my further consideration of whether or not the defendant contravened the prohibition against misleading or deceptive conduct. But in circumstances where a majority of members of the Court of Appeal in that case considered the liability issues in advance of the immunity, I propose to follow the approach adopted by Schmidt J in the professional negligence proceeding and go on to consider the merits of that action in due course, lest I am wrong in my views on the applicability of the immunity.

Cause of action in negligence

1. To reiterate, only two particulars of negligence or breach of retainer are pressed: the failure to warn of risks; and the failure to advise of a significant or substantial prospective costs liability if the plaintiff lost her professional negligence proceeding.

Principles for establishing breach of duty.

1. Section 5B(1) of the Civil Liability Act 2002 (NSW) provides: 1. A person is not negligent in failing to take precautions against a risk of harm unless: 1. the risk was foreseeable (that is, it is a risk of which the person knew or ought to have known), and 2. the risk was not insignificant; and 3. in the circumstances, a reasonable person in the person's position would have taken those precautions 1. In determining whether a reasonable person would have taken precautions against a risk of harm, the court is to consider the following (amongst other relevant) things: 1. the probability that the harm would occur if care were not taken, 2. the likely seriousness of the harm, 3. the burden of taking precautions to avoid the risk of harm, 4. the social utility of the activity that creates the risk of harm.
2. I note also that Part 1A, Division 4 of the Civil Liability Act provides defences to a defendant in a claim for negligence where the person who has suffered harm has suffered that harm as a result of the materialisation of an 'obvious' (s 5H) or 'inherent' risk (s 5I). The defendant did not plead these defences in his Defence in this proceeding.
3. In the context of professional negligence proceedings, there are also well known principles which provide a guide (in conjunction with, but in no way supplanting the statutory requirements of s 5B and 5C of the Civil Liability Act). Some of these were identified by Schmidt J in her Honour's reasons for judgment, at [85] - [86], which I respectfully adopt here (omitting citations): "[85] A solicitor must exercise reasonable care and skill in the provision of legal advice to the standard which may reasonably be expected of legal practitioners. …. "A legal practitioner owes a duty to a client to take reasonable care and to exercise 'due care, skill and diligence', bringing to the task required to be performed 'the competence and skill that is usual among [practitioners] practising their profession... The duty may be pursuant to an express or implied contractual retainer, or under the common law, or both." [86] When determining whether a legal practitioner has breached his or her duty to a client, consideration must be given to the way in which the advice is given. That may be affected by the type and experience of the client for whom the practitioner is acting .."
4. At [87], of her Honour's reasons, a citation was made to the observation of McClelland CJ in Eq in Trust Co Australia v Perpetual Trustees WA (1997) 42 NSWLR 237 at 247, that a lawyer is not normally required to warn experienced business clients of the possibility that (his) opinion, although firmly held, may not in fact prevail.
5. It is certainly possible that a solicitor who gives overoptimistic advice and failed to advise a client of the risk that relief would not be obtained may breached his or her duty of care: Hyland v Campbell (1995) Aust Torts Rep 81-352 (Walmsley, Abadee, Zipser, Sirtes, Professional Liability in Australia, 3rd ed [3.850]). However as the reference to the decision in Trust Co Australia indicates, whether there has been a breach of a duty of care may practically be influenced by the nature of a client. The Court of Appeal said in Heydon v NRMA Ltd (2000) 51 NSWLR 1 at [363] that a solicitor is not normally required to warn experienced business clients of the possibility that their advice or opinion, however firmly held, may not ultimately be correct. Counsel for the defendant also drew my attention to the decision of Artahs Pty Ltd v Gall Standfield & Smith (A Firm) [2013] 2 Qd R 202 at [62]-[64] as authority for the proposition that the sophistication and expertise of a client is a critical factor when assessing the content of a solicitor's duty to advise; particularly where what is at issue is a failure to advise.

Scope of duty of care

1. As noted, the plaintiff's complaints under her actions in the general law centre upon alleged omissions that occurred prior to her commencing her professional negligence proceedings in the Supreme Court on 13 July 2010.
2. In this case, although there was a written retainer between the plaintiff and defendant, dated 9 June 2010, it was ostensibly limited, by its terms, to the defendant acting for the plaintiff in relation to her application to set aside the Bankruptcy Notice. As noted previously, the scope of the work under that retainer was identified as acting on the plaintiff's behalf in the 'Bankruptcy Proceedings', including but not limited to: (I) Briefing counsel (Mr Morahan) to advise and appear on your behalf; (II) prepare and file application in Federal Magistrates Court to set aside the Bankruptcy Notice; (III) attend on your behalf at all Court appearance; (IV) prepare your matter for hearing, attend hearing, and instruct Counsel upon hearing of your application. As is apparent, the precise delineation of these tasks was not exhaustive of the obligations under the retainer.
3. The defendant submits, and I accept, that up until the conference in Mr Morahan's chambers on or about 24 June 2010, the defendant was not specifically asked to, nor expressly undertook, to advise upon the merits of the professional negligence claim that was in prospect. I accept that it was not expressly part of his retainer. From the time he started to act for her on or about 4 June, through to the conference at Mr Morahan's chambers later that month, the defendant was applying himself to the Bankruptcy Proceedings, acting, as he was, under the significant time constraints under that Act for the setting aside of Bankruptcy notices.
4. Nevertheless, an integral part of the implementation of that retainer was a strategy, perhaps primarily devised by Mr Morahan of Counsel, but at any rate also involving the defendant, requiring the preparation and prompt filing of a professional negligence suit against Emil Ford. According to his evidence, the defendant recognised this in his conference with the plaintiff on 4 or 7 June. It was referred to again in the defendants letter to the plaintiff dated 9 June 2010 (which attached the proposed costs agreement and written retainer agreement that was subsequently entered into). Only in this way, could the plaintiff acquire an offsetting claim (of substantial value) that was capable of defeating the firm's claim against her to recover a debt. So the filing of the pleading in the Supreme Court was, in my view, incidental to the defendant's performance of the retainer agreement entered into on 15 June.
5. It would not avail the plaintiff to commence a professional negligence suit in the Supreme Court unless there were reasonable prospects of success. Any solicitor filing the pleading needed to satisfy himself or herself that it had reasonable prospects of success in order to certify it, and therefore comply with statutory requirements. It needed to appear reasonable as well as genuine in order to constitute a persuasive offsetting claim. In this regard, Raphael FM ultimately acknowledged, in his decision setting aside the bankruptcy notice, that from what was put before him, that the draft pleading which ultimately was filed, manifested reasonable prospects of success.
6. In my view, if a solicitor is responsible for filing a statement of claim to commence a proceeding (which s/he has a statutory obligation to certify), ordinarily, an associated obligation is to ensure that the client has been informed of certain material matters concerning the consequences of the proceeding having been commenced. I have noted earlier that the defendant did, in fact, give some generic advice about litigation in early June 2010, about the risks of failure. So the question is whether he went far enough. More specifically, the issue, which I will explore further below, is what are the material matters that should be disclosed.
7. In finding that these obligations were incidental to the retainer, I am relieved of the necessity to consider whether, as the plaintiff urged, there was some 'penumbral' duty in tort to provide advice, separately to obligations under the retainer. In this regard, I adopt, with respect, the approach of Allsop P (as his Honour then was) in David v David [2009] NSWCA 8 at [76] and Dominic v Riz [2009] NSWCA 216 at [290]-[291] [9] , that the proper discharge of a retainer may require the solicitor, upon learning of certain matters placing the client at risk during the course of performing that retainer, to speak out.

