Finch v Arnold Thomas and Becker Pty Ltd
[2018] VCC 54
•13 February 2018
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMERCIAL DIVISION | Revised Not Restricted Suitable for Publication |
GENERAL LIST
Case No. CI-13-01273
| JO-ANNE LAURA FINCH | Plaintiff by Counterclaim |
| v | |
| ARNOLD THOMAS & BECKER PTY LTD | Defendant by Counterclaim |
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JUDGE: | HIS HONOUR JUDGE O’NEILL | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 17 July, 22 September 2017 | |
DATE OF JUDGMENT: | 13 February 2018 | |
CASE MAY BE CITED AS: | Finch v Arnold Thomas & Becker Pty Ltd | |
MEDIUM NEUTRAL CITATION: | [2018] VCC 54 | |
REASONS FOR JUDGMENT
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Subject: PROFESSIONAL NEGLIGENCE
Catchwords: Solicitor retained in proceedings at VCAT where applicant alleged discrimination in employment – retainer on a ‘no win, no fee’ basis – allegations of negligence in preparation of the proceeding – briefing of counsel on a fee-paying basis – by whom and in what circumstances retainer terminated – applicant expressed ‘loss of confidence’ in legal team who withdrew – allegations of failure to accept reasonable advice when settlement offer made – proceeding adjourned and new practitioners appointed – application subsequently lost – whether breach of retainer or breach of duty by solicitors – nature and extent of damages
Legislation Cited: Equal Opportunity Act 1995 (Vic)
Cases Cited:Finch v The Heat Group Pty Ltd (Anti-Discrimination) [2010] VCAT 802; Arnold Thomas Becker Pty Ltd v Finch [2015] VCC 1431; Tomasevic v Melbourne Injury Lawyers [2014] VSC 434; Finch v The Heat Group Pty Ltd (No 5) [2016] FCA 191
Judgment: Counterclaim dismissed.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff by Counterclaim | The plaintiff appeared in person | - |
| For the Defendant by Counterclaim | Ms A M Ryan QC with Mr J B Waters | Wisewould Mahony |
HIS HONOUR:
Preliminary
1 This proceeding has had a long and tortured history.
2 It concerns, originally, a claim by a firm of solicitors, Arnold Thomas & Becker (“ATB”), against its former client, Ms Jo-Anne Finch, for recovery of legal costs and disbursements alleged to be due and arising out of a proceeding at the Victorian Civil and Administrative Tribunal (“VCAT”), (“the VCAT proceeding”). Ms Finch brought a counterclaim against ATB alleging breach of retainer and negligence.
3 The VCAT proceeding was issued on 29 October 2008 and brought against Ms Finch’s previous employer, the Heat Group Pty Ltd (“Heat”), and a number of its employees. She alleged that she had been discriminated against by reason of her sex, her impairment and her pregnancy, in contravention of the Equal Opportunity Act 1995 (Vic). She also made separate allegations of sexual harassment and victimisation against various of those employees.
4 Ms Finch had a range of solicitors and counsel acting on her behalf in the VCAT proceeding, including ATB. The relationship between Ms Finch and ATB broke down and they parted ways on 4 November 2009. Ms Finch then had other solicitors and counsel represent her. Ultimately, her Honour Judge Harbison determined the VCAT proceeding by Judgment published on 29 June 2010.[1] All of Ms Finch’s claims were dismissed. Her evidence was not accepted. She was ordered to pay a substantial proportion of the respondent’s costs.
[1]Finch v The Heat Group Pty Ltd (Anti-Discrimination) [2010] VCAT 802
5 The proceeding in this Court came on for hearing before his Honour Judge Macnamara over fifteen days in 2015 (“the first trial”).[2] His Honour dismissed ATB’s claim for recovery of costs and disbursements. He further dismissed Ms Finch’s counterclaim. That decision was appealed to the Court of Appeal, and on 24 May 2016, the Court set aside that part of his Honour’s Judgment concerned with breach of retainer and negligence on the grounds that Ms Finch had not been provided with procedural fairness.[3] The Court said the trial was concluded by his Honour without her having the opportunity to complete her case and provide final submissions. The orders dismissing ATB’s claim for costs and disbursements, remained undisturbed.
[2]Arnold Thomas & Becker Pty Ltd v Finch [2015] VCC 1431
[3]Finch v Arnold Thomas & Becker Pty Ltd [2016] VSCA 117
6 The Court of Appeal further ordered that the matter be remitted for retrial, limited to the evidence in the first trial, supplemented by any re-examination of Ms Finch and any evidence from her husband, Mr Bush Ndiege. Final submissions were to be confined to writing.
7 This is the Judgment upon the retrial, in accordance with the Court of Appeal’s directions.
8 This retrial was the subject of pre-trial management by his Honour Judge Saccardo, and came before me on 17 July and 22 September 2017. On those days, I made various Rulings and set a timetable from the provision of written submissions. His Honour Judge McNamara had permitted Ms Finch to rely upon the material contained in her affidavit sworn 30 June 2014. Further, I agreed to accept as her re-examination, to the extent it contained material that was relevant, a witness statement of Ms Finch dated 12 July 2017.[4] Mr Bush Ndiege, swore affidavits of 13 September 2013 and 9 September 2014. I permitted the material contained in those affidavits to stand as his evidence-in-chief, noting counsel for ATB did not have the opportunity to cross-examine on the contents.[5]
[4]Exhibit JLF 13
[5]Exhibits JLF 14,15
9 I have read the transcript of the first trial. I have obtained and watched parts of the audio-visual recordings of the first trial, in particular, the examination and cross-examination of Ms Finch.
10 For the reasons which follow, Ms Finch’s Counterclaim should be dismissed.
The pleadings
11 According to her Further Amended Counterclaim dated 10 September 2014,[6] Ms Finch relevantly alleged:
[6]Court Book (“CB”) 20
(a)In August 2008, she retained ATB in relation to a claim for victimisation, discrimination and sexual harassment by a former employer, at VCAT;
(b)In part, the retainer (“the retainer”) was constituted by a “Conditional Costs Agreement” dated 27 August 2008 (“the Costs Agreement”);
(c)The retainer would continue, unless terminated for “good cause”, to the conclusion of the proceeding;
(d)Ms Finch was liable for costs only if there was a “successful outcome” of the proceeding;
(e)ATB would retain counsel in the proceeding on a “no win, no fee basis”;
(f)ATB could terminate the retainer if Ms Finch did not accept “reasonable advice”;
(g)ATB would exercise reasonable skill, care and diligence in carrying out the retainer;
(h)In breach of the retainer, on 4 November 2009, ATB unilaterally and wrongfully ended the retainer without “good cause”;
(i)The termination of the retainer came after an offer of settlement of $115,000 (“the settlement offer”) was made by Ms Finch’s former employer, subject to a release in respect of the VCAT proceeding;
(j)Counsel retained by ATB, Mr Staindl, advised Ms Finch to take the offer;
(k)Ms Finch expressed concerns in respect of legal costs and disbursements to be deducted from the settlement amount and in respect of claims for further entitlements, which she said were owed by the former employer;
(l)Ms Finch sought advice from Mr Staindl in respect of allegations of defamation. He was unable to provide that advice;
(m)On 4 November 2009, Ms Finch said she would not accept the former employer’s offer, and requested an adjournment of the mediation which was then being conducted. She had determined to seek alternative legal advice;
(n)ATB advised her that if she did not accept the offer, both that firm and the barrister would cease to act. At that point, the proceeding was listed for hearing five days later;
(o)On 6 November 2009, ATB delivered a Statement of Costs and Disbursements in the sum of $62,910, including fees due to the barrister, in breach of the retainer that counsel would act on a “no win, no fee basis”;
(p)Prior to this time, Ms Finch had paid $18,000 towards counsel’s fees;
(q)The retainer was determined by ATB without “good cause” and before there was a “successful outcome”;
(r)The advice to settle the proceeding was not “reasonable advice” as it did not take account of the entitlement of Ms Finch to sue for breach of contract, for defamation, and her other entitlements against the former employer;
(s)ATB failed to exercise reasonable skill, care and diligence in carrying out the terms of the retainer in:
·failing to file all appropriate witness statements within a reasonable period
·failing to ensure counsel was properly briefed
·failing to ensure her former employer provided witness statements within a reasonable period
·failing to provide witness statements in reply
·failing to organise an appropriate conference with counsel
·failing to seek all proper instructions from her
·failing to provide reasonable and appropriate advice
·failing to apply for an adjournment of the mediation;
(t)ATB repudiated the retainer;
(u)On 4 November 2009, Ms Finch accepted that repudiation;
(v)As a result, Ms Finch claimed loss and damage;
(x)Further, and in the alternative, ATB was negligent in failing to carry out the terms of the retainer; alternatively, in breach of its fiduciary duty towards Ms Finch;
(y)Further, and in the alternative, ATB was guilty of misleading, deceptive and unconscionable conduct;
(z)Further, and in the alternative, ATB made representations to Ms Finch which were relied upon by her in entering the retainer. As a result, she suffered detriment and as a result of which ATB was estopped from claiming any costs and disbursements.
12 According to its Defence to Counterclaim, ATB said, relevantly:
(a) It admitted it was retained by Ms Finch in respect to the VCAT proceeding, that retainer being partly in writing and constituted by the Costs Agreement and partly implied by law;
(b) It admitted the retainer provided that it would be entitled to legal costs only upon a “successful outcome”;
(c) It denied ATB would retain barristers on a “no win, no fee” basis;
(d) It admitted ATB could only terminate the retainer for “good cause”;
(e) It admitted the retainer could be terminated if Ms Finch did not accept “reasonable advice” whereupon it was entitled to all legal costs;
(f) It said that if it was a term of the retainer that ATB would retain barristers on a “no win, no fee” basis, then it was a further implied term that that obligation only required it to use reasonable endeavours to do so and if it could persuade a barrister to act on that basis;
(g) ATM denied it terminated the retainer. It says Ms Finch terminated the retainer. If it determined the retainer, it was for good cause;
(h) It denied any breach of the retainer;
(i) It said that on or about 26 October 2009, Ms Finch agreed to counsel being engaged on a fee-paying basis, and as such, Ms Finch waived a compliance with any term in the retainer which required counsel to be briefed on a “no win, no fee” basis;
(j) It denied it failed to exercise reasonable care, skill and diligence in carrying out the terms of the retainer;
(k) It denied it repudiated the retainer, or that Ms Finch accepted any such alleged repudiation;
(l) It denied the plaintiff was entitled to any damages, including those set forth in the Particulars subjoined to paragraph 14;
(m) It denied it was guilty of any misleading or deceptive conduct;
(n) It denied it was estopped at equity or otherwise.
