Russo v Desiatnik [2015] NSWSC 256 | Case summary

Russo v Desiatnik [2015] NSWSC 256 | Case summary | Zoe

Judgment

The defendant (to whom I shall refer as "the barrister") sued the plaintiff ("the solicitor") in the Local Court for legal fees. In her Honour's judgment, Magistrate Wahlquist rejected various submissions raised by the solicitor and found for the barrister on much of his substantive claim. However, her Honour disallowed a claim for interest up until the date of the commencement of proceedings by the barrister ("the interest").
The solicitor appealed to this Court pursuant to s 39(1) of the Local Court Act 2007 (NSW). The appeal was founded on asserted errors of law, and accordingly leave was neither sought nor required.
By the end of the hearing before me, the appeal ground was highly focused: it was asserted that her Honour had misinterpreted the requirements of Pt 11 of the Legal Profession Act 1987 (NSW) ("the Act") and of the Legal Profession Regulation 2002 made pursuant to a section of that Act contained within that Part ("the Regulation"), thereby committing an error of law.
In response, the barrister submitted that there was no error of law in the analysis of her Honour. In the alternative, he submitted by way of a notice of contention that, if such an error were established, the verdict could be maintained in his favour on other bases.
Separately, the barrister, by way of a cross-appeal, submitted that her Honour had made an error of law in refusing to order the interest in favour of the barrister. The solicitor submitted in response that her Honour had made the right decision in refusing the interest, albeit for the wrong reasons, and that that part of the verdict should not be the subject of interference by me.
In short, four issues may require determination by me: has the Magistrate committed an error of law with regard to the Act and Regulation? If so, can the verdict in favour of the barrister be maintained on other grounds? Has the Magistrate committed an error of law in refusing to order the interest in favour of the barrister? If so, can that refusal be justified on other grounds? A brief chronology
The entirety of the evidence, documentary and oral, that was before her Honour was placed before me. That was appropriate; nevertheless, due to the focused nature of the issues requiring resolution, only a brief background need be sketched in this instance.
On 12 July 2004, the parties entered into a costs agreement for the provision of legal services. The document that formed the basis of the agreement is at page 71 of Exhibit SR2 to the affidavit of the solicitor of 26 March 2014 which was placed before me.
An attribute of the document that is immediately noteworthy is that it was not signed by the solicitor. Nevertheless, at page 5 of the judgment at first instance, her Honour found that the terms of the costs agreement had been accepted by the solicitor. That finding was based upon an analysis of a number of aspects of the evidence, and was not called into question by the solicitor before me.
Between 13 January 2006 and 24 August 2006, nine bills for legal fees were rendered by the barrister upon the solicitor. They followed a standard format. A typical example was the bill of 16 February 2006, which appears at page 18 of the exhibit to the affidavit of the barrister of 16 April 2014. The upper part of the bill includes, in typed cursive script, a telephone number, DX address, Australian Business Number, street address, and thereafter the title "Memorandum of Fees due to Dr R J Desiatnik". Below that in handwriting are a number of charges, including charges for typing in the sum of $35. The bill concludes by inviting the attention of the solicitor and providing the name of his firm and its post box address.
Before me, neither party submitted that her Honour was in error in determining that the Act (since repealed) applied, as opposed to any subsequent statute. Without demur on the part of the barrister, I was taken by the solicitor to that version of the Act that pertained on the date of its repeal; namely, 1 October 2005.
