Desanges v Johnson

[2006] NSWSC 106

CITATION:	Desanges v Johnson [2006] NSWSC 106
HEARING DATE(S):	27 February 2006
JUDGMENT DATE :	6 March 2006
JURISDICTION:	Common Law Division
JUDGMENT OF:	Associate Justice Harrison
EX TEMPORE JUDGMENT DATE:	02/26/2006
DECISION:	(1) The appeal is dismissed; (2) The judgment and orders of the Magistrate dated 3 April 2003 are affirmed; (3) The amended summons dated 27 August 2004 is dismissed; (4) The plaintiff is to pay the defendant's costs as agreed or assessed.
CATCHWORDS:	Appeal decision of Local Court - costs agreement
LEGISLATION CITED:	Legal Profession Act 1987 (NSW) s 182 Local Court (Civil Claims) Act 1970 (NSW) - ss 39A(2) & 69
CASES CITED:	Kioa v West (1985) 159 CLR 550 Re Minister for Immigration & Multicultural Affairs; exparte Lam (2003) 214 CLR 1
PARTIES:	Lionel Desanges (Plaintiff) Leigh Johnson (Defendant)
COUNSEL:	Mr C R de Robillard (Plaintiff) Mr T Rickard (Defendant)
SOLICITORS:	Leigh Johnson (Plaintiff)

LOWER COURT JURISDICTION:	Local Court
LOWER COURT FILE NUMBER(S):	3029/01
LOWER COURT JUDICIAL OFFICER :	Madgwick LCM

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

ASSOCIATE JUSTICE HARRISON

MONDAY, 6 MARCH 2006

11803/2003 - LIONEL DESANGES v LEIGH JOHNSON

JUDGMENT (Appeal decision of Local Court
- costs agreement)

1 HER HONOUR: By amended summons filed 27 August 2004 the plaintiff seeks, firstly, an order that the judgment of Local Court Magistrate Madgwick in proceeding 3029/01 be set aside; secondly, that judgment be entered for the defendant; thirdly, that the plaintiff pay the defendant’s costs of both these proceedings and the proceedings in the Local Court; and fourthly, that leave to appeal be granted.

2 The plaintiff is Lionel Desanges (Desanges). The defendant is Leigh Johnson (Johnson), the plaintiff’s former solicitor. Desanges relied on his affidavits sworn 21 July 2003, 5 November 2004 and 30 August 2005. Johnson relied on her affidavit sworn 18 November 2005. As Johnson was the plaintiff in the Local Court and the defendant in this Court and likewise Desanges was the defendant in the Local Court and the plaintiff in this Court for convenience I shall refer to the parties by name.

3 Desanges sought leave to appeal on questions of mixed fact and law and also in relation to questions of law alone. Section 69(3) the Local Court (Civil Claims) Act 1970 (NSW) (LCA) provided that a party to proceedings under the LCA who is dissatisfied with the judgment or order of the Court on a ground that involves a question of mixed law and fact may appeal to the Supreme Court, but only by leave of the Supreme Court. However, if the judgment is erroneous in point of law, the appeal is of right (s 69(2)).

4 Section 69(4) of the LCA provided that the Supreme Court may determine an appeal by either (a) setting the judgment or order aside or (b) by varying the terms of the judgment or order or (c) by setting the judgment or order aside and remitting the matter for determination in accordance with the Court’s directions or (d) by dismissing the appeal.

Leave for an extension of time to lodge an appeal

5 On 3 April 2003 judgment in the Local Court was delivered. On 21 July 2003 this appeal was filed. Thus the appeal was filed about 2½ months out of time.

