Dale v Clayton Utz - [2012] VSC 577

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION
COMMERCIAL COURT ARBITRATION LIST

No. 4655 of 2011

CHRISTOPHER ANTONY DALE	Plaintiff
V
CLAYTON UTZ (a firm)	Defendant

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JUDGE:	HOLLINGWORTH J
WHERE HELD:	Melbourne
DATE OF HEARING:	28 August 2012
DATE OF RULING:	29 November 2012
MEDIUM NEUTRAL CITATION:	[2012] VSC 577

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LEGAL PRACTITIONER – Barrister – Application to restrain senior counsel from acting for defendant in this proceeding – Application brought under inherent jurisdiction and to enforce duties of confidence and loyalty – Whether leave to cross-examine deponents required – If so, whether leave should be granted – Leave granted on a limited basis

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr P Ehrlich	O’Donnell Salzano Lawyers
For the Defendant	Mr R Macaw QC Dr A Hanak	Minter Ellison

TABLE OF CONTENTS

Introduction

Is leave to cross-examine required?

Matters relevant to whether leave should be granted

Reasons why Clayton Utz says leave should be granted
Reasons why Mr Dale opposes the grant of leave
Mr Dale’s affidavit materials

Mr Dale’s April affidavit
Mr Dale’s June affidavit
The redacted O’Donnell affidavits
Michael Dale’s affidavit

Clayton Utz’s affidavit materials

Mr Myers’ March affidavit
Mr Myers’ June affidavit

Legal principles concerning the grant of leave to cross-examine prior to trial
Legal principles concerning cross-examination as to credit

Reasons why limited leave to cross-examine will be granted

Relevant considerations
Permissible cross-examination

HER HONOUR:

Introduction

Christopher Dale was, for many years, a litigation partner in the solicitors’ firm of Clayton Utz. In October 2005, Clayton Utz terminated Mr Dale’s partnership. One of the grounds relied upon by the firm in the termination was an alleged breach by Mr Dale of the firm’s pro bono policy, in relation to some matters involving a Mr and Mrs Ebner.

In September 2011, Mr Dale issued this proceeding, in which he claims that, in deciding to expel him, his former partners acted unlawfully and in breach of the partnership agreement.

The defence, which Clayton Utz filed in January 2012, was signed by Allan Myers QC.

By summons dated 14 February 2012, Mr Dale seeks an order restraining Clayton Utz from continuing to retain Mr Myers as its counsel in this proceeding (“the injunction application”). In summary:

(a) Mr Dale deposes that in August 2004 and late 2005 he sought and obtained legal advice from Mr Myers, in relation to some of the matters the subject of this proceeding, being the Ebner matters and his expulsion from the firm; and

(b) Mr Myers deposes that he has no recollection of any such communications, and does not believe he was retained to provide advice to Mr Dale.

The injunction application is made on three bases:

(a) First, to prevent the disclosure of confidential information;

(b) Secondly, to ensure that counsel’s duty of loyalty to a former client is respected; and

(c) Thirdly, under the court’s inherent jurisdiction to restrain counsel from acting, in order to protect the proper administration of justice.

Earlier this year,…

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: [2012] VSC 577
Decision Date: 29 November 2012

CaseChat Overview and Summary

The application arose from a dispute between two law firms, with the applicant, Dale, seeking to prevent a barrister from acting for the respondent, Clayton Utz, in a proceeding. The applicant argued that the barrister had an obligation of confidentiality and loyalty to Dale, stemming from their prior professional relationship. The matter was heard in the Supreme Court of Victoria, which was asked to determine whether leave was required for the applicant to cross-examine the deponents and, if so, whether such leave should be granted.

The central issue before the court was whether the applicant needed leave to cross-examine the deponents in the proceeding. The applicant contended that the inherent jurisdiction of the court should be exercised to restrain the barrister from acting for the respondent and that the duties of confidence and loyalty owed to the applicant should be enforced. The respondent, on the other hand, argued that there was no obligation of confidence and loyalty, and that the applicant's right to cross-examine should not be granted. The court needed to balance the applicant's right to enforce duties of confidence and loyalty against the respondent's right to be represented by counsel of their choice.

The court held that the applicant did require leave to cross-examine the deponents. However, the court granted the leave on a limited basis, considering the specific circumstances of the case and the potential impact on the administration of justice. The court found that the duties of confidence and loyalty did apply in this situation and that the applicant had a legitimate interest in seeking to enforce those duties. Nevertheless, the court exercised its discretion to limit the scope of the cross-examination to protect the respondent's right to be represented by counsel of their choice and to prevent unnecessary delay in the proceeding. The court's decision demonstrated the careful balance required in such cases between enforcing professional obligations and upholding the right to legal representation.

Orders