Three bills were disallowed against the barrister by her Honour on the basis of s 14(1) of the Limitation Act 1969 (NSW). As I have said, having rejected a number of submissions of the solicitor at first instance, her Honour found that six bills were valid, and entered a verdict in favour of the barrister founded upon them. Errors of law said to found the appeal
It is convenient to set out the entirety of the portion of the judgment of her Honour that the solicitor submitted before me contains the asserted errors of law: [12] The next issue is as to whether the plaintiff has complied with the requirements of the Legal Profession Act 1987 or Legal Profession Act 2004 and can sue for his fees. The first question is which Act applies. The Legal Profession Act 2004 came into force on 1st October 2005 (commencement day). There is no dispute that 'the clients' first instructed the defendant on 8th July 2004 and that the plaintiff provided his cost agreement to the defendant on 12th July 2004. I accept that the agreement between the parties came into effect in July 2004. Schedule 9, clause 18 of the Legal Profession Act 2004 sets out; "18 Client Information and legal costs (1) Subject to subclauses (2) and (3), Part 3.2 of this Act applies to a matter if the client first instructs the law practice on or after the commencement day, and Part 11 of the old Act continues to apply to a matter if the client first instructed the law practice in the matter before that day. (2) Part 3.2 of this Act does not apply in respect of a law practice that is retained by another law practice on behalf of a client on or after the commencement day in relation to a matter in which the other law practice was retained by the client before that day, and in that case Part 11 of the old Act continues to apply." I am satisfied that the relevant date is when 'the clients' first instructed the defendant and this was in July 2004 before the commencement date of the Legal Profession Act 2004. I am satisfied that there was no break in instructing of the defendant or of the plaintiff by the defendant from that date until the defendant ceased to act in August 2006. The relevant legislation that applies is the Legal Profession Act 1987, 'the Act'. [13] The defendant has argued that the plaintiff has failed to disclose the matters set out in Division 2 Part 11 of 'the Act'. In the amended defence the defendant has particularised the failures that he relies upon and I will address those matters. The defendant says the plaintiff failed to disclose the basis of the costs for such legal services to be provided; the amount of costs; the basis of the calculation of the costs; the billing arrangement in respect to such costs. The plaintiff did provide a Costs Agreement, which set out, that he would charge at the rate of $350 per hour and the arrangements in regard to parts of hours. The agreement also indicated that accounts were payable within 30 days. The agreement was provided to the defendant as the party who was contracting him. The defendant was a professional contracting a professional and the rate was disclosed. If he required further information in relation to the services to be provided and total costs he was well able to request it. Indeed he accepted a number of accounts without query and paid them. It is argued that the bill of costs does not comply with Section 193 in that the bill does not accord with Regulation 45(1)(d)(i), 45(1)(g) or 45(2)(b) of the Legal Profession Regulation 2002 which requires disclosure of certain information. … I accept that there is no statement in the bill of costs setting out the right to have the costs assessed (Reg 45(1)(d)(i) or who did the work (reg 45(1)(g). I think that the Memorandum of fees is self evident as to who did the work. I accept that the Memorandum of fees does not refer to the costs agreement (reg 45(2)(b), but I do not accept that any of these failures are matters of substance that have any way disadvantaged the defendant or left him not knowing the basis of the fees claimed. I am satisfied that there has been substantial compliance and that that is sufficient. I am satisfied that the plaintiff has complied with the requirements of the Legal Profession Act 1987 and is entitled to sue the defendant for his unpaid fees.
To state things succinctly, the solicitor submitted before me that her Honour erred in not finding that the failure of the barrister to comply with the Regulation disentitled the barrister from reliance upon the invoices. In particular, it was said that that her Honour was in error at the penultimate paragraph extracted of the judgment in the references to regs 45(1)(d)(i), 45(1)(g) and 45(2)(b).
The Regulation in its entirety is as follows: 45 Particulars in bill of costs (1) For the purposes of section 193 (1) of the Act, the following particulars are to be included in a bill of costs: (a) a description of the legal service provided, (b) the total amount of the costs charged, (c) any intended claim for interest under section 190 of the Act if the costs are not paid (including the rate of interest), (d) a statement: (i) in a case where the bill of costs is given to a client-that the client may apply to have the costs assessed under Part 11 of the Act, but that if the costs have been wholly or partly paid, the application must be made within 12 months after the client is given the bill of costs, or (ii) in a case where the bill of costs is given by a barrister or solicitor who was retained by another barrister or solicitor to act on behalf of a client and the bill of costs is given to that other barrister or solicitor-that the barrister or solicitor who is given the bill of costs may apply to have the costs assessed under Part 11 of the Act within 30 days after the bill of costs is given, (e) the work done in providing the legal service, (f) the period over which that work was done, (g) the identity of the persons who did that work (including the position of the persons, for example, partner, associate), (h) the basis on which the costs have been calculated and charged (whether on a lump sum basis, an hourly rate basis, an item of work basis, a part of proceedings basis or other basis), (i) the facts relied on to justify the costs charged by reference to the above, the practitioner's skill, labour and responsibility, the complexity, novelty or difficulty of the matter, the quality of the work done or any other relevant matter. (2) However, the particulars referred to in subclause (1) (e)-(i) need not be included in the bill of costs if: (a) the total amount of costs charged is the amount, or an amount calculated on the basis, set out in a costs agreement for the legal service made under Division 3 of Part 11 of the Act or disclosed in accordance with Division 2 of that Part, and (b) the bill of costs refers to the relevant costs agreement or disclosure document. (3) A bill of costs may comprise more than 1 document.
