Keesing v Adams

Supreme Court of NSW|2010-03-15|Before: Brereton J, Mr J

CITATION : Keesing v Adams [2010] NSWSC 336

DECISION : Contract was with lay client. Summons dismissed with costs.

CATCHWORDS : LEGAL PROFESSION - Barristers - entitlement to fees - at general law - under statute - contracts for legal services - costs agreement - whether contract made between barrister and solicitor or lay client.

Dickson v Creevy [2002] QCA 195 Dimos v Hanos [2001] VSC 173 Doe d Bennett v Hale (1850) 15 QB 171; 117 ER 423 Kennedy v Broun (1863) 13 CB NS 677 Levy v Bergseng (2008) 72 NSWLR 178 CASES CITED : Moore v Row [1629] 1 Rep Ch 38; 21 ER 501 Morris v Hunt [1819] 1 Chit 544, 555 Re Neville; Ex Parte Pike [1896] 17 NSW (B&P) 24 Re Sharpe; Ex Parte Donnelly [1998] FCA 6 Re Wilton (1843) 13 LJQB 17 Rondel v Worsley [1969] 1 AC 191 Wells v Wells [1914] P 157

PARTIES : John Keesing (plaintiff) David John Adams t/as Spencer Whitby & Co (defendant)

COUNSEL : Mr J Anderson (plaintiff) Mr D Shoebridge (defendant)

SOLICITORS : Martin Bell & Co (plaintiff) Frank M Deane & Co (defendant)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

2009/289514 John Edward Keesing v David John Adams t/as Spencer Whitby & Co JUDGMENT (ex tempore) 1 HIS HONOUR: The plaintiff John Keesing, a barrister, sues the defendants David John Adams and Keith Spencer, who are solicitors and partners in the law firm Spencer Whitby & Co, for a declaration that the solicitors are parties to a costs agreement in respect of Mr Keesing's fees for appearing for one Mr Ramsay in an action for damages for personal injuries in the District Court in August 2003. The solicitors deny that they were parties to the costs agreement and say that the costs agreement was between the client Mr Ramsay, and Mr Keesing. 2 The essential facts are these. On 8 August 2003, after initially having declined to do so, Mr Keesing accepted a brief from Spencer to appear in the District Court in the Ramsay matter the following week. Mr Anthony Gidaro, of junior counsel, had already been retained as counsel in the proceedings. Whether or not Mr Spencer or Mr Ramsay made the first telephone call to Mr Keesing, at some stage in the course of the afternoon there was direct contact between Mr Ramsay, who was endeavouring to persuade Mr Keesing, who had initially declined to accept the brief, to do so. 3 It was Mr Ramsay who identified and selected Mr Keesing to be his leading counsel and instructed Mr Spencer to retain him. This arose because of a previous family connection between a member of Mr Ramsay's family and Mr Keesing. Mr Spencer had had no prior contact with and no knowledge of Mr Keesing. 4 After Mr Keesing had somewhat reluctantly agreed to accept the brief, a brief was delivered to him with his name on it and covered by a back sheet showing Spencer Whitby & Co as the instructing solicitors. 5 Two days later, on Sunday 10 August, the day before the trial was to commence in the District Court, there was a conference in Mr Keesing's chambers at which, as well as Mr Keesing, there were present Mr Gidaro, Mr Spencer and subsequently Mr Ramsay. In the course of that conference Mr Keesing produced and Mr Ramsay - but not Mr Spencer - signed a document entitled "Fees Disclosure and Agreement with Solicitor", in which Spencer Whitby were identified as the instructing solicitors. After Mr Ramsay had signed that document, Mr Keesing provided copies of it to Mr Spencer and to Mr Ramsay. 6 There is minor but not extensive relevant disagreement about the course of events in the conference pertaining to the fee disclosure and agreement. What happened is largely uncontroversial, and it is the characterisation to which it is to be given from a legal perspective that is at the heart of the case. 7 The trial commenced before Cooper DCJ on 11 August. On about 13 or 14 August, Mr Spencer detected that he had misplaced the copy of the fee disclosure and agreement that had been provided to him, and requested another, which was sent to him by Mr Keesing on or about 14 or 15 August. 8 The trial continued the following week, on 18 through 20 August. Mr Gidaro ceased to attend, in effect, from 15 August. Mr Spencer was present as instructing solicitor from 11 to 15 August, and his secretary attended on 18 through 20 August. 9 On 27 August, Cooper DCJ gave judgment in favour of Mr Ramsay as plaintiff. Subsequently on 28 August, Mr Keesing rendered a fee note to Spencer Whitby. 10 After a number of communications in which no dispute as to Spencer Whitby's liability for his fees was raised, and in the course of which Mr Keesing, at Mr Spencer's request, agreed in February 2004 to reduce his fees by $4,400, on 14 April 2004, Mr Spencer informed Mr Keesing that Mr Ramsay did not accept his fees and requested that Mr Keesing proceed to assessment. There was on-going disputation as to who should initiate any assessment. In due course, Mr Keesing applied for an assessment of his fees, but the assessor declined to proceed on the basis that there was a dispute as to who was the true contracting party, a dispute which the assessor said that he was unable to resolve. Whether that view was correct, in the light of Levy v Bergseng (2008) 72 NSWLR 178, need not be resolved in the present case. 11 Mr Keesing also endeavoured to sue for his fees in the District Court. That action failed, Armitage DCJ holding that there was a defect in his disclosure for the purposes of the (NSW) Legal Profession Act 1987, s 176, in that the disclosure did not include "the billing arrangements" so far as his fees were concerned - the result being that he could not recover his fees without first having them assessed. 12 The present proceedings are brought to resolve the issue tendered in effect by the costs assessor, namely, whether the costs agreement was one between Mr Keesing and the solicitors, or between Mr Keesing and the lay client Mr Ramsay. 13 Conventionally, a barrister was not entitled to sue for his or her fees, which were regarded in law as an honorarium and in ethics as a debt of honour due by the solicitor to the barrister, but not legally enforceable. This was because there was no contract between the barrister and either the instructing solicitor or the lay client. The authorities in this territory were helpfully reviewed by Lockhart J in Re Sharp; Ex Parte Donnelly [1998] FCA 6. The leading case was that of Kennedy v Broun (1863) 13 CB NS 677; 143 ER 268, in which Erle CJ said (at 287): We consider that a promise by a client to pay money to a counsel for his advocacy, whether made before, or during, or after the litigation, has no binding effect; and, furthermore, that the relation of counsel and client renders the parties mutually incapable of making any contract of hiring and service concerning advocacy in litigation.

