By Summons filed 8 September 2015 the plaintiff seeks leave under s.385 of the Legal Profession Act, 2004 to appeal the whole of the determination of the Costs Review Panel issued 30 July 2015. To the extent that the Summons refers to the Certificate of Determination of Costs Assessor Ian Dwyer issued 11 March 2015, it should refer to the Certificate of Determination of Costs Review Panel. The Certificate and Determination of Costs of Assessor Dwyer was set aside by the Panel. The Panel assessed costs and disbursements in the amount of $37,516.47 and ordered that the plaintiff, the applicant in the Assessment, to pay costs of the Review.
The costs the subject of the Review are bills issued by the defendant law firm to the plaintiff in the course of the defendant's conduct of the plaintiff's defence in Equity Division proceedings in the Supreme Court of New South Wales which proceedings settled on about 25 July 2011. The Amended Summons in those proceedings described the relief claimed as an order for provision out of the estate and/or notional estate of the late Avedis Sanossian (deceased), an order under s.23 of the Family Provision Act, 1982, designating as notional estate an unencumbered one half share in the deceased's property and other orders. The property of the deceased included what the plaintiff in these proceedings referred to as "My home in excess for 30 years". I understand that the plaintiff and his father, the deceased, were joint tenants in the property which was his home and that the plaintiff in those Equity Division proceedings was the plaintiff's mother.
The plaintiff relies principally on his affidavit filed 18 March 2016 and his affidavit in reply of 29 June 2016. The defendant affidavit filed 3 May 2016 was read. There were no objections to the affidavit evidence.
S.385(1) which applies to the application for leave provides relevantly as follows:
1. A party to an application for a costs assessment relating to a bill may, in accordance with the rules of the District Court, seek leave of the Court to appeal to the Court against the determination of the application made by a costs assessor;
2. ………
3. The District Court or Court or Tribunal may, in accordance with its rules, grant leave to appeal and may hear and determine the appeal.
4. An appeal is to be by way of a new hearing and fresh evidence, or evidence in addition to or in substitution for the evidence received at the original proceedings, may be given.
5. After deciding the questions the subject of the appeal, the District Court or Court or tribunal may, unless it affirms the assessor's decision, make such determination in relation to the application as, in its opinion, could have been made by the costs assessor.
Where the Act provides for appeal as of right under s.384, that right is limited to matters of law. Under s.385 an application is not restricted to legal issues, but leave will only be granted in cases where justice requires it. The procedure to follow is as set out in UCPR Division 4, Part 50: Mohareb v Horowitz & Bilinsky Solicitors [2011] NSW DC 170 at [8]. The requirements for leave to appeal are intended to "act as a filter" to avoid unsuitable appeals that place a burden upon the resources of courts and the parties. In Chapmans Limited v Yandell [1999] NSWCA 361 at 12, Fitzgerald JA said of the like provision to s.385 in the preceding statute:
"It is also in my opinion important to keep in mind that s.208M must be considered in the context of s.208L, which restricts an appeal as of right to matters of law. In considering whether or not leave to appeal is granted, it must be decided whether or not, there not being a matter of law arising in the proceeding and there being an appeal as of right only as a matter of law, there is some other matter which in justice requires that leave to appeal be granted to allow the matter to be re-litigated. The party seeking leave to appeal obviously bears the burden of establishing that justice does require that leave to appeal be granted. Further, the Master when considering whether to grant leave to appeal obviously has a very wide discretion; see CDJ v. VAJ [1998] HCA 67, per McHugh, Gummow and Callinan JJ."
As was stated by Justice Beech-Jones in Aktas v Westpac Banking Corporation Limited [2013] NSWSC 1451, after referring to the above quoted passage at [21]:
"It is not possible to exhaustively state the variety of circumstances in which the interests of 'justice' will require that there be a grant of leave under s.385. Clearly, two factors relevant to whether leave will be granted are the strength of the argument as to the asserted error, usually being one which cannot be addressed on an appeal under s.384, and the amount in issue".
Whilst the plaintiff who appeared for himself, was not entirely clear at times or indeed consistent in his argument from the bar table, he explained the grounds for appeal would be, if leave were granted, to agitate that in substance: whereas in the early part of legal services which he received from the defendant (about the second half of 2010) he was advised that his prospects of success were good; closely before the hearing he was advised that due to poor prospects of success he should settle. He complained of that shift of advice and consequently that legal costs incurred were unwarranted.
In his affidavit of 16 March 2016 he described that shift of advice particularly in the following paragraphs:
15. I state that the defendant on the eve of the hearing day:
(a) Surprised me with very costly and new settlement advices, argued strongly to accept them, and expressed no will to defend my cases in any other way.
(b) Breached the undertakings he had given to me at the time of its engagement.