Whether breach of duty (or retainer) established

1. In his affidavit, the defendant said he advised the plaintiff in conference (on 4 or 7 June 2010) of generic uncertainties of litigation: "Litigation is difficult because you can win on every point except one and then still lose the case. Even if you establish that the other side did the wrong thing, if you can't prove that that caused you loss, then you still won't win. Or you could lose on one factual issue, which may be the undoing of the whole case."
2. He was not cross-examined on this part of his evidence and I accept he said these things to the plaintiff.
3. But the defendant does not dispute that he did not advise, or inform, the plaintiff, prior to the filing of the pleading and the commencement of the professional negligence suit that: 1. if he did not conduct the case competently, she may lose; 2. Mr Ford's account of events may be preferred to her own; 3. if she lost, she could be exposed to a substantial cost liability to Emil Ford, which was a matter that needed to be weighed against the circumstances that the net amount of any liability she had for that firm's fees (taking into account her own District Court costs order) was modest.
4. These were, to adopt the language of s 5B, foreseeable and not insignificant risks of harm. The general question, in each case, is what if any reasonable precaution should have been taken by the defendant.
5. Relevant factual considerations to this question include: 1. Prior to the events that gave rise to the professional negligence suit in the Supreme Court, the plaintiff was (and remains) an intelligent person and moreover, had a professional occupation. 2. Prior to the commencement of that suit (in July 2010), the plaintiff had already been involved in a 2-day hearing in the Supreme Court (the Equity Division proceeding), in which she was unsuccessful and was subject to an adverse costs order; 3. A perusal of the reasons for judgment of Einstein J indicates that the outcome of the Equity Division proceeding did not turn upon factual findings based upon the credibility of witnesses [10] . To a significant degree, the case turned upon arguments of law, based on a relatively narrow set of facts; 4. The plaintiff had observed, through the course of the Equity Division proceedings, witnesses being cross-examined, submissions being made on behalf of the parties about that evidence; 5. By July 2010, the plaintiff had also had experience of the proceedings in the District Court. In that proceeding, she had heard Mr Ford give evidence and the judgment (of Curtis J) made a finding [11] that, objectively, would have indicated to the ordinary reader that his reliability as a witness was questioned by the Judge. 6. The plaintiff's lawyers in the Equity Division proceeding had initially claimed the sum of $100,000 for costs of acting her, in a proceeding whose hearing lasted for only 2 days in a case where the main issues were those of law.
6. These circumstances largely relate to the plaintiff's position. Other matters germane to the defendant's position was that: 1. By July 2010, a professional negligence suit had been "on the radar" for virtually 2 years, or, at least well before the defendant's association with the plaintiff had commenced (in May 2010). Before then, the plaintiff had received the input of Brydens Lawyers, Mr Morahan and Mr Wheelahan QC on the desirability of bringing a professional negligence suit against Emil Ford. 2. On 24 June, Mr Morahan of Counsel assumed the responsibility of drafting a pleading for intended use for a professional negligence suit in the Supreme Court. 3. On that date, the only task requested of the defendant was to file the version of the pleading (after having it correctly formatted) drafted by Mr Morahan; 4. The defendant had not been specifically requested by the plaintiff to advise on either the prospects of a professional negligence suit or material risks associated with it; and 5. The defendant has not pleaded the defences of obvious or inherent risk in answer to the plaintiff's complaints about non-disclosure of risk or information that could have been available to him under the Act.
7. There was no expert opinion evidence which the plaintiff relied upon to establish breach of the standard of care. This is certainly not mandatory in professional negligence cases against solicitors [12] .
8. In my opinion, it is part of the duty of care of a solicitor entrusted with the responsibility for the filing of a pleading to either: 1. advise the client himself or herself, or 2. take steps to ensure that a client is advised (perhaps by a barrister), or 3. take steps to ensure that the client is herself aware of certain material features of litigation, prior to commencing a suit on the client's behalf.
9. The complaints made here by the plaintiff - that her evidence might not be preferred to the evidence of the opposing part, and the prospect of a substantial adverse costs order upon a defeat - were not matters which the defendant brought to her attention. It seems to me that he assumed that the plaintiff already knew about them, perhaps because of her past recent experience in litigation; or perhaps because he assumed that those who had previously acted (or counselled) for in the preceding two years had mentioned them; in the context of a professional negligence suit that needed to be brought in conjunction with the application to set aside the bankruptcy notice.
10. For the purposes of s 5B(2), I consider that a reasonable person in the defendant's position would have taken any of the steps referred to in paragraph 133 above, but this did not occur. They were not burdensome and significant harm might follow if, because the client decided to commence a proceeding on an ill-informed basis, the risks associated with losing litigation materialized.
11. I take into account that the plaintiff did in fact have recent experience with litigation, but it is relevant to note that a professional negligence suit (itself based partly upon a failure to advise or inform) was altogether of a qualitatively different nature to litigation to set aside a bankruptcy notice, a defence of a proceeding to enforce a costs order, or the type of proceeding that was before Einstein J. A professional negligence suit of the kind commenced in the Supreme Court, in the way the pleading was cast, was, I think inevitably, going to involve a significant factual contest and in all probability, require a Judge to make findings on credit of the claimant (and the professional). Factual contests and credit findings were not prominent features of the earlier litigation that the plaintiff had been involved in.
12. I also take into account that, by the middle of 2010, the plaintiff had been exposed to a costs order from the Equity division proceedings.
13. There is no evidence before me to indicate that the nature and basic risks of the professional negligence proceeding were brought home to the plaintiff; other than the very generic statement of the defendant made to the plaintiff in early June 2010. I do not consider that it was reasonable, in the discharge of his duty, for the defendant to assume that the plaintiff had received the information that she needed to know about to decide whether to bring the professional negligence suit against Emil Ford because of the involvement of other lawyers in the two years leading up to time when the plaintiff commenced the suit. At least this is so where the defendant did not disclaim any responsibility for providing the information and recommending that it be obtained from some other practitioner; if, after having made inquiry, it had not been ascertained that the information had previously been acquired by the defendant. Another way of expressing this is that, in my view, it was not a reasonable response to the risks for the defendant to consider that it was unnecessary for the plaintiff to be told about the material matters.
14. By 'material' matters, I consider that expression encompasses warning that if it was contested all the way through to a hearing, the professional negligence suit was likely to involve a vigorous factual contest; for which credibility findings might be influential; if not decisive. I also consider that it was material, in this context, for the client to appreciate that, if it was contested, all the way through to the hearing, and if she lost, the plaintiff could be exposed to a very significant costs liability to the other (winning) side. In this last respect, I do not consider it reasonable for the solicitor to place a figure upon it - the solicitor did not have a crystal ball to predict, say, how long a contested hearing might last. It would only be if the client specifically sought a quantified estimate of costs that a reasonable solicitor would think to provide a prediction of that kind and, even then, the prediction would need to be heavily qualified.
15. I find that the defendant was in breach of his duty of care in failing to take reasonable steps to satisfy himself that the plaintiff was informed, or warned, prior to the commencement of the proceeding, that if her professional negligence suit ran to a contested hearing: (a) there was a substantial risk that the trial judge might prefer Mr Ford's account of events; and (b) if she lost, she could be exposed to a substantial costs liability to Ford which was disproportionate to the debt claimed against her by Emil Ford.
16. I am not so persuaded about the remaining complaint: that the defendant did not warn her that if he did not perform his duties as a solicitor competently, she might lose. This is because, at this point, shortly before or at the commencement of the professional negligence suit, there was no clear agreement or assumption of responsibility by the defendant to act for the plaintiff in the proceeding. In this regard, in my view, it could not be said to have been incidental to the plaintiff's prior retainer with the defendant, for the defendant to have assumed any such responsibility.
17. I also consider that it is not generally to be expected that when a client consults a prospective professional service-provider (be it lawyer, doctor, building professional - such as the plaintiff), s/he desires to be informed of adverse consequences should the professional service-provider not act in a competent fashion. Certainly the plaintiff, by occupation, would have been well aware that a professional does not typically warrant an outcome from the service that is offered. But she must have known that if the professional did not act competently, other things being equal, the outcome of the professional service may well fall short of the outcome of the service that is expected. She would also have known that an adverse outcome may be the result of circumstances beyond the professional's control. This may include the role of Counsel, it may include the performance of other witnesses and it may even include the performance of the trial judge as well.