14 As a result of there being no contract between barrister and solicitor or client, there was no legal basis on which the barrister could recover fees from either, [Moore v Row [1629] 1 Rep Ch 38; 21 ER 501; Wells v Wells [1914] P 157; Morris v Hunt]. 15 This was stated as recently as 1969 by the House of Lords in Rondel v Worsley [1969] 1 AC 191 in which Lord Morris of Borth-y-Gest said (at 236): It has for long been considered to be settled law that a barrister may not and does not enter into any contract which enables him to sue for his fees.

16 In the same case, Lord Pearce said (at 262): The long line of decisions that a barrister cannot sue for his fees ... is consistent. And, in my opinion, it is firmly based on sound policy

17 And in the New South Wales case of Re Neville; Ex Parte Pike [1896] 17 NSW (B&P) 24, Manning J said (at 26): A barrister is by law incapacitated from entering into a contract of any kind, either with solicitor or client, in respect of fees, for, at all events, litigious work as a barrister.

18 Those cases, to my mind, establish that until the intervention of legislation the inability of a barrister to recover fees was not just a consequence of public policy holding that a barrister should not be entitled to sue for fees, but of recognition that the way in which barristers practised was not to perform legal services on a contractual basis. In the absence of a contract, there was no legal basis upon which fees could be recovered. 19 There was no rule of law preventing a litigant from instructing a barrister directly or preventing a barrister from appearing on direct instructions -only a professional practice required that counsel should take instructions from solicitors [Doe d Bennett v Hale (1850) 15 QB 171; 117 ER 423]. But as that case held, that practice was seen to be a beneficial one, to be maintained, and under that practice the barrister looked to the instructing solicitor and not to the lay client for fees [Re Wilton (1843) 13 LJQB 17]. 20 A solicitor acting under a general retainer had authority to instruct counsel and pay counsel's fees [Morris v Hunt [1819] 1 Chit 544, 555; Dimos v Hanos [2001] VSC 173], but this authority did not extend to making a contract on behalf of the client with the barrister: The solicitor's retainer allowed the solicitor to retain counsel, but did not authorise the solicitor to enter into a contract on behalf of the client with the barrister [Dimos v Hanos; Levy v Bergseng [122]]. 21 Legislation now permits a barrister to contract with a client, or with a solicitor, and to sue on such a contract. The legislation applicable for the purpose of the present case, which occurred before the commencement of (NSW) Legal Profession Act 2004, is (NSW) Legal Profession Act 1987, in which s 38I provided as follows: 38I Client Access. (1) Barristers. Barristers may accept any clients, subject to the barristers rules and the conditions of any relevant practising certificate.