The evidence of Anastasia Eleftheriou[7]
[7]At the time, she was known as Anastasia Floros
13 Ms Eleftheriou was formerly a lawyer in the employ of ATB. She commenced work there in about 2007 and was contacted by Ms Finch in that year. She was the principal practitioner managing Ms Finch’s VCAT claim.
14 Much of her evidence was given by reference to notes on the ATB file, as she could not recall specific details of much of what occurred.
15 Initially, Ms Eleftheriou made enquiries as to retaining a barrister for a mediation conference on 15 June 2007. There was communication with Ms Finch as to whether a barrister would be prepared to appear on a “no win, no fee basis”.[8] At that point Ms Finch determined not to use the services of ATB.
[8]Transcript (“T”) 528-529
16 Ms Finch again contacted Ms Eleftheriou in around June 2008. She had had several firms of lawyers acting on her behalf in the VCAT proceeding up to that time. At that point, Ms Eleftheriou could not recall any discussion with Ms Finch that not only would ATB act on a “no win, no fee” basis, but so too would any barrister retained by that firm. It was the policy of the firm to attempt to engage barristers on a “no win, no fee” basis, but that could not always be done.[9] The firm would act on a “no win, no fee” basis unless the client would not follow reasonable advice or had misrepresented their case.[10]
[9]T536
[10]T537
17 The Costs Agreement was sent to Ms Finch on 20 August 2008.
18 The signed Costs Agreement was returned, albeit with some handwritten notations, and dated 27 August 2008.
19 Thereafter, Ms Eleftheriou obtained the file from Ms Finch’s previous solicitors and retained counsel, Mr Neill Campbell. He was not prepared to work on a “no win, no fee” basis. At that time, there was a note from the previous solicitors that Ms Finch had been offered $85,000 (presumably, inclusive of costs) in order to resolve the VCAT proceeding. Ms Eleftheriou continued to attempt to retain counsel. There was a file note of 23 September 2008 of a conversation with Mr Jim McKenna of counsel who had spoken to another barrister, Ms Ruth Hamnett, to the effect that she recommended Ms Finch accept an offer of $75,000 which had been made.
20 On 24 September 2008, Ms Eleftheriou spoke to Ms Finch, noting that the firm had approached a number of barristers who were not prepared to work on a “no win, no fee” basis. She advised that if a barrister could not be found to work on that basis, Ms Finch would need to provide funds to cover fees to be incurred. According to a file note,[11] Ms Finch was said to understand that. Thereafter, Ms Eleftheriou’s evidence went through the steps which were taken to attempt to obtain counsel on a “no win, no fee” basis.[12]
[11]CB 523
[12]T544-547, CB 530
21 Around this time, there was discussion with Ms Finch about making an offer of $110,000. On 15 December 2008, Mr Harris of counsel said it would be unwise to put an offer of $110,000, plus $23,400, in what was said to be makeup pay. He suggested that the combined figure of $133,400 would not attract a sensible counteroffer. He suggested an offer of $110,000 be put, which would be taken to include any entitlement to makeup pay. Mr Harris suggested to ATB that Ms Finch be firmly told that if she did not accept that advice, ATB could no longer act for her. He suggested the retainer be brought to an end unless she was prepared to accept that advice. Mr Harris suggested it was unlikely a barrister could be found to act in the matter on a “no win, no fee” basis.
22 Eventually a barrister, Mr David Staindl, was retained to attend a directions hearing on the basis that he be paid a fee of $660. According to Ms Eleftheriou, Ms Finch did not have a problem with paying that fee.[13]
[13]T550
23 On 18 December 2008, according to Ms Eleftheriou, she received instructions from Ms Finch to put a counteroffer of $115,000.
24 After the directions hearing on 19 December 2008, at which Mr Staindl appeared, Ms Eleftheriou sent a letter to Ms Finch suggesting an offer of $115,000 be put on the terms set forth.[14] That offer was put to the solicitors for Heat by letter dated 19 December 2008.[15] It was not accepted.
[14]CB 538-9
[15]T540-1
25 The matter was listed for a further directions hearing on 24 February 2009. There was a risk that unless amended particulars of the claim were drawn and filed, that the matter would be struck out. A further directions hearing was listed for 14 September 2009. Ms Eleftheriou or her secretary again sought to retain counsel.[16] The hearing related to non-compliance with orders for the filing and service of witness statements. Around this time, Ms Eleftheriou attempted to contact and obtain statements from a number of witnesses, the names of which had been provided by Ms Finch. A barrister, Ms Sheehan, was retained, although Ms Eleftheriou could not recall whether it was on a “no win, no fee” basis.[17] Orders were made[18] that witness statements were to be served by 23 September 2009 and failure to comply would result in the complaint being dismissed. The witness statements were filed and served in compliance with the order. It was usual for ATB to act on a “no win, no fee” basis and to retain barristers to do the same.[19]
[16]CB 558
[17]T556
[18]CB 568-9
[19]T557
26 Ms Eleftheriou noted that she had been unable to obtain statements from any of the witnesses whose names had been provided by Ms Finch. By 24 September 2009, Ms Eleftheriou had not been able to obtain counsel to appear.
27 Ms Eleftheriou or her secretary made extensive enquiries as to the availability of a number of counsel who had been recommended by Mr Harris. Many were unavailable; some did not do “no win, no fee” cases; some wanted to see the papers before making a decision. Mr Harris provided a comprehensive list of all barristers who were members of the Industrial Bar Association.
28 On 26 October 2009, Ms Eleftheriou had a telephone conversation with Ms Finch in which she explained that Mr Harris was not prepared to handle the matter, even on a fee-paying basis. Ms Eleftheriou said she was working to try to find someone who would work on a “no win, no fee” basis.[20] Her note of the conversation was that it appeared no barrister would be prepared to do it on a “no win, no fee” basis. Mr Harris suggested Mr David Staindl, who was available to undertake the ten-day hearing commencing 29 October 2009. He would charge $1,800 per day. This was conveyed to Ms Finch by email of 26 October 2009.[21] Ms Finch was advised that an upfront payment of $18,000 was required. By responding email of the same day, Ms Finch indicated she would “get the money sorted out”.[22] She offered to drop the cheque off within several days.[23] A conference was arranged for 28 October 2009. The cheque was ultimately provided and paid into the ATB Trust Account. The trial was due to commence on 29 October 2009.
[20]T569
[21]CB 615
[22]CB 615
[23]CB 614
29 Mr Staindl’s backsheet[24] set out the details of his involvement in the proceeding. A conference was arranged for 28 October 2009. According to the notes of Ms Eleftheriou, in the course of the conference, Ms Finch said “I will take next to nothing if it means I get a day in court”.[25] Mr Staindl expressed doubts about whether the proceeding would succeed.[26]
[24]CB 625
[25]CB 630
[26]T585
30 There was a conference the next day, 29 October 2009. There was a discussion about the prospect of a mediation. It was suggested a figure of $115,000 to settle the proceeding be put. According to the note, “client does not want an offer to be put”.[27] The note further recorded “I talk about reasonable advice & that we are working on a no win/no fee basis”.[28] Ms Eleftheriou suggested that this meant it was important to follow both her and counsel’s advice and that “we” were continuing to work on a “no win, no fee” basis.
[27]CB 633
[28]CB 633; T586
31 Later on 29 October 2009, the matter was called on before Deputy President McKenzie. Mr Staindl indicated that he was not in a position to proceed, given the large volume of material. He had only been involved from the day before. Later on 29 October 2009, Ms Eleftheriou sent an email to another practitioner at ATB, Mr Kim Price, who was to attend and instruct the next day, which said, in part:
“The client is difficult so should she reject or not instruct to put a reasonable offer tomorrow we will have to put her on notice that she is not accepting reasonable advice and we will no longer act on a no win-no fee basis (the barrister is getting paid on a fee basis). I’ve spoken to LF [Lee Flanagan] about this and he agrees, so basically if at mediation she’s not accepting reasonable advice we will seek to have her pay money upfront for legal fees.”[29]
[29]T588
32 Ms Eleftheriou did not attend Court on Friday, 30 October 2009. She attended VCAT on Monday, 2 November 2009. On that day, the hearing of the matter had become a mediation, with a VCAT appointed mediator. On the Friday before, instructions had apparently been obtained from Ms Finch to put an offer of $125,000 to Heat. Ms Finch was advised that Heat would only settle for a full release of all claims arising out of her employment. The offer was rejected and a counteroffer for $50,000 was obtained with various conditions. Instructions were then obtained from Ms Finch to put a counteroffer of $115,000 with the conditions which had been sought by Heat. That offer was eventually accepted by Heat, but they required a deed of release to be prepared. The mediation was adjourned to 4 November 2009, and Ms Finch took a draft copy of the Release to consider over the weekend.
33 According to the notes of Ms Eleftheriou taken 2 November 2009, Ms Finch wanted to renege on the offer. The note records that Ms Finch was concerned that she was not advised that the settlement included “Federal Court matters”. She said that her relationship with Ms Finch had started to strain. She was not listening to what was being advised. Ms Eleftheriou was not aware of any Federal Court matters. An attempt was made to explain things to her clearly.[30] Ms Eleftheriou thought that the $115,000 was a fair settlement and that any entitlement to makeup pay was modest.[31] Up to that point, Ms Finch had not provided any written detail of any entitlement to makeup pay, wages or maternity pay.
[30]T591
[31]T593
34 On 4 November 2009, Ms Finch indicated she would not sign the Release. Ms Eleftheriou emphasised that $115,000 was a good settlement. Ms Finch did not agree, claiming that she had defamation claims and a perjury case which would succeed. Ms Eleftheriou advised Ms Finch that if she would not follow the advice which had been given, then ATB would withdraw as, in accordance with the Costs Agreement, she was not following reasonable advice. Ms Finch responded that Mr Staindl was not accurate in his advice and she claimed to have been bullied, under duress and given incorrect legal advice. Ms Finch had brought along a document which contained 26 issues which expressed her dissatisfaction with the advice she had received. She said she did not have confidence in her legal team. Ms Eleftheriou said she took careful notes of this conference.
35 Mr Staindl then advised the solicitors and counsel for Heat that he was no longer acting in the proceeding. This was on 4 November 2009. The Tribunal resumed at 12.50pm on that day and Mr Staindl advised that he had instructions to withdraw. Counsel for Heat opposed any adjournment given Ms Finch had changed practitioners on three occasions. By that time, the Tribunal had received a facsimile from a solicitor who said he represented Ms Finch, and sought an adjournment of the hearing.
