Nirmal Taluja v John Orford t/as John Orford & Associates & Anor

Dr Taluja's Amended Statement of Claim, Mr Orford and Ms Bhandary 17This section of these reasons contains a summary of the allegations in the Amended Statement of Claim, adopting the headings used in the Amended Statement of Claim. It does not contain any findings of fact. But for convenience within this section the narrative of Dr Taluja's allegations will sometimes appear as a narrative of fact, where the facts in question do not appear to be controversial.

(i) Background 18Since at least January 2003 Dr Taluja has been the registered proprietor of a property in Liverpool Road, Strathfield ("the Strathfield property"). Dr Taluja is a member of the Hindu faith with a particular devotion to the Hindu deity known as Durga, a powerful goddess of singular significance in the Hindu religion. 19Dr Taluja speaks English but her English language skills are insufficiently proficient to enable her to readily read and understand complex legal documentation without legal assistance. 20Both defendants are solicitors. The first defendant Mr Orford has been practising as a solicitor in New South Wales since at least January 2003 as has Ms Janki Bhandary's firm Bhandary & Bhandary. Dr Taluja's negligence allegations against both Mr Orford and Ms Bhandary relate to their performance of her retainers for them to effect certain conveyancing and commercial transactions relating to her Strathfield property. 21Some appreciation of the structure of the Strathfield property is required understand the commercial transactions Dr Taluja was entering into in 2003 and the nature of Mr Orford's and Ms Bhandary's respective retainers in March and July (and possibly August) of 2003. 22The Strathfield property comprises two titles held under the Real Property Act with separate folio identifiers. For convenience these two titles will simply be called Lot 4 and Lot 100. 23Four structures are erected on the Strathfield property. The first is a building called "Leigh Hall" which is formerly used as a Methodist Bible College. The second is the "Temple Building", which was formerly used as a chapel in relation to the Methodist Bible College. The third is known as "Brundah Hall", a two storey, nine room Colonial style building to which there is attached a number of other single storey buildings. Unlike the other buildings, which are erected on Lot 100, Brundah Hall is erected on Lot 4. The fourth group is some miscellaneous structures on the Strathfield property. 24The Amended Statement of Claim next pleads the claim against Mr Orford.

ii) Claim Against Orford in Respect of Lease of Part of the Property to the College 25In about March 2003 Dr Taluja proposed to lease a part of the Strathfield property to the Noor Al Houda Islamic College Pty Limited ("the College"), which teaches the Islamic faith. The College was formed into a company limited by shares and guided by its two directors, Mr Bheej Adada and Ms Silma Ihram, who were associated with the College throughout the transactions in question. 26Dr Taluja had discussed with Mr Adada the lease of part of the Strathfield property to the College; what the Amended Statement of Claim calls "the Proposed College Transaction". The terms of the Proposed College Transaction then being discussed included certain "Agreed College Lease Terms", which terms were to the following effect (clause 12(c) ASC): "(c) those terms included terms (the 'Agreed College Lease Terms') to the effect that: i. Taluja would grant a lease or leases to the College for a term of, or terms aggregating, 30 years of parts of the Property being: 1. Leigh Hall (excluding certain specified parts thereof); and 2. Brundah Hall (excluding certain specified parts thereof); but 3. excluding the Temple Building. ii. the College would share the use of certain common areas of the Property with Taluja and any other tenants or persons authorised by Taluja to use parts of the Property; iii. the College would pay Taluja rent as follows (the 'Agreed College Rental Term'): 1. $20,000 per month for 6 months 2. $20,000 per month plus an additional $500 per week for the next 6 months; and 3. $20,000 per month plus an additional $1,000 per week for subsequent periods, subject to further increases and reviews as agreed between the parties." 27In March 2003 Dr Taluja engaged Mr Orford to act as her solicitor to give effect to the Proposed College Transaction ([13] ASC), in what the pleading calls the First Orford Retainer ([13] ASC). Mr Orford was required under the First Orford Retainer: to exercise professional care and skill; to obtain Dr Taluja's instructions; to ascertain necessary facts; to advise on how Dr Taluja's instructions could be met; to take reasonable steps to ensure that documents that Mr Orford drafted, reviewed or prepared (College Transaction Documents) for the Proposed College Transaction put Dr Taluja's instructions into effect; to take all reasonable steps to ensure that the College Transaction Documents engrossed, executed and delivered also carried into effect the Proposed College Transaction and Dr Taluja's instructions; arrange for registration of any lease prepared pursuant to the retainer; and, advise Dr Taluja as to all aspects of the transactions, of their legal requirements, and of their effects and of all relevant documents ([14 (a)-(h)] ASC). 28The Amended Statement of Claim pleads two contested obligations: (1) to maintain custody of files after the termination of the retainer, and the other to disclose acts of his won negligence to Dr Taluja both during the retainer and after its termination ([14 (i), (j) and (k)] ASC). These allegations became an important focus of the parties' submissions, and were as follows: "(i) maintain control and custody of his files in relation to the retainer during and a reasonable time after such retainer and (subject only to any applicable liens) make those files available to Taluja upon reasonable notice by her; and (j) from time to time during the currency of the First Orford Retainer: i. to consider whether: 1. Orford had acted negligently or otherwise breached the terms of the First Orford Retainer or otherwise failed to carry out Taluja's instructions with regard to the Proposed College Transaction, the Agreed College Terms or the retainer; or 2. there were reasons for suspecting such negligence, breach or failure; ii. if Orford considered that there was such negligence, breach or failure or reasons for suspecting that there was a significant risk that there was such negligence, breach or failure, to advise Taluja: 1. of such negligence, breach, failure or risk; and 2. to obtain independent legal advice in respect of such negligence, breach, failure or risk; and (k) from time to time after completion of the First Orford Retainer: i. either: 1. to consider whether: a. Orford had acted negligently or otherwise breached the terms of the First Orford Retainer or otherwise failed to carry out Taluja's instructions with regard to the Proposed College Transaction, the Agreed College Terms or the retainer; or b. there were reasons for suspecting such negligence, breach or failure; and 2. if Orford considered that there was such negligence, breach or failure or reasons for suspecting that there was a significant risk that there was such negligence, breach or failure, to advise Taluja: a. of such negligence, breach, failure or risk; and b. to obtain independent legal advice in respect of such negligence, breach, failure or risk;" 29The kinds of allegations in [14] (i), (j) and (k) ASC recur throughout the Amended Statement of Claim, both in the First Orford Retainer and in respect of the later retainers pleaded against him and against Ms Bhandary. It is convenient therefore to describe these obligations using common terminology. The allegation of the term in ([14] (1) ASC) is the "file custody and production term". The term described in ([14] (j) ASC) is the "advice of negligence term". The term described in (14 ASC) is described throughout these reasons as the "advice of past negligence term". 30Dr Taluja also pleads in negligence ([15] ASC) that duties of professional care, skill and diligence arose corresponding to this retainer and in conformity with the terms already pleaded (in [14] ASC). And Dr Taluja pleaded ([16] ASC) that Mr Orford was under fiduciary obligation in the First Orford Retainer "to avoid conflicts between Orford's obligations to Dr Taluja and Orford's personal interest". The pleading then moves to Mr Orford's performance of the retainer. 31Mr Orford undertook work to carry out the First Orford Retainer as a result of instructions that Dr Taluja gave him in March 2003 ([17] ASC). Dr Taluja appears to have given her instructions to Mr Orford between 14 and 17 March 2003 (17 ASC). Between 14 and 17 March 2003 and then in a second phase between 17 and 21 March 2003 Mr Orford began exchanging drafts of the proposed lease agreement with the solicitor for the College and engaged in negotiations between Dr Taluja and the College (17 ASC). 32Finally, on 21 March 2003 Mr Orford arranged for the final draft lease agreement resulting from the negotiation process to be executed by Dr Taluja and for the lease to be delivered to the College in executed form, as well as for Dr Taluja to receive an executed form of lease ("the College Lease Agreement") by means of an exchange and execution at Mr Orford's Hurstville office. But it is alleged that after that execution the lease was not registered. 