(c) Reneged on his legal advices.
(d) Cautioned me from losing my 32 year old house in full and more.
(e) Subjected me to potential new claims.
(f) Acted outside the expectations of legal professional duties and rules.
16. I state that the defendant failed to disclose to me in a timely and responsible manner and in writing any substantial changes to anything that expected of a legal practitioner.
17. I state that the defendant acted without intention of success that I was promised to expect.
18. I state that the defendant claimed about $31,758 [out of total claim $37,798] during period between 13-7-11 to 27-7-11 for works which it ought to know that it was preparing me an effective defence and at best they were futile and unwarranted works.
19. I state that the defendant failed to act on my instructions to inform me the whole status of the matters and defer the hearing.
20. I state that the defendant prejudiced me on the hearing day by misrepresenting the facts in its submissions to the court
…..
42. On 21-7-2011, the defendant organised pre-court hearing meeting between counsel Salama, Mr Parisi and me in the counsel's office, [Mr Parisi could not attend because of a traffic problem on the roads]. At the meeting, the counsel raised to me surprise settlement options and suggestions, which included both selling my 32 years old house and paying substantial money to the opponent and just paying substantial money for the settlement. The Counsel also said that he could not expect a better outcome and even could be worse. ……….
43. During the whole meeting period with the counsel, the subject was to convince me to accept the new advices for the settlement because he told me that he was just been aware of the full situation and legally there was not much he can do.
44. I state that these new recommendations were not contemplated or discussed with me by the defendant, and they were not part of my acceptable settlement terms."
[These complaints were repeated and somewhat amplified in the plaintiff's affidavit of 29 June 2016]
In paragraph 26 of his affidavit of 16 March 2016 the plaintiff identified as Exhibit G a written example of the assurances which he received verbally, and which he explained in oral submissions to be implied by the defendant continuing to prepare his matter. It should be noted that Exhibit G shortly pre-dated the filing of a Statement of Claim in the Equity proceedings which was consolidated with the original Summons in those proceedings. Exhibit G is an email from the defendant to the plaintiff in the following terms:
"I suggest that you go to Court on your own on Tuesday. At this stage I agree that their claim looks pretty slim at best. I would imagine that they are going to ask the Court for more time to file the 'apparent' trust claim.
Keep me informed as to the progress".
In his affidavit of 3 May 2016 in these proceedings Mr Parisi described that the plaintiff had acted for himself for some time in defending the Equity Division proceedings before retaining the defendant. The costs agreement was in fact dated 23 November 2010 and according to Mr Parisi he was instructed by the plaintiff to act for him in defending the proceedings on 5 October 2010. The Statement of Claim, contemplated in the email Exhibit G, was served on or about 15 September 2010.
Exhibit G is at least consistent with the plaintiff having been involved in the early stages of his case including going to Court on his own behalf, albeit the defendant had been engaged for the purpose of delivery of advices since about 4 July 2010. The indication of prospects "their claim looks pretty slim at best" is plainly qualified by reference to the then "stage" of presentation of the case and by the prediction, which prediction proved to be correct, that the plaintiff's mother would amend her claim to include a claim in trust.
Without objection from Counsel for the defendant, I endeavoured to permit the plaintiff the opportunity of explaining from the bar table precisely what his grievance in relation to the provision of legal services by the defendant was. He was permitted to go to matters well beyond what was contained in his affidavit evidence. He explained that prior to the defendant being retained in the matter the Equity Division proceedings had been to mediation. What he referred to as his "point" which he wanted me to understand was that as a customer he told the defendant of the problems and the defendant said that the plaintiffs had no prospects of success and that the Family Provisions Act did not permit severance of joint tenancy. He said that the defendant informed him that the onus was on the plaintiff to prove her entitlements in the Equity Division proceedings. He added that another solicitor gave him similar advice. In relation to the lateness of advice of poor prospects encouraging the settlement ultimately entered into, he said that the solicitor should have during preparation, at the earliest opportunity, advised that his prospects were slim. He said that he had suffered damage by having to sell his house and shouldn't have had to pay the defendant who changed his mind and couldn't do what he said he could do. At times he referred to the defendant's early advice as being "a mistake".
I enquired of the plaintiff what he would have done if at the earlier time of, say December 2010, the defendant had advised that his case in those proceedings could result in him having to sell his house. In this, bearing in mind that settlement could only be achieved if the terms were agreed to by his mother, the plaintiff. He responded that he would have got a second opinion from another lawyer. I enquired as to what he would have done had the second opinion been the same and he responded both that he would have gone to a third lawyer and he would have collected further evidence in his case. He could not refer me to where in the affidavits supporting his Summons seeking leave to appeal the Costs Review Panel Determination, he had referred to the obtaining of other evidence in the equity proceedings.
