Donohue v Volanne Pty Ltd (No 2)
[2021] ACTCA 11
•5 May 2021
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
COURT OF APPEAL
| Case Title: | Donohue v Volanne Pty Ltd (No 2) | ||||||||||
| Citation: | [2021] ACTCA 11 | ||||||||||
| Hearing Date: | 5 May 2021 | ||||||||||
| Decision Date: | 12 May 2021 | ||||||||||
| Before: | Murrell CJ | ||||||||||
| Decision: | Application dismissed | ||||||||||
Catchwords: | PRACTICE AND PROCEDURE – CIVIL LAW – Leave to appeal from interlocutory decision – Refusal to grant summary judgment for defendant – Advocates’ immunity from suit – Whether decision attended with sufficient doubt to warrant reconsideration – | ||||||||||
| Whether substantial injustice would result if leave was refused | |||||||||||
| Legislation Cited: | Court Procedures Rules 2006 (ACT) r 1147 Supreme Court Act 1933 (ACT) s 37E(4) | ||||||||||
| Cases Cited: | Australian Coal and Shale Employees Federation v | ||||||||||
| Commonwealth (1953) 94 CLR 621 Arrow International Australia Ltd v Group Konstrukt Pty Ltd [2012] ACTCA 37; 7 ACTLR 48 | |||||||||||
| Capital Property Projects (ACT) Pty Ltd v Australian Capital | |||||||||||
| Territory Planning & Land Authority [2008] ACTCA 9; 2 ACTLR 44 Donohue v Volanne Pty Ltd [2021] ACTCA 7 Galovac Pty Ltd v Australian Capital Territory [2010] ACTSC 132 House v The King (1936) 55 CLR 499 | |||||||||||
| International Consulting and Business Management Pty Ltd v | |||||||||||
| Volanne Pty Ltd [2014] ACTSC 175 Jackson Lalic Lawyers Pty Limited v Attwells [2014] NSWCA 335 Kendirjian v Lepore [2017] HCA 13; 259 CLR 275 Kowalski v MMAL Staff Superannuation Fund Pty Ltd [2009] FCAFC 117; 178 FCR 401 More Than a Morsel Pty Ltd v Dean [2003] ACTCA 9 Quach v Butt [2017] ACTCA 4 QUYD Pty Ltd v Marvass Pty Ltd [2008] QCA 257; 1 Qd R 41 | |||||||||||
| Re an application for leave to appeal by Insurance Australia Ltd | |||||||||||
| [2017] ACTCA 57 Volanne Pty Ltd v Donohue [2021] ACTSC 48 | |||||||||||
| Parties: | Christopher John Donohue trading as Donohue & Co (Applicant) Volanne Pty Ltd (First Respondent) | ||||||||||
| John Fragopoulos (Second Respondent) Anthoula Fragopoulos (Third Respondent) | |||||||||||
| Representation: | Counsel | ||||||||||
| I Griscti (Applicant) | |||||||||||
| K Pattenden (Respondents) | |||||||||||
| Solicitors | |||||||||||
| Gilchrist Connell (Applicant) | |||||||||||
| Aulich Civil Law (Respondents) | |||||||||||
| File Number: | ACTCA 17 of 2021 | ||||||||||
| Decision under appeal: |
| ||||||||||
| MURRELL CJ: | |||||||||||
| Introduction |
1. Pursuant to s 37E(4) of the Supreme Court Act 1933 (ACT), Christopher Donohue (the applicant) seeks leave to appeal from an interlocutory decision of McWilliam AsJ (the
primary judge). In the interlocutory decision, her Honour dismissed the applicant’s
claim for summary dismissal of proceedings brought by the respondents as plaintiffs:
Volanne Pty Ltd v Donohue [2021] ACTSC 48.2. On 7 April 2021, Elkaim J granted the applicant leave to bring the subject application out of time: Donohue v Volanne Pty Ltd [2021] ACTCA 7 (the extension of time decision).
3. In the substantive proceedings, the respondents allege professional negligence and breach of contract by the applicant, who was their solicitor in litigation in which judgment was entered against them: International Consulting and Business Management Pty Ltd v Volanne Pty Ltd [2014] ACTSC 175.
The applicant sought summary judgment on the basis that advocates’ immunity from
suit provided a complete answer to the respondents’ claim.
The primary judge dismissed the application because “the pleading raises triable issues
about whether the advocates’ immunity applies”: at [5].
The primary judge’s reasons for decision
6. The principles applicable to an application for summary judgment were set out by Jagot J in Galovac Pty Ltd v Australian Capital Territory [2010] ACTSC 132 at [5].
