Robert Lindsay Steele v Maurice Robert Marshan

Supreme Court of NSW|2012-02-03|Before: Adamson J

Introduction 1This is an appeal by summons from a decision of the Local Court in its General Division. This Court's jurisdiction arises by reason of s 39(1) and s 40 of the Local Court Act 2007, which provide in part: "39 Appeals as of right (1) A party to proceedings before the Court sitting in its General Division who is dissatisfied with a judgment or order of the Court may appeal to the Supreme Court, but only on a question of law. ... 40 Appeals requiring leave (1) A party to proceedings before the Court sitting in its General Division who is dissatisfied with a judgment or order of the Court on a ground that involves a question of mixed law and fact may appeal to the Supreme Court but only by leave of the Supreme Court. ..." 2As will be apparent from the conferral of jurisdiction set out under s 39(1) an appeal lies only on a question of law. Accordingly, unless the plaintiff identifies a question of law, the decision of the Court below cannot be disturbed. If there is a question of mixed law and fact, an appeal lies only by leave under s 40. 3The plaintiff has articulated, in substance, 6 grounds of appeal. He contends that grounds 1 to 4, the first sentence of ground 5 and ground 6 raise questions of law, and accordingly, he is entitled to appeal as of right. He contends that the second sentence of ground 5 raises a mixed question of law and fact and accordingly seeks leave to appeal.

Factual background to the appeal 4The factual background to the appeal is, in summary, as follows. The plaintiff first met the defendant, a solicitor, in connection with a Local Court criminal matter in 2007 in which he retained the defendant. Subsequently, in 2009, the plaintiff was charged with a summary offence under the Inclosed Lands Protection Act 1901 relating to his presence on land owned by the Wesley Mission in Pitt Street ( the Wesley Mission Proceedings ). The summons was ultimately dismissed but it was in the course of the Wesley Mission Proceedings that the plaintiff contacted the defendant in December 2009 and the defendant appeared on his behalf in the Local Court on 11 January 2010. The defendant first sent a costs disclosure to the plaintiff under cover of letter dated 29 January 2010. 5Before the next return date of the summons, the plaintiff terminated the services of the defendant and appeared on his own behalf. 6Under cover of letter dated 19 March 2010, the defendant rendered an invoice to the plaintiff for his fees, which the plaintiff refused to pay. By statement of claim filed in the Small Claims Division of the Local Court, the defendant brought proceedings against the plaintiff for his fees ( the Costs Proceedings ). The Costs Proceedings were defended by the plaintiff on the basis that there was no retainer between him and the defendant and there had been no costs disclosure by the defendant in accordance with the Legal Profession Act 2004 ( the Act ). The plaintiff also applied to have the matter transferred from the Small Claims Division of the Local Court to the General Division. It appears that the basis of his application was that he wished to cross-examined the defendant and that this would not be permitted if the Costs Proceedings remained in the Small Claims Division. The defendant did not oppose this application. 7The defendant had his costs assessed under the Act, as he was required to do under s 317, because he had failed to disclose his fees in a costs agreement before the services were rendered. Ultimately, on 30 April 2011, the Costs Review Assessor in this Court determined the defendant's reasonable costs to be $1,612.01 and required the plaintiff to pay the costs of the review in the amount of $962.50, and issued costs certificates accordingly. Although the defendant could have lodged the certificates, which would thereupon have become a judgment of the Local Court, he did not do so, but left it to the Local Court to determine, in the Costs Proceedings, whether he had been retained. The sum to which he was entitled was not in issue, by reason of the costs assessment that is referred to above. 8The Costs Proceedings were heard by the Local Court on 10 and 16 June 2011 and determined on 30 June 2011. The Court below entered judgment in favour of the defendant in the sum of $1,612.01 and ordered the plaintiff to pay the defendant's costs in an amount of $2,500.

