Coshott v Parker

The summons must fail 22Candidly, it was accepted for Mrs Coshott at the hearing of the motion, that what was intended to be achieved by this application, was to preclude the defendants from relying on the arguments which had succeeded before the costs assessor and the Review Tribunal in respect of Mr Coshott's earlier costs applications. Those arguments rested on the Court of Appeal's conclusion that any application in respect of the costs in question were statute barred. The effect of the orders here sought would also preclude the defendants raising the arguments which they have advanced in these proceedings, in relation to Mrs Coshott's standing to bring the costs application, given her claimed interest in Mr Coshott's practice and the effect of his bankruptcy. 23So understood, it readily becomes apparent that the high onus falling on the defendants has been met; the relief sought in the motion must be granted; and the summons dismissed. 24It was argued for Mrs Coshott that her summons relied on three principles, in combination or alone, in seeking to deny the defendants the right to challenge her applications for the assessment of costs for the work Mr Coshott had performed for Mr Lenin, in and before 1991. 25Those principles were res judicata, issue estoppel and Anshun estoppel. Each was said to apply because of the decision given by Bell J in 2007. The insuperable difficulties with the approach urged, are the following. 26Firstly, under the 1987 Act, applications for costs assessments are to be determined in accordance with the scheme established under the Act. The role of this Court is to hear appeals in respect of certain assessments. Declaratory relief sought of this Court is not an available alternative mechanism for the disposition of applications for the assessment of costs (see Ryan v Hansen (t/as Hansens Solicitors) [2000] NSWSC 354; (2000) 49 NSWLR 184 and Muriniti v Lyons & Ors [2000] NSWSC 680 at [12] - [13]). 27Secondly, Mrs Coshott was not a party to the proceedings before Bell J. In so far as she is entitled to rely on what Bell J decided, that right can only flow from her claimed interest in Mr Coshott's practice. That was not an interest raised or given any consideration by Bell J. That Mrs Coshott has such an interest is not a matter which has ever been adjudicated between the parties and in the circumstances which have arisen, is clearly not a matter in respect of which res judicata, issue estoppel or Anshun estoppel can have arisen. Her claimed interest was neither apparent, nor sought to be raised at the time of those proceedings. 28Thirdly, Mr Coshott is a bankrupt who has claimed the costs in question as assets in his subsequent bankruptcy. The impact of that situation is also not a matter which has ever been adjudicated between the parties and is not a matter in respect of which res judicata, issue estoppel or Anshun estoppel can arise. 29Fourthly, accepting for the sake of argument that Mrs Coshott could establish a relevant interest in the costs which she wishes to pursue, which would permit her to rely on matters already adjudicated by Bell J, as between Mr Lenin and Mr Coshott, questions of res judicata, issue estoppel and Anshun estoppel do not arise only in respect of Bell J's decision. They also arise in respect of the matters the subject of the decisions given by Neilsen DCJ and the Court of Appeal. There is also no reason for thinking if she was Mr Coshott's partner, that Mrs Coshott is not bound by the decisions which the costs assessor and the Review Panel came to, in respect of the earlier claims which Mr Coshott brought in respect of the same work which Mrs Coshott now seeks to pursue. 30In so far as Bell J's decision conflicts with that given by the Court of Appeal, its decision prevails. In so far as its observations were obiter, they were successfully relied on by Mr Lenin before the costs assessor and the Review Panel, which found them persuasive. Mr Coshott had a right to appeal the Review Panel's decision under s 208L of the 1987 Act in relation to a matter of law and with leave, under s 208M. Similar rights were provided by the 2004 Act. He decided not to pursue those rights. Given the nature of the interest which Mrs Coshott claims in his practice, if it exists, she too, is bound by that decision. 31Furthermore, it appears to be strongly arguable, that Mrs Coshott has no standing to bring the costs assessment applications. These are also questions which have never before been adjudicated. 32Under s 201 of the 1987, relevantly, only a solicitor 'who has given a bill of costs' has the right to seek a costs assessment. The only bill of costs given to Mr Lenin were those sent and later unsuccessfully pursued by Mr Coshott. It was argued for Mrs Coshott that she fell within the definition of 'solicitor' appearing in s 173(2)(b), on the basis that she was 'the assignee of a barrister or solicitor'. On the evidence, it is questionable that she is such an assignee, indeed, she claims to be Mr Coshott's partner. 33In evidence was the resolution of the Council of the Law Society, permitting Mr Coshott to 'share the receipts of his practice'. That resolution does not evidence any assignment of Mr Coshott's interest in the fees which he claims Mr Lenin owed him. Certainly, he later acted inconsistently with such an assignment, given his own unsuccessful pursuit of those fees and his claim in his bankruptcy, that those costs were his assets. Under the 1987 Act, Mr Coshott's trustee has a right to pursue such assets, the trustee falling within the definition of solicitor appearing in s 173(2)(d). On the evidence, it is apparent that the trustee does not seek to pursue those costs and has not authorised Mrs Coshott to do so. 34In his affidavit evidence, Mr Coshott deposed that in 1983, the Law Society had approved Mrs Coshott sharing in 49% of the receipts of his practice and that 'from that time my wife held her 49% share in the practice'. That evidence is inconsistent with the documentary evidence. Annexed to the affidavit was a letter from the Law Society advising of the Council's resolution and that the approval was 'confined to the sharing of receipts in the manner set out in the application and that no consideration has been given to the underlying validity of the arrangements or to their fiscal consequences'. 