The barrister submitted that, for a number of reasons, the Magistrate had not committed an error of law in her Honour's approach to the Regulation. First preliminary question - what is the reach of the Regulation?
In order to resolve the primary dispute, it is first necessary to resolve two ancillary disputes.
The first is whether the Regulation has any application to a bill of costs rendered by a barrister upon a solicitor. The barrister submitted that it did not; the solicitor that it did.
I mean no disrespect to the submissions made on behalf of the barrister on this question by resolving the issue concisely. To my mind, the structure of reg 45(1)(d)(i) and (ii) extracted above shows that the Regulation is, at that point, adopting the bifurcated structure that appears in other sections contained within the Part, and which draw a distinction between costs between a lawyer and a layperson and costs between a lawyer and another lawyer: see, for example, ss 175 and 176, and ss 184(1) and (2) of the Act. That bifurcation shows that, to my mind, the Regulation in its general provisions is extending not only to bills provided by lawyers to lay clients but also to bills provided by one lawyer to another. So does the fact that, having drawn that distinction within reg 45(1)(d), the Regulation does not proceed to do so at any other point.
It follows that, as a matter of construction of the statutory instrument, seen in the general context of the Act that creates it and in the particular context of the pertinent Part of that Act, I accept the submission of the solicitor that the Regulation extends to the situation that pertains here of a barrister having served bills of costs upon a solicitor. Second preliminary question - did her Honour make a slip?
The second subsidiary issue is whether, in referring to reg 45(1)(d)(i), her Honour made a slip, and in truth that must have been a reference to reg 45(1)(d)(ii). The question is an important one, because it can be seen that reg 45(1)(d)(i) is speaking of bills given to lay clients, and both parties accepted before me that that clause can have no application to the parties here.
I respectfully reject the submission of the solicitor that her Honour made a slip, or there has been some typographical error, or any like phenomenon. The pleadings in the Local Court demonstrate that, for whatever reason, the solicitor focused his pleaded contentions upon reg 45(1)(d)(i), and not 45(1)(d)(ii): see the further amended defence of 14 June 2013 of the solicitor in the Local Court, and the reference thereto on behalf of the barrister at page 54 line 12 and following of the Local Court transcript of 22 August 2013. To my mind, in the portion of the judgment under discussion, her Honour was merely responding to the pleaded contentions that had been placed before her by the solicitor.
It follows that I shall approach the resolution of the appeal on the basis that the reference by her Honour to reg 45(1)(d)(i) was not a slip, but rather a response to the issue that had been placed before her Honour by the solicitor.
Having said that, it is true that, in his oral submissions at page 54 of the same Local Court transcript, counsel then appearing for the solicitor sought to address upon reg 45(1)(d)(ii). As against the possibility that my answer to the second preliminary question is wrong, I shall provide a contingent analysis. Names in bills?
Having determined the two preliminary issues, I now turn to determine whether any error of law is demonstrated in her Honour's failure to reject reliance upon any bill of costs rendered by the barrister to the solicitor on the basis of regs 45(1)(d)(ii), 45(1)(g) or 45(2)(b).
Turning to reg 45(1)(g) first, all of the bills in question were headed "Memorandum of Fees due to Dr R J Desiatnik."