7. The primary judge observed that the grant of summary relief is a discretionary remedy to be exercised with the utmost caution and only in very clear cases; a case should not
be summarily dismissed “unless there is a high degree of certainty that it would fail if it
were allowed to go to trial in the ordinary way”: at [6]. At [8], her Honour referred to the
following established principles:
(a) There is a very high threshold that must be met. The Court must be satisfied the claim is “obviously untenable”, in that there must be a high degree of certainty that
there is no real prospect of success on all or part of the plaintiff’s claim.
(b)
The application is assessed on the substance, not the form or expression of the claim.
(c) The necessity for argument, even extensive argument, is no bar to summary relief. However, as soon it appears that there is a “real question” to be determined on
which relief depends, the summary judgment procedure is not available.
(d) On such a summary application the Court assumes that every fact pleaded by the plaintiffs is true. 8. Her Honour summarised the pleadings concerning the applicant’s retainer and the alleged breaches of duty of care or retainer: at [23]–[26]. At [27]–[34], the primary judge discussed the doctrine of advocates’ immunity from suit, referring to several cases,
including Kendirjian v Lepore [2017] HCA 13; 259 CLR 275. On the application for leave to appeal, the applicant conceded that the primary judge had correctly stated the
law in relation to advocates’ immunity.
Having referred to the pleadings at [37] and [39], her Honour noted the applicant’s
submission that every pleaded allegation of fact fell squarely within the advocates’
immunity doctrine.
10. At [49], her Honour said:
As submitted by Senior Counsel for the [respondents], where the work that is the subject of complaint is done out of court, the degree of connection is a matter of assessment. It requires
consideration of the particular factual circumstances surrounding the solicitor’s work and its
effect on any court decision. The assessment is highly dependent on the facts to be established by evidence at trial, and how intimately connected each alleged act or omission
of the defendant was to the court’s determination. This makes the issue quite difficult to
determine at summary stage, save for the clearest of cases.
11. The primary judge referred to observations made and adopted in decisions of the NSW Court of Appeal to the effect that it is not always appropriate that the question of
advocates’ immunity be decided as a preliminary question by reference to the case as
pleaded at an early point in the proceedings: at [50].
12. Her Honour was concerned about deciding the case on the pleadings as they then existed, providing three examples of why a particular pleading might encompass
conduct that did not attract the immunity. At [61]–[62], her Honour concluded:
What these examples indicate is that this particular pleading includes conduct where there might be an argument crafted as to why the pleaded conduct does not attract the immunity. Those arguments are interwoven with conduct that might be thought to squarely attract the immunity, and there is no bright line that enables the Court to carve out particular aspects of the pleading, with a view to striking out certain parts of the claim.
The result is that, contrary to the defendant’s submission, the pleaded facts of the present
case are not so clear as to make it an obvious or inevitable conclusion that a complete
defence is established on the basis of the doctrine of advocates’ immunity from suit.
Accordingly, the argument must proceed to trial for final determination.
Leave to appeal from the interlocutory decision
13. Although there are no rigid and exhaustive criteria which govern the exercise of the discretion to refuse or grant leave to appeal from an interlocutory decision, there are two touchstones:
(a) Is the decision attended with sufficient doubt to warrant its being reconsidered? (b)
Would substantial injustice result if leave was refused, supposing the decision to be wrong?
See Re an application for leave to appeal by Insurance Australia Ltd [2017] ACTCA 57 at [10], Capital Property Projects (ACT) Pty Ltd v Australian Capital Territory Planning & Land Authority [2008] ACTCA 9; 2 ACTLR 44 (Capital Property), More Than a Morsel Pty Ltd v Dean [2003] ACTCA 9 at [4].
14. The onus lies upon the party who applies for leave to satisfy the Court of Appeal of those factors.
15. The type of decision that is the subject of the application also informs the exercise of the discretion. As Refshauge J observed in Capital Property at [28]:
[T]he principles with which a Court approaches the decision as to whether to grant leave are:
(a)
that leave will be granted sparingly to avoid delaying and fragmenting the hearing of cases;
(b)
that a Court will be particularly hesitant to grant leave where the decision is one in respect of practice and procedure or is made in the exercise of a discretion; and
(c)
that decisions which, though interlocutory, determine substantive rights will more readily be the subject of the grant of leave.
See also Arrow International Australia Ltd v Group Konstrukt Pty Ltd [2012] ACTCA
37; 7 ACTLR 48 at [58] and Quach v Butt [2017] ACTCA 4 at [12].16. This application concerns a decision to refuse relief under r 1147(2)(b) and (c) of the Court Procedures Rules 2006 (ACT), which provides:
1147 Summary judgment—for defendant
…
(2) The court may give judgment for the defendant against the plaintiff for the
plaintiff’s claim for relief (or part of it) if satisfied—
(a) that the claim (or part of it) is frivolous or vexatious; or (b) that there is a good defence to the claim (or part of it) on the merits; or (c)
that the proceeding should be finally disposed of summarily or without pleadings.