The grounds of appeal 9By notice of motion filed 13 January 2012, the plaintiff sought to augment his original summons by adding 3 further grounds of appeal. The defendant opposed the amendments. At the hearing, the plaintiff made a further oral application to add the words "due to bias or apprehended bias" at the conclusion of ground 6 of his grounds of appeal. The defendant submitted that if I allowed the amendment to include ground 6, he would not object to the addition of those words. I allowed the amendments and gave my reasons in a separate judgment, delivered ex tempore. 10The hearing proceeded, in substance, based on the 6 "grounds" of appeal articulated by the plaintiff, as amended at the outset of the hearing.

The evidence on appeal 11At the commencement of the hearing of the appeal, the plaintiff applied to adduce "fresh" evidence which comprised the affidavits of Messrs Gleeson and Hyde Page. He submitted that s 75A(7) of the Supreme Court Act 1970 authorised me to receive further evidence and that he could establish "special grounds" within the meaning of s 75A(8). I rejected this application and gave reasons for so doing in a separate judgment. 12There were several objections to the evidence relied upon by the plaintiff in support of his application. I considered that at least some of the objections were well-founded. However, having regard to the quantum involved and the need for the plaintiff to demonstrate a question of law or a mixed question of law and fact, I decided to determine the matter without ruling on the objections in order to save court time. However, the material I have considered for the purposes of determining the plaintiff's claim for relief substantially comprises the following: (1)The reasons for decision of the Court below; (2)The transcript of the proceedings before the Court below; (3)The affidavit evidence before the Court below; (4)Other documents, including case summaries which were served but not necessarily allowed by the Court below; (5)The written submissions relied on by the parties in the Court below; and (6)The written submissions filed in this Court, including the plaintiff's affidavit sworn 27 July 2011, filed in support of the summons, which is rejected as evidence, but read as constituting part of his submissions. 13The documents in (4) have been considered in the context of the plaintiff's allegations of denial of natural justice, and in particular that he was taken by surprise by the defendant's case that there was an implied retainer.

Grounds 1 and 2: defendant's failure to disclose his fees 14Grounds 1 and 2 read: "1. Her Honour stated at paragraph 7 in her judgment that: "there was no written disclosure by Mr Marshan of his proposed fees, nor of the basis on which they would be calculated, until 29 January 2010. It is not suggested that that disclosure was made as soon as practicable after his practice was, he says, retained" [on 22 December 2009, not by any other (non-written) form of disclosure]. 2. The Legal Profession Act 2004 was defied by the solicitor. Sect 309(1) requires that: "A law practice must disclose [costs] to a client in accordance with this Division". And Sect 311 requires that: "Disclosure under 309 must be made in writing before, or as soon after, the law practice is retained in the matter." 15These so-called grounds restate an uncontroverted fact: namely that no costs disclosure was given at the appropriate time. The Act contemplates that legal fees are recoverable in circumstances where no such disclosure has been given as long as certain conditions are met. These grounds do not give rise to a question of law or a mixed question of law and fact. Accordingly, they cannot form the basis of a challenge to the decision of the Court below under s 39 or s 40 of the Local Court Act .

Ground 3: allegations concerning the costs assessment process 16Ground 3 reads: "3. The costs assessment process was rorted by means of the solicitor's allegedly contemporaneous notes which verballed the appellant. And he was conned on 1 October 2010 by a registrar in the Small Claims division, Ms Lambino, who was overborned by the solicitor, to require the appellant to make the application against his will. It was inappropriate as the threshold question of, whether he had engaged representation, and if the solicitor had accepted instructions to plead 'not guilty', should have been resolved first, so as not to waste time and resources." 17As can be seen from its terms, ground 3 is an attempt to undermine the validity of the costs assessment process, which resulted in a certificate being issued for $1,612.01. The reasons of the Court below indicate that the Court below considered the reasonableness of the fees certified before deciding that judgment ought be entered for that sum. It did not merely accept the certificate, although it was a relevant matter. So much appears from the following passage in the reasons of the Magistrate, at [50]: "An amount of $1,612.01 for the work done in respect of the criminal proceedings certainly appears fair and reasonable given the time spent in conference, considering material and at court (even though it is in the range Mr Marshan estimated he might charge if the matter were withdrawn or a plea of guilty entered). It is certainly not unknown for solicitors not to charge defendants in criminal matters for the totality of the time spent in preparation of their cases." 18At the hearing of the appeal, the plaintiff confirmed that he was not concerned about the monetary amount of the judgment, and that he had not been concerned about it in the Court below. As the plaintiff put it, before me: "I was not interested whether it was 20 cents or $2 million, it was the principle at issue and I have not argued the quantum." 19However, the plaintiff wished to record his dissatisfaction with the process, which he reiterated in oral submissions before me. 20I do not consider that ground 3 properly arises in a challenge to the decision of the Court below. It appears to be a collateral attack on a process which was relevant to, but not determinative, of the ultimate decision made by the Court below. It does not give rise to a question of law, nor a question of mixed law and fact. Even if it gave rise to the latter, I would decline leave since it contains a series of unsubstantiated allegations against people who are not parties to these proceedings, which were not litigated in the Court below.