From the bar table he informed me that in the Equity Division proceedings, the settlement was achieved when the trial judge requested the parties to investigate resolution and that the settlement achieved required him to either pay money to the plaintiff or sell his home and pay fifty per cent of the proceeds of sale to the plaintiff whilst he assumed the debt of the mortgage.
The view to which I have come is that the plaintiff's application is not worthy of a grant of leave to appeal on the principles of the application of justice as set out above in the passages from Chapmans v Yandells and Aktas v Westpac Banking Corporation. I propose to deal briefly with the plaintiff's proposed grounds for leave and if granted, for appeal, as I am able to identify them from the documents in his application. The paragraph numbers are taken from the Costs review Panel Certificate of Determination.
16. Dealing firstly with the substantial ground described at length above;
● The Panel directed itself pursuant to s.363(1) of the Act and considered whether in conducting the assessment, Assessor Dwyer considered whether it was reasonable to carry out the work, whether the work was carried out in a reasonable manner and the fairness and reasonableness of the amount of costs (paragraph 3 (xi)).
● The Panel reviewed the whole of the papers in the defendant file but received no further material than that which was put to Assessor Dwyer (paragraph 3(v)).
● The Panel considered the plaintiff's claims that the defendant had given him "some guarantee of success in the case" but found that the file did not bear that out. The Panel observed that on 29 November 2010 the defendant solicitor's filenote of a meeting recorded that the plaintiff was told that he "should settle". Importantly, the Panel from its review of the file reasoned that "Even if the Law Firm did give this advice, the Client's behaviour as evidenced by the file does not support the necessary further factual finding needed to ground the Client's argument and that is that if the Law Firm or the barrister had given different advice that the Client would have accepted that advice". It observed that when told in November 2010 that "he should settle, he instructed the Law Firm to vigorously defend the claim". The Panel further concluded that this 'ground is not supported by the documents and fails". (paragraph 3(xix)).
● The Panel's concluding paragraph dealing with the plaintiff's grounds alleging "negligence" or "poor representation" reasoned that: albeit the plaintiff was unhappy with the settlement, he did instruct his lawyers to accept it; if "at any time the advice about prospects of success was not accurate that allegation is not made out in the Client's submissions"; the "Client it appears was intent on defending the claim and continued to instruct the Law Firm after the events about which he complains"; and if "the Law Firm's advice was in any way not of the standard of a reasonable lawyer (which has not been made out in the Costs Assessment) it would result in a claim for damages but would not mean that costs incurred on instructions were not reasonable nor that the work was not reasonably performed on instructions"; (paragraph 3(xxii)).
17. It is apparent that the plaintiff would seek on appeal to agitate against the Panel's factual findings. For instance, he submitted that he was not told on 29 November 2010, by the defendant, that he "should settle".
18. Generally, it would in my opinion be inappropriate to approach an application for leave to appeal the Costs Review Panel determination in contemplation of how questions of fact might be determined following a trial of sworn evidence to resolve conflicts such as would arise on a contest of what was said and done during the provision of advice in conference on 29 November 2010. Even were the power to take sworn evidence available the cost of a trial determining conflicts in the evidence and challenging the record of the solicitor's file would be so disproportionately high against the amount in dispute in this case (approximately $31,000.00) as to make that approach unsuitable in the interests of justice and according to the principles upon which I am to determine the application for leave set out above. Ultimately the costs assessor must determine factual issues on the documents: Ryan v Hansen [2000] 49 NSWLR 184; NSWSC 354 at [38]; LPA (2004) ss 358 and 359.
19. Even if it were to be assumed that the defendant gave negligent advice, the defendant would be entitled to costs in certain circumstances. The relevant principle was stated by the President (Kirby) in Cachia v Isaacs (1985) 3 NSWLR 366 at 371, reviewed in Ryan v Hansen [2000] 49 NSWLR 184; NSWSC 354 by Kirby J and applied in Burrell Solicitors Pty Ltd & Anor v Reavill Farm Pty Ltd & Ors [2016] NSWSC 303 by White J at [150] to [155]. A solicitor who has been negligent in the performance of the retainer is only wholely disentitled from recovering costs if, as a result of the negligence, the client receives no benefit for the work done, that is, it was useless. But the client may have a claim for damages for loss occasioned by the negligence, notwithstanding a liability to pay costs. The cost assessor's task is to determine the bills of costs, allowing or disallowing items on the bill and not to determine the validity or otherwise of a cross claim, or to award damages. There is no suggestion in this case that costs incurred were outside the specific instructions given by the plaintiff.