(3) The court may make any other order it considers appropriate.
17. The interlocutory decision was a discretionary decision. While sub-rules (2)(a), (b) and (c) act as jurisdictional preconditions to the exercise of the power, the use of the term “may” shows that the Court’s power is permissive rather than mandatory: Kowalski v
MMAL Staff Superannuation Fund Pty Ltd [2009] FCAFC 117; 178 FCR 401. In exercising the power, the Court must make an evaluative judgment in the absence of full evidence. The power is broad and tolerates a range of outcomes; under r 1147(3), the Court may make any other order it considers appropriate.
18. For the following reasons, the applicant has failed to establish that a grant of leave is justified.
Is the interlocutory decision attended with sufficient doubt to warrant reconsideration?
19. The decision was discretionary. Consequently, as Kitto J stated in Australian Coal and
Shale Employees’ Federation v Commonwealth (1953) 94 CLR 621 at 627:
… there is a strong presumption in favour of the correctness of the decision appealed from,
and that that decision should therefore be affirmed unless the court of appeal is satisfied that
it is clearly wrong.20. To succeed on an appeal from a discretionary decision, the applicant must identify the type of error discussed in House v The King (1936) 55 CLR 499.
21. The proposed grounds of appeal assert that the primary judge erred in:
(a) failing to find that the case was not an instance where the Court is able to grant summary judgment dismissing the proceedings; and (b) failing to find that the case pleaded in the amended statement of claim related to work the subject of advocates’ immunity.
22. The crux of her Honour’s reasoning was that the pleaded facts were not so clear as to make it an obvious or inevitable conclusion that advocates’ immunity from suit provided
a complete defence to the claim. Her Honour illustrated this proposition by reference to allegations in the pleadings which, on the material facts pleaded, did not identify the negligent conduct with sufficient precision. The point was that, owing to the lack of precision, her Honour could not be satisfied that, once further steps were taken to
prepare the respondents’ case, there could be no argument as to why the pleaded
conduct did not attract the immunity.
23. In taking this approach, her Honour did not clearly err.
24. This is not a case where, as Bathurst CJ (Meagher and Ward JJA agreeing) observed when granting leave to appeal in Jackson Lalic Lawyers Pty Limited v Attwells [2014] NSWCA 335, the breach is defined clearly and agreed upon, such that the only question for determination is whether any liability for breach falls within the scope of
the advocates’ immunity.
25. The analysis of the functional connection between out-of-court work and litigation entails a factual inquiry. The underlying facts in the present case suggest a degree of
complexity and involve the applicant’s actions over a period of at least four years.
26. At this point, the applicant has filed no defence. The respondents have not had access
to the retainer agreements, and further particulars of the applicant’s retainer may be pleaded following discovery. The respondents’ allegations may be reformulated. Once
these steps have been taken, it is likely that the factual and legal issues will gain more
focus.27. The applicant has not identified any error of fact, error of principle, any relevant or irrelevant consideration, or any unreasonableness in the interlocutory decision that gives rise to sufficient doubt to warrant reconsideration.
28. This conclusion is sufficient to dispose of the application.
Would substantial injustice result if leave was refused?
29. However, in addition, I am not satisfied that substantial injustice would result if leave to appeal was refused, supposing the decision to be wrong.
30. The applicant did not identify or provide evidence in support of prejudice or injustice, other than the ordinary prejudice of incurring the costs of defending the proceedings (and, presumably, the associated stress). Should the applicant succeed at trial, he can expect to be awarded his costs.
31. In a practical sense, the refusal to grant summary judgment does not finally determine
any substantive rights. The applicant’s arguments regarding the application of the doctrine of advocates’ immunity to the pleaded case are preserved and can be fully
ventilated at trial: QUYD Pty Ltd v Marvass Pty Ltd [2009] 1 Qd R 41; [2008] QCA 257
at [6] (per Fraser JA).32. Further, the applicant is not precluded from making a further application for summary judgment at a later stage. Alternatively, the applicant could seek to have the question
of advocates’ immunity determined separately.
Conclusion
33. The interlocutory decision is not attended with sufficient doubt to warrant its reconsideration. It was a discretionary decision that did not determine substantive rights. The grounds of appeal do not identify any error of fact, error of principle, any relevant or irrelevant consideration, or any unreasonableness giving rise to sufficient doubt to warrant reconsideration.
34. The applicant has not identified any substantial injustice flowing from the refusal of leave, supposing the decision to be wrong.
Orders
35. The application for leave to appeal is dismissed.
36. Within seven days, either party may apply to have the matter relisted for submissions on costs. If no application is made within seven days, the applicant is to pay the
respondent’s costs of the application.
I certify that the preceding thirty-six [36] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Chief Justice Murrell.
Associate:
Date:
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