Causation

1. By the combined operation of sections 5D and 5E of the Civil Liability Act, it was necessary for the plaintiff to prove that: 1. the defendant's negligence was a necessary condition of the occurrence of harm (factual causation); 2. it is appropriate for the scope of the defendant's liability to extend to the harm so caused (scope of liability).
2. In relation to the former of these requirements, s 5D(3) provides that if it is relevant to the determination of factual causation to determine what the person who suffered harm would have done if the negligent person had not been negligent: 1. the matter is to be determined subjectively in the light of all relevant circumstances (subject to paragraph (b)); and 2. any statement made by the person after suffering the harm about what he or she would have done is inadmissible except to the extent (if any) that the statement is against his or her interest.
3. In the light of my findings on breach it is now necessary to specifically consider whether either or both of them made out factual causation. Counsel for the defendant did not contend that if I was to find that factual causation was made out, I should go on to find that the scope of liability requirement was not made out.
4. In practical terms, it is incumbent upon the plaintiff to prove (in satisfaction of the factual causation element) that she would not have commenced the professional negligence proceeding in the Supreme Court had she been advised by her solicitor that: (a) she might lose (because the Court might prefer Mr Ford's evidence over her evidence) or (b) if she lost, she could be exposed to a large prospective costs liability to Emil Ford.
5. I am not persuaded by the plaintiff that she would have taken a different course, namely, refrain from commencing the professional negligence suit, had she been informed of either or both of these matters.
6. The background context suggests to me that as at the period May - July 2010, the plaintiff appreciated that if she wanted to preserve her status as a registered or licensed building professional, she needed to do all that she could to avert committing an act of bankruptcy and thereby endanger that status. It was clear, and the plaintiff accepted, that she was not in a position to adopt the alternative options that she had been advised of by the defendant (ie paying the debt or entering into an alternative arrangement with her creditor). Her only option was to apply to set aside the bankruptcy notice and she appreciated (following legal advice) that this necessarily required her to commence a professional negligence suit, with some prospects of success, to establish the offsetting claim she needed to set aside the notice. In practical terms, if she wanted to hold on to her professional status and livelihood, the plaintiff had convinced herself that she had no practical choice but to proceed to institute the professional negligence suit in the Supreme Court.
7. Further, although I do not consider that the defendant was entitled to assume that the plaintiff was already aware of the matters about which she complains, I do think that it is likely that the defendant did in fact appreciate or understood that once the professional negligence suit had been commenced, if it went to a hearing, there was likely to be a significant factual contest between herself and Mr Ford which would needs to be determined by the trial judge. Further, I also find that the plaintiff did in fact appreciate that if she lost the professional negligence suit then it was likely that she would be liable to a costs order and that the quantum of such order might be very substantial.
8. I consider that the best evidence of the plaintiff's determination to proceed with this professional negligence suit (even after she had succeeded in setting aside the bankruptcy notice) comprises: (a) her willingness to proceed even after her receipt of the McSpeddon Memorandum; and (b) her attitude towards the settlement negotiations in November 2012, shortly before and after the hearing commenced before Schmidt J.
9. The short point of the McSpeddon Memorandum was that, although technically, it was capable of being 'certified', the plaintiff had poor prospects of success and the prospects would be further downgraded to "dismal" if expert opinion evidence was not obtained. In evidence in this trial, the plaintiff tended to overlook this primary opinion and instead focused upon the next part of his conclusions bring, in effect, that her amended pleading (ie the pleading of 1 November 2017, being the version before this Court) needed to be extensively re-pleaded. Taken in isolation, it appears that the plaintiff has treated the suggestion of further amendments as providing something of a ray of hope.
10. She also neglected the next conclusion advanced by Mr McSpeddon, that "the professional negligence proceedings," it continued, "are likely to prove very complicated protracted and very expensive". Mr McSpeddon's final conclusion was to urge the plaintiff to immediately attempt to mediate so as to "avoid the very large risks (she and her husband) face of losing the professional negligence proceedings and of incurring very great further liabilities in respect of costs".
11. These last two conclusions were cogent evidence to indicate that anything that the defendant may have said to her on the possibility of a prospective costs liability to Emil Ford prior to the commencement of the proceeding would not have deterred her from instituting the action.
12. As to the aspect concerning settlement negotiations, as a preliminary point, I think it is more likely than not, that the instruction that was provided by the plaintiff to the defendant on 29 November 2012 was not to make an offer to the defendant of $250,000 inclusive of costs. It is inconceivable, to my mind, that to have made a positive offer of $250,000 inclusive of costs could have been "contrary" to the advice received from Mr Baran and the defendant at the time; because making an offer in those terms would not have been detrimental to the plaintiff. It makes greater internal sense that Counsel and the defendant had advised her to make an offer of $250,000 (inclusive of costs), but that this amount was not enough for the plaintiff; in terms of what sum she sought from the litigation (whether by settlement or court adjudication). What was prominent in her mind, at this point, was to obtain a sufficient dollar recovery from the litigation that would enable her to repay the debts: this point emerged very clearly the next day on 29 November when the plaintiff explained to the defendant her reasons for rejecting Emil Ford's offer of $50,000 that day. This was irrespective of the crucial consideration for any proposal for settlement; being a realistic or objective appraisal of the plaintiff's prospects of success after days 4 and 5 of the hearing.
13. In summary, I consider that the plaintiff's state of mind was such that she felt driven to institute the professional negligence suit and inclined to proceed with it until the bitter end. It would not have mattered to her, at any stage, but most relevantly at the stage just prior to the commencement of proceeding - at a point where she had already received the advices of other practitioners other than the defendant - whether the defendant had informed her of the prospect of the court preferring the evidence of Mr Ford, or the likelihood that she would bear a substantial costs liability to Emil Ford if she lost. Further, for the plaintiff to contend, as she now does, that the relatively modest nature of the debt claimed by Emil Ford did not warrant the costs risks associated with an unsuccessful professional negligence suit amounts to an exercise in historical revisionism.
14. I find that the plaintiff has not established the element of causation. That being so, her action in negligence must fail.