The solicitor submitted before me that that was not sufficient compliance with the Regulation. The submission was that, to the extent that any bill showed that typing had also been undertaken and was the subject of invoice, if it be the case that the person who did the typing was not identified, then that bill could not be sued upon, because it was invalid for failing to comply with the requirements of the Regulation: see page 15 line 20 of the transcript of proceedings before me on 7 October 2014. It was also submitted that, if it be the case that the typist was not identified by name, then the whole of the bill of costs was invalidated, including that portion that reflected work done by the barrister. That was said to be the case even if the proportion of the total bill that pertained to typing was only quite small: see the same transcript at page 16 line 5.
I respectfully reject the submission of the solicitor that her Honour fell into legal error in approaching this question. Each and every invoice clearly identified that it was the barrister who was charging for legal fees. I do not accept the proposition that reg 45(1)(g) is to be interpreted as requiring explicit identification of the person who undertook such relatively mechanistic tasks as typing.
Reading the Part and indeed the Act as a whole, it is true that it can be said that one of its purposes is the regulation of the legal profession in the interests of the community. But as a matter of statutory interpretation, I respectfully consider that the approach contended for by the solicitor before me is erroneously punctilious. I do not accept that it was the intention of Parliament that the Regulation in question was to be seen as so demanding, and as having so draconian an effect. And that is especially the case in the context of the provision of a bill of costs provided to a solicitor by a barrister, and which had been preceded by a costs agreement that was accepted by the solicitor.
There is authority of this Court to that effect: see the judgment of Hoeben J (with whom McColl JA and Handley AJA agreed) in Dennis v Cameron [2007] NSWCA 228. Furthermore, the judgment of Johnson J in Maloney v Collins [2011] NSWSC 628, to very similar effect, whilst not hierarchically binding on me, I consider to be powerfully persuasive.
In short, I am not persuaded by the solicitor that her Honour fell into legal error with regard to reg 45(1)(g). That is because I do not accept that, if a bill of costs that clearly sets out the name of a barrister is rendered upon a solicitor, and the bill does not name typists and those who have done other ancillary work, then the whole bill is contrary to the Regulation and thereby invalidated. Right of assessment?
Turning to reg 45(1)(d)(i), I respectfully consider that the reliance placed upon that clause by the solicitor at first instance was misconceived. That was because, as I have said, the solicitor was not a lay client of the barrister. It follows that it did not constitute an error of law for her Honour to determine that that clause of the Regulation did not stand in the way of the barrister relying upon the bills of costs against the solicitor. Contingent analysis of right of assessment
As against the possibility that I have been erroneously prescriptive in the analysis immediately above, I turn briefly to consider the ancillary question of whether reg 45(1)(d)(ii) should have stood in the way of reliance on the bills by the barrister.
In that regard, it is to be recalled that the bills were preceded by a costs agreement that her Honour found had been the subject of acceptance by the solicitor.
It is also the case that there is authority that, as a matter of statutory interpretation, the provisions of the Regulation are "directory" rather than "mandatory": see Kulevska v Coshott [2006] NSWSC 963 at [15] (Lloyd AJ). In other words, failure to comply with the Regulation on the part of a barrister who renders a defective bill upon a solicitor does not prohibit reliance upon the bill as a basis for a statement of claim.
Thirdly, it may also be said that, if Parliament had intended that non-compliance with any provision of the Regulation would have the consequence that a bill of costs could not found a claim for payment of that bill, it would have been a simple matter for Parliament to have explicitly said so, either within the Act or the Regulation itself. And yet Parliament refrained from doing so.
Thirdly, to my mind what was said by the Court of Appeal in Dennis v Cameron and by Johnson J in Maloney v Collins applies here as well. In particular, one would have thought that even a very junior solicitor admitted to private practice in New South Wales would have a sound understanding of the statutory provisions relating to disputes about costs between solicitors and barristers.