33But the Amended Statement of Claim complains that the College Lease Agreement so exchanged and executed in Mr Orford's office in Hurstville on 21 March 2003 did not reflect the Agreed College Lease Terms pleaded in (12 ASC), set out earlier in these reasons. The inconsistency between the two was pleaded in the Amended Statement of Claim ([18] ASC) as follows: "18. The College Lease Amendment: (a) contained terms to the effect that: i. Taluja was to let part of the Property for a term of 25 years with an option to renew for a further 5 years; ii. rent was payable at the rate of $20,000, increasing by $500 per month after six months and a further $500 per moth after a further six moths (the 'Executed Rental Terms'); iii. that Taluja would: 1. do all things necessary to give effect to the College Lease Agreement; 2. do all things reasonable on Taluja's part to be done: a. to obtain approval to any subdivision (including registration of a plan of subdivision of the Property) effect the lease; and b. to obtain registration of the lease in terms of the College Lease Agreement (having regard to the requirements of s. 23F of the Real Property Act 1900 and s 76A of the Environmental Planning and Protection Act 1979); Particulars The terms pleaded in (i) and (ii) were express. The terms pleaded in (iii) were implied, as found by Ball J in Australian International Academy of Education Limited v Dr Nirmal Taluja & Ors [2011] NSWSC 647, who also found that the College Lease Agreement constituted a sub-division of the Property. (b) resulted in a lease of the entire Property, as found by the Court of Appeal in Taluja v Australian Academy of Education Limited [2011] NSWCA 416; (c) was not in accordance with: i. the Agreed College Terms; ii. Taluja's instructions; (d) did not contain terms to the effect of the Agreed Rental Terms; (e) contained the Executed Rental Terms which were inconsistent with the Agreed Rental Terms; (f) did not contain terms that carried into effect the Proposed College Transaction, the Agreed College Terms, the Agreed College Rental Terms or Taluja's instructions; (g) were in terms that gave rise to a risk that: i. Taluja would be required to incur further costs on subdivision of the Property and registration of a lease in terms of the College Lease Agreement; ii. the whole of the Property would be demised." 34Despite this alleged inconsistency, Dr Taluja says that in carrying out the First Orford Retainer, Mr Orford did not advise her of its deficiencies, at any time before her execution of the College Lease Agreement, and specifically did not advise her that it did not carry into effect the Proposed College Transaction, the Agreed College Terms or Dr Taluja's own instructions (19 ASC). Dr Taluja also contended that Mr Orford did not advise her that the College Lease Agreement, as executed, would give rise to a risk that Dr Taluja would be required to incur further costs on the subdivision of the property and the registration of the lease in terms of the College Lease Agreement, and that the whole of the property would be demised under the College Lease Agreement (19 and (e) ASC). 35Dr Taluja's next allegation relates to Mr Orford's state of mind for a period of some eight years after the conclusion of his performance of the retainer. She alleges ([20] ASC) that from 21 March 2003 until, at the earliest, 17 June 2011 Mr Orford "had reason to suspect that there was a significant risk that he had acted negligently" or to suspect that he had breached the First Orford Retainer or had otherwise failed to carry out Dr Taluja's instructions with respect to the Proposed College Transaction ([20] ASC). This pleading of Mr Orford's state of mind provides a platform for Dr Taluja's next allegation of a breach of the advice of negligence term and the past advice of negligence term in the First Orford Retainer. 36Dr Taluja alleges that at no time during the currency of or after the completion of the First Orford Retainer did Mr Orford advise her of his alleged negligence, breach, failure or the various pleaded risks of further expenditure on her part ([21] ASC). Not only is it alleged that Mr Orford did not advise of his own negligence but that he failed to advise Dr Taluja "to obtain independent legal advice in respect of" such negligence, breach, failure or risk (21 ASC). The allegations in relation to the First Orford Retainer then move to the issue of Mr Orford's maintenance, control and custody of his files in relation to that retainer. Dr Taluja alleges: that Mr Orford did not maintain control and custody of his files in relation to the First Orford Retainer ([22] ASC); that Mr Orford failed to provide Dr Taluja from about June 2009 until June 2011 with access to his First Orford Retainer files ([23] ASC); and, that he failed to advise Dr Taluja of these matters described in [21], and [23] ASC, whereby Mr Orford is alleged to have "placed himself in a position where his obligations to [Dr] Taluja conflicted with his personal interest in avoiding liability in respect of the matters set out in [21] above", namely his own negligence. 37Dr Taluja's pleading then moves to damages. The Amended Statement of Claim alleges that by reason of the circumstances pleaded in ASC [17] to [23] that Mr Orford breached the terms of the First Orford Retainer ([25] ASC). 38Dr Taluja alleges that she suffered damages that may be classified under a number of heads, as a result of those breaches ([26] ASC). Those heads of damage included: the loss of rental income due to Mr Orford's alleged failure to ensure that the Agreed College Rental Terms were reflected in the College Lease Agreement; and, certain legal costs thrown away ([26] particulars ASC). 39The legal costs said to be thrown away were of several types. Dr Taluja alleges that she incurred costs in procuring the authorisation and registration of the subdivision of the Strathfield property, so as to give effect to the College Lease Agreement, and costs incurred in the registration of the lease in terms of the College Lease Agreement. Dr Taluja contends that this loss crystallised with the Supreme Court's decision in Australian International Academy of Education Ltd v Dr Nirmal Taluja & Ors [2011] NSWSC 647 ("AIAEL") in which Ball J held on 6 July 2011 that the College Lease Agreement contained the implied terms pleaded in [18] (a)(iii) ASC above and that it constituted a subdivision (rather than reflecting the terms of the Proposed College Transaction). 40Dr Taluja also alleges that she incurred costs arising out of her failure to be able to access Mr Orford's files in relation to the First Orford Retainer, in a reasonable time before the hearing of the AIAEL proceedings (2010/298143), that ultimately led to the decision before Ball J in AIAEL. It is alleged that those legal costs included three adjournment applications in the AIAEL proceedings and the legal costs of an appeal from Ball J's decision in AIAEL. 41Dr Taluja also makes allegations of breach of fiduciary duty based on the same underlying facts. She alleges that on the basis of [21] ASC and [23] ASC that Mr Orford placed himself in a position of conflict of interest and duty [24] ASC and that by reason of these matters Mr Orford also breached his fiduciary obligation to Dr Taluja ([29] ASC). The breach of fiduciary duty is grounded in Mr Orford's alleged failure to advise Dr Taluja of his own negligence, breach, failure, or risk, and of his failure to advise her to obtain independent legal advice in respect of the same ([21] ASC), and his failure to provide Dr Taluja with access to his files in relation to the First Orford Retainer. The breach of fiduciary duty is said to be his putting himself in a position of conflict of personal interest and his duty to Dr Taluja as alleged in [24] ASC. The breach of the advice of negligence term, was also a breach of a fiduciary duty. 42This completes the allegations against Mr Orford in relation to his execution of the First Orford Retainer. In the next section, section (iii) of the pleading, Dr Taluja makes claims against both the Bhandarys and Mr Orford.

(iii) Claims Against Bhandary and Orford in Respect of the Lease of Part of the Property to Shree Shirdi Sydney 43Dr Taluja's second group of claims against Ms Bhandary and Mr Orford relate to a part of Dr Taluja's Strathfield property, the Temple Building. The underlying transaction is one in which Dr Taluja alleges she entered into a joint venture with Shree Shirdi Sydney for the future joint use of the Temple Building, for a proposed investment in a property in Campbelltown and for other incidental matters. The claims against Ms Bhandary and the second claim against Mr Orford both arise out of their attempts to give legal effect to this Taluja-Shree Shirdi Sydney Joint Venture Agreement ("the Joint Venture Agreement"), with which the Amended Statement of Claim begins this section ([31] to [37] ASC). 44Dr Taluja pleads the background to the Joint Venture Agreement. From about 1994 Dr Taluja conducted Hindu religious meetings in the Temple Building, meetings which she dedicated primarily to the Hindu deity Durga. She used parts of Brundah Hall on the Strathfield property for catering purposes in relation to these religious meetings ([31] ASC). Devotees of other Hindu deities were also welcome to attend Dr Taluja's meetings. One of these other groups of devotees was lead by a Mr Jaikshen Tolani, a devotee of the Hindu 20th century spiritual master regarded by his devotees as a deity, Shirdi Sai Baba. From about May 1998, Mr Tolani proposed that he and his devotees join in and conduct worship at the Temple Building and establish a Shirdi Baba association which could also use the Temple Building for worship ([33] ASC). 45An informal arrangement grew between Dr Taluja and the devotees of Durga, and Mr Tolani and the devotees of Shirdi Baba, which continued quite successfully between 1998 and 2003. Dr Taluja provided access to the Temple Building for Mr Tolani and the Shirdi Baba devotees. Led by Dr Taluja, the religious ceremonies were conducted together, and Mr Tolani or Shree Shirdi Sydney made weekly financial contributions to Dr Taluja's expenses, to the maintenance of the Temple Building, and to the holding of the meetings ([34] ASC). 46The Joint Venture Agreement was first discussed in June 2003, at about the time Dr Taluja had identified an investment property in Campbelltown and was seeking to fund its acquisition ([35] ASC). 47In July 2003 Dr Taluja entered into a Joint Venture Agreement with Shree Shirdi Sydney ([36] ASC) referred to throughout the pleadings as the "Joint Venture Agreement". 