20. Whilst, in accordance with these principles, the assessor may disallow costs on the basis that in consequence of the solicitor's negligence they have not been properly incurred; it is plain from the Panel's reasons set out above, that it considered all relevant information, and properly directed itself to the enquiry arising from the plaintiff's assertion that costs billed were not reasonably incurred because they were in consequence of negligent or inadequate advice. The Panel determined not only that the negligence was not apparent but that rather than the costs being the result of useless or unreasonable work, ongoing costs were incurred on instructions from the plaintiff to vigorously defend the claim. Further, the plaintiff was unable to identify in argument, given a generous opportunity to do so from the bar table, that he was willing to settle earlier, even had he then been given advice of the nature which he says he received in coming to the ultimate settlement of the Equity Division proceedings. The answers which he gave indicated to me that he would have continued to contest the proceedings rather than to have resolved them earlier on a basis which would have caused him, as plaintiff's terms of settlement ultimately did, to sell his home.
21. In my opinion, it is apparent that the Panel gave proper and full consideration to what I have described as the plaintiff's substantial complaint which he would seek leave to prosecute by way of a hearing on appeal. Nothing put to me by the plaintiff nor from the evidence leads me to think that there are real prospects of a different result if an appeal were to be granted.
22. Taking the plaintiff's submissions by affidavits of 16 March 2016 and 29 June 2016 and his submissions from the bar table in whole, I do not find any right to appeal on the basis of error of law in the Determination of the Panel. I say that having taken the precaution of considering the s.384 question in circumstances of the self-represented plaintiff.
23. I propose to shortly and in point form deal with the other detectable arguments for grant of leave advanced by the plaintiff as follows:
(a) That the Panel viewed additional evidence without affording the plaintiff the opportunity to make a reply, said to be in breach of s.375(2) and (3) - see plaintiff affidavit 16 March 2016 paragraph 6. Despite the Panel's power to determine "otherwise" (s.375(3)) at paragraph 3(v)) it expressly stated that it did not consider material further to that put to Assessor Dwyer. I addressed that paragraph of the Panel's Determination to the plaintiff and it was apparent from his response that he could not point to any evidence that the Panel had addressed information in relation to which he was not afforded a reply, or indeed any material other than that which was before Assessor Dwyer. The plaintiff's argument amounted to not more than that he disagreed with the summary or conclusive statements of the Panel as appear in the reasons for its Determination, based upon its interpretation of the defendant's file.
(b) That the Panel was the first assessor to receive the plaintiff's submissions - see paragraph 9 of the plaintiff's affidavit 16 March 2016. At paragraph 3 (xv) of the Panel's Determination, the chronology plainly shows that the plaintiff was afforded every opportunity to make submissions before Assessor Dwyer but refrained from doing so. In submissions from the bar table he confirmed the accuracy of that finding of fact. He explained that he did not reply to letters requiring his submissions because he refused to participate in an assessment of "items" as he understood was being conducted, because his real point was the substantial complaint considered above and he thought that on reviewing the file the assessor "would wake up to" the issue for himself. Plainly, the plaintiff has failed to identify any error by the Panel in this regard.
(c) That the Panel did not establish a valid and meaningful costs agreement - see plaintiff affidavit 16 March 2016 paragraphs 10 and 30. Mr Parisi in his affidavit 3 May 2016 says that at a meeting with the plaintiff on 24 November 2010 he provided him with the costs agreement. The Panel in its Determination at paragraph 3(xvi) observed that the file contained "ample evidence that the Client was sent and probably did receive the Costs Agreement", but in any event the Panel determined that rates charged by the defendant were fair and reasonable being not in the higher range of market rates. Again, I do not find that the plaintiff has an argument of reasonable strength that the question of whether or not he was provided with a costs agreement would affect the result of an assessment of costs. I do not find any error apparent in the reasons for Determination by the Panel.
(d) That the defendant failed to make disclosures. This point is made in paragraphs 11, 16 and 17 of the plaintiff's affidavit 16 March 2016 and paragraph 13 of the plaintiff's affidavit of 29 June 2016. It is apparent from those paragraphs and from the plaintiff's argument from the bar table that his reference to "disclosures" is not disclosure as to rates of charge or terms of retainer but rather to disclosure by continuing advice of the risks and prospects of the litigation, being the same complaint made in relation to the substantial complaint considered above. For the reasons given above, this point does not support a grant of leave.
As I have concluded in relation to every point of complaint made by the plaintiff that I do not find an arguable basis for error on the part of the Panel to have been shown, leave to appeal is refused.
The orders of the Court are:
1. Leave to appeal under s.385 Legal Profession Act, 2004 is refused;
2. The plaintiff's Summons is dismissed;
3. The plaintiff is to pay the defendant's costs of these proceedings.
[3]
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Decision last updated: 04 August 2016