Solicitors may accept any clients, subject to the solicitors rules and the conditions of any relevant practising certificate.

A barrister or solicitor may enter into a contract for the provision of services with a client or with another legal practitioner. The barrister or solicitor may accordingly sue and be sued in relation to the contract.

A barrister may enter into a contract with a client even though the barrister has accepted a brief from a solicitor in the matter.

Nothing in this section affects any law relating to immunity to sue in relation to advocacy.

22 While s 38I permitted a barrister to enter into a contract for legal services for the provision of legal services with a solicitor or a lay client, it did not require the barrister to do so. The result, in my view, was that a barrister could continue if he or she wished, generally or in any particular case, to render legal services on the conventional non-contractual basis, or could choose to render legal services generally or in a particular case on a contractual basis by entering into a contract for provision of legal services with a client. If the barrister rendered services on the conventional basis, the fee would not be recoverable at law, because there would be no contract on which a barrister could sue. 23 In Re Sharpe; Ex Parte Donnelly, Lockhart J observed that the 1994 Legal Profession Act, though not expressly stating that a barrister may sue for the recovery of the fees, impliedly assumed that right in s 184, s 191 and s 192. His Honour does not appear to have been referred to s 38I. In my view, the correct position is that a barrister who chooses to enter into a contract for legal services can, by way of s 38I, recover his or her fees at law pursuant to that contract. A barrister who elects to render services on the conventional non contractual basis would not be entitled to recover fees at law and would be left to the traditional extra curial remedies.

24 As well as providing for barristers to enter into contracts for legal services, the 1987 Act also provides for a barrister, as well as a solicitor, to enter into a costs agreement, with the instructing solicitor or with the lay client. "Costs agreement" defined by s 173 to mean an agreement referred to in s 184 "as to costs for the provision of legal services". Section 184 provided as follows: (1) An agreement as to the costs of the provision of legal services may be made with a client by:

(a) the barrister or solicitor who is retained by the client to provide the services, or

(b) the barrister or solicitor retained on behalf of the client by another barrister or solicitor.

(2) An agreement as to the costs of the provision of legal services may also be made between the barrister or solicitor providing the services and another barrister or solicitor who retained that barrister or solicitor on behalf of the client.

(3) An agreement under this section is called a costs agreement.

(4) A costs agreement is void if it is not in writing or evidenced in writing.

(5) A costs agreement may form part of a contract for the provision of legal services.

(6) A costs agreement may consist of a written offer that is accepted in writing or by other conduct. A disclosure in accordance with Division 2 under section 175 or 176 may constitute an offer for the purposes of this subsection. 25 Again, it is notable that such an agreement is described as "an agreement as to the costs of the provision of legal services" and may form part of, but is a distinct concept from, a contract for the provision of legal services. The practical and legal effect of a costs agreement is to be found in s 208C, which provided as follows: (1) A costs assessor is to decline to assess a bill of cots if: (a) the disputed costs are subject to a costs agreement that complies with Division 3, and

(b) the costs agreement specifies the amount of the costs or the dispute relates only to the rate specified in the agreement for calculating the costs.

(2) If the dispute relates to any other matter, costs are to be assessed on the basis of that specified rate despite section 208A. The costs assessor is bound by a provision for the payment of a premium that is not determined to be unjust under section 208D.

(3) This section does not apply to any provision of a costs agreement that the costs assessor determines to be unjust under section 208D.

(4) This section does not apply to a costs agreement applicable to the costs of legal services if a barrister or solicitor failed to make a disclosure in accordance with Division 2 of the matters required to be disclosed by section 175 or 176 in relation to those costs.