Ground 4: question of implied retainer 21Ground 4 reads: "4. There is no validity in her Honour's judgment (paragraphs 33 and 40) of an implied retainer, which is in conflict with the ratio in previling precedents: Court of Appeal of NSW in Integrated Computer Services P/L v Digital Equipment Corp. (Aust) P/L (1988) 5 BPR 11, 110 at 11, 117; Australian Energy Ltd v Lennard Oil NL [1986] 2 Qd R 216 at 237; and Pegrum and Another v Fatharly (1986) 14 WAR 92 at 94" 22The question whether there was an implied retainer is not a question of law. It can best be characterised as a question of mixed law and fact, rather than a pure question of fact. Accordingly, leave to appeal is required under s 40 of the Local Court Act . 23The plaintiff urged that notwithstanding the amount of money involved, the question was an important one because it concerned issues of professional misconduct and bias. 24I refuse the grant of leave on two grounds: first, because the application by the Court below of the principles articulated in the authorities referred to was, in my view, correct; and secondly, because this matter which fell within the jurisdiction of the Small Claims Division of the Local Court is about a relatively insignificant amount of money and does not warrant the grant of leave. I do not consider that any of the plaintiff's allegations of professional misconduct or bias have been substantiated and accordingly I reject this argument as providing any warrant for the grant of leave to appeal.

Ground 5: denial of natural justice 25Ground 5 reads: "5. Her Honour's decision to deny the appellant the opportunity to give evidence-in-chief breached the law, and denied natural justice and due process. And her subsequent conclusions and decisions erred in law, and/or could not reasonably be arrived at upon the evidence." 26In substance, ground 5, amounts to an allegation that there has been a denial of natural justice, although the terms "breached the law" and "denied... due process" are also used. An allegation of denial of natural justice raises a question of law. I take the second part of ground 5 to be, effectively, an argument that the decision was so unreasonable that no reasonable Court could have arrived at it, which also raises a question of law ( Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223). 27Accordingly, leave is not required in respect of ground 5. 28The plaintiff alleges that he was not given an opportunity to give evidence in chief. This allegation is inconsistent with the transcript of evidence of the proceedings in the Court below, which records that the plaintiff's affidavit was admitted as an exhibit. Furthermore the following passage establishes that the plaintiff was given the opportunity to augment his affidavit evidence before he was cross-examined: "HER HONOUR... Q. Mr Steele, the affidavit which you've just handed up is now exhibit 3 in the proceedings and you have sworn that the contents of that are true and correct. A. that's correct, your Honour. Q. As we've just discussed, that now forms your evidence-in-chief. Is there any specific additional matter that you wish to state prior to Mr Marshan cross-examining you? A. Yes. I - I had first telephoned Mr Morris - Mr Marshan to ask a question, a very simple question, regarding the processes of the court at first instance if you plead guilty. He avoided answering the question and was immediately said he was willing to represent me on the 11 th and I had made - PLAINTIFF: Your Honour, I object to this. It's in the affidavit. HER HONOUR: Yes. Q. This is in the affidavit, Mr Steele. PLAINTIFF: It's paragraph 4. WITNESS: Okay. Okay. HER HONOUR: Q. Mr Steele, I'm going to ask Mr Marshan to cross-examine you - A. Okay Q. -if there's anything arising out of that-- A. All right. I'll say it in final submissions, yes. Okay. 29In the Court below there were detailed directions as to the filing and service of affidavits. The plaintiff filed an affidavit in accordance with the directions. He was given a further opportunity, as set out above, to add to anything in his affidavit. His response to that opportunity was to restate what was in his affidavit. In those circumstances it is not a denial of natural justice for the Court below to stop him from giving that evidence, since it was already in evidence. 30Furthermore, at the conclusion of the defendant's cross-examination of the plaintiff, the Court below invited the plaintiff to return to the witness box to give evidence as to anything arising from the cross-examination. 31Therefore, although ground 5 raises a question of law, no denial of justice has been made out and accordingly no error has been demonstrated.