36 Earlier that morning, Mr Staindl had provided a memorandum to ATB on the events which had occurred.[32]
[32]CB 740-745
37 Ms Finch was present in the hearing room when Mr Staindl announced that his instructions, and those of ATB, had been withdrawn. At no time did she indicate that she wished ATB to continue to act. She sent an email saying she had a new legal team on 7 November 2009.[33] Ms Eleftheriou received a copy of an email sent to Mr Staindl[34] which contained a document, “BARRISTER ISSUES”.[35] By email of 5 November 2009, Ms Finch raised a number of “lawyer issues”. The document contained a litany of complaints in respect of Ms Eleftheriou. On 5 November 2009, Mr Staindl provided a further memorandum.[36]
[33]CB 746
[34]CB 747
[35]CB 748-750
[36]CB 761-2
38 A letter of 6 November 2009 setting out details of costs and disbursements was sent to Ms Finch.[37] She replied with a number of emails to ATB querying various aspects of the Bill of Costs. According to an email of 8 November 2009, Ms Finch said:
“I would like to confirm as you noted in paragraph 4 of your letter, that yes I did disengage the services of Mr David Staindl, this was based on the issues contained in my list to you, which I hereby attach again … .”[38]
[37]CB 765-6
[38]CB 772
39 She further noted in the letter that Mr Staindl had advised her that it was unlikely she would win the case. She alleged he “push[ed] me to settle, rather than take my interests (emotionally and financially) into account …”.[39] She noted that she was:
“… continually threatened that your firm would cease to act for me if I did not follow his advice. I found this quite unreasonable due to the above and the Barrister issues I sent you that I shared and tried to address with your firm’s Representative.”[40]
[39]CB 772
[40]CB 773
40 ATB replied to Ms Finch’s letter with a letter of 13 November 2009.[41] In part, the letter said:
“In relation to the allegation that we have somehow prejudiced your claim by requiring you to appear, we do not believe this to be the case. It is regrettable that our relationship ended this way, however our Cost Agreement requires you to accept reasonable advice from our office and we do not believe you did so.”[42]
[41]CB 789-792
[42]CB 791
41 At no time after 4 November 2009 did Ms Finch or her husband suggest that ATB should continue to act for her.[43]
[43]T611
42 On 2 March 2010, Ms Finch made a complaint to the Legal Services Commissioner in respect of the conduct of Ms Eleftheriou.[44] The complaint was dismissed.
[44]CB 836
43 Ms Eleftheriou was then cross-examined by Ms Finch. Ms Eleftheriou’s experience was in WorkCover and personal injury, and not employment law. Ms Eleftheriou was provided with the names of witnesses by Ms Finch, and she contacted some of them and drafted statements. Another solicitor in the firm, Mr Price, dealt with some other witnesses. Others in the firm did not have experience in employment law.
44 When asked why witnesses suggested by Ms Finch were not subpoenaed, Ms Eleftheriou said that a decision was made not to subpoena witnesses who did not want to come to the Tribunal. Some of the witnesses were not going to be helpful for the case.
45 Ms Eleftheriou disagreed ATB was “underprepared with witness statements and filed them extremely late”.[45] She said a new timetable had been set in the directions hearing in September for the October trial. All the material was filed by the required date. The fact that there was a self-executing order meant that ATB “had dropped the ball”.[46] She denied writing file notes inaccurately. The “Disclosure Statement”, which was part of the Costs Agreement, stated:
“We engage barristers on a no win/no fee basis and in the event that your case is unsuccessful and that you accept reasonable advice, the barristers that we engage will not charge a fee for work performed.”[47]
[45]T624
[46]T624
[47]CB 491
46 Ms Finch’s claim at VCAT against her former employer was in respect of gender discrimination, pregnancy discrimination, sexual harassment, victimisation and vicarious liability.[48]
[48]T641
47 In a letter to ATB of 12 December 2008, Ms Finch authorised Ms Eleftheriou to put a counteroffer of $110,000 to Heat. At the time of this communication, Ms Finch raised the fact that she claimed to be entitled to $23,400 in makeup pay. The Deed of Settlement which Mr Staindl and Ms Eleftheriou advised Ms Finch to execute in November 2009 would have resulted in abandonment of any claim in respect of makeup pay. In December 2008, Ms Eleftheriou was having difficulty obtaining a barrister who would undertake the case on a “no win, no fee” basis.
48 At the time of the hearing, Ms Eleftheriou could not recall whether she considered that Ms Finch had a claim for $23,400 in makeup pay. She may have forgotten about it.[49]
[49]T661
49 By an email of 17 December 2008, Mr Peter Harris, a barrister formerly briefed in the matter, advised against making an offer of $110,000 plus $23,400 in makeup pay. A total of $133,400. He suggested such an offer would not provoke any sensible counteroffer. Up to that point, an initial offer from the former employer of $50,000 had been made, and then increased to $75,000. This had been rejected.
50 By letter dated 19 December 2008, Ms Eleftheriou sent a letter to Heat’s solicitors putting a counteroffer of $115,000, which included entitlements to various claims.[50] Ms Finch authorised the despatch of that letter.[51] Ms Eleftheriou was not aware of other claims Ms Finch may have, save those referred to in the letter.
[50]CB 540-541
[51]T665
51 Mr Staindl and Ms Eleftheriou saw Ms Finch as a difficult client, in that she would not take advice. Statements were completed and filed by 23 September 2009 in accordance with the orders of Deputy President Coghlan of VCAT, although there was still over a month in which to find another barrister on a “no win, no fee” basis. Mr Harris replied with an email with a list of barristers. This was approximately two weeks prior to the hearing.[52] On 13 October 2009, Ms Eleftheriou’s secretary called those various barristers. A number of barristers on the list were sent the brief originally held by Mr Harris. Some held onto the brief for a period before deciding they were not prepared to take on the case.[53] Heat’s witness statements were filed late, given the late filing of Ms Finch’s witness statements. Ms Eleftheriou said there was still time after the service of the material to consider it and to prepare for trial.[54]
[52]T688
[53]T695
[54]T700
52 Ms Eleftheriou, on the advice of counsel, thought it was unnecessary to issue any subpoenas, or to obtain an order for discovery of documents.[55] The witness statements of Ms Finch and her various witnesses came to several hundred pages. Mr Staindl had available to him all the witness statements, pleadings, statement of Ms Finch, Heat’s material and VCAT documents. Ms Finch had asked Ms Eleftheriou to subpoena some documents. She could not recall whether Ms Finch had requested she obtain discovery. Mr Harris did not see the need for any documents to be subpoenaed.
[55]T714-5
53 Ms Finch’s witness statement to VCAT was 98 pages’ long.
54 Witness statements from Heat’s witnesses were provided to Ms Eleftheriou late on 23 October 2009. That was a Friday. Some were transmitted to Ms Finch on that day, and some were picked up by her husband on Monday, 26 October 2009. All in all, there were fifteen witness statements from Heat’s witnesses. It was put to Ms Eleftheriou that given the late provision of the statements, and that it had been difficult to find a barrister on a “no win, no fee” basis, that it would have been appropriate to apply to adjourn the trial. Ms Eleftheriou said that she was still attempting to retain counsel, and counsel could make that call if it was needed.
55 In fact, on the first day of the hearing, 29 October 2009, Mr Staindl sought an adjournment. An adjournment of the trial was granted, in the sense that the matter referred for mediation.
56 On Monday, 2 November 2009, at the Tribunal, after an offer had been made the previous Friday, Ms Finch told Mr Staindl and Ms Eleftheriou that she felt she had been pushed into settlement and she wanted the makeup pay to be part of the settlement. Ms Finch said she wanted to renege on the offer. She said she was not advised that the VCAT settlement included her entitlements in the Federal Court. Over the weekend, Ms Finch came to the conclusion that she had a right to make a claim under WorkCover or at common law, and also makeup pay and other industrial entitlements totalling $129,000. She thus came to the conclusion that settling all these matters for $115,000 made no sense.[56]
[56]T779
57 There was a discussion on this day that Ms Finch wanted to pursue some aspects of her industrial claim in the Federal Court. If she signed a release, she was going to give those claims away. Ms Eleftheriou recalled Ms Finch raising a possible defamation action with Mr Staindl. There may have been other actions also. Throughout this, the mediator was present.
58 Ms Eleftheriou said at this point, that the relationship had started to strain. Ms Finch did not want to proceed with the settlement and required changes to be made to the Release which had been previously provided. There was also an issue regarding defamation which Ms Finch had not raised until 2 November 2009. The matters relating to allegations of defamation came about because of what was said in Heat’s witness statements.
59 On Monday, 2 November 2009, Ms Finch said that she had potential proceedings in the Federal Court which were not being taken into account, including her employee entitlements.[57]
[57]T788
60 Ms Eleftheriou thought settlement of her discrimination case at $115,000 was reasonable. Her only area of concern was a cause of action in VCAT under the Equal Opportunity Act 2010. On 2 November 2009, Mr Staindl advised Ms Finch that the offer of settlement was a full release arising out of employment, save for any entitlement for WorkCover under the Accident Compensation Act 1985. Mr Staindl advised that Heat was not prepared to settle without a general release in respect of all matters relating to employment. Ms Eleftheriou and Mr Staindl spent a lot of time trying to get Ms Finch to change her mind.
61 Ms Eleftheriou said[58] there were always risks with the VCAT case. Mr Staindl, who has experience in Federal Court employment cases, did not think that there was the prospect of obtaining compensation in respect of a breach of contract case. At one point, there was discussion between Ms Eleftheriou and Mr Staindl that if Ms Finch would not accept reasonable legal advice, she would have to pay money up front for legal fees.
[58]T800
62 On Wednesday, 4 November 2009, the mediation resumed about 10.00am. She made reference to the Costs Agreement where Ms Finch was obliged to follow reasonable advice. Ms Finch did not agree. Ms Eleftheriou had advice from Mr Staindl, an employment law expert, as to the appropriateness of the offer of $115,000. She was frustrated that Ms Finch was not listening and then she presented a document with 26 points which raised concerns about the advice provided.[59] Ms Finch said she did not have confidence in her legal team. Ms Eleftheriou explained that Ms Finch had an obligation to follow reasonable advice in accordance with the Costs Agreement. Ms Eleftheriou agreed that the proposition was put to Ms Finch that if she did not accept the legal advice that was being given in respect of settlement, that ATB and Mr Staindl would withdraw and charge legal costs.
[59]T808
63 However, on 4 November 2009, Ms Eleftheriou said that Ms Finch indicated she was not happy with the service and that there was a breakdown between them.[60] Ms Finch was very upset. Ms Eleftheriou recalled Ms Finch said that she did not have confidence in her legal team. She agreed that, at this point, Mr Staindl may have said that he was ceasing to act for her. According to her notes,[61] in relation to Mr Staindl, “he will not act further”. He terminated himself as Ms Finch did not have confidence in her legal team. Mr Staindl said that he would not act further. He communicated to Heat’s lawyers that he had been sacked. According to a letter from Ms Finch to ATB of 8 November 2009,[62] Ms Finch said “… yes I did disengage the services of Mr David Staindl, this was based on the issues contained in my list to you, which I hereby attach again …”.
[60]T814
[61]CB 735
[62]CB 772
64 When the matter came on for the member at VCAT on 4 November 2009, he said that a new solicitor, Mr Jacka, had faxed through a letter saying that he was now acting for Ms Finch.