26 Thus it will be seen that the practical consequence of there being in force a costs agreement is that, if the costs agreement is one that provides a lump sum or total amount for the costs of the work to be done, those costs are not subject to assessment, and if the costs agreement specifies the rate specified, then the rate is not subject to assessment. In other words, the practical effect of a costs agreement is to remove from the scope of an assessment the capacity of the client to dispute the quantum of the gross fee or the quantum of the rate charged, as distinct from the reasonableness or the performance of individual items of work comprising a whole bill charged according to a rate. That is the sole function of a costs agreement. It is an agreement "as to the costs of the provision of legal services" because it is an agreement as to what the costs of those services will be. 27 The 1987 Act also provided for disclosure of costs and obliged a barrister as well as a solicitor to disclose to a client the basis of the costs of legal services to be provided. Section 175 (3) provided that disclosure to a client is not required to be made by a barrister who is retained on behalf of the client by another solicitor; however, the disclosure to the client by the solicitor had to include the costs of the barrister so retained, and s 176 (1) provided that a barrister retained on behalf of a client by a solicitor must disclose to the solicitor the basis of the costs of legal services to be provided to the client by the barrister. Accordingly, there was no requirement for a barrister retained by a solicitor to disclose his or her fees directly to the lay client, but there was an obligation to disclose to the instructing solicitor. 28 It should also be noted that s 192 prohibited the institution of proceedings for the recovery of costs by a barrister or solicitor unless 30 days had passed since a bill was given. In Re Sharpe, Lockhart J thought this indicative of an implied right of a barrister to sue for his or her fees. I agree, but qualify that agreement with the observation that that is applicable where the barrister is rendering legal services on a contractual basis, but not otherwise. 29 Of some significance is s 201, which provided that a barrister or solicitor who is given a bill of costs may apply for an assessment of those costs. Upon completion of the assessment, the assessor issues a certificate setting out the determination, which, upon filing in a court of competent jurisdiction, has effect as a judgment of that court for the amount of unpaid costs [see s 208J]. 30 As I have mentioned, a costs agreement is not a contract for legal services although it may be included in one. It has the very limited function of excluding from the scope of assessment the quantum of a lump sum fee or of an agreed rate. The mere entry of a practitioner and client into a costs agreement does not create a liability to pay costs where otherwise there is no liability. However, because the purpose of a costs agreement is to exclude the agreed matters from the scope of any assessment, and because the purpose of assessment ultimately is to culminate in a legally enforceable judgment, it seems to me that the entry into a costs agreement is a strong indication, though not an absolute one, of an intention that the practitioner is to render services on a contractual basis, such that his or her fees be recoverable pursuant to the assessment process. If it were not so, it is difficult to see any utility in entering into a costs agreement. 31 Where a barrister does render services on a contractual basis, there will be a question as to whether the contract is with the solicitor or the lay client. This question was considered by the Supreme Court of Victoria in Dimos v Hanos, in which a Magistrate had held that there was a presumption that any such contract was between the barrister and the solicitor. On appeal to the Supreme Court, Gillard J held there was no such presumption. As His Honour said (at [37]): What the Magistrate said may be the effect of the evidence in the particular circumstances of the case, but it is not a principle of law, and cannot be stated as a general rule of law or fact. By stating that as a general rule, the Magistrate misdirected himself

32 But although holding that there was no such presumption, Gillard J ultimately came as a matter of fact to the same conclusion. His Honour said (at 99): 99. The mere fact that a contract is entered into between A and B, pursuant to which B is to perform services for A for the benefit of C, does not change the nature of the contract or the parties. The parties are still A and B. As a general rule C cannot enforce the agreement. But as has been stated often, the parties may themselves contract in a way which does give enforceable rights to third parties or does limit the liability of a particular party. 100. In the normal course of events, a client who retains the services of a solicitor, engages the solicitor to provide professional services for him. In providing those services, the solicitor may advise the client that it is necessary to brief a barrister to provide specialist services. For example, it may be necessary to retain a barrister to appear in court. Retention of a barrister is, in part, satisfaction of the provision of legal services by the solicitor. In the absence of any contrary evidence, the retention of barrister would result in a contract between the barrister and the solicitor. 101. The rules stated above are subject to exceptions, one of which is where the contracting party is acting as agent for a disclosed principal. The general rule is that the principal alone can sue, or be sued, on the contract. In certain cases, the agent can also be sued.