Whether the pleaded representation was made

1. Is not clear to me that an express representation, in the pleaded terms, was made by the defendant. In her pleading (paragraph 11) the plaintiff appears to effectively allege that an express verbal representation made by the defendant during a conference in July 2010. No further particulars were provided (or, apparently) sought. However, there was no evidence to support any express representation to this effect in her primary affidavit of 20 April 2018 (and the matter was not touched upon in her affidavit in reply).
2. In circumstances where the plaintiff was not requested to give particulars of the representation, I would be prepared to accept that the plaintiff is not precluded from relying upon any implied representation to the effect pleaded. I consider that it is more probable than not that by filing a pleading for a professional negligence suit and thereafter acting for a claimant in a professional negligent suit, it may be inferred that the solicitor not only considers himself or herself to have sufficient experience and expertise to act in such a suit, if retained to conduct the proceeding, but has also impliedly conveyed that belief to the client.
3. In his affidavit, and also his evidence under cross-examination, the defendant gave a succinct account of his experience in conducting professional negligence proceedings. Two of those involved solicitors; and the balance concerned medical health professionals. He also gave an account of his experience, as a solicitor, in working in insurance litigation involving tort law.
4. Upon the assumption that the representation, if implied, was made, I am satisfied that the defendant was in fact, experienced or had expertise in acting for claimants in professional negligence litigation. In this sense, as a statement of past fact, referable to past events, it was not misleading for the defendant to represent that he was experienced and had expertise in professional negligence litigation.
5. But contrary to the defendant's submissions, the plaintiff's pleading of the (implied) representation, properly construed, is broader than that. The issue raised by the pleaded representation was whether the defendant had the experience or expertise to act in a competent fashion as the plaintiff's solicitor in professional negligence proceedings, should he be retained by the plaintiff, in her suit against Mr Ford. That is a different representation of the kind which the defendant contended for. To represent that one is experienced and has expertise in a special area of law is a statement of current, or perhaps more accurately, historical fact. It is another thing to say that this expertise and experience will be brought to bear in the event that the solicitor is retained. That is a statement as to the future; and may well amount to a promise or assurance about future events.
6. It seems to me that such an implied representation is not dissimilar and might even be relevantly the same, in substance, to the implied term (promise) that the solicitor will act with reasonable care and skill. I did not understand Counsel for the defendant to contend to the contrary.
7. The plaintiff's case, to repeat, is that evidence was either not put before Schmidt J, or not put before her in a timely or convincing way. The evidence (which was essentially the subject of the plaintiff's affidavit in reply in this proceeding) was: 1. Mr Ford's 'Investigating the Investigators' article; 2. The content of her 9 May 2012 affidavit, which had not been inserted in her primary affidavit of June 2011 and therefore not the subject of responsive affidavit evidence from Mr Ford; 3. The content of her 10 May 2012 affidavit, which was not put before the Court at all, following an order to that effect by Registrar Bradford; 4. A missing transcript of an interview that the plaintiff had with Mr Ford on or about 17 June 2007.
8. The plaintiff's case is that the inclusion of all of these matters would have resulted in different findings made by Schmidt J, and especially different credit findings as against the plaintiff. For example, if the missing transcript was available, this might have 'matched' the detailed file notes prepared by Mr Ford which, according to the plaintiff, had impressed Schmidt J.
9. There are serious difficulties with all of these contentions. Some relate to breach. All of them have a causation problem of one kind or another. The fundamental causation problem for the plaintiff is that it would be necessary for her to show that if the matters which she says should have been put before Schmidt J, but were not (or, perhaps, not put in the prominent or emphatic way that she would have liked), then Schmidt J would have reached different conclusions. In other words, on the balance of probabilities, the plaintiff, who carried the onus of proof on call issues relevant to causation [13] , had to prove what someone else (Schmidt J) would have done, but for the negligence, in circumstances where Schmidt J was not, and could not, have been called to give evidence. That problem is fatal for the plaintiff's argument on causation.
10. As I have said, however, there are other difficulties. I will now go through each one.
11. First, the plaintiff belatedly conceded that Mr Ford's 'Investigating the Investigator's' article was, in fact, before Schmidt J. It was referred to at [44] of her Honour's reasons for judgment. How it became admitted in evidence is not apparent, but its presence before Schmidt J means that any negligent failure by the defendant to see to it that it was included in her primary affidavit of 2011 had no consequence.