It is true, as the solicitor submitted, that, in a long line of cases, s 192 of the Act has been held to be mandatory, in that it is an essential pre-condition of suing for legal costs that a bill of costs was served upon the asserted debtor 30 days before any statement of claim is filed: see Zizza v Seymour [1976] 2 NSWLR 135 at 137 (Moffitt P); Conder v Silkbard [1999] NSWCA 459 at [27] (Beazley JA, with whom Meagher JA agreed.) (In saying that compliance with that section is mandatory, I do not mean to assert that it is incapable of being the subject of waiver or estoppel: see the discussion to that effect from as long ago as 1851 that was referred to with approval in the judgment of Hoeben J in Dennis v Cameron at [38].)
But it is one thing to say that a central provision of the Act with long statutory antecedents is to be interpreted strictly. It is quite another to find that all of the provisions of a regulation designed primarily to protect members of the public is to be interpreted in that way.
In short, even if I be wrong in focusing my analysis upon reg 45(1)(d)(i), and consideration should in truth be given to reg 45(1)(d)(ii), I would nevertheless not find that there was an error of law in the Magistrate failing to come to the view that that latter clause disentitled reliance by the barrister upon the bills of costs. Ameliorative provision?
The third asserted error of law was said to be the analysis by her Honour of reg 45(2)(b). But it can be seen that reg 45(2) cannot operate to avail the solicitor. To the contrary, reg 45(2) sets out a mechanism whereby the barrister could overcome any failings in his bills of costs that pertained to reg 45(1)(e) to (i) inclusive. It follows that the approach of the Magistrate to that clause cannot avail the solicitor on this appeal. Contingent analysis - conduct of solicitor
As against the possibility that I am wrong in the whole of the above analysis, I consider that I should very briefly deal with the ancillary submissions of the barrister about estoppel and waiver. The submissions were also advanced by the barrister in the Local Court, but her Honour did not deal with them in the judgment, presumably because the barrister had succeeded on his primary ground. Her Honour did find, however, the following facts at [10] of the judgment: (a) The plaintiff did send a costs agreement to the defendant. Although the defendant did not sign and return it, as set out was required in Paragraph 18 of the agreement his actions subsequent to this agreement being sent indicate that he accepted the agreement and his liability for the plaintiff's fees. Exhibit 26 contains the defendant's accounts sent to 'the clients'. In an account dated 21 August 2004 addressed to Mr Tran there is an item dated 16 July 2004 "letter to Counsel enclosing Notice of Motion and confirming costs agreement". This clearly refers to the plaintiff's cost agreement which was signed on 12th July 2004 by him. (b) The Plaintiff sent a regular Memorandum of fees to the defendant based on the amount set out in the Costs agreement, which were not disputed by the defendant. (c) The defendant billed 'the clients' for the plaintiff's fees as a Disbursement. (d) The defendant initiated proceedings in the District Court in which he sued 'the clients' for the plaintiff's fees. (e) The defendant's letter to the plaintiff dated 6th June 2006 indicates up until that letter that he regarded himself as liable for the plaintiff's fees and asking for clarification if there was to be another arrangement. Exhibit 26 which includes the defendant's accounts to 'the clients' has an entry of 6th June 2006 "perusal of letter from Dr Desiatnik" which suggests a reply from the plaintiff and thereafter the defendant continues to send accounts to 'the clients' claiming the plaintiff's fees as disbursements, which supports the proposition that there was no change in the agreement between the parties."
I was told at the end of the hearing, without demur on behalf of the solicitor, that those actions included with regard to the bills that are the subject of this appeal. In other words, it was not disputed before me on behalf of the solicitor that his appeal asserting errors of law related to fees of a barrister for which the solicitor had invoiced the lay client, on the basis that they were amongst the disbursements of the solicitor.
It is true that s 189 of the Act is as follows: 189 Rights may not be waived 1. Any provision of a costs agreement or other agreement that is inconsistent with this Division is void to the extent of the inconsistency. 2. In particular, any provision of a costs agreement or other agreement that purports to waive rights to an assessment of costs under this Part, or the right to receive a bill of costs in the form required for assessment under this Part, is void.