However, whether he acts as agent and whether he contracts as such, are questions of fact. The starting point in those circumstance, is proof of the agency and authority to contract on behalf of the principal. The next issue to consider is, the capacity in which the agent purported to enter into the contract.

I repeat the trite often quoted principle, that each case will depend upon its own particular circumstances. 33 Having repeated the Magistrate's presumption and again rejected it, His Honour continued: 106. However, in my opinion, the Magistrate was correct in reaching the conclusion that in respect of each of the three retainers, the contract was between the barrister and the solicitor, and not between the barrister and the client.

The evidence revealed, in respect of each retainer, that the solicitor was acting for a client, and that as part of the professional services provided by the solicitor, the solicitor retained a barrister to appear in court on behalf of the client.

In the case involving the client Ms Yves, which involved the barrister appearing for her, a back sheet was delivered by Mr Egan, retaining the barrister, and there is nothing on the back sheet, which is endorsed with the name and address of the instructing solicitor, suggesting that the retainer was between the barrister and the client, nor is there any evidence of any discussion between Mr Egan and the barrister to that effect. Further, there is no evidence from Mr Egan or Mr Dimos with respect to the question, whether the client expressly authorised the solicitor to brief the barrister and bring into existence a contract between the barrister and the client. Subject to evidence to the contrary, the retainer between solicitor and client authorised the solicitor to retain counsel, but that authority did not extend to bringing into existence a contract between the barrister and the client.

34 It was that principle that was endorsed by Rothman J in Levy v Bergseng, to which I have referred. 35 On questions of professional legal practice, a court does not need to have evidence, but can resort to its own knowledge of professional practices and standards. This is frequently seen in legal professional negligence cases, where in - distinction from, for example, medical negligence or architectural negligence cases - there is no need for a plaintiff, except perhaps in specialist areas of the law, to adduce expert evidence of a departure from appropriate standards [see, for example, Dickson v Creevy [2002] QCA 195]. 36 Although, in some respects, a solicitor is an agent for his or her client, and although the cases to which I have referred show that a solicitor has authority to retain a barrister, that authority does not extend to making a contract on behalf of the client with the barrister. Centuries of practice dictate that the solicitor is treated as the party to whom the barrister ordinarily looks for his or her fees and is primarily liable for that fee, even only if in honour and not at law. In the absence of what Gillard J described as evidence to the contrary, an informed observer knowing of the historical practices of barristers and solicitors would ordinarily conclude from the delivery of a brief by a solicitor to a barrister, in a case that is not a direct access case, that any contract was made with the solicitor. So much was practically acknowledged by Mr Spencer in the course of cross-examination. 37 In this case, the barrister sues only for a declaration that the solicitor was a party to a costs agreement. That, of itself, would be of little if any utility unless the solicitor was also party to a contract for legal services pursuant to which the barrister was rendering legal services on a contractual basis under a contract to which the solicitor was a party. There are, in the present case, a number of indicia - not all of them consistent - as to the identity of the contracting parties. 38 First, the barrister was sourced by the client, and there was some direct intervention between the client and the barrister in securing the barrister's services, at least after he had initially declined. He was not previously known to the solicitor. But it is not uncommon for a client to choose or nominate a barrister; the selection may arise from reputation, from direct knowledge or from prior connection, either professional or personal. The fact that the lay client sources and selects the barrister does not tell against the ordinary result that where a brief is delivered by a solicitor to a barrister ordinarily, any contract for legal services would be with the solicitor. However, the fact that there was some prior relationship and some direct intervention by the lay client with the barrister does provide part of the factual matrix against which the events of 10 August ultimately have to be judged. 39 Secondly, the brief was delivered by the solicitor addressed to the barrister with a backsheet endorsed with the name of the solicitors' firm and containing no indication that the solicitor was not to be liable for the barrister's fees. This is a significant factor, and it reinforces what would ordinarily be the position, that any contractual relationship would be with the solicitor absent any special endorsement or marking on the brief. This was not a direct access brief. 40 Thirdly, there is the fact that the barrister required that there be a costs agreement, not merely providing a disclosure of his fees. The document which he proffered was entitled "Fees Disclosure and Agreement With Solicitor", and it is relied on as being not a mere disclosure but also a costs agreement. Indeed, if it were not, there would be no point in suing for the relief presently sought. The matters referred to in the fee disclosure and agreement document go beyond mere matters of agreement "as to costs". For example, they provide for the circumstances in which the barrister may return his brief. They seek to preserve the barrister's common law immunity. They seek to limit the standard of skill and care required of the barrister. All of these circumstances fortify the inference which arises from, as I have said, entry into a costs agreement, at all and that the barrister intended to render services on a contractual basis as distinct from on the conventional basis, so as to be able to sue for recovery of his fees, if necessary.