65 When the matter resumed at 12.50pm on 4 November, Mr Staindl advised the Tribunal that instructions had been withdrawn, and that applied also to his instructing solicitor. He indicated that Ms Finch would seek an adjournment of the matter to obtain other legal representation. After this time, Ms Eleftheriou did not take any steps to re-establish the relationship with Ms Finch. That was because she had engaged other legal representation and ATB were no longer acting.
66 Ms Eleftheriou was taken to a memorandum of Mr Price of 30 October 2009, where Mr Staindl advised that most of the witness statements from Ms Finch’s witnesses were useless. There were twenty-five or more potential witnesses. Some were not involved, some had no recall of relevant events, and many were unhelpful. Someone said that employment at Heat was a female friendly environment.[63] Witness statements were originally to be filed by 1 September 2008. ATB did not act until 28 August 2008 and therefore there was no time, after ATB had been retained, to file those statements.
[63]CB 642
67 At no time between December 2008 and commencement of the mediation did Ms Finch give any instructions that she was interested in pursuing a Federal Court claim. She could not recall advice about defamation or about Federal Court proceedings being sought. Ms Eleftheriou did not ever meet with Ms Finch to discuss a personal injury claim. When Ms Eleftheriou gave advice that $115,000 was reasonable, she had in mind that Mr Staindl said she was unlikely to be successful in the proceeding and that, in any event, and even if she was, damages would only be in the order of $40,000.
The evidence of David Staindl
68 In 2009, Mr Staindl was an experienced industrial law barrister. He was briefed in the Finch case to attend a directions hearing in December 2008. His next involvement was October 2009. The case was due to go for two weeks. He was asked if he would do it on a “no win, no fee” basis and declined. It was not a clear-cut discrimination case.
69 Subsequently, on 26 October 2009, Ms Eleftheriou contacted Mr Staindl and an agreement was reached that he be paid $1,800 per day. His backsheet[64] set out his involvement in the proceeding. He was paid the sum of $9,000, together with $660 for the earlier directions hearing. The brief was contained in five lever arch folders. The case was due to start on Thursday, 29 October 2009. He received the brief on the Tuesday afternoon, 27 October 2009. He was immediately concerned with being able to consume the volume of statements and material.
[64]CB 625
70 He advised Ms Finch at the conference on Wednesday, 28 October 2009, that it was unlikely she would receive any award of costs. Generally, only modest awards of damages are made at VCAT. He told Ms Finch that the costs might be $30,000 if the matter was to run. Ms Finch had previously been made an offer of $125,000. He recalled Ms Finch saying something to the effect that she would take next to nothing if it meant that she could get a day in court.
71 Heat had made an offer of $75,000, and he was concerned that if Ms Finch got less than that, there may be a costs order against her. He thought that there was no significant component of economic loss in the claim. Awards for pain and suffering were not worth a great deal. Having read the witness statements, Mr Staindl had doubts whether Ms Finch’s case would be successful. The statements of Heat’s witnesses were very strong and contradicted the version given by Ms Finch. His advice was to try and settle the case.[65] He thought Ms Finch would not be a good witness. Her response to his enquiries tended to change when an apparent contradiction was pointed out.
[65]T889-890
72 Mr Staindl thought he recalled Ms Eleftheriou saying to Ms Finch that Ms Finch should accept reasonable advice and that because the solicitors were acting on a “no win, no fee" basis, she had to accept reasonable advice. When the matter was called on, Mr Staindl indicated to the Tribunal member, Ms McKenzie, that there was a large volume of material and, as a result, he was not ready to proceed. He further indicated that he had not given up trying to resolve the matter.
73 A mediation was ordered by Deputy President McKenzie and took place the next day, Friday, 30 October 2009, before a mediator, Ms Francesca Falduti. Mr Staindl sought a deferral of the matter for several days, until after Cup Day. Heat opposed that application as they claimed the proceeding had been “riddled” with delay. At 3.00pm on 30 October 2009, there was a discussion between Ms Finch and Mr Staindl as to her legal costs.[66] He was of the view that most of the material contained in the witness statements provided by Ms Finch was inadmissible. Ms Finch said she did not care about costs and was aware of the risks.
[66]CB 637
74 He raised a figure of $115,000 and suggested this be put to the other side.
75 Ms Finch made some reference to Federal Court options for makeup pay. At that stage, he did not think annual leave was mentioned. If annual leave were owing, it needed to be paid out in addition to any settlement figure. In any event, he said “I don’t think there is much in that”.[67]
[67]T903
76 On 30 October 2009 an “Authority to Settle” was prepared to enable an offer of $115,000 to be made in full and final settlement of her VCAT claim pursuant to the Equal Opportunity Act.[68] The document provided various conditions and was signed by Ms Finch. The document was also signed by Mr Staindl, who noted that in his view, the proceeding was unlikely to be successful and, even if so, damages would be no more than $40,000.
[68]CB 670-1
77 Ms Finch provided instructions to resolve the case for that amount.
78 In any event, the entitlement to makeup pay under the award was either $3,000 for 13 weeks or $6,000 for 26 weeks. It was a relatively modest sum in the scheme of things. Heat indicated clearly that they would only settle the matter if Ms Finch agreed to a release in respect of all claims arising out of her employment, save for personal injury. They were also likely to require confidentiality and a non-denigration clause.
79 Mr Staindl’s view was that an offer of $115,000 would have well and truly covered any entitlement to maternity leave pay, which was not all that generous. Her entitlements would not add up to much and would be well and truly covered by the settlement sum.[69] Mr Staindl contemplated making an offer which excluded makeup pay and annual leave from any terms of settlement. Heat wanted a full release.
[69]T911
80 Mr Staindl said he was frank in his assessment of the prospects of success. He told Ms Finch that she would lose the case.[70] He considered the settlement of $115,000 was extraordinarily good in the circumstances, even allowing for claims for makeup pay, maternity leave and annual leave.
[70]T915
81 A defamation proceeding was not mentioned until Monday, 2 November 2009. A deal had been reached before then. The first Deed of Release was tabled late on Friday. There had been, in effect, an acceptance of the figure of $115,000. The file note records Mr Staindl saying that he did not think Ms Finch was entitled to $16,000 in maternity leave. There was no suggestion that the resolution of the VCAT proceeding would jeopardise any entitlement to a WorkCover or personal injuries’ claim. That was specifically excluded.
82 In the course of the mediation, there was a discussion with Ms Finch, her legal team and the mediator. Heat’s legal team was not present. The mediator said words to the effect that it was a good settlement and it should be taken. Ms Finch said “I’ll just walk away. This is about my life.”[71] The mediator said “Maybe it’s time to let go”.
[71]CB 664
83 The memorandum from Mr Staindl to ATB was sent on 4 November 2009. He wanted to put on record that he had concerns about his ability to continue to act for Ms Finch.[72] There were lengthy discussions between Mr Staindl and Ms Finch on the Friday and the Monday. He told her it was unlikely she would be successful. She denied that would be the case. The Deed of Release was received late on Friday evening. Mr Staindl explained the terms to her. She requested the weekend to look through it.
[72]T939
84 On Monday, 2 November 2009, the matter of potential defamation proceedings was raised. Ms Finch said she wanted to renege on the offer. On the Friday, Mr Staindl and his opponent, Ms Siemensma, had agreed on the figure of $115,000 with a full release from all claims arising out of employment, save and except for claims made in respect of personal injury or illness. There was a further provision for confidentiality and a non-denigration clause.[73] A Deed of Release was prepared by Heat’s solicitors. Ms Finch had provided clear advice to settle on those terms.[74]
[73]T945
[74]T946
85 Most of Monday, 2 November 2009 was dealt with going through the terms of the Release and attempting to deal with Ms Finch’s concerns. There were some handwritten changes to the Deed. These arose as a result of discussions during the course of that day. No Deed of Release was finally executed. On the Monday afternoon, Ms Finch said that she was tired and Mr Staindl did not pursue execution of the Deed. In Mr Staindl’s view, the settlement figure did not include annual leave payments.[75]
[75]T952
86 On Wednesday, 4 November 2009, Ms Finch said she would not take $115,000. She wanted the matter adjourned for another mediation. Ms Finch’s husband provided several sheets of paper which set out the issues of concern.
87 Ms Finch said she did not have confidence in her legal team.[76] In response, he said that he should not continue to act for her. She agreed to this. He then said that he would tell the other side. There was never any retreat from her position that Mr Staindl should not continue to act for her, save that she may have requested him to appear and obtain an adjournment. He felt his brief had been terminated.
[76]T955
88 Mr Staindl advised Ms Finch that he was experienced in Federal Court matters and that he believed a breach of contract proceeding would bring little in the way of damages.
89 On 5 November 2009, Mr Staindl sent a memorandum to ATB.[77]
[77]CB 761-2
90 Ms Finch made a complaint to the Legal Services Commissioner in respect of Mr Staindl’s conduct. That complaint was dismissed.
91 Mr Staindl was then cross-examined. He accepted he did not have “full knowledge” about Ms Finch’s entitlements either to maternity leave or makeup pay. Mr Staindl said discovery was not normally ordered in VCAT. The statements of the witnesses provided by ATB in support of Ms Finch’s claim did not assist in proving her case.[78] Without interviewing the witnesses, he was unable to say whether there was any further relevant evidence they could give.
[78]T1008
92 Mr Staindl said that he was not able to read all of the material prior to the commencement of the mediation. He thought that he had read all the statements, but not necessarily all of the attachments to them. He was concentrating on trying to resolve the matter. He wanted the commencement of the mediation to be deferred until the next week. Mr Staindl said he did not think he commented that most of the witnesses’ statements were useless, although he was not sure. There was an order from the Tribunal that Heat’s statements in response were to be filed by 5.00pm on 23 October 2009. Some came in before 5.00pm, and some parts of it after. At that point, counsel had not been retained.
93 Mr Staindl said that his starting point was that the statements of Ms Finch were true and accurate, but when he was confronted with different versions of events, he tested those by reference to documents, to Ms Finch’s instructions, and using his commonsense. He then asked the question as to what was likely to be accurate. He concluded that the witness statements of Heat hurt Ms Finch’s case a lot. By his comment to Deputy President McKenzie that he had not given up hope of resolving the matter, was a hint to have the matter referred for mediation. If Ms Finch had instructed him not to attend a further mediation, then he would not have dropped that hint.
94 In the course of negotiations, Mr Staindl put a figure of $115,000 to Heat’s counsel, upon instructions from Ms Finch. They put a counteroffer of $40,000. He then sought instructions from Ms Finch to put a counteroffer of $80,000 or $90,000, but Ms Finch did not provide those instructions. He told Heat that “we are stuck on $115,000”. He did not expect that they would accept that offer, but eventually they did. They were only prepared to settle with a full release for all claims arising out of employment, save in respect of personal injury or illness.