6 On 24 March 2003 Desanges was aware that the matter was listed before the Court on 3 April 2003. He did not attend Court on that day. Subsequently he received a notice that judgment had been entered against him. On 12 May 2003 Desanges attended the Local Court registry and received a copy of Johnson’s submissions (see aff, 21 July 2003). On 26 May 2003 Desanges was informed that another request for the judgment would be sent to the work centre. On 29 May 2003 Desanges filed an application to stay the orders made on 3 April 2003. On 19 June 2003 Desanges had requested, but not yet received, a copy of the Local Court judgment. On 21 July 2003 when he lodged his notice to appeal, at paragraph [6] of his affidavit, Desanges deposed that he asked for reasons and reserved the right to amend grounds once reasons were published. It appears that even as late as at 21 July 2003 he had still not received the reasons for decision but nevertheless went ahead and lodged the appeal. This explanation for the delay in lodging the appeal is considered just adequate. An extension of time to lodge the appeal is granted.

Grounds of appeal

7 The grounds of appeal are firstly, that her Honour Madgwick erred in law when she wrongly determined that there was a costs agreement; secondly, that her Honour erred in fact and in law when she wrongly determined that there was a costs agreement; thirdly, that her Honour erred in law and in fact when she failed to take into account the lack of evidence from Johnson as to service of the Memorandum of Fees on Desanges, prior to the commence of the proceedings; fourthly, her Honour erred in law when she allowed Johnson interest pursuant to “section 39A” and not pursuant to the relevant provisions of the Act; fifthly, and the her Honour denied Desanges procedural fairness.

Local Court proceedings

8 Johnson claimed that Desanges was indebted to her in respect of legal fees owing which Desanges refuses to pay. Johnson claimed the sum of $37,132.50 pursuant to an agreement whereby it was agreed the defendants would pay the plaintiff for her services rendered and interest pursuant to s 39A of the Act at the rate of 10% from 1 November 1999 to 18 March 2001 (S/C 19/03/2001).

9 Desanges pleaded that Johnson had failed to comply with the provisions of the Legal Profession Act 1987 (NSW) (LPA) including but not limited to s 182(2) and denied that there was any agreement between them as claimed in paragraph one of the statement of claim (Defence 10/04/2002).

10 On 3 April 2003 the Magistrate entered judgment in favour of Johnson in the sum of $37,132.50 plus interest calculated under s 39A of the Act as from 10 May 2000 plus costs as agreed or assessed.

The Local Court hearing

11 On the first day of the hearing, Desanges appeared unrepresented. Johnson, a solicitor, was represented by Mr Healey of Counsel. On subsequent occasions Desanges was represented by Mr de Robillard of Counsel. At the trial Johnson, Desanges, Ms Karpaty and Ms Turner gave evidence and were cross examined.

12 Johnson’s evidence was that that the fee agreement was a standard two page document which related to Desanges criminal matters. It had been executed and signed by Desanges. The original together with files had been stolen from her office (t 28/06/02 4-7). Johnson outlined the legal work she carried out on behalf of Desanges and conversations she had with him about payment of outstanding fees. Johnson issued a memorandum of costs dated 10 May 2000, which she forwarded, to Anne Marie Lourey, Sharon Gilmore and Desanges. Sharon Gilmore is Desanges’s sister and a solicitor. These two women acted as “messengers” for Desanges (t 28/06/0218.30). Ms Turner gave evidence that she was aware that there was a signed costs agreement in relation to the professional work to be done on behalf of Desanges by Johnson and that she had prepared the memorandum of costs dated 10 May 2000. The memorandum was sent out on the same day (t 28/06/02 53.18-21).

13 On the other hand, Desanges gave evidence that Johnson said that she did not expect to be paid (t 28/06/02 68.19-24). There was no dispute that Johnson acted on behalf of Desanges or was retained by him between 16 September 1999 to sometime in December 1999 and that Desanges paid $7,500 to Johnson (t 28/06/02 68). Desanges denied that he signed a costs agreement or that one was ever presented to him.

14 Desanges denied receiving a memorandum of costs at any stage (t 28/06/02 72). Ms Karpaty stated that she introduced Desanges to Johnson and that she recalled a discussion about legal aid (t 28/06/02 36.10-14; 51-54).