Ground 6: no allegation of implied retainer 32Ground 6, as amended as set out above, reads: "6. The Statement of Claim filed by the plaintiff on 30 July 2010, and his Affidavit of Evidence sworn on 8 April 2011, made no claim of an 'implied retainer'. The appellant was denied natural justice in the conduct of his defence, and in her Honour's finding of an 'implied retainer', due to bias or apprehended bias." 33This ground also amounts to an allegation of denial of natural justice and accordingly raises a question of law, in respect of which an appeal lies as of right. This ground raises two aspects of natural justice: namely the hearing rule (that the decision-maker must hear from a person before making a decision that is adverse to that person) and the bias rule (that where there is doubt about the decision-maker's impartiality, the decision-maker should disqualify him- or herself. These separate rules, in the context of the proceedings before the Court below will be considered in turn. 34The defendant's statement of claim in the Costs Proceedings relevantly alleges, in paragraph 3: "The defendant [Steele] retained the services of the plaintiff [Marshan] in relation to- (a) act on his behalf in relation to a Police charge of Remain in inclosed lands (at Wesley Mission Sydney) on 6 December 2009, and (b) to advise in relation to disputes between him and Wesley Mission." 35The evidence before me does not reveal that there were any particulars provided as to this allegation. Accordingly, whether the retainer was express or implied was at large in the proceedings in the Court below, at least on the pleadings. I reject the plaintiff's submission that paragraph 3 was necessarily a reference to an express retainer. 36The defendant's affidavit in the Costs Proceedings sworn on 8 April 2011 set out, in several paragraphs, the conduct of both the plaintiff and the defendant, the delivery up of documents to him and communications between them. In my view this recitation of facts and circumstances was sufficient to put the plaintiff on notice that the defendant relied on an implied retainer, in so far as an express retainer was not found. 37Further, the defendant filed a document in the Costs Proceedings which was marked "Statement of Agreed Facts and Issues". The document was not signed by the plaintiff and represented the defendant's appreciation of what issues were agreed and what remained in issue. The list of "Agreed Issues" includes the following: "8. Did the defendant on or about 22 December 2009 retain the plaintiff to act for him in relation to a Police charge of "remain on inclosed lands"? 8.1 and to represent him at Downing Centre Local Court on the return date of the Court Attendance Notice on 11 January 2010? 9. Did the defendant at the same time also retain the plaintiff to advise him generally as to his dispute with the Uniting Church (Wesley Mission)? 10. Was the plaintiff entitled to believe that as a result of the defendant's attendances upon him by telephone on 21 December 2009 and at his office on 22 December 2009, the defendant had retained him for the purposes referred to in paragraphs 8 & 9 above? 11. Did the transmission of further Wesley Mission material to the plaintiff by the defendant both before and on 11 January 2010 constitute a confirmation of the plaintiff's retainer by and his instructions from the defendant? 12. Did the defendant's acts as referred to in paragraphs 8, 9, 10 & 11 (above) constitute a retainer agreement, entitling the plaintiff to be paid for the professional services he rendered to the defendant pursuant thereto? 13. Did the plaintiff act properly and reasonably within the scope of his [implied] retainer with, and his [continuing] instructions from, the defendant?" 38I consider that this list of issues and, in particular, the issue set out in paragraph 13, was sufficient to put the plaintiff on notice that the defendant relied on an implied retainer, in so far as an express retainer was not found. I note that this document was rejected by the Court below since it was not a joint document. Nonetheless it was served on the plaintiff and therefore can be considered in the context of whether he was put on notice of the way in which the defendant put his case in the Court below. 39The defendant relied on a document in the Court below entitled "Final Submissions" dated 15 June 2011 which, in my view, was ample to put the plaintiff on notice that an implied retainer was alleged. In particular, paragraph 7 of this document reads in part: "The fact that there was a retainer entered into between the plaintiff and the defendant is evidenced by- . . . " 40There follows a list of facts and circumstances relied upon by the defendant to establish a retainer. Although the word "implied" does not appear in this paragraph, the issue of an implied retainer is, in my view, squarely raised. 41The allegation of implied retainer was expressed in the following terms in paragraph 14 of the defendant's "Final Submissions" in the Court below, which reads as follows: "14. the plaintiff's case and his evidence is not only corroborated by the contemporaneous diary notes annexed to his affidavit, but further, by his letter to the defendant of 29 January 2010 (annexure 'I'), all of which pre-date the termination of the plaintiff's implied retainer in the telephone attendance of 16 February 2010." 