48Different parts of the Joint Venture Agreement are pleaded in [37] ASC. The whole of the pleaded terms of the Joint Venture Agreement are described in the pleading as the Agreed Shree Shirdi Terms. The first pleaded part may be described as the Joint Venture Agreement's long term objective: to develop certain land associated with the Temple Building upon Shree Shirdi Sydney's making a capital contribution to aid that objective. This long term objective is pleaded in 37 ASC) as follows: "(a) Shree Shirdi Sydney and Taluja agreed that: 1. Shree Shirdi Sydney and Taluja (and/or a charity to be established by Taluja, together with Taluja the 'Taluja Parties') were to: 1. investigate way in which to, and make endeavours to, develop a parcel of land which occupied 800 metres squared of the Property and which contained the Temple Building but which was otherwise unspecified (the 'Temple Land') and for further development and use: a. as a temple for the conduct of services for the worship of Durge and Shirdi Baba; b. for the promotion of the Hindu faith (particularly in relation to the worship of the Durga and Shirdi Baba deities); 2. subject to sub-parragraphs [37(a)(ii) - (vi)] below, investigate means by which Shree Shirdi Sydney and the Taluja Parties could hold half shares in the Temple Land and hold such land jointly in common and/or under strata or community title for the purposes of the Joint Venture (the 'Temple Land Allocation'); 3. carry into effect the Temple Land Allocation in accordance with such means; 4. each meet one half of the expenses of operating, maintaining and developing the Temple Land; ii. the amount to be contributed by Shree Shirdi Sydney to acquire a half share in the Temple Land was $700,000 (the 'Payment'); iii. the Payment was to be made in instalments as agreed ('Payment Instalments'); iv. the cults of Durga and of Shirdi Baba were each to be accorded equal respect and to be promoted on an equal basis; v. Shree Shirdi Sydney on the one hand and the Taluja Parties on the other hand would be given equal access to the Temple Building and Temple Land; vi. Taluja was to continue to be a leader of worship at the Temple; and" 49But the Joint Venture Agreement also established interim arrangements. Pending achieving the Joint Venture Agreement's long term objective, the parties decided to regulate more formally the use and access of the Temple Building between Dr Taluja and Shree Shirdi Sydney and their devotees in the following terms: "(b) pending the investigations and actions contemplated in paragraphs [37(a)(i)] above: i. Taluja agreed to continue to permit Shree Shirdi Sydney to use the Temple Building for the purposes of conducting religious services and community functions on the basis agreed with Taluja (and in particular on the basis that: 1. Shree Shirdi Sydney pay rent of $250 per week to Taluja; 2. such rent payment represented half of the notional rent of the Temple Lad of $500 per week; 3. the cult of Durga and of Shirdi Baba were each to be accorded equal respect and to be promoted on an equal basis; 4. Shree Shirdi Sydney on the one hand and the Taluja Parties on the other hand would be given equal access to the Temple Building; 5. reasonable notice to Taluja, and Taluja's consent, was required as a condition to Shree Shirdi Sydney's acces to or use of the Temple Land (apart from the Temple) or any part of the Property (apart from the Temple Land) (the 'Excluded Property'); 6. Shree Shirdi Sydney and the Taluja Parties, were each to: a. continue to use the Temple Building for the purposes of conducting religious services and community functions on the basis agreed; b. meet one half of the expenses of operating, maintaining and developing the Temple Building and the conduct of worship thereat and the provision of amenities in relation thereto. 7. Shree Shirdi Sydney must, at its own expenses, comply with he requirements of any government authority concerning the use of the Temple Building and the Temple Land; 8. Shree Shirdi Sydney must not change the nature of use of the Temple Building or Temple Land without first complying with the requirements of any government authority concerning the use thereof;" 50The Joint Venture Agreement contained other machinery terms. The parties agreed they would consider and investigate the means by which Shree Shirdi Sydney could be reorganised to represent as members the devotees of Durga, including Dr Taluja and the devotees of Shirdi Baba and engage further with the Shirdi parties (37 ASC). And Shree Shirdi Sydney was to present a proposal for written agreements to carry into effect the long term objective, the interim arrangements and the engagement with the Taluja Parties, all of which are described in the Amended Statement of Claim as the "Proposed Shree Shirdi Transactions" (37 ASC). This completes the background to the claim against Ms Bhandary. 51Dr Taluja first alleges that Shree Shirdi Sydney engaged Ms Bhandary to advise and to act for it generally in relation to the Agreed Shree Shirdi Terms and to carry into effect the Proposed Shree Shirdi Transactions and to reflect the leasing by Dr Taluja to Shree Shirdi Sydney of part of the property, and in respect of a grant by Dr Taluja to Shree Shirdi Sydney of an option over part of the property ([38] ASC). 52Dr Taluja also engaged Ms Bhandary to "act for her in relation to the preparation of documents to reflect the Agreed Shree Shirdi Terms and provided instructions to the Bhandary's to prepare documentation in accordance with the Agreed Shree Shirdi Sydney Terms" ([39] ASC). Ms Bhandary accepted the instructions and commenced to act upon the Bhandary Retainer. 53Dr Taluja's Amended Statement of Claim in relation to the alleged breach of the Bhandary Retainer is structured in much the same way as were her allegations in relation to the First Orford Retainer. The terms of the Bhandary Retainer and its performance and alleged breach are set out in this section of these reasons. 54Dr Taluja alleges ([40] ASC) that the Bhandary Retainer included terms that Ms Bhandary would exercise professional care skill and diligence in respect of the retainer and the Proposed Shree Shirdi Transactions and the Agreed Shree Shirdi Terms, to obtain Dr Taluja's instructions, to ascertain facts necessary to carry out Dr Taluja's instructions, to advise Dr Taluja on the way the instructions could be met and any risks inherent in the means adopted to meet those instructions ([40] (a) - (d) ASC). 55Dr Taluja's Amended Statement of Claim also pleaded a number of related duties in the Bhandary Retainer to prepare effective transaction documents to give effect to the Agreed Shree Shirdi Terms. Those terms included the taking of all reasonable steps to ensure that the transaction documents in respect of the Agreed Shree Shirdi Terms were: able to carry into effect the Proposed Shree Shirdi Transactions and the Agreed Shree Shirdi Terms; to carry Dr Taluja's instructions into effect; and to advise if there was a significant risk that the transaction documents were not effective to do so (40 ASC). Moreover, Dr Taluja also pleads a term that to the extent that Ms Bhandary arranged the engrossment execution delivery receipt or exchange of documents, that Ms Bhandary would take all reasonable steps to ensure that the manner in which those documents were engrossed, executed, witnessed, delivered, received or exchanged was effective to carry into effect the Proposed Shree Shirdi Transactions, and to carry out Dr Taluja's instructions, and to advise Dr Taluja if there was a significant risk that the result would be ineffective (40 ASC). 56The pleading alleges that the Bhandary Retainer conferred other functions on Ms Bhandary, in the execution of the retainer: functions to arrange for registration of any leases prepared under the Bhandary Retainer (40 ASC); and, functions to advise Dr Taluja of the documents drafted to give effect to the Agreed Shree Shirdi Terms and with respect to the property (40 ASC). 57Once again the pleading of the Bhandary Retainer alleges that this retainer also contains advice of negligence terms. As with the First Orford Retainer it is pleaded that Ms Bhandary should consider the possibility of her own negligence and to disclose it to Dr Taluja, both during the retainer and after the conclusion of the retainer. The advice of negligence term pleaded requiring such disclosure during the retainer was the following (40 ASC): "(i) from time to time during the currency of the Bhandary Retainer: i. to consider whether: 1. Bhandary had acted negligently or otherwise breached the terms of the Bhandary Retainer or otherwise failed to carry out Taluja's instructions with regard to the Proposed Shiree Shirdi Transactions, the Agreed Shree Shirdi Terms or the retainer; or 2. whether there were reasons for suspecting such negligence, breach or failure; ii. if Bhandary considered that there was such negligence, breach or failure or reasons for suspecting that there was a significant risk that there was such negligence, breach or failure, to advise Taluja: 1. of such negligence, breach, failure or risk; and 2. to obtain independent legal advice in respect of such negligence, breach, failure or risk; and" 58Dr Taluja pleaded a similar duty of consideration and disclosure of possible negligence, after completion of the Bhandary Retainer, another advice of past negligence term (40 ASC): "(j) from time to time after completion of the Bhandary Retainer: i. to consider whether: 1. Bhandary had acted negligently or otherwise breached the terms of the Bhandary Retainer or otherwise failed to carry out Taluja's instructions with regard to the Proposed Shree Shirdi Transactions, the Agreed Shree Shirdi Terms or the retainer; or 2. whether there were reasons for suspecting such negligence, breach or failure; and ii. if Bhandary considered that there was such negligence, breach or failure or reasons for suspecting that there was a significant risk that there was such negligence, breach or failure, to advise Taluja: 1. of such negligence, breach, failure or risk; and 2. to obtain independent legal advice in respect of such negligence, breach ,failure or risk." 59Dr Taluja pleaded a number of other non-contractual duties based upon the pleaded terms of the Bhandary Retainer. She pleaded that Ms Bhandary became subject to a duty to take all reasonable professional care, skill and diligence in respect of the Bhandary Retainer ([41] ASC) and that Ms Bhandary was under a fiduciary obligation to Dr Taluja "to avoid conflicts between Bhandary's obligation to [Dr] Taluja and Bhandary's interest to other duties" ([42] ASC). 