41 Fourthly, there are the events of the conference of 10 August. According to Mr Keesing's version, which for present purposes I am content to accept, the following occurred: I took my "FEES DISCLOSURE AND AGREEMENT WITH SOLICITOR" form from my drawer principally addressing Mr Ramsay (because of the warnings I had been given about him concerning his personality and character) but also addressing Mr Spencer. I said words to the following effect:

'I have a standard form of fee disclosure which I must make because of the Legal Profession Act. In short my fees are $360.00 per hour and $3,200.00 per day. In addition when liability is strongly disputed I charge a success rate of 25%. I will not charge you anything if you don't settle or win the case'. I then completed the blanks of my standard Fee Agreement by hand. I said to Mr Ramsay: 'I'm going outside for a smoke. You can discuss this with Mr Spencer'.

As I left my room, I handed the document to Mr Spencer. Mr Gidaro came out with me. Approximately 10 minutes later I returned and said words to the effect to Mr Ramsay: 'Is there anything you need me to explain in relation to the Fee Agreement?' I do not recall whether he replied. I believed that it would be prudent to be able to prove that disclosure of my fees and other terms had been made to Mr Ramsay. I then asked Mr Ramsay to sign the "FEES DISCLOSURE AND AGREEMENT WITH SOLICITOR", which he did. I took the document to the reception area, about 5 metres away and made two photocopies. I gave one to Mr Spencer and one to Mr Ramsay. Annexed hereto and marked with the letter "B" is a true copy of the "FEES DISCLOSURE AND AGREEMENT WITH SOLICITOR" dated 10 August 2003 signed by Mr Ramsay. 42 My acceptance for present purposes of that version is qualified in one respect, to which I shall come. It is appropriate also at this point that I set out the terms of the "Fees Disclosure and Agreement With Solicitor":