95 Ms Finch then raised the matter of maternity leave and makeup pay. Mr Staindl advised that the release would forego claims for those matters. He advised her that Heat would not settle, save with a full release. He perceived that Heat wanted to be rid of Ms Finch and wanted nothing to do with her again, and the only way to achieve that was to settle with a full release. Initially, Ms Finch was resistant to making an offer, but she ultimately agreed to make the offer at $115,000. Mr Staindl was careful to ensure he obtained clear instructions.
96 A memorandum from Mr Price dated 30 October 2009, setting out details of the events of that day,[79] was not disagreed with by Mr Staindl. Mr Staindl said Ms Finch clearly gave him instructions to settle all matters arising out of employment, save in respect of personal injuries.[80] Mr Staindl recalled that the mediator, Ms Falduti, expressed the view that Ms Finch could not win the case. Heat’s position, which was inevitable and very firm, was that there was to be a full release in respect of all employment entitlements. In the course of negotiations, Mr Staindl said Ms Finch was uncertain whether her former employer had a maternity leave pay policy, and there was a further issue as to whether or not she was entitled to it, if one existed. Because Heat wanted to get rid of Ms Finch, that was a reason, to a large extent, why the offer was so good.[81]
[79]CB 642-645
[80]T1053-4
[81]T1063
97 Mr Staindl, having read the ultimate Judgment of her Honour Judge Harbison in the proceeding, considered that while Heat had a maternity leave policy, which entitled an employee to three months’ paid maternity leave, that only had application if the employee returned to work. He considered that Ms Finch had no such entitlement, as she did not return to work. In any event, Mr Staindl factored into his advice a possible entitlement to maternity leave. At best, she may have been entitled to $12,000.[82]
[82]T1069-1070
98 Subsequently, Ms Finch said she was paid $13,598 from Heat by way of annual leave. However, this assessment was made in 2012, well after October 2009. Whatever Ms Finch’s entitlement to annual leave was, it was encompassed within the figure of $115,000. The figure of $115,000 amply covered an allowance for annual leave, makeup pay, and the possibility of maternity leave.[83]
[83]T1086
99 Ms Finch commenced work with Heat in June 2002. Mr Staindl’s assessment of Ms Finch’s entitlements was on the basis that she resigned. She may have had other entitlements had she been sacked. Had she resigned, then she may not have had any entitlement to maternity pay. In any event, Mr Staindl thought he factored in three months’ maternity leave,[84] approximately $12,000. Mr Staindl said if there was an entitlement to makeup pay, it would only be if Ms Finch was under an award. Even accepting that, the makeup pay would be at best three to six months.[85]
[84]T1092
[85]T1094
100 Mr Staindl was taken to Ms Finch’s affidavit,[86] and to the calculations she made about matters not taken into account. He disagreed she had any entitlement to makeup pay of $35,400.[87] Typically, there may have been an allowance for three to six months in makeup pay. Mr Staindl advised Ms Finch that in any Federal Court action she would not get very much. Mr Staindl did not agree that a breach of an employer’s policy would sound in damages. It would depend upon the ramifications of that breach.[88] However, that aspect was within the contemplation of the VCAT proceedings. On 2 November 2009, Mr Staindl says his advice was somewhat tempered when the issue of defamation was raised. He said “Look, I think that 115 is a good settlement but I can’t advise you in respect of defamation”.[89]
[86]CB 141
[87]T1096
[88]T1105
[89]T1118
101 Mr Staindl disagreed that he ought to have adjourned the mediation in order to get further advice as to Ms Finch’s entitlement to an award for defamation.
102 Mr Staindl said that it was clear that after long discussions on Friday, 30 October and Monday, 2 November 2009, Ms Finch said that she had lost confidence in her legal team. As a result of that, he said that he could no longer act and would tell the other side.[90]
[90]T1135
103 In advising Ms Finch to accept the offer of $115,000, Mr Staindl took into account:
· the costs she might be charged by her solicitors
· the prospects of her losing the case
· an entitlement of up to $66,000 in the Federal Court
· an entitlement of up to $10,000 in a defamation claim.
104 Mr Staindl said, accepting all these things, $115,000 was a sufficient settlement.[91]
[91]T1151-1152
Evidence of Diana Dolley
105 Ms Dolley was a secretary employed by ATB at the relevant time. On 15 December 2008, she made enquiries as to the availability of a number of barristers in a discrimination case at VCAT.[92] She made further enquiries on 10 September 2009.[93]
[92]CB 530
[93]CB 558, CB 563-564, CB 566, CB 584-585, CB 602, CB 609
Evidence of Kim Price
106 Mr Price commenced work at ATB in October 2008. As at the time of the hearing, May 2015, he was a partner in that firm. In 2008, he commenced as a trainee. He first became involved in the Finch case in the latter part of 2009. Ms Eleftheriou requested that he assist in obtaining witness statements. He telephoned, or attempted to telephone, all of the witnesses he had been given the names of. There were about twenty-five. He contacted most of them. Many of the witnesses were either not prepared to speak to him, or were not able to assist. In respect of some witnesses, their evidence was not consistent with Ms Finch’s claims.
107 He also assisted Ms Eleftheriou in compiling a list of the applicants’ documents. He conferred with Mr Staindl on about 28 October 2009, with Ms Finch present. He made notes of the conference.[94] In the conference, Mr Staindl was still getting his head around the brief. At one point, Ms Finch said “I will take next to nothing if it means I get a day in court”. Mr Staindl said she would not get costs. He was at the conference a couple of hours.
[94]CB 629-631
108 He was not present on the first day of the hearing, 29 October 2009. He attended again on Friday, 30 October 2009. He made notes of what transpired on that day.[95] Those notes were reduced to a typed version.[96] The typed version contains some additional notes. Amongst those typed notes, there was recorded:
[95]CB 645A-651, CB 654-656
[96]CB 642-645
·The client stated she would not agree to a confidentiality clause, unless Heat paid for it.
·David Staindl advised most witness statements were useless.
·Overall, the witnesses provided were unhelpful.
·Mr Staindl advised that Ms Finch could not claim for lost commission.
·Any claim in the Federal Court was worth very little.
·Mr Staindl suggested offering $115,000.
·Mr Price advised that it was possible that if Ms Finch did not accept the advice of Mr Staindl and ATB regarding settlement, they may not be able to continue to act on a “no win, no fee” basis and would require payment for provisional costs.
·The mediator stressed that if there was an award of $75,000 or less, Ms Finch may be ordered to pay Heat’s costs. Ms Finch said she did not care about costs. She had been advised of the risks many times before. Mr Staindl said that Ms Finch was not entitled to makeup pay and was not covered by an award.
·The mediator advised that VCAT would not make much of an award even if she was successful.
·Mr Staindl asked for instructions to put $115,000.
·Ms Finch said she did not know her entitlements in relation to Federal Court options. Mr Staindl said this was worth very little. She may be able to claim makeup pay if covered by an award, but did not believe she was. Even if covered, then she would be entitled to $3,000 or $6,000.
·There was discussion regarding a clause to exclude the makeup pay and annual leave.
·Ms Finch also wanted maternity leave entitlements excluded. Mr Staindl said Heat would likely only agree to a settlement figure if it was a global figure.
·Ms Finch gave instructions to offer $115,000, excluding makeup pay and annual leave.
·Ms Finch stated that she thought $200,000 was reasonable.
·The mediator said she would not put that figure as Heat would walk away.
·Ms Finch instructed to offer $125,000 in full and final settlement. Her offer was decreased to $115,000.
·Mr Staindl advised settlement would exclude any personal injury or ACA[97] claim.
·Ms Finch expressed a desire to withdraw her offer.
·Mr Staindl and Ms Eleftheriou returned and said that Heat had accepted Ms Finch’s offer of $115,000 and that Terms of Settlement were being drawn up. An Authority to Settle was prepared.
·Ms Finch clearly understood the Terms of Settlement.
·Ms Finch signed the Terms. Mr Staindl explained all the terms of the Agreement. Ms Finch said that the day was too long and she wanted to take the document home to read it over the weekend.
[97]Accident Compensation Act 1985
109 Mr Price recalled the mediator saying that the settlement at $115,000 was a very good result.[98] Ms Finch voluntarily signed the Authority to Settle document. She wanted a much higher settlement and was not happy with the result, but she voluntarily agreed to the settlement. Mr Staindl spent a long time re-assuring Ms Finch about the settlement. Ms Finch was not threatened nor compelled to sign the document.
[98]T1241
110 Mr Price had, since November 2009, sent several emails to Ms Finch offering to return the balance of the $18,000, namely $9,000, to her, the rest being taken in Mr Staindl’s fees. She would not accept it.[99]
[99]CB 910
111 In the course of the mediation, the relationship between Ms Finch and Mr Staindl was quite cordial, although there was some robust discussion about the strengths and weaknesses of the case. The advice to Ms Finch was predominantly given by Mr Staindl. Mr Price thought the settlement was a very good one. Mr Price advised Ms Finch of her legal costs. They were $22,000 in professional costs and $8,000 in counsel’s fees. There was also costs of her previous lawyers of approximately $20,000.
112 Mr Price was then cross-examined. He accepted that in late 2008, he had very little professional experience in employment law. Of the eight or so witness statements which were provided, some provided support to Ms Finch’s arguments. Originally, there were about twenty-five or twenty-six names of potential witnesses provided to Mr Price. In the end, about eight witnesses provided statements. The rest did not support the case.
113 In the course of the conference that Mr Price attended, he formed the impression that Ms Finch was passionate about pursuing her case, but was not prepared to listen to advice.[100] In the course of that conference, Mr Staindl advised he had great concerns that if Ms Finch was to obtain a judgment less than the offer which had previously been made, that is, $75,000, she may be liable for costs. Mr Staindl appeared to have a sufficient understanding of the case and the evidence to be able to confidently give advice as to a possible settlement. Mr Price said Mr Staindl was experienced in the jurisdiction, he understood the law, he understood the issues, and spoke with some authority about the strengths and weaknesses of the case. He impressed Mr Price as being very competent and experienced.[101]
[100]T1271
[101]T1275
114 The Authority to Settle[102] was raised late on Friday, 30 October 2009, and its contents were explained thoroughly to Ms Finch.
[102]CB 670-671
115 Mr Price told Ms Finch that he and Mr Staindl believed an offer of $115,000 all in was more than reasonable and that if she did not accept it, the firm was no longer prepared to act on her behalf on a “no win, no fee” basis. That was because she would be in breach of the costs agreement in not following reasonable advice.[103] Mr Price said Ms Finch was difficult, in that she was reluctant to accept the advice that was being provided to her in relation to her case and its prospects. She would question, query and doubt explanations and advice that was given to her. She would come to an understanding or decision and then seek to retract it. That was why, after nine hours of mediation on 30 October 2009, the matter had not resolved.[104] The mediation on Friday, 30 October 2009 concluded about 7.00pm as everyone was tired and Ms Finch wanted the weekend to consider the Deed of Release.