42The allegation was put squarely in paragraph 23 of the same document: "23. In all the circumstances, therefore the court should find on the balance of probabilities that there was in fact an implied retainer as asserted by the plaintiff and the retainer was as argued for by the plaintiff, and 23.1. the court would reject the defendant's assertions and evidence to the contrary, particularly by reference to the defendant's credit, his obsession with the dispute with the Uniting Church (which, on the evidence, he appears to have now also transferred to the plaintiff)." 43The transcript of proceedings, particularly the transcript for 16 June 2011, is redolent with reference to implied retainers and whether a retainer should be found to have arisen as a matter of implication in the instant case. 44In his own document entitled "Final Submissions" dated 23 June 2011 (which post-dated the oral submissions) the plaintiff responded in terms to the defendant's submissions that there was an implied retainer. The following passages are sufficient to illustrate the joinder of issue on the question of implied retainer: "Not until the end of the plaintiff's [Marshan's] 9 May 2011 'Case Summary', after acknowledging that no retainer agreement existed, did he assert that 'there was an implied agreement'." "There was no 'implied agreement' other than that the defendant would consider retaining the plaintiff as sole advocate at his criminal trial. . ." ". . .he inserted. . . the fantasy of an 'implied retainer'. . ." "There certainly there [sic] was no 'implied retainer' with the plaintiff." 45For the reasons given above, the first aspect of ground 6 is without foundation. Although the ground alleges a matter which is a question of law, there is no basis for the allegation. 46As to the allegation of bias or apprehended bias, this can be dealt with relatively shortly. At the outset of the hearing, the following exchange occurred between the plaintiff (the defendant in the Court below) and the Magistrate: "HER HONOUR: ...Mr Steele, can I just ask you a question? DEFENDANT: Sure. HER HONOUR: I have no recollection of what the case was that I have previously sat on that you have been involved in however I believe there has been one DEFENDANT: Yes. HER HONOUR: As I say, I don't recall anything about it. I just raise it so that - to give you an opportunity, if you wish to, to object to my hearing this case. I don't know whether you wish to or not and I don't know whether I would accept any such objection because as I say, I have no recollection of it, but I recognise your face and I am raising it at this point so that we don't get further down the track and get into some difficulty. Is there anything you want to raise about that? DEFENDANT: No, your Honour. I have considered that point but I believe I can trust your own honesty and the procedures of the court. Thank you." 47There was no application at that time, or at any time during the hearing, that the Court below ought disqualify itself because of the previous encounter. 48The plaintiff, before me, confirmed that, in the Court below, he had accepted what the Magistrate said, namely that she had no recollection of the case she had previously dealt with which concerned the plaintiff. He explained the position to me in the following terms: I had been before her three times already. I was concerned and hoping that she would not be there. She was the one saying, "I recognise your face, I don't remember any of the circumstances. Do you object to me?" And I took her at her word and I said, "No, I trust you and the processes of the court," and then immediately the bias was apparent in the treatment that I received which was so unequal to that she afforded Mr Marshan. 49However, when the decision was adverse to him, he considered that she must have been biased against him, and had in fact remembered, contrary to what she had said in Court, the circumstances of the previous case. The plaintiff also instanced various rulings which had been made against him in the course of the hearing, and relied on these to establish actual bias or apprehended bias. 50The relevant principles are summarised in the following terms in Aronson et al, Judicial Review of Administrative Action (4 th ed), at 9.265: "Parties who do not raise an objection when they become aware of the facts alleged to give rise to the objection risk the possibility that any subsequent objection might fail on the ground that the lack of any timely objection constituted an implied waiver. The prudent course is to object as soon as possible after the person affected becomes aware of the problem. A party cannot keep the objection in reserve until they see that they are going badly and might have to use it." 51I consider that the plaintiff has sought to keep the objection in reserve. Indeed, he admitted as much before me when he said that after the first day he "still hoped for the best". 52There is no basis on which to doubt what the Court below said at the outset of the hearing. Her disclosure was prudent and was sufficient to guard against the risk of pre-judgment. I consider that the plaintiff waived his right to rely on the previous experience of the Magistrate in the exchange set out above. However, in any event, he raised no objection until the result of Costs Proceedings was known, notwithstanding what he told me; namely that the bias was apparent "immediately" in the hearing before the Court below. In particular he raised no objection in the course of the proceedings to the Magistrate's continuing to hear the matter. 53Accordingly, even if the matter raised a question of law, I would not allow the appeal on that ground. If the question is one of mixed law and fact, I would refuse leave for the reasons given above.