12. Secondly, the plaintiff also accepted that her affidavit of 9 May 2012 was read in the Court. Here, the plaintiff complains of a forensic issue: the affidavit was read as evidence in reply to what Mr Ford had said in the latter's affidavit in response to the plaintiff's primary affidavit. Had it been put in her evidence in chief, the plaintiff said, then it would practically have forced Mr Ford to respond to it; or at least avert the situation that (I was informed by the plaintiff) he could blithely say that he was not aware of its contents when he gave evidence. This argument overlooks many of the realities of trial. First, when it was served, Mr Ford was on notice of it. He was liable to be cross-examined by the plaintiff's Counsel at trial having regard (amongst other things) to its content. Whether or not Mr Ford had responded to the content of the 9 May 2012 affidavit, whether in his affidavit, or in the cross-examination, it would not matter whether or in what circumstances he had read the plaintiff's affidavit in reply. Secondly, beyond mere assertion, there was no attempt by the plaintiff to demonstrate what was so material about the content of her 9 May 2012 affidavit as would likely have raised questions in the mind of Schmidt J as to why the content had not been included in her primary affidavit. Thirdly, and this is an endemic and probably insuperable problem for the plaintiff, it is impossible to say what difference it would have made, in the eyes of the trial judge, that the content of her affidavit of 9 May 2012 had been included in her earlier affidavit.
13. Thirdly, on the evidence before me of the defendant's involvement, I regard the criticism of him for not acting in a more prompt fashion; such that it caused the Registrar to prohibit the plaintiff from using her 10 May 2012 affidavit as unfounded, if not unfair. The plaintiff accepts that the defendant had no involvement in the drafting of this affidavit. He had not acted for her since November 2011, six months before. She said she had drafted it herself. This was after her retainer with Marsdens had terminated. No evidence was put before me, beyond the plaintiff's statement of her recollection, to show how and in what way: (a) there had been non-compliances with Court directions; or (b) the defendant was responsible for non-compliances which might [14] have caused Registrar Bradford to impose the prohibition which the plaintiff says he did. But what did emerge as a result of the Court's questioning was that the prohibition imposed by Registrar Bradford was not absolute: the plaintiff accepted that facility was provided to her, by notice of motion, to seek the Court's leave to rely upon the affidavit. In the events that happened, the plaintiff also said that her Counsel at trial knew of her affidavit of 10 May. Whether or not he was informed of the impediment to its admission into evidence imposed by Registrar Bradford; it was open to Counsel, if he thought the affidavit sufficiently material or useful, to attempt to read it and, if met with the objection that this would be contrary to Registrar Bradford's direction or order, application for leave might then have been sought. In circumstances where, by then, the defendant had received this affidavit for virtually 6 months, there were at least some prospects that leave might be granted, had it been sought [15] ; and even if the affidavit itself may not have been allowed; it is also quite possible that documents annexed or exhibited to it, might have been admitted. Thus, at the level of breach, it is not clear how any representation as to expertise or experience in professional negligence litigation was falsified by this conduct and at the level of causation, there are there real questions as to whether the representation caused any harm at all; having regard, amongst other things, that the plaintiff's trial Counsel had it within his power to press for its inclusion in the plaintiff's evidence.
14. Fourthly, on the matter of the missing transcript, this complaint has no foundation. The plaintiff acknowledged to the Court that the significance of these missing pages only dawned on her after the decision of Schmidt J. The possibility that they might have existed at all might (objectively) only have been apparent to a person reading Mr Ford's files. But it was the plaintiff herself who took on the responsibility to inspect those files. She did so at a time when it was not the defendant, but another firm, acting as her solicitors. It was that firm of solicitors, not the defendant, who had, on the plaintiff's behalf, arranged for the inspection of documents. It was that firm who might have had some knowledge, in a broad sense at least, of what the plaintiff was inspecting. The plaintiff did not inform the defendant of the existence of these pages once the defendant had returned to represent her (3 months or so before the hearing commenced) or at any time prior to the proceeding.
15. Whether as a matter of falsity, or whether as a matter of causation, or perhaps both, none of the species of conduct by the defendant which the plaintiff complains of, individually or in combination, made out an actionable case of misrepresentation, even if I am wrong about the application of the immunity defence. This cause of action is rejected.