[103]T1305
[104]T1330
116 It was put to Mr Price that given ATB was instructed only in respect of the VCAT claim, it was improper to give advice about claims which might be brought in the Federal Court, or some other court for defamation or to advise Ms Finch to sign a release which encompassed those potential actions. Mr Price replied that counsel was engaged and it was his opinion that the proposed offer was reasonable. Mr Price concurred with that opinion.[105]
[105]T1366
Evidence of Catherine Norman
117 Ms Norman was an articled clerk with ATB in 2009, having commenced on 14 April of that year.
118 On Monday, 2 November 2009, Ms Norman arrived at the mediation around 4.00pm. She had been asked to attend and to make notes of what occurred. According to those notes:
·Ms Finch indicated she may tell her doctor about the settlement (in breach of the confidentiality clause). She said “… whose side are you on, you are ruining my claim, my personal injury claim. If this settlement was to end it all – I would be asking for $500,000.”[106]
[106]CB 659
·Ms Finch said no-one could tell her what she could or could not say to her doctor.
·She asked the mediator to see standard VCAT Terms of Settlement. Terms in another matter were shown to her.
·Ms Finch was not prepared to accept the proposed clause that Heat could seek an injunction and damages for a breach of the confidentiality provisions.
·Mr Staindl said that if Ms Finch did not move on clause 2(d), that she would be running the case alone on Wednesday, as he would be compromised.
·Ms Finch asked the mediator if she could speak to someone at VCAT about the Terms. The mediator said, VCAT does not give legal advice.
·Ms Finch complained about various other clauses of the Release.
·Ms Finch’s husband told Mr Staindl that he was talking as if he was on the other side.
·Ms Finch said that for an extra $10,000 the clause would be included. Mr Staindl refused to put that.
·Ms Finch said that Mr Staindl was not briefed in respect of Federal issues and claimed that she had $66,000 owing.
·“David advises he may not be able to act. She says can you do that, I’ve already paid. David says if I don’t appear you get a refund (partial) for hearing date. She said you can’t abandon us under legal practitioner’s Act, David says if you do not take my advice I can.”[107]
[107]CB 663
·Ms Finch said that this has been a “balls up” from the start.
·Ms Finch persisted in asking him to put that $10,000 had to be paid in order for the confidentiality clause to be included.
·There was debate about Mr Staindl’s professional obligations.
·The mediator said that this was a very good settlement – maybe it is time to let go. Ms Finch replied that she might walk away as it was about her life.
·Mr Staindl advised that a court may find that there was an agreement and it contained a full release. The other side might either run the case, or rely on the agreement which had been reached.
·There was then negotiation with Heat’s practitioners about various clauses in the Release. Heats agreed to amend various of the clauses, save for the “eee[108]” clause.
[108]It is unclear what this refers to or means
·Ms Finch said that if Mr Staindl would not represent her, then she would get another barrister.
·Ms Finch said she was tired and unable to continue. The mediator said to adjourn it to Wednesday for further mediation.
·The mediator advised that the mediation would be adjourned to Wednesday. Ms Finch said she did not want to come. The mediator said that she had to.
·Ms Finch said she needed to speak to a defamation lawyer in respect of a potential action against employees of Heat.
·Ms Finch said she was happy to go to court, she wanted the satisfaction of reporting them to the DPP.
·Ms Finch wanted an extra $10,000 for the clause to be withdrawn, plus one day of Mr Staindl’s fees. She then wants to check out a defamation suit.
·The mediator emphasised that if she went to court it would be unlikely she would get a better award than was proposed.
·Ms Finch said she had been advised by a few people she could get $75,000 at VCAT. She was also entitled to $66,000. She would report Heat to 60 Minutes. The mediator commented she might not win.
·The parties left at 7.00pm.
119 Ms Norman prepared a typed summary of her notes.[109] The date at the top, 30 October 2009, was wrong.
[109]CB 657-658
120 Ms Norman said that Ms Finch was being very erratic, jumping between what she had originally agreed to. She kept changing in relation to some clauses she wanted removed. It was a difficult negotiation. The mediator reinforced that it was a good settlement. Aside from taking notes, Ms Norman did not play any significant role in the conference or mediation.
121 Ms Norman agreed that Ms Finch objected to the generality of the form of the release.
The evidence of Jo-Anne Finch
122 Ms Finch was permitted to refer to the narrative as set forth in her affidavit sworn 30 June 2014.[110] Further, I permitted her witness statement of the 12 July 2017, to the extent it contained matters that were relevant, to stand as her re-examination.
[110]CB 122 and following
123 Ms Finch commenced proceedings in the Federal Court in 2012. She said that she was terminated from her employment with Heat in November 2010 without warning. She took the matter to the Fair Work Ombudsman and was paid an amount of money, possibly $14,000, as annual leave entitlement. She claimed she was owed further money by her former employer, and that is, in part, the subject of the claim to the Federal Court.
124 In the course of the mediation at the end of October/early November 2009, she said she did not want to sacrifice the various other claims she had outside VCAT when it came to discuss settlement. She did not think it was right to sacrifice those claims for the sake of costs which may be incurred in the VCAT proceeding.[111] Ms Finch said it was unfair that she was being pressured to settle the Federal Court and defamation proceedings when she was at the VCAT mediation. It was mentioned by Mr Staindl, on the Wednesday, about there being a general release. It had been mentioned by ATB before, but she would not have wanted to settle a Federal Court proceeding. An earlier firm of solicitors had raised a general release with her, and then ATB had some discussions on the point. There were discussions about a full release. She thought that the trial date for the hearing at VCAT would be adjourned to another date. She wanted to stick to the matter that was before VCAT. That was why she was not inclined to give a general release in respect of all other claims.[112] She wanted to obtain specialist advice on those other claims.
[111]T1507-8
[112]T151-2
125 Given Ms Finch’s affidavit sworn 30 June 2014 was admitted into evidence, I shall summarise what I understand to be the main points contained in that affidavit relevant to the issues in this proceeding:
(a) In around July 2008, Ms Finch retained ATB in relation to the VCAT proceeding. Ms Eleftheriou became her lawyer. ATB agreed to work on a “no win, no fee” basis. This was clear from various emails;[113]
[113]Exhibit JLF2 – email 13 August 2008
(b) On 20 August 2008, a conditional Costs Agreement and Disclosure Statement was sent to her by ATB;
(c) After enquiry, ATB advised that they would charge at $45 per quarter hour with a “success fee” reduced from 25 to 20 per cent.
(d) Ms Finch signed the Agreement and returned it, relying upon representations that the case would be conducted on a “no win, no fee” basis;
(e) On 26 October 2009, Ms Eleftheriou provided the witness statements of various employees of Heat, two days prior to the date of the scheduled hearing at VCAT;
(f) There were a further eight statements which had not been provided. Those further statements were not provided until 28 October 2009. They were extensive and lengthy;
(g) Ms Finch considered some of the matters raised in those statement as defamatory and would compromise her prospects of employment in the industry in the future;
(h) Eventually, in December 2009, Ms Finch’s reply to these statements went to 121 pages;
(i) Mr Harris of counsel was briefed to represent Ms Finch at VCAT on a “no win, no fee” basis. He was retained around 6 October 2008;
(j) There was no discussion about the financial details of Mr Harris’s retainer;
(k) Mr Harris notified Ms Eleftheriou that he would be unable to act three weeks prior to the hearing date. Ms Finch was not notified of this until 26 October 2009, three days prior to the hearing date;
(l) Ms Eleftheriou advised Ms Finch she would find a barrister who would be prepared to work on a “no win, no fee” basis;
(m) Ms Finch was subsequently advised that it would be necessary to brief a barrister on a fee-paid basis;
(n) Ms Eleftheriou advised she could not find a barrister to work on a “no win, no fee” basis;
(o) Ms Eleftheriou had found a Mr Staindl of counsel, but it would be necessary to provide $18,000 “up front” to pay his fees of $1,800 per day for ten days;
(p) Ms Eleftheriou did not:
“(a) seek my assistance, or advise me to try and find a Barrister;
(b) discuss the possibility of running the case without a Barrister;
(c) discuss the circumstances or conditions of payment with any other new potential Barristers I don’t believe, at least she did not mention this to me at all;
(d) address or discussed (sic) the fact that Mr. Staindl would be hired on a standard contractual basis; or
(e) advise me how the new Barrister, Mr. Staindl would handle my case; and in addition
(f) provide me with a statement setting out the details of Mr. Staindl’s fees as per the Plaintiff’s Disclosure Statement as raised above.”[114]
[114]CB 130
(p)Ms Finch became distressed that she had been late advised that she had to pay for a barrister;
(q)In fear of not being properly represented, Ms Finch paid the amount requested;
(r)On 26 October 2009, Ms Eleftheriou sent an email which provided various details of Mr Staindl’s retainer;
(s)Ms Finch made herself and her husband available for conferences, and it was not correct to suggest that there was any real delay on her part;
(t)Mr Staindl was not provided with the extensive documentation relating to the case until late, as a result of which he:
“… could not prepare adequately for the case, which was due to commence on 29 October. It was for this reason that I sought (and obtained) the client[’]s instructions to seek that the hearing be deferred.”[115]
[115]CB 133
(u)Ms Finch provided a cheque for $18,000 to Ms Eleftheriou on 28 October 2009;
(v)On 28 October 2009, at the conference with Mr Staindl and Ms Eleftheriou, initially the conference lasted only an hour. Mr Staindl advised Ms Finch that she had not had sufficient time to prepare the case and that she had not had sufficient time to reply to the lengthy witness statements filed on behalf of Heat;
(w)The conference was to resume on 29 October 2009 and Ms Finch was requested to bring a large number of documents to that conference;
(x)The next day, 29 October 2009, Ms Finch returned for a further conference with Mr Staindl, and Mr Kim Price, then an article clerk, was present;
(y)Mr Staindl spoke “very derogatively” about the case;
(z)At the tribunal, Mr Staindl sought a deferral of the case, and a Tribunal member, Ms McKenzie, ordered mediation to commence the next day;
(aa)The mediation commenced on 30 October 2009;
(bb)Ms Finch said she expressed concerns to Ms Eleftheriou that the mediation ought to be put on hold until Mr Staindl was fully across the case;
(cc)Mr Staindl did not read all the material Ms Finch had prepared, but talked about the case in a negative manner;
(dd)Mr Staindl pressured her to provide a figure to resolve the case. She was not comfortable with this;
(ee)Ms Finch became very distressed at being pressed to provide a figure to resolve the VCAT proceeding. That pressure continued in respect of Mr Finch’s husband;
(ff)A Deed of Release was provided which set out that Ms Finch should accept the sum of $115,000 and provide a release in respect of a range of matters and proceedings. It included that she was to resign and release all employment entitlements. She was required not to talk to anyone about the events surrounding her employment;
