Muriniti v Lyons & Ors

Lena Ruggero (Third Defendant)

P: Mr R K Weaver COUNSEL : 1D: Miss E Cohen 2,3D: Mr Segal P: L. C. Muriniti & Associates SOLICITORS : 1D: Self 2,3D: I V Knight, Crown Solicitor CATCHWORDS : Legal Costs - whether costs assessment should proceed - transitional operation of Legal Profession Reform Act 1993 - whether matter appropriate for judicial review Legal Profession Act 1987, ss 184, 192, 193-195, 201, 206, 208L, 208M, Sch 8 LEGISLATION CITED : Law Reform (Miscellaneous Provisions) Act 1944, s 2 Legal Profession Regulation 1994, regs 26A, 78, 79 Legal Profession Reform Act 1993 DECISION : Dismissed with costs.

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

14 JULY 2000 12152/99 - Leonardo C MURINITI v Janice LYONS & ORS JUDGMENT 1 HIS HONOUR: The plaintiff, Leonardo Carlo Muriniti, is a solicitor who briefed Robert Lyons, a barrister, in several matters concerning the clients, Jacob Koopman and Seija Aulikki Mather. Mr Lyons died on 2 May 1995. His widow, Janice Lyons, the first defendant, is the executrix of Mr Lyons' will. 2 Section 192 of the Legal Profession Act, 1987 ("the Act") provides, inter alia:

(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 30 days have passed since a bill for those costs was given to the person in accordance with this Division.

Mrs Lyons claims she has served bills of costs upon the plaintiff in accordance with ss 193, 194 and 195 of the Act. At the hearing, it was not submitted that Mrs Lyons, as executrix of Mr Lyons' estate, was not entitled to pursue any remedy that Mr Lyons would have been entitled to pursue during his lifetime. Counsel for Mrs Lyons pointed to s 2 of the Law Reform (Miscellaneous Provisions) Act, 1944 . As this issue was not debated, I need not discuss it further. 3 Section 201 of the Act provides:

(1) A barrister or solicitor who has given a bill of costs in accordance with this Part may apply to the proper officer of the Supreme Court for an assessment of the whole of, or any part of, those costs.

Mrs Lyons made an application under s 201. In accordance with reg 26A of the Legal Profession Regulation, 1994 , notice was given to the plaintiff. He lodged an objection. Mrs Lyons filed a response. The third defendant, Lena Ruggero, who was the proper officer of the Supreme Court, then, in accordance with s 206 of the Act and reg 26A, referred the matter to the second defendant, Mr Peter J McNally ("the costs assessor") for assessment. 4 In the summons and the affidavits filed in support, no point was raised which cast any doubt upon the statutory entitlement of Mrs Lyons to proceed under s 201 of the Act or upon the statutory duty of the costs assessor to assess the costs claimed in the bills of costs served by Mrs Lyons. Nor at the hearing did counsel for the plaintiff raise any such point. 5 In written submissions since delivered, counsel for the plaintiff has submitted that the bills of costs were not signed in accordance with s 194 of the Act and were not served in accordance with s 195 of the Act. It is too late to raise these issues which, if they were to be relied upon in these proceedings, should have been debated at the hearing. The matter was adjourned for written submissions on the transitional operation of the Legal Profession Reform Act, 1993 and it is on that issue that I read the submissions. The additional points raised by counsel can be raised before the costs assessor and dealt with by him, at least if they were mentioned in the plaintiff's objection. Counsel for the plaintiff has also submitted in his written submissions that "The applicant [for costs] is not a legal entity". As that matter has not been debated before me, it will be for the costs assessor to determine. 6 Counsel for the plaintiff has submitted that there was an oral agreement between the plaintiff and Mr Lyons that both would provide legal services in relation to a case in which Mr Koopman and Ms Mather were involved, such services to be provided on the basis that the lawyers would be paid only if Mr Koopman and Ms Mather were successful in the litigation and if they were successful in selling a patent for a lock which they were attempting to sell. Counsel alleged that, although the legal proceedings were successful, Mr Koopman and Ms Mather were not able to sell the patent and, therefore, a condition upon which the legal fees would become payable was not fulfilled. In relation to two other legal proceedings, counsel for the plaintiff alleged that these were undertaken by Mr Lyons on a pro bono basis. 7 Counsel for the plaintiff submitted that the oral agreement between the plaintiff and Mr Lyons was made in about May 1994, before 1 July 1994, which was the date upon which the reforms introduced by the Legal Profession Reform Act, 1993, including the reforms as to costs agreements and as to assessment of costs, commenced to operate. Counsel submitted, for example, that s 184(4), which provides that "A costs agreement is void if it is not in writing or evidenced in writing", did not apply to the oral agreement made between the plaintiff and Mr Lyons in about May 1994. 8 However, Schedule 8 to the Act contains transitional provisions. The following clauses are relevant:

41 (1) Subject to this Part, Part 11 (as substituted by Schedule 3 to the Legal Profession Reform Act 1993 ) extends to bills of costs given before, or agreements as to costs made before, the commencement of that substituted Part if any such bill of costs or agreement has effect after that commencement. … 42 Part 11, as substituted by Schedule 3 to the Legal Profession Reform Act 1993 , does not apply to barristers' costs for which a fee has been marked or a memorandum of fees has been rendered before the commencement of that substituted Part. 9 Moreover, the Legal Profession Regulation, 1994 deals with transitional matters. Regulation 78(1) provides:

(1) Division 3 of new Part 11 of the Act does not apply in respect of legal services provided by a legal practitioner on or after 1 July 1994 if the practitioner was retained to provide those services before 1 July 1994.

Regulation 79 provides: (1) This clause applies in respect of costs which are the subject of a bill given to a client (or which are the subject of an order of a court or tribunal made) on or after 1 July 1994. (2) An assessment of those costs under Division 6 of new Part 11 of the Act, to the extent that the costs relate to any work done by a solicitor or barrister, or action taken, before 1 July 1994, is to be made by a costs assessor in accordance with new Part 11 of the Act. However, the former taxation principles apply to any such assessment and that Part is to be construed accordingly. 10 Accordingly, the costs assessor's jurisdiction does not include barristers' costs for which a fee was marked or a memorandum of fees was rendered prior to 1 July 1994. Otherwise, to the extent that the costs relate to work done or action taken before 1 July 1994, the matter is to be assessed under the former taxation principles. By virtue of cl 41(1) of Schedule 8 to the Act, Part 11 of the Act applies to any agreement as to costs made before 1 July 1994 to the extent that the agreement has effect on and from that date. Further, the costs assessor will have to determine when Mr Lyons was retained to provide the services which are the subject of Mrs Lyons' bills of costs. In this respect, there may be a question as to whether Mr Lyons accepted a continuing retainer to act throughout the litigation, which was the subject of Mrs Lyons' bills of costs, or whether he was retained from time to time when work was required. The evidence before the Court does not show how and when Mr Lyons was retained in respect of services performed after 1 July 1994. Regulation 78(1) was not relied on by counsel for the plaintiff until after the hearing. 11 In the present proceedings, the plaintiff has sought a declaration that Mrs Lyons has no legal standing and/or legal personality to pursue her application for the assessment of costs. The plaintiff has sought orders that Mrs Lyons be restrained permanently from presenting to a proper officer of this Court the documents attached to her application and that she be restrained permanently from proceeding with the assessment. The plaintiff has also sought a writ of prohibition restraining the costs assessor from proceeding with or taking any steps in relation to the matter before him. The plaintiff further seeks an order in the nature of certiorari quashing the referral of the matter to the costs assessor. 12 The summons before the Court is misconceived. It is not the function of the Court, at this stage, to hear witnesses, find facts and assess costs. The legislature has established processes for the assessment of costs. 13 Counsel for the plaintiff submitted that the subject process of assessment of costs was futile and an abuse of process. But whether the plaintiff's contentions, as to the oral agreement and as to the agreement to undertake pro bono work, are successful and whether reg 78(1) applies to all the services provided by Mr Lyons, are not matters to be determined at this stage by this Court. They are matters to be determined in the first instance by the costs assessor to whom the matter has been referred. Once the costs assessor has brought down his determination, any party dissatisfied with it may appeal to the Court on a point of law in accordance with s 208L of the Act or on the merits by leave in accordance with s 208M of the Act. The Act has laid down this procedure for the assessment of costs. The Court should not shortcut the procedure at the whim of a solicitor who wishes to dispense with the statutory process. 14 If the summons had been based on the reg 78(1) issue, it may have been appropriate for the Court to consider the issue at an early stage, for the issue goes to jurisdiction. However, that was not the way the summons was expressed nor how the matter was presented at the hearing. 15 In the circumstances, the application to the Court should be dismissed with costs. **********

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