Other matters 54The submissions made by the plaintiff, in addition to those referred specifically above, included a general complaint that the Court below had preferred the evidence of the defendant to his own evidence. Not only does this grievance give rise to a question of fact, in respect of which no appeal to this Court, whether with or without leave, lies. But in any event, I would be precluded from intervening by reason of the principles enunciated by the High Court in Devries v Australian National Railways Commission (1993) 177 CLR 472 and Abalos v Australian Postal Commission (1990) 171 CLR 167. The Court below has had the opportunity of hearing and seeing the plaintiff and the defendant giving evidence and its decision, which is based at least in part on that advantage, ought not lightly be disturbed. The plaintiff has not pointed to any matter, which in my view, is sufficient to undermine the findings of fact of the Court below which are based on the evidence of the plaintiff and the defendant. 55The plaintiff's submissions also contain many criticisms of the defendant. I do not propose to recite them or consider them further. They are not germane to the grounds of appeal, my deliberations in respect of which have been set out above, and for that reason do not warrant further consideration.

Conclusion 56The plaintiff has raised six grounds of appeal (excluding grounds 7 and 8 which are not, in substance, grounds at all). Even if each of the grounds was properly characterised as giving rise to a question of mixed law and fact, and therefore requiring a grant of leave, I would not be disposed to grant leave in respect of any of them. I do not regard any of the grounds as having any substance. Furthermore the amount of money involved also militates against the grant of leave.

Orders 57For the reasons given above, I make the following orders: (1) Summons dismissed. (2)Order the plaintiff to pay the defendant's costs of the proceedings, including any reserved costs.

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: 08 February 2012

Legal Profession Act 2004(NSW)

Local Court Act 1997(NSW)ss 39, 40

At a glance

Court

Decision date

Before

Source

Judgment (13 paragraphs)

Parties

Legislation Cited (3)

Cases Cited (3)

Cited By (2)