60The Bhandary Retainer was performed in July and early August 2003. In July and August of that year Ms Bhandary took instructions from Dr Taluja ([43] ASC). By about 5 August 2003 she had drafted a memorandum of lease terms, and on 5 August 2003 she arranged for the memorandum of lease terms to be executed and exchanged by Dr Taluja and Shree Shirdi Sydney, together it is alleged, with a standard form of lease terms (all of which together are referred to in these reasons and the pleading as the "Shree Shirdi Lease Documents") (43 ASC). 61Finally, the pleading alleges that in August 2003 in further performance of the Bhandary Retainer Ms Bhandary arranged for the executed Shree Shirdi Lease Documents to be registered but that Ms Bhandary did not procure registration of those documents (40 and (e) ASC). 62But Dr Taluja alleges that the Shree Shirdi Lease Documents were not in accordance with the Agreed Shree Shirdi Terms ([44] ASC), and that they did not carry out Dr Taluja's instructions with respect to the Proposed Shree Shirdi Transactions. 63The Amended Statement of Claim then replicates the structure of the advice of past negligence allegations with respect to the First Orford Retainer. Here the allegation begins that, since 5 August 2003 on the completion of the Bhandary Retainer, Ms Bhandary "has had reason to suspect that Bhandary had acted negligently or otherwise breached the terms of the Bhandary Retainer or otherwise failed to carry out [Dr] Taluja's instructions with regard to the Proposed Shree Shirdi Transactions" ([45] ASC). 64Dr Taluja then alleges that Ms Bhandary failed to disclose this alleged negligence, breach of duty and conflict of interest to Dr Taluja, both during the Bhandary Retainer ([46] ASC) and afterwards ([47] ASC). Dr Taluja details the allegation of non-disclosure during the Bhandary Retainer in [46] ASC, as follows: "46. In carrying out the Bhandary Retainer, Bhandary did not advise Taluja: (a) that the Shree Shirdi Lease Documents: i. failed to carry into effect the Agreed Shree Shirdi Terms or the Proposed Shree Shirdi Transactions; and ii. contained terms less beneficial to Taluja and more beneficial to Shree Shirdi Sydney than the Agreed Shree Shirdi Terms of the Proposed Shree Shirdi Transactions; (b) of the possibility of a conflict of interest between: i. on the one hand, Bhandary's duty to Taluja; and ii. on the other hand: 1. Bhandary's duty to Shree Shirdi Sydney; or 2. Bhandary's personal interests; (c) to obtain independent legal advice." 65Dr Taluja alleges that Ms Bhandary's failures to disclose her own alleged negligence and to make other related disclosures either during or after the retainer, meant that "Bhandary placed herself in a position where her obligations to [Dr] Taluja conflicted with her personal interest in avoiding liability in respect of those matters [namely the matters which it is alleged should have been disclosed]"([48] ASC). 66Then the pleading moves to a quite separate allegation of fiduciary conflict, the conflict of duty and duty, an allegation with no parallel in the First Orford Retainer. Dr Taluja alleges that in acting for both Shree Shirdi and Dr Taluja that Ms Bhandary "placed herself in a position where her interests to [Dr] Taluja were in conflict with her interests to Shree Shirdi Sydney" ([49] ASC). 67Dr Taluja's pleading against Ms Bhandary moves to breach. She alleges that the Bhandary Retainer was breached ([50] ASC) and that as a result of those breaches Dr Taluja suffered damage ([51] ASC). The damage is said to arise out of Shree Shirdi Sydney's 2010 proceedings, the proceedings to which Dr Taluja now seeks to have any Amended Statement of Claim added as a second Cross Claim. It is pleaded that if Shree Shirdi Sydney succeeds in the 2010 proceedings, Dr Taluja alleges that she will lose the benefit of the Agreed Shree Shirdi Terms and suffer a resultant loss in the value of the Strathfield property. But if Dr Taluja were to prevail over Shree Shirdi Sydney in the 2010 proceedings, then she alleges that she will suffer damage to the extent that she is not able to recover her costs of those proceedings. 68The same loss is alleged to be the result of Ms Bhandary breaching her pleaded duty of care to Dr Taluja ([52] and [53] ASC). 69And Dr Taluja alleges that Bhandary "breached her fiduciary obligation to avoid (duty and duty) conflicts between her obligation" to Dr Taluja and her obligations to Shree Shirdi Sydney, and to avoid (interest and duty) conflicts between Ms Bhandary's own personal interests and her duty to Dr Taluja ([54] ASC). These breaches of Ms Bhandary's fiduciary obligations are alleged to result in the same loss as flows from the contract and tort breaches ([55] ASC). 70All the breaches of duty pleaded against Ms Bhandary are said to be within the scope of her partnership in the firm Bhandary & Bhandary and that the firm is liable as a result for a full range of those breaches ([56] and [57] ASC).

(iv) Second Claim Against Orford - Claim in Relation to Shree Shirdi Lease Documents 71The pleading moves to the second claim against Mr Orford, for work he allegedly did for Dr Taluja in August 2003 in relation to the Shree Shirdi Lease Documents. 72The second claim against Mr Orford is based, not upon an express retainer as with the First Orford Retainer, but upon a retainer to be implied from Mr Orford's conduct in relation to the Shree Shirdi Lease Documents, whilst he was acting on a retainer from Shree Shirdi Sydney which involved his dealing with those documents. Dr Taluja alleges that Mr Orford acted for Shree Shirdi Sydney in preparing the Shree Shirdi Lease Documents for registration ([58] ASC) and that on or about 5 August 2003 he also took upon himself: to review the Shree Shirdi Lease Documents "on behalf of [Dr] Taluja"; to complete the documents by adding the standard form lease terms (described as the Shree Shirdi Lease Cover); and, to authorise Dr Taluja's execution of the documents ([59] ASC). In so doing Mr Orford is said to have constituted himself as a "solicitor de son tort" in respect of Dr Taluja for the purposes of reviewing, settling and authorising Dr Taluja's execution of the Shree Shirdi Lease Documents. Dr Taluja alleges that Mr Orford thereby became subject to an implied retainer, called in the pleading the "Implied Orford Retainer". 73The terms of the Implied Orford Retainer are in most respects similar to those pleaded with respect to the First Orford Retainer and the Bhandary Retainer: to exercise professional care, skill and diligence; to ascertain Dr Taluja's instructions; to advise Dr Taluja on how the instructions could be met; to advise with respect to transaction documents and to ensure that they were effective; to arrange for the registration of leases; and to advise Dr Taluja with respect to all aspects of the transaction (62 to (g) ASC). Dr Taluja also alleges that the Implied Orford Retainer contained the familiar advice of negligence term, so that Mr Orford had the duty to consider whether he had acted negligently and to advise Dr Taluja of that (60 ASC) and after the retainer to continue to consider whether he had acted negligently, and to advise Dr Taluja, either of such negligence or for her to obtain independent advice (62 ASC), an advice of past negligence term is also pleaded in (62 ASC). 74The terms of the Implied Orford Retainer are said also to found a duty of care, to exercise professional care, skill and diligence ([63] ASC). The pleaded terms also ground the later pleaded fiduciary duty. The Implied Orford Retainer is alleged to contain a term that Mr Orford must "avoid conflict between [Mr] Orford's obligations to [Dr] Taluja and [Mr] Orford's interest or other duties" ([64] ASC). 75It is alleged that Mr Orford undertook work on the Implied Orford Retainer on about 5 August 2003. But in doing so he is alleged to have breached the retainer in a number of ways. These may be briefly summarised as: failing to take Dr Taluja's instructions; failing to consider the Shree Shirdi Lease Documents in relation to Dr Taluja's instructions; or to consider that they carried Dr Taluja's instructions into effect, without risk (65 - (f) ASC). 76Dr Taluja then repeats against Mr Orford in respect of the Implied Orford Retainer a breach of the now familiar advice of negligence and advice of past negligence allegations: that he had reason to suspect a significant risk that he had acted negligently ([66] ASC); that he did not either during the currency of or after completion of the Implied Orford Retainer advise, Dr Taluja of such negligence ([67] ASC) and by failing to so advise placed himself in a position of conflict of interest between his personal interest in avoiding liability for negligence and his duty to Dr Taluja ([68] ASC). 77Following the earlier structure of her pleading, Dr Taluja alleges breach of the contractual, tortious and fiduciary duties that Mr Orford is alleged to have under the Implied Orford Retainer. Mr Orford is said to have: breached the contractual terms of Implied Orford Retainer ([70] ASC); and, breached his duty of care ([72] ASC), as a result of which Dr Taluja alleges she suffered damage ([71] and [73] ASC). 78Dr Taluja also alleges Mr Orford continued to act in breach of fiduciary duty on the Implied Orford Retainer. Dr Taluja alleges (in [69] ASC): "By acting for both Shree Shirdi Sydney and [Dr] Taluja in respect of the Shree Shirdi Lease Documents, [Mr] Orford placed himself in a position where [his] interests to [Dr] Taluja were in conflict with [his] interests to Shree Shirdi Sydney". 79As a result of so acting Dr Taluja alleges that Mr Orford breached his fiduciary obligation to avoid conflicts between his obligation to Dr Taluja and his obligations to Shree Shirdi Sydney and his own personal interests ([74] ASC). 80That completes the structure of the pleadings in the Amended Statement of Claim. It is now useful to turn to the parties' submissions.