(gg)Ms Finch was advised that the matter could not be resolved unless she released all these matters and proceedings;
(hh)At one point, Ms Eleftheriou said she had to leave the mediation and was replaced by Mr Price, who was then replaced by Ms Norman;
(ii)Ms Finch denied that she did not follow reasonable advice in the course of the mediation;
(jj)Ms Finch continued to remain distressed about the settlement offer;
(kk)Ms Finch was not happy with her legal team. She was advised that unless she did not follow Mr Staindl’s advice, ATB would cease to act for her. She was not happy about this;
(ll)Ms Finch was pressed to remain in the mediation until 7.00pm. By this time she would not sign anything as she felt under duress;
(mm)On the next day of mediation, 2 November 2009, Mr Staindl and Ms Eleftheriou were present, although the latter not all day;
(nn)Ms Finch continued to press Mr Staindl that she required legal advice in relation to various other proceedings or issues, including defamation;
(oo)Ms Finch thought it was unfair that she would be pressed to obtain a settlement in these circumstances;
(pp)Ms Finch was owed various employment entitlements from Heat, including $12,000 for maternity leave, annual leave and severance pay of approximately $10,000, makeup pay of approximately $35,400, a total of about $57,400. This, together with approximately $71,000 in legal fees owed to various solicitors, brought the total to $128,000. If she had taken the settlement offer, she would have waived her right to her proper employment entitlements;
(qq)Ms Finch and her husband attempted to discuss other litigation with Mr Staindl, but it was clear that he was not across all issues;
(rr)Mr Staindl negotiated that if the matter was to be resolved, she would be provided with a Statement of Service;
(ss)Ms Finch advised Mr Staindl, at about 6.45pm, that she felt pressured and under duress to sign the document and would thus take it home for further consideration;
(tt)On the third day of the mediation, 4 November 2009, Mr Staindl and Ms Eleftheriou were in attendance;
(uu)Again, Ms Finch expressed her concern that Mr Staindl was not across her Tribunal matters and the lengthy documents involved;
(vv)Ms Finch expressed concern about some matters raised in Heat’s statements about her and thought she had the prospect of a defamation suit against those persons. She told Mr Staindl this was an additional reason to halt the mediation;
(ww)Ms Finch was not advised to seek independent advice;
(xx)Ms Eleftheriou did not call a halt to the mediation to obtain such advice;
(yy)We were in a conflict of interest situation and were acting in their own interests;
(zz)If Ms Finch were to sign the Release, she would lose the chance to bring a successful defamation proceeding;
(aaa)As a result, Ms Finch would not sign the Deed of Release;
(bbb)Any right Ms Finch had to bring a defamation proceeding had expired due to lapse of time;
(ccc)In order to properly advise in relation to the settlement, it was necessary for Mr Staindl and Ms Eleftheriou to understand the details of all of her past legal fees and full employment entitlements, which they were not;
(ddd)At this point, Mr Staindl said he would not adjourn the mediation and “was withdrawing his instructions and ceasing to act immediately”;[116]
[116]CB 147
(eee)ATB then advised that if Ms Finch did not accept Mr Staindl’s advice and take the settlement offer, that they would, too, cease to act;
(fff)Ms Finch said she did not terminate Mr Staindl’s services as he suggests. He withdrew and ceased to act;
(ggg)Ms Finch denied advising that she was dissatisfied with her legal team, although accepted she raised concerns about Mr Staindl’s advice, in particular, the release of future litigation against Heat, and entitlement to employment benefits;
[152]T1680
(k) She denied that she would ever use the term “legal team” in 2009, given that phrase was alleged to have been used by her in the course of the mediation,[153] yet it was clear from emails sent to Mr Flanagan shortly after the mediation[154] that she used that term on a number of occasions. Her attempted explanation[155] was made up on the spot;
[153]T1699
[154]CB 758, CB 772, CB 776, CB 780
[155]T1711
(l) Her evidence that Mr Staindl had changed his mind, and at one point told her that she would be successful and obtain damages of $40,000 at VCAT,[156] was in contrast to the notes taken by the various ATB lawyers present, and the advice of Ms Staindl. It was again made up on the spot;[157]
[156]T1717
[157]T1718
(m) Her claim that she did not want to terminate ATB’s retainer, nor for them to cease to act,[158] is entirely inconsistent with the fact that by 4 November 2009, she had a new “legal team”, being a Mr Jacka, who had, by the time the matter came before the Tribunal on 4 November 2009, already forwarded a letter that he was acting for her in the proceeding;[159]
[158]Affidavit at paragraph [121], CB 149
[159]T1763
(n) In her affidavit,[160] she claimed the previous barrister, Mr Harris, had advised her that her case was strong and that she would be successful. This stands in clear contrast to his email to Ms Eleftheriou of 16 December 2008,[161] where he noted the offer that had been made was a good offer and ought be accepted;
[160]Paragraph [136(d)], CB 154
[161]CB 534
(o) She claimed in her affidavit[162] that she had received incorrect advice regarding her WorkCover entitlements. However, that entitlement, if any, was specifically excluded from the Release;
[162]Paragraph [137(g)], CB 155
(p) She was very quick to blame most, if not all, the practitioners who had acted for her in the various proceedings, when the advice provided did not accord with her construction of the facts and her intended outcome. She was critical of counsel who represented her in the VCAT trial, Ms Duffy, saying that her Honour Judge Harbison had criticised Ms Duffy in her Judgment. However, her Honour said[163] that Ms Duffy had behaved in an exemplary manner and the failure of the case was due to Ms Finch’s evidence. She also made complaints about Mr Kotsifis,[164] and claimed a Mr Boden had settled her costs case for $180,000 without her instructions.
(q) Ms Finch confirmed, in cross-examination, that when a previous solicitor, Mr Sanna, was acting for her, Heat made an offer of $100,000 to settle a proceeding.[165] Subsequently, she produced two emails which were said to comprise the offer from Heat’s solicitors, Minter Ellison. Part of the emails[166] had been redacted. She said – “I’ve removed some personal details. It’s a – some of it’s about my daughter and her condition”.[167] In fact, the emails had been copied and pasted. One was not an email from Minter Ellison but, rather, an email from Ms Finch to Mr Sanna which did not contain an offer. She then claimed Mr Sanna had made the offer by telephone. When the redacted parts were closely examined by Mr Harrison, counsel for ATB, and his instructor, it became evident that part of the redacted words were to the effect that Mr Sanna had advised, on a number of occasions, that Ms Finch could lose her house. This evidence was not only inaccurate, it was calculated to deceive.
[163]Paragraphs [35]-[36], CB 337
[164]T1824
[165]T1519-1520
[166]T1742
[167]T1742, L24
148 I am buoyed in my assessment of Ms Finch’s credibility by clearly similar views taken by Judges in other proceedings. In the VCAT proceeding before her Honour Judge Harbison, she made a number of significant adverse credit findings and described her as a witness of little credibility.[168] She described Ms Finch as “stretching of the truth” and “evasive in answering questions and attempting to fashion what she thought was the best answer to fit the way she had pleaded her case”.[169]
[168]Finch v The Heat Group Pty Ltd (Anti-Discrimination) [2010] VCAT 802 at paragraph [78]
[169](Supra) at paragraph [79]
149 In the first trial, his Honour Judge Macnamara was also critical of Ms Finch’s evidence.[170]
[170]Arnold Thomas Becker Pty Ltd v Finch [2015] VCC 1431 at paragraphs [146]-[162]
Credibility of the other witnesses
150 As stated, I permitted Mr Ndiege to tender into evidence two affidavits of 13 September 2013 and 9 September 2014. Counsel for ATB did not have the opportunity to cross-examine him. Mr Ndiege’s affidavits are of little assistance. There was little reference to the crucial issues, in particular, precisely what was said around the time ATB and Ms Finch parted company. The affidavits are supportive of Ms Finch. I do not consider them independent, and pay little regard to the contents. I accept the submissions of ATB in respect of his evidence.[171]
[171]Paragraph [63]
151 The principal witnesses called on behalf of ATB were Ms Eleftheriou, Mr Price and counsel, Mr Staindl.
152 Ms Eleftheriou and Mr Price were, at the time, junior lawyers. Their recollection of events was limited, but supported by extensive file notes. Each confirmed that the file notes recorded what was discussed at the time. I was impressed with the evidence of both Ms Eleftheriou and Mr Price. They made sensible concessions when called upon. Ms Eleftheriou admitted that she was not experienced in employment law and had probably “dropped the ball” in some aspects of the preparation of the witness statements for the VCAT hearing. I accept the file notes of each of those practitioners as accurately recording the events which transpired.
153 I was particularly impressed with the evidence of Mr Staindl. I assess him as an experienced and competent practitioner in employment and industrial law. He had a reasonable recollection of events, and the two memoranda he forwarded were comprehensive, and, I assess, accurate. I accept his evidence, both oral and as reflected in his memoranda, of the events which transpired over the days of the mediation. I accept he gave careful and considered advice to Ms Finch about the offers being made by Heat, the prospects of her being successful in other potential proceedings in the Federal Court and the extent of the release which she was required to give if the offer was to be accepted. I accept, without reservation, his assessment that under no circumstances was Heat prepared to make an offer of settlement, save with a full release against all claims arising out of employment.
154 I further accept the evidence of Ms Dolley in relation to the enquiries she made as to the availability of barristers prepared to take on Ms Finch’s case. I further accept the evidence of Ms Norman as to the accuracy of the file notes taken during the course of her involvement in the mediation.
Analysis of the facts
Ms Finch makes a range of allegations in her Counterclaim. She alleges breach of retainer, negligence, misleading and deceptive conduct in trade or commerce, equitable estoppel and damages as a result. At this stage, I will analyse the factual allegations Ms Finch makes in the Counterclaim. It should be borne in mind Ms Finch’s case is only directed to ATB and not Mr Staindl.
ATB failed to retain Counsel on a “no win, no fee” basis
155 It is not clear whether the Costs Agreement, said to constitute the retainer, at least that part of it that was in writing, was tendered into evidence. However, I shall presume that the Costs Agreement was the written basis for the retainer between the parties.
156 There is no reference in the Costs Agreement to counsel being retained on a “no win, no fee” basis. However, the attached document, “Disclosure Statement”[172] contains a number of provisions in respect of barristers’ fees. Clause 1, in reference to disbursements, refers to expenses, including barristers’ fees, which are required to be paid by the client. Somewhat in contrast, paragraph 11 of the document says:
“Engagement of another lawyer …
We may need to engage on your behalf a barrister or other lawyer to provide specialist advice or services. We will consult you about the terms of this engagement and provide you with a statement setting out the details of this person’s fees before incurring the expense.
