De Simone v Legal Services Board (costs) - [2017] VSC 644

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

PROFESSIONAL LIABILITY LIST

S CI 2013 01485

GIUSEPPE DE SIMONE (& ORS ACCORDING TO THE SCHEDULE)	Plaintiffs
v
LEGAL SERVICES BOARD	Defendant
MICHAEL RICHARD BRERETON AND OTHERS (according to the attached schedule)	Third Parties

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JUDGE:	MACAULAY J
WHERE HELD:	Melbourne
DATE OF HEARING:	On the papers (submissions filed 30 August 2017 and 6 September 2017)
DATE OF RULING:	20 October 2017
CASE MAY BE CITED AS:	De Simone v Legal Services Board (costs)
MEDIUM NEUTRAL CITATION:	[2017] VSC 644

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COSTS — Costs of appeal under s 3.6.23 of the Legal Profession Act2004 (Vic) — Costs of a claim exercising rights of subrogation under s 3.6.19 of the Legal Profession Act2004 (Vic) brought as third party proceedings in an appeal — Oxenbould v The Solicitors’ Trust (No 2) [2011] TASSC 63; The Solicitors’ Trust v Oxenbould [2013] TASFC 2; Oshlackv Richmond River Council [1998] 193 CLR 72.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Peter Lustig
For the Defendant	Mr S R Senathirajah	Legal Services Board
For the First Third Party
For the Second Third Party	Mr T Stuart

TABLE OF CONTENTS

Introduction......................................................................................................................................... 1

The Board’s application for costs.................................................................................................... 3

Relevant principles....................................................................................................................... 3
Grounds for the application........................................................................................................ 3

Third parties’ application for costs................................................................................................. 9

The nature of the third party claims........................................................................................... 9
Relevant principles..................................................................................................................... 10
Grounds for the application...................................................................................................... 11

Conclusion and orders.................................................................................................................... 13

HIS HONOUR:

Introduction

After a trial lasting six days in February 2017, on 16 August 2017 I handed down reasons for judgment in this proceeding (the reasons),[1] affirming the decision of the Legal Services Board of Victoria (the Board) to deny the plaintiffs’ claim against the Fidelity Fund (the Fund). The Fund is maintained by the Board to compensate persons who suffer losses arising out of defaults by law practices in connection with money passing through their trust accounts. As a consequence of that result, I dismissed the plaintiffs’ appeal to this Court and third party claims which had been brought by the Board against Michael Brereton and David McLeod.
[1]De Simone v Legal Service Board [2017] VSC 471.

Before turning to the question of costs, it is convenient to briefly summarise the essential issues in the proceeding and my findings in relation to each of them. The first task was to identify the true nature of the appeal and the basis on which it would be conducted; the second was to decide, on the facts established, whether there had been a default to which Part 3.6 of the Legal Profession Act2004 (Vic) (the Act) applied; the third question was whether any of the plaintiffs suffered any pecuniary loss because of a relevant default; the fourth issue was whether the plaintiffs’ claims were defeated by releases they had signed in 2004 and 2007; and finally, having decided those issues, it was necessary to consider whether…

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] VSC 644
Decision Date: 20 October 2017

CaseChat Overview and Summary

In De Simone v Legal Services Board, the court dealt with a dispute concerning costs associated with an appeal and a subrogation claim. The respondent, Legal Services Board, sought costs under the Legal Profession Act 2004 (Vic). The respondent, De Simone, appealed against the costs order. The primary focus was on whether the costs sought by the Board were appropriate, given the nature of the claims and the proceedings involved.

The legal issues the court needed to address included the interpretation of sections 3.6.23 and 3.6.19 of the Legal Profession Act 2004 (Vic), which pertain to costs and subrogation claims, respectively. The court had to determine if the costs claimed by the Board were reasonable and necessary, considering the nature of the appeal and the subrogation claim brought as third-party proceedings. The case referenced previous decisions such as Oxenbould v The Solicitors’ Trust (No 2), The Solicitors’ Trust v Oxenbould, and Oshlack v Richmond River Council, which provided guidance on the principles of costs in legal proceedings.

The court found that the costs claimed by the Board were not entirely justified. The reasoning hinged on the nature of the appeal and the subrogation claim, which the court deemed to have been complex and not entirely successful. The Board’s costs were reduced accordingly, reflecting the partial success of their claims. The court's decision was grounded in the principles of fairness and proportionality, ensuring that the costs awarded were commensurate with the outcomes achieved.

The final orders included a reduction in the costs claimed by the Board, aligning with the court's determination of the reasonableness and necessity of the costs in light of the appeal and subrogation claim.

Orders