DAMAGES CLAIM

1. I have found that the plaintiff's claims have failed. In case I am wrong on these liability findings, it is appropriate for me to further consider what quantum of damages she would have recovered if she succeeded with her actions. In this regard, the plaintiff did not seek to persuade me that she was entitled to recover any greater amount of damages for the statutory action for misleading or deceptive conduct (under s 236 of the Australian Consumer Law) that she would for the general action in negligence.

The plaintiff's damages claim

1. In her Schedule of Damages, the plaintiff indicated that the damages claim was made up of the following components:

• The damages that Schmidt J would have awarded her if she had succeeded against Emil Ford in her professional negligence suit - $489,055
• Counsel's fees in the Supreme Court proceeding - $65,000
• Counsel's fees of the Court of Appeal proceedings - $3039
• Counsel's fees in Federal magistrates court proceeding - $12,000

1. The plaintiff also quantified her interest claim is being for the sum of $294,102.39.
2. She also seeks her legal costs incurred during these proceedings (prior to the time where she became unrepresented).
3. For the damages claim, the plaintiff relies upon her affidavit dated 21 June 2018. This affidavit was admitted on the basis of being treated as a submission supported by a bundle of documents attached to the affidavit. It may be seen, even at a cursory level, that the plaintiff seeks to visit upon the defendant all legal costs and expenses that she has sustained ever since she commenced her initial proceeding in the Equity division, in 2007, well before she had any association with the defendant.

Parties' submissions on damages

1. The plaintiff made no submissions as to damages during the hearing.
2. Counsel for the defendant submitted that the plaintiff's schedule of damages extended well beyond the pleading. He reminded me that the pleading only claimed (paragraph 15): 1. Counsel's fees in the Federal Magistrates Court - $12,000 2. Counsel's fees paid in the Supreme Court and 3. Court of Appeal proceeding - $65,000 4. filing fees - $5,500 5. the alleged liability to the defendant (Emil Ford) being wasted monies - $104,000 1. the alleged liability to the solicitors for the defendant (Mullane & Lindsay), being wasted monies - $200,000
3. No application was made before me by the plaintiff to amend its pleaded claim of damages.
4. The defendant submitted that with the exception of payment of $30,000 to Mr Baran (in the Supreme Court of New South Wales and Court of Appeal proceedings) and $11,231 and for Mr Durston's fees (in the Federal Magistrates Court proceedings) there is in fact no evidence of payment to the others.
5. The defendant submitted that even if I were to address the plaintiff's schedule of damages (irrespective of whether it went beyond the pleaded claim), there were other problems as well.
6. First, the claim for $489,055, based as it was upon the amount that Schmidt J would have awarded had her Honour found in the plaintiff's favour in the Supreme Court proceeding, is inconsistent with the way that the plaintiff had run this proceeding (at least until this hearing) which was, to say, that the professional negligence suit against Emil Ford never had any prospect of success. By the terms her pleading, the plaintiff was running a damages case of wasted expenditure.
7. To turn around now and argue that the professional negligence suit did in fact have a reasonable prospect of success would, the defendant submits, be to convert her damages claim into a 'loss of chance', or 'loss of opportunity' claim; to be assessed in accordance with the cases such as Sellars v Adelaide Petroleum (1994) 179 CLR 332 and Commonwealth of Australia v Amann Aviation Pty Ltd (1991) 174 CLR 64. The defendant says it would be unfair that it would have to respond to such case now when it was not pleaded.
8. As to the plaintiff's reliance upon the affidavit of 21 June 2018, aside from the limited basis upon which that affidavit was admitted (ie a submission only and not as proof of the contents asserted), generally, the defendant says that the affidavit contains many alleged expenses that have no connection to the loss and damage claimed by the plaintiff to have been caused by the negligent or misleading conduct of the defendant in her pleading.