But that section cannot avail the solicitor: it is speaking of waiver by agreement, not by unilateral conduct. In any event, the fact that the Court of Appeal has confirmed the availability of waiver in Dennis v Cameron in the face of that section demonstrates that it does not have the effect for which the solicitor contended before me.
In those circumstances, I consider that one can say without the need for intricate analysis that a solicitor should be prohibited, whether by way of the doctrine of waiver or of estoppel, from denying his indebtedness to a barrister with regard to legal fees that the solicitor has charged to a lay client on the basis that they are disbursements for which the solicitor is responsible to the barrister. To paraphrase the words of Mason CJ in The Commonwealth v Verwayen [1990] HCA 39; 170 CLR 394 at 407, the solicitor has so conducted himself as to be prohibited from raising a particular defence or objection that may (for the purposes of this contingent analysis) otherwise have been available to him.
In other words, even if the entirety of my foregoing analysis of the Act and Regulation is misconceived, I would not permit the solicitor to deny his indebtedness to the barrister, the Magistrate having found that the solicitor had billed the lay client for the very fees of counsel that were in dispute in the Local Court and before me. Conclusion with regard to appeal by the solicitor
In short, I do not consider that any of the asserted errors of law on the part of the learned Magistrate have been made out by the solicitor. It follows that his appeal must be dismissed. Cross-appeal by the Barrister
As I have said, the cross-appeal by the barrister is founded upon the refusal of the Magistrate to order the interest claimed. Again, it is convenient to set out the entirety of the judgment in that regard: [14] The plaintiff claims interests on his unpaid fees from 1st September 2006. The Plaintiff relies on clause 10 of the Costs Agreement which says; "10. Subject to clause 11 hereof, fees must be paid within one calender month of the date of my account, unless a brief is taken "on spec". Where such payment is not made, interest at the rate prescribed under the Supreme Court Act 1970, s 55 and prevailing as at the date of that account, is payable until such fees are paid." The plaintiff also relies on the s 190 of the Legal Profession Act 1987, which sets out a right to claim interest; "190 Interest on outstanding costs (1) A barrister or solicitor may charge interest on the unpaid costs for legal services provided by the barrister or solicitor, if the costs are unpaid 30 days or more after the barrister or solicitor has given a bill of costs for those services in accordance with this Division. (2) A barrister or solicitor may not charge interest on the unpaid costs for legal services unless the bill of costs for those services contains a statement that interest is payable and of the rate of interest. (3) A barrister or solicitor may also charge interest on the unpaid costs for legal services in accordance with a costs agreement. (4) A barrister or solicitor may not charge interest under this section or under a costs agreement at a rate that exceeds: (a) except as provided by paragraph (b) - the rate prescribed under the Supreme Court Act 1970 in respect of unpaid judgments of the Supreme Court, or (b) the rate prescribed by the regulations." The defendant says that the plaintiff is precluded from seeking interest on unpaid costs as the bill of costs rendered by the plaintiff do not comply with the Legal Profession Regulation 2002 and are not bills of costs. Regulation 45(1)(c) says that the bill of costs should include any intended claim for interest under Section 190 if the costs are not paid (including the rate of interest). The Memorandum of fees do not contain this information. I have ruled already that "substantive compliance" is sufficient and in that regard relied on Justice Lloyd in Kulevska v Coshott (2006) NSWSC 963 at para 15 "Moreover, it seems to me that the provisions of reg 22A of the 1994 Regulation (and reg 45 of the 2002 Regulation) are directory rather than mandatory. Although the distinction is now in disfavour, it is a convenient way of ascribing the legislative purpose. The fundamental question is whether it was a purpose of the legislation that an act done in breach of the provision should be invalid: Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355 at 390 [93]. That is, the provision is complied with if there has been "substantial compliance" with it: Project Blue Sky at 390 [92]." (and reg 45 of the 2002 Regulation) are directory rather than mandatory [sic]. While I have accepted that there is "substantive compliance" in regard to the claim for the amount claimed in the bill, I do not think that there is substantive compliance in regard to a claim for interest, as indeed there is no mention of an intention to claim interest on unpaid fees in the Memorandum of fees. If the plaintiff wanted to claim interest on his unpaid fees he should have set it out in his bill of costs as per Regulation 45(1)(c). I refuse the plaintiff's claim for interest up until he brought this action. He is entitled to interest on the amount he has successfully claimed from 5th April 2012 being the date he filed the Statement of Claim."