The Orford and Bhandary Motions 81Both Mr Orford's motion ("the Orford motion") and Ms Bhandary's motion ("the Bhandary motion") seek to strike out Dr Taluja's pleadings against them in the Amended Statement of Claim on the basis that Dr Taluja's respective claims against them, in contract, in tort and for breach of fiduciary duty, are statute barred. Because those parallel claims would be a complete answer to Dr Taluja's Amended Statement of Claim these reasons deal with them first, commencing with the contentions in the Orford motion. 82Both the Orford and Bhandary motions on this limitation issue seek the exercise of the Court's power under UCPR, r 13.4(1)(b) and r 14.28(1)(a) to strike out a pleading which does not disclose a reasonable cause of action, as a pleading which on its face must fail, because it will be answered by an effective Limitation Act 1969 defence, and therefore does not disclose a reasonable cause of action. 83The Orford motion advances an alternative ground, based upon an alleged abuse of process. Mr Orford contends that aspects of the allegations in relation to the First Orford Retainer are an abuse of process, in that they are said to be a collateral attack upon issues already determined against Dr Talluja in earlier proceedings. The alleged collateral attack arises from Dr Taluja's allegation that the Agreed College Lease Terms between Dr Taluja and the College were not carried into effect in the finally executed rental terms. Mr Orford points out in contrast to this allegation that, Ball J found in AIAEL that the executed lease did accurately record the terms of the parties' agreement and accurately recorded the instructions that Dr Taluja gave to Mr Orford on the subject of the Agreed College Lease Terms. Mr Orford contends that such a collateral attack is not now open to Dr Taluja. 84The Bhandary motion does not maintain any abuse of process contention similar to that of Mr Orford. No prior judicial determination overlaps with the subject matter of the Bhandary Retainer in the same way that the decision in AIAEL does with respect to the First Orford Retainer. 85Both the Orford and the Bhandary motions also seek relief on the basis that the Amended Statement of Claim is embarrassing in form. It has not proved necessary in these reasons to consider this further alternative ground in any depth because the defendant's limitation period contention is successful on both the Orford and the Bhandary motions. And Mr Orford's abuse of process contention is also upheld. Although some observations are made about the form of the pleadings in the context of considering the Further Amended Statement of Claim upon which Dr Taluja sought to rely after 19 March 2014.

The Limitation Issue on the Orford and Bhandary Motions 86Both the Orford and the Bhandary motions seek to strike out Dr Taluja's claims on the grounds they are statute barred. 87The Orford Motion-Contract/Tort. Mr Orford's argument that Dr Taluja's causes of action in contract and tort are statute barred may be shortly stated. Dr Taluja's breach of fiduciary duty claim will be dealt with after the common law causes of action. 88To strike out the causes of action in contract Mr Orford contends the following. Mr Orford's performance of the First Orford Retainer was complete by 21 March 2003. If he breached the First Orford Retainer the breach occurred at the latest on 21 March 2003. A cause of action in contract is complete upon the occurrence of breach. Therefore Dr Taluja's cause of action in contract accrued on 21 March 2003. Limitation Act 1969, s 14(1)(a) sets a limitation period of 6 years in respect of causes of action in contract. Dr Taluja's cause of action in contract therefore expired on 22 March 2009. The 2012 proceedings were not commenced until 18 December 2012, about three years and nine months after the expiration of the applicable limitation period. Mr Orford submits the proceedings are statute barred and should now be struck out. 89Mr Orford applies similar logic to the cause of action in tort. An action in tort accrues upon the occurrence of damage consequent upon the pleaded duty of care. The last date upon which damage could have occurred is 21 March 2003, the date on which execution and exchange of the College Lease Agreement occurred. The limitation period for causes of action in tort is 6 years: Limitation Act, s 14(1)(b). Again, the Statement of Claim was filed some three years and nine months out of time and the cause of action in tort is therefore statute barred. Mr Orford's submissions highlight that the allegations of breach of duty and contract and in tort, but for the allegations of non-disclosure (which will separately considered), all took place in the confined period 17 to 21 March 2003. This is clear from the short considerations of the allegations involved. 90One of Dr Taluja's principal allegations of negligence in breach of contract is that she contends she agreed with the College to commencing monthly rental of $20,000 for certain parts of the Strathfield property with such rent to increase by $500 per week after the first six months of the term, followed by another increase of $500 per week after the next six months, followed then by a rent review escalation of 5 per cent after 18 months. Dr Taluja alleges that Mr Orford failed to prepare a form of lease the College Lease Agreement, and Executed Rental Terms in accordance with her instructions. She alleges that his error was to prepare a lease which commenced in July 2003 with the correct base rent but with a rental increase after six months (in January 2004) of $500 per month, instead of $500 per week, and then a further increase of $500 per month after six months (in July 2004), instead of $500 per week. As a consequence of executing a lease with a monthly rather than weekly rent increase of $500 the plaintiff continued over time to receive less rental income than she would have otherwise have done. Dr Taluja's original Statement of Claim in the 2012 proceedings sets out a calculation of lost rental income which is consistent with the case she now makes: that the increased rental was lost from 15 January 2004 and continues thereafter to be less than that for which Dr Taluja says she bargained. By the time of the filing of the Statement of Claim the difference between the two rental figures had grown to a gross claimed loss excluding interest of $389,197.69. Mr Orford's contention is that an executed lease, or agreement for a lease which fails to record a client's instructions to a solicitor will only ordinarily involve conduct by the solicitor on the retainer up until execution of the lease. 91Dr Taluja also alleges in relation to the First Orford Retainer that she and the College remain in disagreement about whether the standard form lease defined as "the RP Cover" were agreed to be included in the lease as made. This allegation too relates to a period on the pleadings where Mr Orford's conduct is complete by the time that the lease is executed, subject to issues of non-disclosure which will be separately considered. 92The causes of action in contract and in tort on the First Orford Retainer though elaborately pleaded are unspecific as to the breaches of duty that Dr Taluja relies upon. This lack of specificity became the subject of discussion during the parties' submissions. One result of this discussion was that Dr Taluja advanced her post hearing amendments. These post hearing amendments did not identify any other relevant conduct of Mr Orford that post dated 21 March 2003, other than the allegations of non-disclosure. 93Mr Orford undertakes similar analysis with respect to the Implied Orford Retainer, which retainer is said to have been performed in August 2003. Mr Orford contends that all breaches of contract or tortious breaches of duty must have occurred in relation to this claim by no later than 5 August 2003 and that both causes of action must therefore have been compete by that date. The conduct alleged against Mr Orford in respect of the Implied Orford Retainer is that in the course of acting for Shree Shirdi Sydney to prepare the Shree Shirdi Sydney Lease Documents for registration, Mr Orford undertook an implied retainer for Dr Taluja, when he made certain amendments to the Shree Shirdi Sydney Lease Documents and when he allegedly authorised Dr Taluja's execution of them on 5 August 2003. The result of this alleged conduct is said to be that Shree Shirdi Sydney may succeed in the 2010 proceedings in maintaining its rights to a lease and option to purchase over the Temple Building and its surrounds. Applying the same logic to support his strike out of this claim as he does in relation to the First Orford Retainer, Mr Orford argues that any applicable cause of action in contract or tort was complete on 5 August 2003 and therefore expired on 6 August 2009, which is still some 3 years and 3 months before Dr Taluja filed her Statement of Claim in the 2012 proceedings. 94The Implied Orford Retainer claim is puzzling. It is not at all easy to see how Mr Orford could ever have assumed any responsibility to advise Dr Taluja whilst he was acting on behalf of Shree Shirdi Sydney in this transaction. Such doubts can be put aside for present purposes. Were the matter to proceed to a trial they would no doubt be much debated. 95I accept the following analysis arising out of the parties' competing legal contentions. Absent questions of non-disclosure in breach of the advice of negligence term (which will be considered separately), Dr Taluja's allegations with respect to the First Orford Retainer and the Implied Orford Retainer involve Mr Orford's alleged failure to perfect certain lease documents containing rights which corresponded with those that should have been obtained if the firm had executed the retainers in accordance with their instructions and without any breach of duty. The alleged result was that the College Lease Agreement and the Executed Rental Terms, finalised on 21 March 2003, and the later Shree Shirdi Sydney Lease Documents, finalised on 5 August 2003, contained bundles of rights which were inferior to those that Dr Taluja would otherwise have received, absent Mr Orford's conduct. The damage Dr Taluja suffered by acquiring an inferior bundle of rights to those which she was otherwise entitled is not contingent upon any other event. Nor is the fact that Dr Taluja's quantum of damage may have increased over time due to rental increases accruing at a slower rate than Dr Taluja had expected, to the point. 