Consideration

1. It is fundamental that in order to recover damages the plaintiff must establish that the acts of negligence or misleading deceptive conduct have caused her to suffer loss and damage.
2. As to her complaint about the misleading conduct, centred on a misrepresentation of expertise and experience, the causation issue is what would have happened had the defendant not made the misrepresentation. The premise must be that it was a material and even decisive consideration in the plaintiff's decision to commence the professional negligence suit that she was assured that the defendant had the experience and expertise to conduct it. That being so, in applying the factual causation test, and, in particular, contemplating the appropriate counter-factual, the hypothesis must be that the defendant would have indicated that he was not sufficiently experienced or did not have enough expertise to conduct a professional negligent proceeding. I agree with the submission of Counsel for the defendant that if that indication was provided, it is most likely that the plaintiff would have retained a solicitor who could assure her (to her satisfaction) that s/he was sufficiently experienced and had enough expertise to conduct such a proceeding. In this way, I am not satisfied that the plaintiff has suffered loss or damage as a result of the misrepresentation that she says was made by the defendant.
3. In my view, the plaintiff's pleaded complaints in negligence were, in substance, that had she been properly informed about various matters by the defendant, she would not have commenced the proceeding at all.
4. That being so, the case would be aptly characterised as a 'wasted expenditure' case. That is, as Counsel for the defendant submits, very different in nature to a case of a 'loss of opportunity to obtain a better outcome'. I also consider that it would not be fair now, given that the plaintiff changed her position during the hearing, to allow her to run a damages claim based upon the loss of opportunity premise. Had she done so well before the trial, I have no doubt that the defendant would have wished to challenge such case. It would not be fair to force the defendant to respond to this altered nature of a damages claim during the hearing.
5. The question then becomes what was lost as a result of the decision to commence the professional negligence suit. Subject to two important qualifications, what was lost, or wasted, included her Counsel's fees, that she paid, her solicitor's fees (if any) and, arguably, the costs that she incurred from the proceeding to Emil Ford.
6. Firstly, consideration needs to be given to the McSpeddon Memorandum, of March 2012, in which she was informed that he prospects of success were poor and, in the event that she could not obtain expert opinion evidence, "dismal" and advised to settle. Then on 10 August 2012, she received an offer of compromise, through which she could have got out of the litigation with no obligation to pay the defendant's costs.
7. In my opinion, the plaintiff's decision to reject that offer of compromise and continue with the litigation in the face of the McSpeddon Memorandum broke any causal connection with the defendant's pre-litigation omission to advise. True it was that the McSpeddon Memorandum held out advice that amendments might be made to the pleading, but as at August 2012, the McSpeddon Memorandum had been received 5 months before. At August 2012, the case was three months before trial and the prospect of being able to amend or recast the pleading in any radical fashion may likely have passed.
8. Alternatively, the second qualification is that on day 5 of the hearing of the professional negligence suit, being 30 November 2012, the plaintiff had received an offer, whose details I have referred to. Had it been accepted, it would have avoided any liability in her to pay Emil Ford's costs. It would also have given her an amount by which she would, at least partially, have been able to pay some of her legal representatives' fees of the proceeding. The offer was put to the plaintiff and, against the advice not only of her Counsel but also the defendant, she rejected it. She rejected it not because of any rational consideration of the offer in light of her prospects of winning the case, at that point, but because of her financial predicament.
9. In my opinion, this was also unreasonable conduct by the plaintiff which severed any causal connection between any negligence of the defendant in failing to inform of certain information prior to the institution of the proceeding and the loss and damage arising when the risks materialized.
10. I reject the submission that the plaintiff would be entitled to costs of the appeal proceedings. They were in no way incurred as a result of any non-disclosure of information prior to the institution of the suit in 2010. They were, instead, incurred because of the plaintiff's decision to pursue an appeal which her Counsel and her legal representative had identified as having poor prospects of success: as at December 2013, she had been warned by Counsel of his "stern recommendation ... that the appeal should not proceed". The decision to appeal was made with full appreciation of the risks involved.
11. In my view, had she succeeded in her case on liability, her damages would have been restricted to her legal representative's fees which she had paid from the date the proceeding was commenced (13 July 2010) until 10 August 2012, when she rejected Emil Ford's offer of compromise. If I am wrong in this respect, I would have held that she would no longer be entitled to damages from 30 November 2012.

Contributory negligence

1. In light of the way that I have identified the breach and assessed the damages, with reference to supervening events, had I found in the plaintiff's favour on liability, I would not have determined that there was further scope to reduce the damages on account of the plaintiff's failure to act reasonably to protect her own interests (under s 5R, when read with s 5B of the Civil Liability Act).

Proportionate liability

1. The plaintiff's claim is predominantly one by which she seeks to recover damages, in negligence, for economic loss. Accordingly, it is an 'apportionable' claim within the meaning of s 34(1) ((a) and (b)) of the Civil Liability Act.

