He v Aloe & Co Pty Ltd [2006] VSCA 150

He v Aloe & Co Pty Ltd [2006] VSCA 150 - VSCA 2006 case summary — Zoe

[5]

1 The appellant, Daming He ("DH"), sued in the Magistrates' Court for $2026.50 plus costs and interest, for damage to his motor vehicle. The respondent ("AAC") was his solicitor. After three adjournments, the matter came on for hearing on 30 November 2001. Following negotiations, the case was settled for $1425, plus costs and disbursements agreed at $1716.

2 DH was very unhappy with the outcome. He was dissatisfied with the conduct of his lawyers, and believed he had been pressured into accepting inadequate compensation. He made a complaint against the barrister to the Legal Ombudsman, which was dismissed. Then in March 2003, he filed a complaint with Victorian Lawyers RPA Limited ("the Law Institute") against AAC. The Law Institute was unable to resolve the dispute and referred it to the Legal Profession Tribunal ("the Tribunal"). After a hearing on 10 March 2004, the Tribunal upheld a no-case submission on behalf of AAC and dismissed DH's claims. DH appealed to the Full Tribunal, which dismissed his appeal and ordered him to pay costs.

3 Under s.170(1) of the Legal Practice Act 1996 ("the 1996 Act"),[1] DH has an appeal as of right to this Court from the decision of the Full Tribunal, but only on a question of law. By notice of appeal dated 18 August 2004, DH set out at length his complaints about the procedure in the Tribunal and in the Full Tribunal. His principal complaint was that, both in the Tribunal and on appeal to the Full Tribunal, his allegations of misconduct by AAC had been ignored. The notice of appeal itemised 10 instances of alleged misconduct.

4 The appeal to this Court was due to be heard on 24 November 2005 but the hearing date was vacated after the Court decided that the draft notice of appeal did not comply with the applicable rules, set out in Order 4 of Chapter 2. Contrary to the requirements of rule 4.11(1), the draft notice did not identify questions of law in an appropriate way and did not set out concisely the grounds of appeal. Accordingly, the Court ordered that paragraphs 1-28 of the draft notice be struck out, but gave leave to DH to apply at a later date for leave to substitute appropriate paragraphs in the notice of appeal.

5 It is that leave application which is now before the Court. DH has filed a draft substitute notice of appeal. The application is opposed by AAC, which argues that no question of law is raised and that the appeal should be dismissed as vexatious. We have approached the application on the basis that, if one or more questions of law is disclosed by the redrafted notice of appeal, DH should have leave to substitute those questions, unless it is shown that the grant of such leave would be futile because the ground(s) of appeal would have no prospect of success.[2]

6 As will appear, in order to understand properly the questions which DH wishes to ventilate on this appeal, it has been necessary to examine the history of the matter in detail. In particular, we have read in full the transcript of proceedings before the Tribunal and before the Full Tribunal. Certain matters have emerged from that review which were not apparent at the time of the leave hearing. Reference will need to be made to those matters later.

7 In the course of the hearing of the leave application on 6 April 2006, the President raised with DH and with counsel for AAC, Mr G Rice, whether it would be appropriate for the hearing of the application for leave to be treated as the hearing of the appeal itself, since (as has proved to be the case) consideration of the application for leave would necessarily involve some consideration of the merits of the grounds of appeal. This procedure - of treating the application for leave as the hearing of the appeal itself - is a course adopted from time to time in this Court, designed to save time and expense for all concerned, including the Court. Counsel for AAC indicated that his client would consent to this course. DH, however, did not consent, arguing that he was not in a position to argue the appeal in full.

8 We have concluded that DH should have leave to substitute most, but not all, of his proposed grounds of appeal. Ordinarily, a grant of leave is not accompanied by lengthy reasons. In the present case, however, it is necessary to set out the history of the matter in some detail, in order that the questions of law which DH wishes to agitate on the appeal can be understood in context.

The Magistrates' Court proceeding

9 On 30 October 2000, DH was involved in a motor vehicle accident, in which his vehicle was damaged. The driver of the other vehicle was insured with AAMI Insurance ("AAMI"), which accepted liability. AAMI would not, however, pay the cost of repairing the vehicle, which was estimated at $4000. AAMI considered the car a "write off" and offered DH $800.

