Ben Aulich and Associates Pty Ltd v Jackson - [2017] ACTMC 21

MAGISTRATES COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Case Title: Citation:	Ben Aulich & Associates Pty Ltd v Jackson [2017] ACTMC 21
Hearing Date:	31 August 2017
DecisionDate:	23 November 2017
Before:	Magistrate Morrison
Decision: Catchwords:	See paragraph [46] CIVIL LAW –– statutory interpretation – right to recover legal costs under Legal Profession Act 2006 (ACT) – effect of amendment of s304 of LPA – proper approach to construction of remedial legislation – effect of non-compliance with s277 of LPA – temporary stay ordered.
Legislation Cited:	Justice and Community Safety Legislation Amendment Bill 2016. Legal Profession Act 2006 (ACT) Part 3.2, ss 269, 271, 279, 277, 298, 304. Limitation Act 1985 (ACT).
Cases Cited:	Berowra Holdings Pty Limited v Gordon [2006] HCA 32; 225 CLR 364; 80 ALJR 1214; 228 ALR 387. Emanuele v Australian Securities Commission [1997] HCA 20; (1997) 188 CLR 114; 71 ALJR 717; 144 ALR 359. IW v City of Perth [1997] HCA 30; 191 CLR 1; 71 ALJR 943; 146 ALR 69. Maxwell v Murphy (1957) 96 CLR 261. Nichol and Co Pty Ltd v Turner and Another [2015] ACTSC 42. Nilant v Macchia [2000] FCA 1528. Racic v Haltiner (2010) 4 ACTLR 224.
Parties:	Gary Jackson (Applicant) Ben Aulich & Associates Pty Ltd (Respondent)
Representation:	Counsel Mr Moffett (Applicant) Mr Buckland (Respondent) Solicitors Marjason & Marjason (Applicant) Ben Aulich & Associates Pty Ltd (Respondent)
File Number:	CS 305 of 2016

MAGISTRATE MORRISON:

At the heart of the contest before me is a dispute about legal costs. The applicant is a former client of the respondent. The right of a law practice to recover costs is regulated by the terms of the agreement with the client and the provisions of the Legal Profession Act 2006 (“LPA”).
The outcome of this application turns on the construction of sections 277 and 304 of the LPA. It is convenient to start these reasons with an analysis of the proper construction of section 304 of the LPA. The section was amended in 2016.

In its pre-amended form the section read:

(1) Despite anything to the contrary in this part, legal costs that are or have been the subject of a consumer dispute under chapter 4 (Complaints and discipline) must not be the subject of a costs assessment under this division.
(2) This section is subject to section 409 (Referral of matters for costs assessment—complaint investigation).

The effect of section 304, in its pre-amendment form and in the context of sections 277 and 298 of the LPA, is the subject of the decision of Master Mossop (as His Honour then was) in Nichol and Co Pty Ltd v Turner and Another [2015] ACTSC 42 (Nichol and Co). His Honour construed the relevant provisions of the LPA in a way which he acknowledged may produce an anomalous result.

For present purposes, the relevant effect of His Honour’s decision in

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2017] ACTMC 21
Decision Date: 23 November 2017

CaseChat Overview and Summary

In Ben Aulich & Associates Pty Ltd v Jackson, the Magistrates Court of the Australian Capital Territory was tasked with determining the right of a law firm to recover legal costs from a former client, a dispute governed by the Legal Profession Act 2006 (ACT) ("LPA"). The primary legal issues were the proper construction of sections 277 and 304 of the LPA and their implications for the law firm's right to recover costs in the context of a dismissed complaint and non-compliance with the disclosure requirements.

Section 304 of the LPA was amended in 2016 to address an anomalous situation identified in a previous case, Nichol and Co Pty Ltd v Turner. The amendment aimed to allow for the recovery of legal costs in certain circumstances despite a client's complaint. The court considered whether this amendment had retrospective effect and whether it applied to the facts of the present case. The court held that the amendment should be interpreted in a manner that avoids reviving causes of action that were otherwise barred, and that it could be applied without requiring a conclusion on retrospective effect.

The second issue concerned the consequences of non-compliance with section 277 of the LPA, which requires certain disclosures to clients before legal proceedings can be brought for cost recovery. The court found that while non-compliance with section 277 does not invalidate proceedings, it does necessitate a temporary stay until a costs assessment is conducted under the LPA. This approach balances the primacy of the client agreement for cost recovery with the protections afforded to clients by the Act.

The court ordered that the law firm was to pay the client's costs of the application but allowed for a potential re-listing if either party requested it within 14 days. The decision underscores the importance of interpreting remedial legislation liberally, while also respecting the principles of statutory construction and the specific purposes of the LPA.

Orders