Concurrent wrongdoers

1. By its Defence, the defendant identifies Mr Wheelahan QC and Mr Morahan as 'concurrent wrongdoers', being persons whose respective conduct caused, independently of each other or jointly, the damage or loss that was the subject of the plaintiff's claim. Curiously, no lawyer from Brydens was identified as a concurrent wrongdoer.
2. The plaintiff did not join Mr Wheelahan or Mr Morahan as additional defendants. Accordingly, the evidence, such as it was, as to their respective conduct was far from complete.
3. The test for concurrent wrongdoing, essentially, means the identified wrongdoers committed some legal wrong which caused the same loss or damage as that which was caused by any negligence of the defendant [16] . But as the High Court has clarified, the nature of the conduct by each concurrent wrongdoer may be completely different in nature (and in time) to that of the conduct of the defendant.
4. The first step is to consider whether the putative concurrent wrongdoers committed any legal wrong.
5. If it was necessary to decide, although his name was mentioned in connection with the strategy of responding to the bankruptcy notice which had, as a component, the institution of a professional negligence suit, there was very little before me as to the circumstances of Mr Wheelahan's involvement. It appeared to me such involvement as he had was at a high (strategic) level; rather than at a level which, any duty of care, required him to warn of practical consequences of implementing the strategy.
6. It is pivotal, I think, that at the trial, the plaintiff abandoned any contention that the recommendation to commence a professional negligence suit was negligent, as it had no reasonable prospects of success. Once that was so, I do not consider that it can be said that Mr Wheelahan - whose only apparent involvement was to recommend that such suit be transferred to the Supreme Court - committed any wrong. It is therefore unnecessary to consider any causal connection between that wrong and the plaintiff's loss or damage. He is therefore not a concurrent wrongdoer.
7. Mr Morahan's position was quite different. He had acted for the plaintiff since about 2008 and appeared for her in the District Court proceeding defending Emil Ford's attempt to recover the unpaid fees. He drafted the document that later became the pleading in the Supreme Court proceedings not only having the benefit of instructions from the plaintiff on the day of his conference on 24 June 2010 (in which the defendant was a participant) but also before. His ongoing role in advising and assisting the plaintiff spanned a period in which the plaintiff had different solicitors acting for her (Brydens, Mr Mullally and eventually, the defendant). When he drafted the pleading in conference on 24 June 2010, the defendant had only recently started to act for her, with a primary focus upon the looming bankruptcy proceeding. It is likely that Mr Morahan would have known of the recency of the defendant's involvement. Essentially, he was the principal counsellor and adviser to the plaintiff in the middle of 2010, at least on the subject of the professional negligence claim.
8. It is not common to find that a barrister has a duty to advise a client about the practical implications of commencing a law suit. It usually is the province of a solicitor. But there is authority for the view that where a barrister advises a client, in conference, s/he has a responsibility to take reasonable steps to see that the advice is received, but also understood by the client [17] .
9. In the particular (and somewhat unique) circumstances of this case, I would have been inclined to consider that Mr Morahan had a duty to take reasonable steps to ascertain that the plaintiff understood the material risks of a lawsuit. Those included the uncertainties as whether a witness' version of events might be believed and the significant costs consequences should she lose.
10. However, assuming that Mr Morahan had such a duty, there is no evidence before me as to whether or not he breached it. What he advised, and what he did not advise, about the professional negligence suit was not in evidence before me. Further, as I have found in relation to the defendant, I would not have been satisfied that any such breach would have caused loss or damage to the plaintiff.
11. If it was necessary to decide, Mr Morahan was not a concurrent wrongdoer.

Set-off

1. It is not necessary to consider whether this defence applies.

SUMMARY & ORDERS

1. For these reasons, I order: 1. Judgment and verdict for the Defendant. 2. The plaintiff is to pay the defendant's costs 3. Liberty to apply is granted to apply for a variation of order (2), exercisable in accordance with the following table: 1. The applicant for variation is to serve short submissions (not exceeding 3 pages, but excluding supporting documentation) within 5 days of these reasons; 2. The opponent of any application for variation has a further period of 5 days to serve submissions in response to the applicant's submissions 3. Contemporaneously with the service of such submissions, copies of same are to be forwarded by email to my Associate; 4. Thereafter, subject to any notice to the parties to the contrary, any application for variation will be considered on the papers.

Endnotes

1. Charles Phillip Bird by his tutor Vrede Jane Bird v Campbelltown Anglican Schools Council [2007] NSWSC 1419
2. Ford & Pritchard v Bird & Bird (District Court of NSW, Curtis J, Unreported, 12 June 2009)
3. Bird v Ford [2013] NSWSC 264
4. Bird v Ford [2014] NSWCA 242
5. In that case, Basten JA held that the immunity question should be considered first. If it was determined to apply, his Honour said that it was inappropriate to consider findings of breach below (at [263]). However, in the leading judgment of Beazley P, with whom other members of the Court agreed, findings of negligence were considered in advance of the immunity question.
6. Sparks v Hobson [2018] NSWCA 29 at [18], [326]; South West Sydney Local Health District v Gould [2018] NSWCA 69 at [117]-[129]
7. Attwells at [38] & [46], Kendirjan at [31]
8. Young v Hones [2014] NSWCA 337 at [172]-[176]; also Nikolaidis v Satouris [2014] NSWCA 448
9. These decisions were subsequently followed indifferently constituted benches in the New South Wales Court of Appeal, including Keddie v Stacks/Goudkamp (2012) 293 ALR 764 at [104] and Provident Capital Ltd v Papa (2013) 84 NSWLR 231 at [75]-[76]
10. Bird v Campbelltown Anglican Council Schools [2007] NSWSC 1419 at [65]-[67], where Einstein J accepted the Headmaster's evidence as 'reliable'.
11. Ford & Pritchard v Bird & Bird (District Court of NSW, Curtis J, Unreported, 12 June 2009) at [20]
12. Lucantonio v Kleinert [2009] NSWSC 853
13. Civil Liability Act 2002 (NSW) s 5E
14. Beyond the plaintiff's assertion, there was no record put before me of what Registrar Bradford ordered, or the reasons for what he ordered at any time.
15. Counsel for the defendant emphasised that Schmidt J allowed the defendant leave to rely upon a late affidavit of Mr Davidson, Counsel for the plaintiff in the Equity Division proceedings.
16. Hunt & Hunt Lawyers v Mitchell Morgan (2013) 247 CLR 613 at [47] & [90]-[91]
17. Chamberlain v Ormsby t/as Ormsby Flower [2005] NSWCA 454 at [86]-[87]; Firth v Sutton [2010] NSWCA 90 at [96] DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 19 August 2019