96The law in this State is clear that where a solicitor obtains for a client by way of lease a bundle of rights inferior to those that the client would otherwise have received absent the firm's conduct, either in breach of contract or in breach of a duty of care, the client first suffers loss at that moment and any applicable causes of action in tort and contract run from that date: Winnote Pty Ltd (in liq) v Page t/as Freehill, Hollingdale & Page [2006] NSWCA 287; (2006) 68 NSWLR 531 ("Winnote"), at [40]. 97But Mr Raphael, counsel for Dr Taluja sought to bring the case within the well known passage in Wardley Australia Limited v Western Australia (1992) 175 CLR 514 ("Wardley"), at 532 submitting that where the loss is contingent, even if it were very likely to arise, the cause of action does not arise until the loss actually occurs. 98But this is not like Wardley a case of loss subject to a future contingency. It is exactly like Winnote, a case where a solicitor was given instructions to prepare a lease, which was executed in November 1998. Legal proceedings were commenced against the firm in 1995. Mason P, with whom Tobias JA agreed in Winnote, dimissed at [59] and [60] the relevance of comparisons with Wardley thus: "[59] Of course, a defendant wishing to show that the negligently induced "transaction" caused immediate actual loss of a measurable kind has to establish that proposition. But sometimes this can be "self-evident" (Wardley at 528 per Mason CJ, Dawson J, Gaudron J, McHugh J) or "clear beyond argument" (Moore & Co at 279 per Bingham LJ See also per Neill LJ at 277.). [60] The present is such a case, in my opinion. From the outset, Winnote got significantly less than it should have, in consequence of the solicitors' 1988 negligence. The "goods were damaged" to use Lord Walker's terms. This is demonstrable when one compares the rights secured under the RPL with the rights that ought to have been secured under mining tenements from the outset. The former instrument was legally worthless as later events demonstrated. As Mr Gageler SC put it during argument in this Court, the rights secured by the RPL "were of a dramatically inferior kind" (CA Tr p 24)." 99And (at [66]) Mason P counsels against ignoring the earlier actual damage merely because substantial loss occurs at a later time: "[66] Merely because a substantial loss occurs (ex hypothesi) at a later point of time does not establish that there was no damage stemming from the same breach occurring at an earlier date being damage that occurred outside of the limitation period, thereby barring the whole claim (Wardley at 531, Segalat [26]). In this area of economic loss, the same principle applies as for personal injury, namely time commences to run from the first measurable occurrence of damage (Scarcella). It is unnecessary to consider the correctness of decisions such as Mount Albert Borough Council v Johnson [1979] 2 NZLR 234 (invoked by Winnote) which suggest that successive actions will lie for each successive and distinct accrual of damage where negligent work causes a building to subside and crack. The Australian and English "transaction" cases to which I have referred do not recognise any such principle in the present area of discourse." 100Here the loss occurs immediately upon the receipt of an inferior bundle of rights in a lease transaction, in either March 2003 (the First Orford Retainer) or in August 2003 (the Implied Orford Retainer). 101A Continuing Duty to Disclose Negligence. Dr Taluja also alleges that Mr Orford had and has a continuing duty to disclose his own negligence to her, both during and after the completion of both the First Orford Retainer and the Implied Orford Retainer. Neither of these submissions is persuasive. 102Authority is against the submission. This allegation in the Amended Statement of Claim certainly shows ingenuity in avoiding the limitation problem which otherwise confronts Dr Taluja. The allegation seems to have been advanced to outflank an earlier defendants' submission relying on Winnote. 103Such ingenuity has been unsuccessfully deployed before and in not dissimilar situations. In a short judgment in Wood v Jones (1889) 61 LT 551, at 552 dealing with a client's claim against her solicitor for negligence in having advised an investment in a mortgage (which proved insufficient) without disclosing that there had been no independent valuation on behalf of the mortgagee. Kekewich J found that the client's right of action arose when the negligent act was committed, not when it was discovered by the client, it not being a duty on the part of her solicitor continuing day by day to disclose his negligent act, Kekewich J said: "The defendant's case against the plaintiff is this: You told me as my solicitor that this mortgage was a proper investment. In that you acted negligently, because there had not been any independent valuation made of the property as there ought to have been. The answer is, that was more than six years ago, and the statute applies. To that it is replied that it was the duty of the solicitor to his client to disclose the fact of his negligence. Assuming the facts to be as alleged, the solicitor was guilty of negligence; but his neglect was in 1880, and the action is not brought until 1888. I cannot hold that there was a duty on the part of the solicitor continuing day by day to disclose the fact of his negligence. 104This principle has been applied in England and Australia since that time: see for example Midland Bank Trust Co Ltd v Hett Stubbs & Kemp (1979) Ch 384 ("Midland Bank Trust Co") and Winnote Pty Ltd (in liq) v Page t/as Freehill, Hollingdale & Page (2006) NSWLR 531 at [102]. 105Mr Orford submits that there can be no continuing duty to disclose negligence in either the First Orford Retainer or the Implied Orford Retainer, as these were commercial and conveyancing transactions wholly completed in 2003. This argument is persuasive. There seems nothing inherent in the nature of Mr Orford's instructions or the subject matter of his expired retainer which would require him to constantly check after 21 March 2003 whether or not he may possibly have been negligent in his performance of the First Orford Retainer. 106But Dr Taluja has a counter argument. She actually pleads what she submits is a relevant continuing duty at the time of breach. The law is clear that there is an exception to the Wood v Jones (1889) 61 LT 551 principle, if the relevant continuing duty is an aspect of the retainer at the supposed time of breach: Winnote Pty Ltd (in liq) v Page t/as Freehill, Hollingdale & Page (2006) NSWLR 531 at [104]. And here Dr Taluja submits it is pleaded, as an aspect of the alleged retainer from the beginning. 107It was on this point that Mr Raphael sought to bolster his pleading after the hearing. The Further Amended Statement of Claim, Exhibit C, filed on 28 March contains a further paragraph [21A] which pleads that Mr Orford left his conveyancing work incomplete and that the College Lease Agreement was required to be registered as its term exceeded three years but that it could not be registered because Mr Orford had completed only part of the lease work and that a number of matters still needed to be attended to, such as the addition of the RP Lease Cover, the obtaining of the Commonwealth Bank's consent to the lease as mortgagee, and a number of other matters (21A(b)(c) FASC). Moreover, the FASC alleges that Mr Orford did not advise Dr Taluja of those aspects of the incompleteness of the conveyancing transaction upon which she had given him instructions. 108Exhibit C seems designed to mimic of the kind of commercial or conveyancing transaction retainer such as that is inferable from cases such as Midland Bank Trust Co: that a solicitor may in some circumstances assume a retainer which involves asking himself or herself about earlier negligence, where the essential task of the solicitors' retainer is to complete something that is incomplete. 109A brief aside is necessary at this point about Exhibit C. The Court is not prepared to give leave to Dr Taluja to rely upon Exhibit C. No leave was given to file any further pleading at the conclusion of argument on 19 March 2014. The Court allowed the parties to put in supplementary written submissions on the FASC to see whether it could be dealt with. But for the following reasons it cannot now be dealt with. The FASC, Exhibit C: (1) repeats many of the defects in the ASC; (2) raises wholly new issues such as the suspension of limitation periods in equity and the operation of the Limitation Act, s 55 and possible fraudulent conduct of Mr Orford or Ms Bhandary, a class of allegations that were disclaimed in the hearing; (3) is complex and embarrassing in form in a way that cannot be satisfactorily dealt with by short post hearing written submissions; and (4) introduces for the first time the idea that the solicitors were in fact aware of their own negligence. 110But nothing in the present pleading, the Amended Statement of Claim, indicates that the facts would ground the inference of a continuing duty on Mr Orford in this case. In my view the pleading here does not even resemble the kind of facts that would need to be pleaded to establish a duty to keep a matter under constant review, sufficient to found a continuing duty, such as for example a duty to commence litigation within time: see Nikolaou v Papasavas Phillips & Co (No 2) (1989) 166 CLR 394, at 403-404. The Court of Appeal in Winnote at [109] adverted to the nature of the matters that would have to be pleaded to raise a continuing duty, none of which are present here. "[109] During oral submissions, Winnote's counsel suggested that the retainer incorporated some kind of obligation to correct or keep under review any advice given about a lease, licence or permit needed to extract peat. But no such obligation was pleaded, nor was there evidence directed to this aspect of a solicitor's duties, generally or in the particular case. A retainer that required matters to be kept under constant review in such a way would have costs implications for the client. After the advice of 23 August 1988 had been given, attention turned to the practical matters of drafting the real property lease, its execution, stamping and registration, lodgement of caveats pending registration and so on. Freehill, Hollingdale & Page, Sydney was never instructed to review its earlier advice or to carry out fresh or later investigation as to the status of peat under the Victorian legislation." 111But there is another insurmountable difficulty for Dr Taluja's argument. Even if despite its improbabilities, the pleaded continuing duty of care is established, no fresh damage is pleaded from any such continuing breach of duty. The applicable law is clear, even with a continuing duty of care "a fresh cause of action will only arise if a fresh breach causes loss going beyond the loss resulting from the barred cause of action": Hawkins v Clayton t/as Clayton Utz and Co (1986) 5 NSWLR 109 ("Hawkins v Clayton") and Sheldon v McBeath (1993) Aust Torts Rep. 81-209; (62,069 at 62,082 per Handley JA). 