Koutsourais & anor v Metledge t/as Metledge & Associates [2003] NSWSC 416 | Case summary

JUDGMENT 1 HIS HONOUR: This matter came before the Court in the Duty Judge's Application List upon the filing of a "Notice of Appeal from Master" expressed to be pursuant to SCR Pt60 r12 (sic r10). On the list callover the question of the competency of the appeal was raised by the Court and the matter was stood down until later in the day. Upon being called for hearing, the solicitor for the appellants indicated that he had examined and considered the issue of competency and was prepared to argue and contend for competency of the appeal, as well as merits. The hearing proceeded accordingly. 2 Dispute between the parties came to litigation commenced by the respondent against the appellants in the Local Court at Burwood. The originating pleading alleged that the appellants became indebted to the respondent for various professional services performed as a solicitor in respect of which billings for fees of $21,653.38 had been rendered. Payment not having been made, an agreement was entered, orally, that specific periodic payments would be made. The appellants performed their obligations under the agreement in part. The claim of the respondent alleged "breach" of this agreement and judgment was recovered for $9,398 together with interest. 3 Judgment was entered in the Local Court on 12 August 2002 and on 25 October 2002 the appellants filed a summons in this Court seeking an extension of time pursuant to SCR Pt51B r5(5) and "leave to appeal pursuant to Pt51B r1". An appeal to this Court from a decision such as that made at Burwood Local Court in this instance is limited by the Local Courts (Civil Claims) Act 1970: "69 Appeal (1) Subject to subsection (2), all judgments and orders of a court exercising jurisdiction under this Act shall be final and conclusive. (2) A party to proceedings under this Act who is dissatisfied with the judgment or order of the court as being erroneous in point of law, may appeal to the Supreme Court therefrom. …………….." 4 The matter which had been raised by the Court had particular reference to SCR Pt60 and to Schedule D of the Rules. It was acknowledged by the parties that there has been no conferral of power for a Master to hear and determine an appeal brought pursuant to s69(2) of the Local Courts (Civil Claims) Act 1970. 5 Nevertheless, for reasons which are not apparent from the court file, a special fixture before a Master was allocated for 12 March 2003. There is within the file a form document noting that fixture which appears to have been signed on behalf of the appellants. 6 On the scheduled date Master Malpass proceeded with the hearing and on 28 March 2003 he delivered judgment dismissing the summons. He referred to the application for extension of time in these terms: "The appeal is presently incompetent. It was brought out of time. This matter was not argued and the question of extension of time was not addressed by the plaintiffs." 7 Despite the absence of conferral abovementioned, the judgment of the Master is validated by s118 of the Supreme Court Act of which relevant provisions are: "Powers: divisional master (3) A judgment given or an order made by a divisional master in any Division may be set aside or varied by the Court. (4) Subject to subsection (3), a judgment given or an order made or direction given by a divisional master in any Division shall have effect as a judgment or order or direction of the Court in the Division, whether or not the judgment, order or direction is within the powers mentioned in this section of the divisional master. " 8 Thus, by virtue of these provisions, the judgment of the Master has effect as "a judgment of the Court in the Division" against which appeal is expressly assigned to the Court of Appeal by the Supreme Court Act s101(1)(a). 9 The expression in s118(3) does not create an independent right of appeal from a Master to a single Judge. In Gill v Residential Tribunal 2001 53 NSWLR 425 Dunford J observed that any such appeal must be brought in accordance with the rules and as constrained or limited by them. I would add, even more emphatically is this the case when there is statutory expression such as s101(1)(a). 10 The appellants pointed to the terms of SCR Pt60 r10: "Right of appeal An appeal shall lie to the Court from any decision of a master, except in any case where an appeal lies to the Court of Appeal pursuant to rule 17."

and the absence of mention of an appeal such as the present in rule 17. 11 A judgment which has effect as a judgment of the Court in the Division pursuant to s118(4) is not, in my view, a "decision of the Master" within the meaning of that expression in SCR Pt60 r10. 12 The appeal is incompetent and must be dismissed. 13 Even if an appeal did lie from the Master to a single Judge, it would be limited to error of law: Do Carmo v Ford Excavations Pty Limited 1981 1 NSWLR 409. There is no apparent error of law in the implicit refusal to extend time. I should record that at the hearing before me, attention was not drawn to the part of the Master's judgment which I have above recited and I expressed the view during argument that, if the Master did not refer to it but dealt with the appeal on the merits, it might be inferred that he was granting the extension. In the light of my opinion on the question of competency, the issue is no longer of consequence. 14 As the issue of competency was raised by the Court, I should further record that neither party sought referral to the Court of Appeal and given the amount involved in the judgment and the potential for incurring further substantial costs, I affirm my indication that I would not of my own motion, so refer the matter. 15 In deference to argument presented, I should shortly express my views on the merit issues which were canvassed. 16 At the Local Court the learned magistrate had dealt with as a preliminary issue, a contention that the respondent's claim was not justiciable for failure to comply with s192(1) of the Legal Profession Act 1987 viz: "192(1) Proceedings for the recovery of costs by a barrister or solicitor for providing legal services must not be commenced or maintained against any person unless at least thirty days have past since a bill for those costs was given to the person in accordance with this division." 17 At the outset of the hearing before the Local Court, counsel for the respondent opened that the plaintiff's claim was based upon a forbearance from bringing action arising out of a promise by the appellants to pay instalments, upon breach of which, the full amount was then alleged to have become due. 18 The preliminary issue was decided in favour of the respondent. The reasons of the magistrate included a conclusion that the claim of the respondent should not be characterized as proceedings for the recovery of costs for legal services but rather as a claim for breach of the "forbearance" agreement. Although not mentioned in his reasons, it was common ground that the learned magistrate drew attention to a decision in Connolly Suthers v Frost 1994 2 Qd R 117 where solicitors had performed work and, being unpaid, entered into a deed with the debtors which included certain guarantees for payment. Upon default, action was commenced in the District Court and this action was settled by entry into a deed of compromise. The solicitors sued upon the second deed. There were different applicable statutory provisions but they inhibited actions for costs unless there had been examination and allowance by a taxing officer. The Court of Appeal (Queensland) held that the money sought bore the character of a promise in connection with the compromise of the action rather than payment for legal services. The determination of the magistrate bore some analogy to this decision. 19 This preliminary ruling concerning s192 of the Legal Profession Act was the asserted error in point of law which was agitated by the appellants at the hearing before the Master. 20 There is binding authority that the terms of s192(1) are mandatory: Conder v Silkbard [1999] NSWCA 459. Whether the claim by the respondent was for professional costs, as contended by the appellants, or an amount payable under an independent agreement to meet a debt by instalments was a question of fact. The section is operative in the former case. Whether the magistrate's determination of fact was correct or not, cannot be the subject of appeal by reason of the limitation expressed in s69 of the Local Courts (Civil Claims) Act. The Master stated: "It seems to me that the learned Magistrate has had regard to the particular circumstances of the case before him. In those circumstances, I consider that it was open to him to take the view that the section had no application because the defendant's proceedings were not for the recovery of costs for providing legal services." 21 I am unpersuaded that the Master erred in law, however, for the reasons already expressed, I am of the opinion that this appeal is incompetent. 22 The summons is dismissed. The appellants are to pay the respondent's costs of the summons. **********

Koutsourais & anor v Metledge t/as Metledge & Associates

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