Fahd v Kenneally - [2011] NSWCA 419

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Fahd v Kenneally [2011] NSWCA 419
Hearing dates: 18 November 2011
Decision date: 22 December 2011
Before: Macfarlan JA at 1; Young JA at 2; Tobias AJA at 8
Decision:
Appeal dismissed with costs
[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Catchwords: PROFESSIONAL NEGLIGENCE - Drafting and preparing conveyancing contracts - enforceability of side agreement - legal profession - scope of retainer - breach of retainer - scope of duty of care - breach of duty of care - Conveyancing Act
Legislation Cited: Conveyancing Act 1919 (NSW)
Cases Cited: Adamson v Hayes [1973] HCA 6; 130 CLR 276
Hoyt's Pty Ltd v Spencer [1919] HCA 64; 27 CLR 133
Mendelssohn v Norman Pty Ltd [1970] 1 QB 177
Nassif v Fahd [2007] NSWCA 269
Texts Cited: A F Mason and SJ Gageler, "The Contract" in Finn, Essays on Contract
Category: Principal judgment
Parties: first appellant: Alex George FAHD
second appellant: Ibtisam FAHD
third appellant: Alexi FAHD
fourth appellant: Priscilla FAHD
Respondent: Belinda KENNEALLY
Representation: Counsel:
Appellants: G W Mc Grath SC/ P R Bolster
Respondent: G Sirtes
Solicitors:
Appellants: McGrath Dicembre & Co
Respondent: Wotton & Kearney Lawyers

File Number(s): CA 2010/384257
Decision under appeal

Date of Decision:

2010-10-25 00:00:00

Before:

Rolfe DCJ

File Number(s):

DC 2008/317618

Judgment

MACFARLAN JA: I agree with Tobias AJA.

YOUNG JA: I agree with Tobias AJA. However, I should add some comments.

It is clear that until Nassif v Fahd [2007] NSWCA 269, the lawyers had not considered the rule laid down by the High Court in Hoyt's Pty Ltd v Spencer [1919] HCA 64; 27 CLR 133 invalidating inconsistent collateral contracts.

This is understandable to a degree as the rule is given scant mention in the most popular Australian book on contract law, the authors mention that it has been subject to trenchant criticism and is not the law in England; see eg Mendelssohn v Norman Pty Ltd [1970] 1 QB 177, and A F Mason and SJ Gageler, "The Contract" in Finn, Essays on Contract p 18. However, the High Court has spoken and adhered to its view and the Australian law is clear.

The respondent based her view that writing was necessary on her concern about the operation of s 54A of the Conveyancing Act 1919.

That concern has some validity. Section 54A applies to the enforceability of "any contract for the sale or other disposition of land or any interest in land." The section may well have affected the current transaction in either or both the following ways:

(a) without the side-deal 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.

Continue reading Fahd v Kenneally

Details

AGLC: Fahd v Kenneally [2011] NSWCA 419
Case: [2011] NSWCA 419
Decision Date: 22 December 2011

CaseChat Overview and Summary

In *Fahd v Kenneally*, the Court of Appeal of New South Wales considered a dispute concerning professional negligence arising from the drafting and preparation of conveyancing contracts. The case involved allegations that the defendant solicitor breached their duty of care and retainer by failing to ensure the enforceability of a side agreement related to the sale of property.

The primary legal issues before the Court were whether the defendant had breached their retainer by failing to adequately advise on or secure the enforceability of the side agreement, and whether this failure constituted a breach of the duty of care owed to the plaintiff. The Court also had to consider the scope of the solicitor's retainer and duty of care in the context of conveyancing transactions and the enforceability of collateral agreements.

The Court of Appeal affirmed the decision of the primary judge, finding that the defendant had not breached their retainer or duty of care. The reasoning focused on the scope of the retainer, which was limited to the conveyancing transaction itself. The Court held that the solicitor was not obliged to ensure the enforceability of a separate side agreement unless it was expressly included within the scope of the retainer or was intrinsically linked to the conveyancing process in a way that necessitated such action. The principles applied centred on the contractual nature of the solicitor-client retainer and the established boundaries of a solicitor's duty of care in conveyancing matters.

The appeal was dismissed, and the plaintiff was ordered to pay the costs of the appeal.

Orders

Orders of the court

Appeal dismissed with costs

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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Medium Neutral Citation:	Fahd v Kenneally [2011] NSWCA 419
Hearing dates:	18 November 2011
Decision date:	22 December 2011
Before:	Macfarlan JA at 1; Young JA at 2; Tobias AJA at 8
Decision:	Appeal dismissed with costs [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
Catchwords:	PROFESSIONAL NEGLIGENCE - Drafting and preparing conveyancing contracts - enforceability of side agreement - legal profession - scope of retainer - breach of retainer - scope of duty of care - breach of duty of care - Conveyancing Act
Legislation Cited:	Conveyancing Act 1919 (NSW)
Cases Cited:	Adamson v Hayes [1973] HCA 6; 130 CLR 276 Hoyt's Pty Ltd v Spencer [1919] HCA 64; 27 CLR 133 Mendelssohn v Norman Pty Ltd [1970] 1 QB 177 Nassif v Fahd [2007] NSWCA 269
Texts Cited:	A F Mason and SJ Gageler, "The Contract" in Finn, Essays on Contract
Category:	Principal judgment
Parties:	first appellant: Alex George FAHD second appellant: Ibtisam FAHD third appellant: Alexi FAHD fourth appellant: Priscilla FAHD Respondent: Belinda KENNEALLY
Representation:	Counsel: Appellants: G W Mc Grath SC/ P R Bolster Respondent: G Sirtes Solicitors: Appellants: McGrath Dicembre & Co Respondent: Wotton & Kearney Lawyers
File Number(s):	CA 2010/384257
Decision under appeal	Date of Decision: 2010-10-25 00:00:00 Before: Rolfe DCJ File Number(s): DC 2008/317618