112In Hawkins v Clayton Glass JA received a submission that a negligence claim for financial loss should be governed by the rule in the nuisance-subsidence cases, such as Darley Main Colliery Ltd Company v Mitchell (1886) 11 App Cas 127, and not by the general rule which applies to negligence causing property damage or personal injury. In the subsidence cases a fresh cause of action accrues for wrongful withdrawal of support each time a subsidence occurs. But Glass JA rejected this approach saying (at 124F-125A): "No reason appears to me why a negligence claim for financial loss should be governed by the rule in subsidence cases and not by the general rule which applies to negligence causing property damage (Pirelli) as well as negligence causing personal injury. It follows in my view that no fresh cause of action accrued to the beneficiary when he suffered further loss of income during the six year period of limitation. Assuming a continuing duty of care, a fresh cause of action will only arise if a fresh breach causes loss going beyond the loss resulting from the barred cause of action. Such a fresh cause of action was established in Adams v Ascot Iron Foundry Pty Ltd (1968) 72 SR (NSW) 120; 89 WN (Pt 2) 37, where the plaintiff being statute barred in respect of lung disease caused by negligence before the limitation period was able to prove subsequent negligent exposure to dust which rendered his condition worse than it would have been as a consequence of the statute barred negligence." 113The problem for Dr Taluja's pleading is that there is no fresh loss after 21 March 2003. Even if Dr Taluja could establish a continuing duty in contract or tort she would still have to plead that a "fresh breach causes loss going beyond the loss resulting from the barred cause of action". In my judgment the character of any loss that Dr Taluja suffers does not change. It is all loss resulting from the original breach on 21 March 2003. Dr Taluja's Further Amended Statement of Claim attempts to identify such loss through more detailed particulars ([30] FASC). But one way or another all of the fresh particulars propound the idea that Dr Taluja could have commenced proceedings or taken other steps in litigation earlier than she did. But no allegation of fraudulent concealment of the cause of action by the solicitor is made. 114The Orford Motion - Fiduciary Duty. Dr Taluja also alleges that Mr Orford breached his fiduciary duty by his alleged non disclosures of his own negligence during and after the First Orford Retaner and the Implied Orford Retainer. A cause of action for breach of fiduciary duty applies by analogy with that in tort and contract: Aussie Ideas Pty Limited v Tunwind Pty Ltd; Hoddinott v Tunwind Pty Ltd [2006] NSWCA 286 at [19] - [24] and see also Cia de Seguros Imperio v Health Ltd [2000] EWCA Civ 219; [2001] 1 WLR 112. It expires after 6 years. But Dr Taluja contends that the fiduciary duty continues just as the pleaded advice of negligence duty is said to continue after the end of the retainer. 115But allegations of breach of fiduciary duty do not avail Dr Taluja. Mr Orford's fiduciary duty to Dr Taluja ceases at the time that the retainer is completed in both cases. The following passage from Prince Jefri Bolkiah v KPMG (A Firm) [1999] 2 WLR 215 ("Prince Jefri") at 224-225 states the applicable law: ""The fiduciary relationship which subsists between solicitor and client comes to an end with the termination of the retainer. Thereafter the solicitor has no obligation to defend and advance the interests of his former client. The only duty to the former client which survives the termination of the client relationship is a continuing duty to preserve the confidentiality of the information imparted during its subsistence." 116The decision in Prince Jefri was cited with approval by the Court of Appeal in Beach Petroleum NL v Abbott Tout Russell Kennedy [1999] NSWCA 408; (1999) 48 NSWLR 1 at [205] and was recently applied by Beech-Jones J in Marshall v Prescott (No. 3) [2013] NSWSC 1949 at [109]: see also Attorney General v Blake (1998) Ch 439 at 453-5. Only duties of confidentiality arising out of fiduciary relationships survive the ending of the relationship: Co-ordinated Industries Pty Ltd v Elliott (1998) 43 NSWLR 282, and Meagher, Gummow, Lehane Equity Doctrines & Remedies, 4th Edition, paragraph 5-010. But no issues of confidentiality are pleaded or relied upon in this case. 117The Bhandary Motion. The Bhandary motion raises similar limitation issues to the Orford motion. Dr Taluja's case against Ms Bhandary essentially is that because of alleged poor drafting by Ms Bhandary in July 2003, the lease on which Shree Shirdi Sydney now relies in the 2010 proceedings which that company brings against Dr Taluja was more disadvantageous to her than would have been the case if Ms Bhandary had properly carried into effect the Agreed Shree Shirdi Terms in the Joint Venture Agreement. In particular, Dr Taluja is now facing a claim from Shree Shirdi Sydney in the 2010 proceedings that Dr Taluja leased the Temple Building and the surrounding Temple Land to it and gave Shree Shirdi Sydney an option to purchase that land, which Shree Shirdi Sydney exercised. Dr Taluja's case against Ms Bhandary is structured in exactly the same way as is the case against Mr Orford: the terms on which she gave effect a conveyancing and commercial transaction were less advantageous to Dr Taluja than they should have been. As with the claim against Mr Orford, there is no proper basis for a plea of a continuing duty on the part of Ms Bhandary for her to disclose her alleged negligence to Dr Taluja. This claim is also out of time and should be dismissed.

The Abuse of Process Question on the Orford Motion 118The Orford motion contends that the allegations concerning the First Orford Retainer are a collateral attack on Ball J's 6 July 2011 decision in AIAEL. 119Mr Orford's abuse of process argument invokes the well established principle that, notwithstanding the absence of any issue estoppel a party's attempt to re-litigate against another party an issue which the party has already lost may amount to an abuse of process: Haines v Australian Broadcasting Incorporation (1995) 43 NSWLR 404 at 410B. In modern times the relevant principle was laid down by Lord Halsbury LC in Reichel v Magrath (1889) 14 App Cas 665 ("Reichel v Magrath") at 668-669: "...a scandal to the administration of justice if, the same question having been disposed of by one case, the litigant were to be permitted by changing the form of the proceeding to set up the same case again...it surely must be in the jurisdiction of the Court of Justice to prevent the defeated litigant raising the very same question which the Court has decided in a separate action." 120The principle in Reichel v Magrath has been widely accepted in Australia. And a guiding consideration for the Court on the question is the existence of any oppression or unfairness to the other parties of the litigation and concern for the integrity of the system of the administration of justice: State Bank of New South Wales Ltd v Alexander Stenhouse Ltd (1997) Aust. Torts Reports 81-423 (64-007) at (64,089, Giles CJ Comm Div.) ("Stenhouse"). Giles CJ Comm. Div explained in Stenhouse (at 64,089) the relevant considerations to which the Court will have regard in deciding whether proceedings or an aspect of proceedings are an abuse of process: "It is apparent from this brief review of the decisions that whether proceedings are, or an aspect of proceedings is, an abuse of process because a party seeks to relitigate a issue already decided depends very much on the particular circumstances. The guiding considerations are oppression and unfairness to the other party to the litigation and concern for the integrity of the system of administration of justice, and amongst the matters to which regard may be had are - a). the importance of the issue in and to the earlier proceedings, including whether it is an evidentiary issue or an ultimate issue; b). the opportunity available and taken to fully litigate the issue; c). the terms and finality of the findings as to the issue; d). the identity between the relevant issues in the two proceedings; e). any plea of fresh evidence, including the nature and significance of the evidence and the reason why it was not part of the earlier proceedings; all part of - f). the extent of the oppression and unfairness to the other party if the issue is relitigated and the impact of the relitigations upon the principle of finality of judicial determination and public confidence in the administration of justice; and g). an overall balancing of justice to the alleged abuser against the matters supportive of abuse of process. " 121Mr Orford contends that Dr Taluja's First Orford Retainer allegations attempt to re-litigate an issue which she lost before Ball J in AIAEL. Ball J found in AIAEL that the lease accurately recorded the terms of Dr Taluja's agreement with the College and accurately recorded the instructions that Dr Taluja gave to Mr Orford. The allegation of breach of the First Orford Retainer seeks to do just the opposite: to promote a finding that the lease did not accurately record Dr Taluja's agreement with the College and did not accurately record her instructions to Mr Orford. To understand the nature of the alleged abuse of process it is necessary to examine some of the evidence in contest before Ball J, Ball J's findings, the findings of the Court of Appeal and then to contrast those with the allegations in the ASC and the FASC. 122The starting point is the lease itself, made between Dr Taluja and the College. It was a 25 year lease commencing on 15 July 2003 and terminating on 14 July 2028. The lease was in evidence and provides for a monthly rental (in Item 7 of the lease's reference schedule), as follows: "Item 6: THE TERM: Twenty Five (25) years Date of Commencement: 15th July 2003 Date of Termination: 14th July 2028 Item 7: MONTHLY RENT: Initial monthly rental of ($20,000) dollars per month to be increased to $20,500.00 per month after six (6) calendar months, and further increased to $21,000.00 after twelve (12) calendar months for a further period of six (6) months and thereafter to be renewed pursuant to Item 8, eighteen (18) months after the commencement date of this Lease." 123Dr Taluja called Mr Orford in evidence before Ball J and gave evidence herself. He prepared a form of draft statement of evidence of 22 June 2011, which he adopted in his sworn oral evidence. He gave evidence about the terms of the agreement for a lease of part of the Strathfield property that he recorded as having been made between Dr Taluja and the College. 