It can be seen from the judgment at [14] that, at first instance, the barrister relied upon s 190 of the Act in its entirety.
For completeness, clause 11 of the costs agreement reads as follows: No work will be done by me whilst there are fees, including any interest accrued thereon, still owing to me in the matter, unless the work is done "on spec".
In her Honour's analysis, interest was refused on the basis that, in short, reg 45(1)(c) had not been the subject of compliance. So much may be accepted, in that the bills of costs rendered by the barrister did not refer to interest: see Exhibit RDJ-1. But it is clear that the barrister also relied upon s 190(3) of the Act.
It is noteworthy that the Magistrate did not deal in the judgment with this separate basis upon which the interest could be claimed.
In short, the barrister submitted before me that his right to the interest was not founded on the bills, pursuant to s 190(1) and (2) of the Act. Rather, it was founded upon the costs agreement, pursuant to s 190(3). It was said that, in failing to deal with and uphold that submission, the Magistrate had made an error of law.
The solicitor submitted that the bills of costs did not comply with the Regulation with regard to interest on unpaid bills. In light of that, the barrister could not claim the interest in question.
I respectfully reject that submission of the solicitor. That is because, to my mind, the use of the word "also" within s 190(3) makes it clear that that subsection provides a separate mechanism whereby a lawyer may charge the kind of interest in question, even if he or she has not referred to interest in a bill of costs. The use of that word within the section to my mind commands such a reading.
I also consider that that interpretation makes sound sense, in that once a costs agreement has been the subject of acceptance, it would be onerous and unnecessary for each and every bill to need to remind its recipient of the possibility of interest being charged on unpaid costs.
Finally, to my mind the provisions of the Regulation, properly interpreted, are speaking of what a bill of costs must contain for one to be able claim interest based upon the bill. They say nothing about the pre-conditions for claiming interest when that claim is founded upon a costs agreement that explicitly refers to such interest.
In short, I consider that the barrister was entitled to charge and claim the interest in accordance with the costs agreement that her Honour found had been the subject of acceptance by the solicitor. In focusing only upon the bills of costs, and not also (to use the word contained in the relevant subsection) upon the costs agreement, I consider that her Honour made an error of law. That error, I respectfully consider, was founded upon a misapprehension as to the structure of s 190 of the Act, and in particular the interrelationship between subsections 190 (1) and (2) and subsection 190 (3). It follows that the cross-appeal should be upheld. Conclusion
In short, I have determined that the solicitor has not established that the Magistrate fell into any error of law in entering a verdict for the barrister. In doing so, I have provided a number of contingent analyses in case my primary analysis is wrong.
I have also determined that the Magistrate committed an error of law in finding that the barrister was not entitled to interest up to the date of commencement of proceedings. In doing so, I have determined that there is no basis upon which the solicitor can resist the success of the cross-appeal in that regard. Costs
Before me, the parties agreed that costs should be reserved. I am content to accept that joint submission. The parties should have liberty to approach my Associate within two (2) weeks of today to set a convenient date for a succinct debate about costs.
I would have thought that, assisted by written submissions of no more than four pages on behalf of each party, such a debate should take no more than thirty minutes.
Without making formal orders, I would be obliged if the submissions of the barrister were filed and served one week before the hearing date, and the submissions of the solicitor two days before the same date.
I would also be obliged if, on the next occasion, counsel for the barrister were to provide me with the precise orders, including in terms of quantum, that she submits I should make to give effect to my foregoing analysis. Orders 1. The appeal of the plaintiff is dismissed. 2. The cross-appeal of the defendant is allowed. 3. Costs are reserved. 4. The parties have liberty to approach my Associate within two (2) weeks from today to set a date for hearing to determine precise orders to give effect to orders 1 and 2, and to determine the question of costs.

Russo v Desiatnik

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Judgment (3 paragraphs)

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