JOHN KEESING - BARRISTER-AT-LAW FEES DISCLOSURE AND AGREEMENT WITH SOLICITOR SOLICITOR: Spencer Whitby DATE: 10/8/03 CLIENT: Stephen Ramsay MATTER: Ramsay v Hill WORK : As encompassed by instructions received from time to time including all work (a) directly or indirectly arising therefrom or related thereto; or (b) ratified (expressly or by conduct). FIXED SUM : No Sum: N/A BASIS OF FEES WHERE NO FIXED SUM: Charged by time engaged, Chambers Work and Uncontested Short Appearances $360.00 per hour for all work undertaken, including reading, research, preparation, CONFERENCES, drafting, settling and checking documents, (eg Court documents, written submissions, advices, opinions and correspondence); telephone conferences 10 minutes or more - all with minimum fee $100.00 Uncontested interlocutory appearances (directions hearings, mentions, including waiting in Court in connection therewith and all other interlocutory steps), taking reserved judgments - all with minimum fee $600.00 COURT OR OTHER TRIBUNAL APPEARANCES IN TRIALS, APPEALS, REFERENCES, ARBITRATIONS, MEDIATIONS, CONTESTED APPLICATIONS, MOTIONS, EXTENDED ARGUMENTS INCLUDING ALL LISTED AND ADJOURNED HEARING DAYS: $3200.00 per day OR $3200.00 per half day, including waiting in Court or Chambers for case to commence and taking ex tempore judgments. CANCELLATIONS FEES: To be paid in full unless written agreement to waive same is concluded EXPENSES CHARGED SEPARATELY: Airfares or other travel expenses, overnight accommodation and sustenance, international telephone and facsimile transmission. MY ESTIMATED TOTAL FEES TO END OF MATTER (excluding appeals) on basis of present instructions and steps and proceedings presently contemplated and in absence of unforeseen other circumstances, and delays or adjournments $28,000.00 (excluding success premium). CONTINGENT FEE: Yes SUCCESS PREMIUM: 25% DEFINITION OF SUCCESS: Judgment for Plaintiff INTEREST CHARGED on accounts unpaid after 30 days at rates prescribed under section 95 of the Supreme Court Act . BRIEF MAY BE RETURNED if (a) required by professional ethical consideration, (b) justifiable under Bar Association Rules, or (c) fees not fully paid after 90 days from date of account and 14 days notice given, regardless of position of case at that time. Right to require payment in advance reserved, (d) Counsel believes on reasonable grounds that he will not be paid either in part or in full, (e) Counsel is engaged in another matter which has priority by being part-heard, or any other cause, (f) Counsel's advice is rejected or not followed. RATES OF FEES REVIEWABLE: at intervals of not less than 12 months apart. Retainer may be cancelled on either side if agreement on fees not reached at time of review. All outstanding fees due immediately if retainer cancelled. FEES PAYABLE: by solicitor, unless agreed otherwise, in writing OTHER TERMS: Services provided will be to the best of my ability and judgment and to no other standard. No assurance given as to result achieved by services provided. Common law barristerial immunity from suit applies. GST: The abovementioned sums do not include any sum payable for Goods and Services Tax. Where appropriate Goods and Services Tax shall be charged in addition to the above sums at the rate prescribed by the Australian Government. ACCEPTANCE BY SOLICITOR: By written acceptance or continued instructions. This disclosure need not be signed to be fully operative. Signature by the client or the client's representative is an acknowledgment of disclosure. 43 It is noteworthy that, according to Mr Keesing's version - which in this respect was not contentious - he referred only to those aspects of the document which quantified his costs, including the 25 percent uplift for success. It is not suggested that he referred to the various provisions contained in the agreement as to the costs being payable by the solicitor, or as to how the agreement might be accepted by conduct as opposed to by signature. Mr Keesing accepted in cross-examination that he addressed his words "primarily" to Mr Ramsay as distinct from Mr Spencer; I interpret his evidence to mean that he was looking and speaking, at least most of the time, at Mr Ramsay; and when he used the word "you" in the course of the conversation set out above, he meant and others understood him to mean Mr Ramsay; but that Mr Spencer who was in the room could hear what was said. 44 The respect in which my acceptance of Mr Keesing's version is qualified is his assertion that as he left the room he handed the document to Mr Spencer, which Mr Spencer disputes. This dispute has to be resolved on the balance of probabilities, where there is one witness in either direction, where Mr Ramsay is not a witness, and where Mr Gidaro's evidence does not touch on the topic. As I say, it has to be resolved on the balance of probabilities. 45 Two matters incline me to think that Mr Spencer's version, that the document was handed to Mr Ramsay and not to him, is the more probable one. The first is I thought that Mr Spencer demonstrated greater certainty about the events that occurred on that occasion, and in particular this event pertaining to the handing over of the document, than did Mr Keesing. The second is that it is more consistent with what Mr Keesing agrees he said to Mr Ramsay, namely: I am going outside for a smoke. You can discuss this with Mr Spencer that he would have handed it to Mr Ramsay than to Mr Spencer. 