35The documents put before the Council for its consideration were not in evidence. What was tendered was an unsigned document purporting to be a partnership agreement dated 1 July 1984. Clearly that was not an agreement which the Law Society could have considered, as Mr Coshott conceded in cross-examination. Mrs Coshott had earlier been asked by the defendants, to provide a copy of the partnership agreement she claimed she had entered, but had not responded. She gave no evidence that the document in evidence was one that she had ever signed. 36The claimed partnership agreement contains only two terms: "1. That the abovenamed shall be partners in the following shares:- ROBERT GILBERT COSHOTT 51% LJILJANA COSHOTT 49% 2. The provisions of the Partnership Act apply except as are inconsistent with the control of the practice remaining solely with ROBERT GILBERT COSHOTT." 37In cross-examination, Mr Coshott explained that he had never provided a copy of this agreement to his trustee; that his wife had recently located the document in her tax files, together with correspondence sent to the Australian Tax Office ('ATO'), which was not in evidence; that a signed copy of the agreement could not be found, but that he assumed that it had gone to the Law Society for approval, or to the ATO. 38Clearly the partnership agreement, if executed only in 1984, cannot have been before the Law Society for approval in 1983. It appears to have post-dated the Law Society's 1983 resolution approving a profit sharing arrangement. That any statutory mechanism then existed for approval of an agreement, whereby an unqualified person entered into partnership with a solicitor, was not established. 39Whether the effect of such an agreement, if valid, was to bring Mrs Coshott within the definition of 'solicitor' in s 173(2)(b) is a live question. Whether the purported partnership was valid, given the provisions of the Legal Practitioners Act 1898 , which were in operation in 1983, when Mr Coshott claims he entered into the partnership with his wife, is also a live question. Certainly during the time that Mr Coshott performed work for Mr Lenin, while the 1987 Act applied, it does not appear to have permitted solicitors to practice in partnership with non-qualified persons such as Mrs Coshott. It was only in 1993 that the 1987 Act was amended to permit a solicitor to be in partnership with a person who is not a barrister or solicitor (see s 48G). 40In a supplementary note, it was argued for Mrs Coshott that there had been an 'Everett' assignment in which Mr and Mrs Coshott had participated in, which permitted a 49% assignment of the practice. The provisions of s 12 of the Conveyancing Act 1919 , which deals with written assignments of debts, which are made binding on debtors given notice of them, on which the defendants seek to rely to resist Mrs Coshott's claims, were argued to be of no relevance. Reliance for this submission was placed on Federal Commissioner of Taxation v Galland [1986] HCA 83; (1986) 162 CLR 408. 41That authority does not, it seems to me, have the effect contended for by Mrs Coshott. There the High Court was concerned with the assignment by a partner of a two partner law firm of a 49% of his share of partnership capital and profits, to a trust to be set up in favour of his family, not with a purported partnership between a solicitor and an unqualified person. In Federal Commissioner of Taxation v Everett [1980] HCA 6; (1980) 143 CLR 440, the High Court had to consider a four man partnership where one partner had a 13% interest 'in the capital and income of the Firm', a part of which was conveyed and assigned to his wife, who was also a solicitor, by deed. Again, the wife was not claimed to be a partner in the firm. 42By way of contrast, the agreement here relied on appears to be a partnership agreement, not an Everett assignment of a part of a partner's equitable interest in the partnership. 43It is apparent that these are all also matters over which the parties have never previously joined issue and which the defendants are entitled to rely on in their resistance of Mrs Coshott's costs applications. It follows, in the circumstances, that the principles which it was explained she seeks to rely on to pursue the relief sought in the summons, can provide no basis for the relief sought. 44The Civil Procedure Act 2005 requires that in the management of proceedings before it, the Court follow the dictates of justice, having in mind the overriding purpose established in s 56, facilitating the 'just, quick and cheap resolution of the real issues in the dispute or proceedings' and having in mind the efficient disposal of the business of the court, the efficient use of available judicial and administrative resources, the timely disposal of the proceedings, and other proceedings in the Court, at a cost affordable by the respective parties. 45These considerations also support the conclusion that in this case, the defendants have met the high onus falling upon them, in respect of the relief sought in their motion.

Orders 46The usual order as to costs is that they follow the event. Unless the parties wish to be heard on costs, in which event they should approach within 7 days, the costs order will be that Mrs Coshott bear the defendants' costs. For the reasons given, the summons is dismissed.

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