10 According to the statement of DH's case filed with the Tribunal ("the statement of case")[3], DH consulted AAC in about November 2000, following AAMI's offer. He met with a solicitor named Bakhaazi, who was employed by AAC. According to DH, Bakhaazi agreed that the firm would act for DH, and gave him the following assurances:

[20]

17 Had DH been informed promptly - as he should have been - that the 21 May hearing had been adjourned, he would presumably have avoided having to take a day off from work on 21 May. In the events which happened, however, he was not advised of the adjournment until the morning of the hearing, by which time he had already taken leave for the day. One of DH's claims against AAC was for the earnings lost ($200) as a result.[5]

18 By letter dated 4 June 2001, AAMI's solicitors forwarded to AAC "our client's cheque for $650, made payable to your firm." According to DH, he was not told until much later that AAMI had made this payment to AAC for the costs of the adjournment on 21 May. What is rather more significant is that, no counsel's fee having been incurred for that day (no doubt because of the agreement in advance to adjourn the hearing), this sum of $650 was paid to AAC in respect of its own professional costs of the adjourned hearing. This is a matter to which reference will be made later in these reasons.

19 On the adjourned hearing date, 24 July 2001, counsel was briefed on behalf of DH but neither AAMI nor its representatives appeared at court. The case was again adjourned - this time to 21 September 2001 - and the court ordered the defendant (in effect, AAMI) to pay DH's costs of $744. This sum comprised counsel's fee of $544 and $200 representing DH's loss of earnings for that day, which on this occasion was claimed by AAC on his behalf. As on 21 May, DH had been obliged to take a day off work in order to be at court.

20 By letter dated 16 August 2001, AAMI's solicitors forwarded to AAC a cheque for $744 payable to the firm. Counsel's fees of $544 were subsequently paid but AAC at no time paid to DH the sum of $200 which, as mentioned, was payable to DH for his loss of earnings. Counsel's backsheet clearly identified the amount of $200 as being for "witness expenses (plaintiff)". The non-payment of the $200 formed the basis of another of DH's claims against AAC.[6]

21 In June 2001, AAMI's solicitors made a settlement offer of $1600 plus costs. A letter was drafted by AAC purporting to accept that offer, but DH was not satisfied with the offer, and the letter was not sent.[7]

22 On the next hearing date (21 September 2001), DH's loss assessor, Fanning, failed to attend at court. According to the account he later gave to the Victorian Bar, DH's barrister made "desperate telephone calls" to Bakhaazi and to Fanning.

[149]

103 There appears to be some inconsistency between these answers and what had been said by AAC in acknowledging the falsity of Aloe's evidence to the Full Tribunal. Aloe had given evidence that DH owed AAC $650 for the first adjournment, on 21 May 2001. It was that evidence which he later retracted.

104 We have so far dealt with, and allowed, proposed questions 3-6, 9, 10, 12-14 and 18. Taken together, those questions will make it necessary to examine on the appeal the full history of the matter and virtually every aspect of the proceeding before the Full Tribunal. As we have indicated, it will also be necessary to look closely at what occurred before the Tribunal.

105 We would also grant leave in respect of proposed questions 1, 2, 7 and 11. We would not grant leave in respect of questions 8 and 17, as neither raises a question of law.

106 Accordingly, DH will have leave to substitute in his notice of appeal proposed questions 1-7, 9-16 and 18.

107 Before concluding, we make the following observations. This will be an important appeal, in two distinct respects. First it illustrates how a small claim can turn into a large grievance. What begins as a complaint about a lawyer's handling of the claim turns into a further complaint about the process by which the initial complaint is investigated. "All I want," DH says, "is a fair hearing". Secondly, this appeal raises some important issues about the approach to be taken by tribunals dealing with complaints against professional service providers.

108 One matter of particular concern to us is this. If DH succeeds in establishing - for example - jurisdictional error or a breach of natural justice or a fundamental mistake of fact by the Full Tribunal in relation to the purported $650 debt, that will mean that the decision of the Full Tribunal cannot stand. On ordinary principles, the matter would have to be remitted to the Tribunal for a re-hearing. Under the 2004 Act, that would be a proceeding before the Victorian Civil and Administrative Tribunal.

109 That cannot be a very attractive prospect for anyone involved, given that the complaint relates to events which occurred in 2001, and given the amount of time already given to these issues and the inevitable stress and anxiety for all concerned. If a re-hearing is the only course open, then that will of course occur. But, in the hope that it may be possible to achieve a more satisfactory outcome, without further proceedings, we propose to provide a copy of these reasons to the Legal Services Commissioner. We will ask the Commissioner to review the history of the matter in the light of these reasons and to consult with the parties in an endeavour to identify some mutually satisfactory solution.

110 In the event that the appeal proceeds, we would invite the Commissioner to appear before the Court at the hearing of the appeal as amicus curiae, to make submissions both about the general issues of tribunal process and about how justice might best be done in the present case.

At a glance

Court

Decision date

Before

Source

Judgment (150 paragraphs)

Parties

Cases Cited (2)