15 From reading the transcript of the proceedings the parties were concerned to prove the existence or non-existence of a costs agreement, and if there was a costs agreement did it satisfy the definitions set out in s 184 of the LPA, namely an agreement between a solicitor and client for the provision of legal services (ss (1)), it must be in writing (ss (4)), and it may consist of a written offer accepted in writing or by other conduct (ss (6)).

16 The Magistrate held that there was a costs agreement between the parties and stated:

“In support of that [the proposition that there was a costs agreement] I accept the evidence of Ms Turner and the fact that the letters tendered refer to accounts previously sent, ie, the letter of 6 December from the plaintiff [Johnson] to Ms Gilmore and the letter from Anne Marie Lowry [ sic ] to the plaintiff advising that the defendant [Desanges] no longer wished the plaintiff represent him and that he was unwilling to make any further payment.”

17 The Magistrate also found that Desanges’s contention that there never was a costs agreement, that Johnson was representing him as a favour for Dominic Choy and that there was never any intention that Johnson be paid, is in direct contradiction to the letters tendered in evidence (t 03/04/03 5.55-6.1).

LPA

18 Desanges argued that Johnson had failed to comply with the LPA and referred to s 182(2). Desanges submitted that the Magistrate failed to instruct herself as the issues covered in Part 11 of the LPA and failed to instruct herself as to the standard of proof placed on Johnson. There was evidence from Johnson and Turner to support the finding that there was a costs agreement between the parties and that the memorandum of fees had been forward to Desanges. Section 182 (2) refers to a failure to make a disclosure of matters referred to in s 175 and s176. The matters in s 175 are the amount of the costs, if known, if the amount of the costs is not known, the basis of calculating the costs, the billing arrangements, the client’s rights under Division 6 in relation to a review of costs, the client’s rights under Division 4 to receive a bill of costs and other matters disclosed in the regulations. Section 176 is applicable only where a solicitor or barrister is retained by another solicitor or barrister on behalf of a client, thus this section is not relevant in this case. Some of these matters such as billing are covered in the costs agreement and no complaint was made in relation to non-compliance with s 175. It was open to the Magistrate to find that there was a costs agreement.

19 Desanges argued that the standard to be met is higher than the ordinary civil standard. It is my view that the Magistrate dealt with the issues in dispute between the parties. The standard of proof is the ordinary civil one. There was evidence that the memorandum of costs dated 10 May 2000 and sent on that date, was served on Desanges at his address and at the address of his sister and Ms Lourey.

Denial of procedural fairness

20 Desanges submitted that he was denied procedural fairness in three areas. Firstly, when the matter proceeded on the first day when Desanges was unrepresented; secondly, when the Magistrate allowed improper questions to be put by Johnson’s Counsel; and thirdly, when the Magistrate delivered judgment at a time when Desanges had not provided written submissions.

21 In relation to natural justice, Professor S A de Smith, Judicial Review of Administrative Action, 5th ed., (Sweet & Maxwell Limited, 1995) at 432, stated:

“Procedural fairness generally requires that persons liable to be directly affected by proposed administrative acts, decisions or proceedings be given adequate notice of what is proposed, so that they may be in a position: (1) to make representations on their own behalf; or (2) to appear at a hearing or inquiry (if one is to be held); and (3) effectively to prepare their own case and to answer the case (if any) they have to meet.” [footnote omitted]

22 In Kioa v West (1985) 159 CLR 550 the High Court held that the duty to accord natural justice is a duty to act fairly. In the normal course, a party to judicial proceedings (as are those in a tribunal) could expect to be apprised of the nature of the case sought to be made against it, and of the date and time fixed for hearing such as to give it a reasonable opportunity to meet that case and to advance its own. These statements are similar to those expressed by Professor de Smith referred to earlier.