124Dr Taluja firmly advanced the case that the instructions she had given to Mr Orford in March 2003 were for an increase of $500 per week after six months, and then another $500 per week after a further six months from the lease commencement date of July 2003. She said that not only did she agree this with the College but she gave instructions to Mr Orford to that same effect. Mr Orford's evidence supported Dr Taluja's. A handwritten note which was adduced from him into evidence certainly assisted the case that at some stage instructions were given to him to increase rent by $500 per week after six months and then 12 months, rather than by $500 per month. 125But Mr Orford's oral evidence was more equivocal about what was finally agreed between the parties before the lease was executed. He described his handwritten notes as "preliminary instructions from Dr Taluja". But he ultimately agreed that "the end result of the instructions is displayed in the final lease that was signed by Dr Taluja", the form of lease that Dr Taluja now disputes in these proceedings. The trial judge, Ball J, regarded Dr Taluja's evidence about her agreement with the representatives of the College as entirely unsatisfactory: AIAEL [27] - [31]. For example Dr Taluja attempted to disclaim the final written form of lease on the basis that she had only signed the last page. But it became evident in the course of the hearing, and the trial judge found, that she had indeed signed and assented to every page of the lease: AIAEL [27]. 126Dr Taluja failed before Ball J. Her case was that the lease had been subject to a side agreement between herself and the College's representatives and that it could be rectified to reflect that side agreement. But Ball J dismissed that case with the following fundamental findings. "[29] Secondly, Dr Taluja's evidence is not supported by the evidence given by Mr Orford. Mr Orford gave evidence that the lease that was signed by the parties reflected the instructions that he had been given. He said that he received multiple instructions for Dr Taluja during the course of the meeting on 18 March 2003 and that Mr Adada and Ms Ihram were in the same room when those instructions were given. He says that he recalls some reference to a "side agreement". However, his evidence in that regard goes no further than saying that there was a reference to the possibility of Dr Taluja wanting to redevelop part of the site and Mr Adada or Ms Ihram replying that that could be the subject of further negotiation and dealt with in a further agreement subsequently. Importantly, Mr Orford gave evidence that he went to some trouble to draft a clause dealing with a possible redevelopment and that clause was rejected by Mr Adada and Ms Ihram. The fact that they did so is inconsistent with the suggestion that the parties had reached agreement on that issue at that time. [30] Third, implicit in Dr Taluja's account of what happened is the contention that there would be no binding lease until the terms sought by Dr Taluja had been incorporated in it or in a side agreement. On the other hand, Dr Taluja appreciated that the document she signed was to be used by Noor Al Houda to obtain government funding. Moreover, Dr Taluja used the document she had signed to obtain a valuation of the property for the purposes of refinancing her mortgage. On both counts, if the lease was not intended to be enforceable according to its terms, that would have involved Dr Taluja participating in a fraud and the document she signed amounting to a sham. The court should not lightly infer that that was Dr Taluja's intention; and Mr Raphael, who appeared for Dr Taluja, disavowed that it was. Indeed, it was Mr Raphael's case that the parties had actually agreed on the terms sought by Dr Taluja on or before 18 March 2003 and that that agreement either formed a collateral contract or was the basis of a claim for rectification of the lease. In final submissions, Mr Raphael confined himself to the latter proposition. Whatever might be said about those claims, they are inconsistent with Dr Taluja's accounts of the meeting. [31] Fourth, Dr Taluja's accounts of the meeting are implausible. There are very good reasons why Mr Adada and Ms Ihram could not agree to Dr Taluja continuing to occupy the flat in Brundah House; and there is no reason to think that they would not do everything necessary to comply with their obligations in connection with running the school. I accept their evidence that Dr Taluja only used the flat occasionally. Consequently, it is not surprising that she would be prepared to give up that use in order to reach agreement on the lease. The lease was obviously important to her in order to make an application to refinance her mortgage. Dr Taluja maintained, particularly in her oral evidence, that she would not have agreed to a rent of $20,000 per month for both Leigh Hall and Brundah House when Noor Al Houda had been paying rent of $19,500 per month for Leigh Hall alone. I do not accept that contention. The buildings were in a dilapidated condition. It was contemplated that Noor Al Houda would spend significant sums of money renovating them. The lease provided for rent increases after 6 and 12 months, plus increases of 5% per annum 6 months after that, together with a market rent review after 5 years. It seems implausible in those circumstances that Mr Adada and Ms Ihram would have agreed to pay additional rent on top of that and, if they had, it is quite unclear why that additional rent needed to be dealt with in a side agreement as Dr Taluja asserts on at least one version she gives of the meeting on 18 March 2003." 127Based upon these findings Ball J was then required to consider whether the lease should be rectified. He declined to rectify the lease for the following reasons: "[75] The claim for rectification is based on the side agreement said to have been reached by Dr Taluja and Ms Ihram and Mr Adada, although in final submissions it was limited to a claim that the lease should be rectified to reflect the additional rent Dr Taluja claims she was entitled to in respect of Brundah House. Having regard to the factual findings I have made, this claim must fail." 128The AIAEL proceedings were brought by that company to specifically enforce the lease which it had taken on assignment from the College. Ball J ordered that the agreement should be specifically performed under the control and direction of the Court. It was the written form of lease which Dr Taluja seeks to disclaim in these proceedings against Mr Orford that Ball J has ordered to be specifically performed. 129In my judgment these proceedings are an abuse of process to the extent that they attempt to make any allegation inconsistent of the written form of lease between the College and Dr Taluja, and in respect of which Ball J has now made an order for specific performance. All the considerations in Stenhouse point in this direction: the terms of the lease were an ultimate issue in the AIAEL proceedings; a full opportunity was available and was taken to litigate that issue by Dr Taluja in the AIAEL proceedings; Ball J's rejection of Dr Taluja's version involves the findings as to her credit; and exactly the same issue arises in these proceedings. But of perhaps the greatest significance is the fact that to allow these allegations to proceed now would be oppressive and unfair to Mr Orford, who was called as a witness on Dr Taluja's behalf at a time when these allegations could have readily been appreciated by Dr Taluja and made against him. It would have made him a potentially less satisfactory witness for her at that time but would have been much fairer to him. The proceedings against Mr Orford are an abuse of process and should be dismissed. To the extent that there are any allegations made in the proceedings against him not dependent upon the form of the lease, they appear to be merely incidental so that the whole claim can be dismissed against Mr Orford. 130In addition, the criticisms of Dr Taluja's ASC pleading that it is frequently embarrassing are well founded. But given the Court's findings on principal issues, it is not necessary to determine in any detail which parts of the pleadings are embarrassing.

Conclusions and Orders 131The Court has considered both Mr Orford and Ms Bhandary's motions to strike out the Amended Statement of Claim which Dr Taluja seeks to file as a form of Cross Claim in the 2010 proceedings. For the reasons indicated above, in my view, the pleading fails to disclose a reasonable cause of action against either defendant. The original pleading which Dr Taluja sought to advance by her March 2014 motion fails to disclose causes of action which are not statute barred under Limitation Act, s 14. Moreover, Mr Orford's contention that the proposed pleading is an abuse of process with respect to the First Orford Retainer is also successful. The pleading will be struck out on that ground as well. It has not been necessary for the Court to consider other more detailed questions concerning whether the pleading is embarrassing in other ways. The Court has decided that it would be procedurally unfair to the defendants to permit Dr Taluja to have leave to rely upon the Further Amended Statement of Claim that she advanced after the hearing. 132It follows from the conclusions that the Court has reached therefore that Dr Taluja's Statement of Claim should be dismissed with costs and that her March 2014 motion should also be dismissed with costs. The orders below provide for these results. 133The orders of the Court therefore will be: (1) Strike out the plaintiff's Statement of Claim filed on 18 December 2012 on the basis that the plaintiff's cause of action is statute barred pursuant to Limitation Act 1969, s 14 and on the grounds that the claims against the first defendant in that Statement of Claim are an abuse of process. (2) Dismiss the plaintiff's application for leave to file the Amended Statement of Claim. (3) Judgment for the first and second defendants against the plaintiff in the proceedings. (4) Order the plaintiff to pay the first and second defendants' costs of the proceedings, including the costs of the first defendant's motion of 6 December 2013 and the second defendant's motion of 19 December 2013. (5) Otherwise dismiss the first defendant's motion of 6 December 2013 and the second defendant's motion of 19 December 2013. (6) Dismiss the plaintiff's motion of 17 March 2014 in the proceedings. (7) Order the plaintiff to pay the defendants' costs of the plaintiff's motion of 17 March 2014.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 03 June 2014