Deutsch v Gleeson - [2016] VSC 49

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COSTS COURT

S CI 2015 5159

ERWIN DEUTSCH	Plaintiff
v
PHILLIP GLEESON	Defendant

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JUDGE:	WOOD AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	29 January 2016
DATE OF JUDGMENT:	12 February 2016
CASE MAY BE CITED AS:	Deutsch v Gleeson
MEDIUM NEUTRAL CITATION:	[2016] VSC 49

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Application to review legal costs pursuant to s 3.4.38(5) of the Legal Profession Act 2004 –Standing of applicant - Res judicata – Issue estoppel

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr W Smith	KWS Legal
For the Defendant	Mr P Lovell	Gleeson & Co

HIS HONOUR:

On 1 October 2015 the applicant filed a Summons for Taxation to review the legal costs incurred while the respondent was acting for the applicant in proceeding
S CI 2008 5515 (‘the substantive proceedings’). Any entitlement to review would arise pursuant to section 3.4.38 of the Legal Profession Act2004 (‘the Act’).

The matter came before Judicial Registrar Gourlay on 24 November 2015. On that occasion the respondent raised the issue of the applicant’s right to review having regard to the terms of an order of Hargrave J. That order was subsequently set aside by the Court of Appeal with the consent of the parties to the substantive litigation. The consent of the respondent was not obtained or deemed necessary. Before the Judicial Registrar the respondent also flagged the issue of whether the applicant was out of time to review costs. An order was made for the respondent to advise the applicant of all preliminary issues to be raised (in addition to the issue of the effect of the order of Hargrave J) by 22 January 2016. In compliance with that order the respondent produced a list of five questions dated 31 December 2015. A copy was filed on 7 January 2016.

On 29 January 2016 a hearing occurred in relation to these preliminary questions which potentially impact on the applicant’s standing and capacity to seek review. At the hearing the respondent changed position on two issues. The previously flagged argument that the applicant was out of time to review costs was not to be pursued. The second was a retreat from a position conveyed in correspondence between the parties and an affidavit of the respondent that the applicant had been provided with a bill of costs. I reserved my decision at the conclusion of the hearing in relation to the preliminary questions and now publish my decision and reasons.

Preliminary Questions

There are five preliminary questions identified by the respondent for determination.

First, do the findings of Hargrave J in Robert Deutsch & Ors v Erwin Deutsch & Ors (2014) VSC 494 and/or Order 6 of the orders of Hargrave J made on 2 October 2014 in proceeding No S CI 2008 5515 prevent the applicant from reviewing the legal costs of the respondent (including counsel fees) pursuant to section 3.4.38 of the Legal Profession Act 2004?

Secondly, does payment of the…

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: [2016] VSC 49
Decision Date: 12 February 2016

CaseChat Overview and Summary

In Deutsch v Gleeson, the applicant sought a review of legal costs awarded in a previous proceeding. The case involved the applicant, Deutsch, challenging the decision of Gleeson, the respondent, to award certain legal costs under section 3.4.38(5) of the Legal Profession Act 2004. The dispute centred on the standing of Deutsch to bring the application, as well as issues of res judicata and issue estoppel. The court had to determine whether Deutsch had the legal standing to challenge the costs and whether the principles of res judicata and issue estoppel applied to prevent the review of the costs.

The court considered whether Deutsch had standing to bring the application for review of costs. It examined the statutory provisions of the Legal Profession Act 2004 and determined that Deutsch did not have standing to challenge the costs. The court found that the statutory scheme did not confer standing upon Deutsch to bring the application, and thus the application was without standing. Furthermore, the court examined the principles of res judicata and issue estoppel to determine whether they precluded Deutsch from challenging the costs. The court concluded that these principles applied, preventing Deutsch from bringing the review application.

The court's reasoning was based on the statutory interpretation of the Legal Profession Act 2004 and the application of established legal principles. The court found that the statutory framework did not provide Deutsch with the standing necessary to challenge the costs. Additionally, the court held that the principles of res judicata and issue estoppel applied, preventing Deutsch from bringing the review application. The outcome was that Deutsch's application for review of legal costs was dismissed due to a lack of standing and the application of res judicata and issue estoppel.

The final orders of the court were that Deutsch's application for review of legal costs was dismissed. The court held that Deutsch did not have the necessary standing to bring the application and that the principles of res judicata and issue estoppel precluded the review of the costs. The court did not grant any relief to Deutsch and dismissed the application in its entirety.

Orders