23 In relation to procedural fairness, Mason J stated in Kioa that the law had now developed to a point where it may be accepted “that there is a common law duty to act fairly, in the sense of according procedural fairness, in the making of administrative decisions which affect rights, interests and legitimate expectations, subject only to the clear manifestation of a contrary statutory intention” (at 584). Further, procedural fairness as a notion is “a flexible obligation to adopt fair procedures which are appropriate and adapted to the circumstances of the particular case” (at 585).

24 In Re Minister for Immigration & Multicultural Affairs; ex parte Lam (2003) 214 CLR 1 the High Court discussed the manner in which procedural fairness cases are approached by the courts, and Gleeson CJ said (at 14, [37]):

“Fairness is not an abstract concept. It is essentially practical. Whether one talks in terms of procedural fairness or natural justice, the concern of the law is to avoid practical injustice.”

25 In relation to the first issue, that the matter proceeded on the first day when Desanges was unrepresented, the transcript reveals that when the Magistrate stated that the matter had to go ahead on that day (28/06/2002) because of the long history of the matter, Desanges replied “Yeah, its fine” (t 28/06/02 1.48-51). The Magistrate asked Desanges if he knew how the court worked to which he replied, “Yes” (t 28/06/02 1.53-55). Later that morning, Johnson’s Counsel asked to be excused to attend to another matter, when the Magistrate was prepared to excuse Mr Healey, Desanges stated, “Excuse me, your Worship, definitely a problem. I’ve waited long enough.” (t 19.10-11). Desanges’s witness, Ms Karpaty attended Court that day was interposed and gave evidence and was cross examined.

26 The second submission that the Magistrate allowed unfair questions is not made out (t 30/09/02 5). The Magistrate observed that Desanges was an intelligent man who was aware of the issues in the matter and was quite effective in some of his cross examination (t 30/09/02 5.30-31). Both sides were permitted to conduct wide ranging cross examination.

27 In relation to judgment being delivered without Desanges having made submissions, Desanges was aware that his matter was before the Court on 3 April 2003 but chose not to attend. On 24 March 2003 Desanges wrote to the Magistrate and said:

“I would like to bring to your attention that my barrister Rodger De Robillard informed me that orders were made by you to file submissions by the end of February 2003. To date there has been no submissions from the plaintiff nor any response whatsoever and I therefore would like the matter re listed for further directions from you as contact with Mr Healey has proved to be not possible and there has been no reply from Ms Johnson. As the case is listed for next session on the 3rd of April 2003 I would like this situation resolved as soon as possible.”

28 If Desanges had attended Court on 3 April 2003 he could have requested further time so as to permit him to file submissions. By not appearing at Court he did not avail himself of that opportunity. In these circumstances was no denial of procedural fairness.

Interest

29 Section 39A(2) of the LCA provides that:

“(2) Where
(a) proceedings have been commenced for the recovery of a debt, a liquidated demand or liquidated damages, and
(b) payment of the whole or a part of the debt, demand or damages is made during the currency of the proceedings and prior to or without judgment being given in respect of the debt, demand or damages,
the court may order that interest be paid at such rate as it thinks fit on the whole or any part of the money paid for the whole or any part of the period between the date when the cause of action arose and the date of the payment.”

30 The Magistrate ordered that interest be paid from the date of issue of the memorandum of costs, namely 10 May 2000. The Magistrate in the exercise of her discretion was entitled to make this order. There is no error of law. I have treated the issues raised on appeal as being erroneous in law. Thus I did not consider it necessary to grant leave to appeal.

31 The appeal is dismissed. The judgment and orders of the Magistrate dated 3 April 2003 are affirmed. The amended summons dated 27 August 2004 is dismissed.

32 Costs are discretionary. Costs usually follow the event. The plaintiff is to pay the defendant’s costs as agreed or assessed.

The Court orders:

(1) The appeal is dismissed.

(2) The judgment and orders of the Magistrate dated 3 April 2003 are affirmed.

(3) The amended summons dated 27 August 2004 is dismissed.

(4) The plaintiff is to pay the defendant’s costs as agreed or assessed.

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