D A Starke Pty Ltd v Yard & Anor (No 2)

The case of D A Starke Pty Ltd v Yard & Anor (No 2) involved a dispute over legal fees and disbursements between the plaintiff, D A Starke Pty Ltd, and the defendants, Alfred Yard and Yardoo Pty Ltd. The plaintiff sought to recover its fees and disbursements from the defendants, which were incurred during a number of actions that the plaintiff's sole director, Mr Starke, had represented the defendants in. The plaintiff was successful in its claims and was awarded costs of the recovery action. The primary issue in this case was whether Mr Starke could recover the fees incurred by him in the recovery action, given the decision in Bell Lawyers Pty Ltd v Pentalow & Anor. Specifically, the court had to determine if the Chorley exception, which allows a legal practice to recover its own costs when acting for itself, applied to incorporated legal practices.

The court found that the plaintiff had failed to provide evidence of an arm's length arrangement between itself and Starke Legal, as required by the decision in Bell Lawyers. The court rejected Mr Starke's submission that the work carried out to recover disbursements was not for the benefit of the plaintiff, as it was directly to the benefit of the plaintiff who carried the liability to pay the accounts. The court also noted that while United Petroleum was not binding, it was highly persuasive, and it would be unusual for a judicial officer to depart from its decision. The court concluded that the abolition of the Chorley exception did not apply to incorporated legal practices, and thus Mr Starke was not entitled to recover the fees incurred by him in the recovery action.

The final orders of the court were that the application by Mr Starke to recover the fees incurred by him in the recovery action was dismissed, and that the defendants were to pay the plaintiff's costs of the application.