46 In reaching that conclusion, I wish it to be clear that I am simply assessing where, on the limited material before me, the probabilities lie. It does not involve in the slightest disbelieving Mr Keesing, but assessing where I think the probabilities lie between two people trying to remember what happened some years ago. 47 Next, there are the circumstances of execution. One thing is quite clear, and that is that the document was executed by Mr Ramsay alone and not by Mr Spencer. This, in my view, tells quite strongly in favour of an objective intention that the contract be with the client and not with the solicitor. It is true that the document contained provision for acceptance by conduct, including continued instructions. However, there is nothing to establish that Mr Spencer was on notice of those provisions of the document at any time on 10 August 2003. If it were desired that the solicitor be a party, then it would have been a very easy matter for that to have been required and attended to at the time on 10 August. It might have been different had Mr Ramsay not been asked to sign any document at that time, and I do not overlook that the document itself provided that signature by the client is an acknowledgment of disclosure and that enforceability of the contract does not depend on signature; but the fact that the signature of one potential party was required and that of the other was not does tell in favour of the view that the contract was with he who was asked to, and did, sign it. 48 I also do not overlook Mr Keesing's evidence that he made the disclosure and required the client's signature for more abundant caution, in order to ensure compliance with the requirements of s 175 and s 176, but it seems to me that the informed, independent and impartial observer would think that in the light of s 175 and s 176 there was no reason to make a disclosure to the client as distinct from to the solicitor, if the contractual relationship was to be with the solicitor. 49 I come then to the terms of the written agreement itself. In one sense, it does not tell against the solicitor being a party, as it expressly provided that costs are to be paid by the solicitor unless otherwise agreed in writing; nor does it exclude the possibility that the solicitor accepted the contract by continuing instructions; but one cannot infer acceptance from continuing instructions in the absence of proof that the solicitor was on notice of the term providing for such acceptance, and I am simply not satisfied that he was on notice of either of those terms on 10 August. The highest the evidence rises is that he may have read the document after the second copy was forwarded to him on about 14 or 15 August. By that time, the case was well and truly advanced in circumstances where, to the solicitor's observation and belief, the barrister had made his commercial dealings on 10 August with the client as distinct from with the solicitor. 50 I think the better view is that if the solicitor read the document on 14 or 15 August it would have occurred to him, as it would to the impartial, informed observer, that a form that was inapt to the particular circumstances had been completed, and that the provision relating to the solicitor paying the costs was simply inapt having regard to the dealings that took place on 10 August. The request on 10 August for a signature by the client would convey that, despite the provision in the pro-forma agreement for acceptance by on-going instructions, in this case acceptance was to be by signature. 51 In my view, no offer was made by the barrister to Mr Spencer on 10 August. The mere provision to Mr Spencer of a copy of the document already signed by Mr Ramsay would not objectively have been understood to constitute an offer to Mr Spencer capable there and then of acceptance or rejection by Mr Spencer. It had already been accepted by Mr Ramsay. 52 The next significant matter is that Mr Spencer admittedly never said anything expressly, or for that matter implicitly, to the effect that the firm would not be liable for the barrister's fees. Because, ordinarily, one would expect the solicitor to be liable, that is a matter of some significance and in might well be favourable to the barrister's case. But for the dealings that took place in the conference on 10 August, it probably would have been so, but in the light of the dealings that occurred on 10 August, that absence of express objection takes on a different colour. It was known to the barrister and the solicitor that there had been some direct approach by the lay client to the barrister, and some prior connection which provided the foundation for the instructions to retain the barrister. Coupled with the barrister's act in addressing primarily the lay client, and obtaining the lay client's signature to the document on 10 August, it seems to me that in those circumstances the solicitors remaining silent about the firm not intending to assume liability is understandable. 53 Finally, there is the solicitor's failure to dispute, until April 2004, liability on the fee note that was addressed to the firm. While that could amount to an admission and cast some light on the parties' intentions on 10 August, to my mind it does not really assist one to form a better view of what happened and what was agreed on 10 August. Its weight, in any event, is to my mind slight. The solicitor was probably seeking to avoid an unnecessary dispute if it could be avoided while there was still scope for negotiation, and the solicitor would have thought it not unusual to receive a fee note in circumstances where it was anticipated that the solicitor would in due course receive the judgment moneys from the defendant's insurer. 54 I am quite certain that on 10 August Mr Keesing believed that he was not departing from his usual practice of having the solicitor liable, and that he obtained the lay client's signature for more for abundant caution. In many ways, that was for the solicitor's benefit and protection as well as his own. I am also quite certain that Mr Spencer was, to borrow his own words, 'relieved' that he was not asked about the question of liability for costs, but left the conference on 10 August believing that counsel had made arrangements, so far as his costs were concerned in this case, with the lay client rather than with the solicitor. But ultimately, the question for me is not what Mr Keesing believed or what the solicitor believed, but what the impartial, informed observer present at that conference and knowing the surrounding events known to both parties would have concluded. I am convinced that this 'fly on the wall', so to speak, would have thought that, for whatever reason, but quite possibly due to the prior connection between the lay client and Mr Keesing and the lay client being the source of his instructions, Mr Keesing had decided in this case to make his commercial arrangements directly with the lay client, and not with the solicitor. 55 For those reasons, I decline to make the declaration sought. 56 I order that the Summons be dismissed with costs. **********

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At a glance

Court

Decision date

Before

Source

Judgment (43 paragraphs)

Parties

Cases Cited (4)