We engage barristers on a no win/no fee basis and in the event that your case is unsuccessful and that you accept reasonable advice, the barristers that we engage will not charge a fee for work performed.”[173]
[172]CB 182
[173]CB 185
157 I am satisfied from the evidence of Ms Eleftheriou and Ms Dolley that extensive attempts were made to retain a barrister to appear at VCAT on a “no win, no fee” basis.[174] They were not able to do so. I am satisfied, despite those attempts, there were no sufficiently experienced industrial barristers available to handle Ms Finch’s case on this basis. To the extent there was a term of the retainer that only barristers would be retained on that basis, then that term became frustrated.
[174]CB 561-581
158 In her email to Mr Flanagan of 8 November 2009, Ms Finch, in referring to earlier Counsel, Mr Peter Harris, who had refused to take the trial brief, said:
“… Had Anastasia told me that my previous Barrister had ceased to act for me, I would have organised a payment and Mr Harris would have been there and not Mr Staindl … .”[175]
[175]CB 774
159 Of most significance is the email from Ms Finch to Ms Eleftheriou of 26 October 2009. She described the appointment of Mr Staindl, who she noted as quite experienced in the jurisdiction, as “good news”. She expressed clear agreement that she was prepared to pay the $18,000 required for the ten-day hearing.[176] That sum was promptly paid.
[176]CB 615
160 To the extent that the retainer contained a condition requiring counsel to be appointed on a “no win, no fee” basis, I find that clause was the subject of an oral amending term, reached a short time before the matter came to hearing to the effect that counsel was to be briefed on a fee-paying basis.
161 A written agreement may, in certain circumstances, be varied by oral agreement between the parties. This was one of those circumstances. It was necessary to amend to give effect to the fact that the term was frustrated, and was agreed to by the parties
Failure to obtain an adjournment
162 It is clear from the evidence of Ms Eleftheriou that there was a degree of late preparation prior to the first day of trial, 28 October 2009, although the timetable for the provision of witnesses’ statements was met. Mr Staindl was only briefed two or three days beforehand and had to deal with a large amount of material encompassed in some five folders. In part, this was due to the witness statements of the respondents not being provided until about 23 October 2009. This left little time to digest what Heat’s witnesses were to say in response.
163 I accept the evidence of Mr Staindl that he found it difficult to get across all of the material and to sufficiently prepare the proceeding for hearing. He expressed this concern to the Deputy McKenzie on the first day. To the extent that Ms Finch alleges Ms Eleftheriou ought to have obtained an adjournment before 28 October 2009, I am satisfied that such an application would have had little or no prospect of success. It is the common practice in most courts and tribunals that any application to adjourn a matter within several days of the trial date would have been referred for a consideration by the trial judge or trial member. In any event, when the matter came on for hearing, and Mr Staindl expressed his reservations about being in a position to proceed, Deputy President McKenzie, probably taking into account Mr Staindl’s view that he was not without hope of a resolution of the proceeding, turned the trial into a mediation before a Tribunal appointment mediator. Mr Staindl indicated he would have liked the mediation to be delayed for a number of days, but the Tribunal Member determined it was appropriate that it commence straight away. The mediation then progressed over three days. I am satisfied that Mr Staindl had sufficient time to prepare the case to ensure he was in a position to properly advise Ms Finch, and to enter negotiations in an attempt to resolve all of the issues. He was able to make a preliminary assessment of how Ms Finch was likely to present as a witness (which turned out in the end to be accurate).
164 Those days of mediation was time well spent, in the sense that Mr Staindl was able to extract what I am satisfied was a generous offer from Heat, which surpassed any offer which had previously been made and which, as things turned out, it would have been very wise to accept.
165 There is no merit in Ms Finch’s allegation that ATB were negligent or in breach of the retainer in failing to obtain an adjournment of the proceeding.
Failing to obtain all appropriate witness statements
166 This allegation suggests that ATB ought to have obtained more, or more extensive, witness statements from Ms Finch’s witnesses. Allied to this allegation raised in the course of evidence, was that ATB had failed to subpoena those witnesses.
167 It is clear from the evidence that ATB was provided with a large list of potential witnesses by Ms Finch. Of the many names provided, twenty-five or twenty-six, only eight were prepared to provide statements and give evidence. There was no point in subpoenaing witnesses who were either not prepared to give evidence, or whose evidence was irrelevant.[177]
[177]T1262-3
168 The obligation was upon Ms Finch to provide details of the witnesses who were prepared to assist her cause. Few were.
169 There is no merit in this allegation.
Failing to ensure Counsel was properly briefed
170 Ms Finch made vague allegations that the brief to Mr Staindl did not contain relevant documents. However, there was no real evidence to support such an allegation. Mr Price gave evidence that he considered, given he was at the mediation, that Mr Staindl was properly briefed and adequately prepared on the morning of 30 October 2009.[178]
[178]T1356
171 Mr Staindl said in evidence that aside from the matter of defamation, which was an area in which he was not particularly experienced, he believed he was in a position to advise not only in respect of the VCAT proceeding, but in respect of the various other allegations made by Ms Finch arising out of her employment, and for which she expressed a desire to litigate in the Federal Court.
172 I am satisfied that Mr Staindl was briefed with sufficient material not only to advise as to resolution of the VCAT matter, but in addition, to provide Ms Finch with adequate and appropriate advice as to the nature and extent of the Release she was being requested to sign, and the merit of her other claims in the Federal Court.
The termination of the retainer
173 Ms Finch maintained that it was ATB which terminated the retainer. According to her Counterclaim, she said ATB withdrew its services without good cause; alternatively, terminated the retainer without good cause; alternatively, purported to terminate the retainer in the absence of reasonable advice. I am satisfied none of these grounds are made out.
174 It is clear that significant time and effort was involved in negotiating a resolution that ended in an authority to settle being signed by Ms Finch, that she would resolve the VCAT proceeding for $115,000 with a general release. On Friday, 30 October 2009, Ms Finch determined that she wanted to think about matters over the weekend. No doubt it had been a long and gruelling mediation to that point. When she returned on Monday, 2 November 2009, she had decided to withdraw her offer. At that point, there was no doubt advice both from ATB and Mr Staindl that if she wished to persist with her rejection of the offer, then she would be “failing to take reasonable advice” in accordance with the Costs Agreement. That would then entitle ATB to charge for its services, and require payment for costs up front.
175 However, I am not satisfied that that was what brought about the end of the retainer. Up to that point, while there was discussion about whether Ms Finch was prepared to act upon reasonable advice, the retainer was still alive. Efforts were still being made to settle the case. There was no point reached where Mr Staindl or ATB said – “the retainer is at an end because you are not prepared to accept reasonable advice and settle the proceeding as you had agreed on Friday, or alternatively agree to pay legal costs and disbursements”, or anything to that effect.
176 It was clear from the evidence of Ms Eleftheriou that Mr Staindl was advised by Ms Finch that she “does not have confidence in legal team”.[179] I accept reference in Ms Eleftheriou’s notes to that effect as accurate. Mr Staindl’s evidence on the point was clear.[180] Ms Finch said she did not have confidence in her legal team. I accept his evidence, and reject the version put by Ms Finch. He regarded those words as critical.[181]
[179]CB 735; T818
[180]T955-6
[181]T955
177 This came about when Ms Finch sought to revoke the offer she had agreed to. She apparently considered the proposed settlement and the release which she was required to give failed to take account of various other claims she sought to prosecute in other places. According to Ms Eleftheriou’s file note, Ms Finch’s husband expressed the view that Mr Staindl and ATB were not on her side.[182] A document was produced which set out a litany of complaints (“barrister and lawyer issues”) against the practitioners and the advice they had given. This was hardly an environment where Mr Staindl, and ATB, could feel they had Ms Finch’s confidence and could properly represent her.
[182]CB 694
178 Mr Staindl said that when he told her he could not act because of her lack of confidence, Ms Finch agreed. Even when faced with the prospect of not having counsel, she did not retract those words. All Ms Finch wanted was for Mr Staindl to apply to have the proceeding adjourned. Mr Staindl, quite properly, considered that his brief had been terminated. I am satisfied the phrase “lost confidence in my legal team” had equal application in respect of ATB.
179 In an email to Mr Flanagan of 8 November 2009,[183] Ms Finch confirmed that she did “disengage” the services of Mr Staindl when she provided him with a litany of complaints.
[183]CB 772
180 Ms Finch said that she had a clear recollection of what occurred over those days of the mediation. Yet in her voluminous affidavit, precisely what occurred at the time was addressed in only several short paragraphs.[184]
[184]CB 147-8
181 As was suggested to her in cross-examination, I am satisfied Ms Finch was “second guessing” ATB, as she had done with the various previous solicitors. Prior to the attendance before the Tribunal on 4 November 2009, I am satisfied Ms Finch had obtained legal advice from another lawyer, Mr Jacka. When it was announced to the Tribunal that Mr Staindl and ATB had had their retainer determined, the Tribunal noted that at that time, it had received correspondence from Mr Jacka which indicated he appeared for Ms Finch. It is hardly a sign of confidence in legal representatives that another lawyer had been retained to give advice.[185]
[185]T1810
182 I am satisfied that Ms Finch had no real interest in settling the matter even although she had signed an authority accepting the proposed settlement. She rather, wanted her day in court on the false assumption that her case would succeed, and the evidence to be given by the witnesses from Heat would not be accepted. That turned out not to be the case.
183 In her submissions, Ms Finch made reference to Tomasevic v Melbourne Injury Lawyers.[186] She suggested that even if it were found that she had said he had lost confidence in her legal team, that was not sufficient to determine the retainer. Tomasevic was a case where solicitors sought to file a notice ceasing to act on a range of grounds, including that the client said that he did not trust his solicitors, that he was being provided with incorrect information and had become abusive. He was suffering from a psychiatric condition at that time. Hargrave J upheld the determination of an Associate Justice granting leave for the solicitors to withdraw. He said the evidence had demonstrated an irretrievable breakdown of trust and confidence between the firm and Mr Tomasevic. If anything, the case supports the proposition that a breakdown of confidence is sufficient to terminate a retainer, although, it must be said, that the facts were significantly different from the present case.
[186][2014] VSC 434
184 I am satisfied Ms Finch clearly expressed a lack of confidence in ATB and Mr Staindl. That, in combination with the provision of a litany of complaints against the advice she was being given, questioning their loyalty, seeking to withdraw from the offer which had been made on her authority, and obtaining other legal advice, all constituted a dismissal of both Mr Staindl and ATB. I am satisfied both Mr Staindl and ATB were left with no option other than to announce to the Tribunal they could no longer represent Ms Finch.
The failure to exercise reasonable care and skill and to provide appropriate advice
185 Ms Finch makes various allegations. These include failing to properly assess the merits of the case, and failing to take account of, and provide advice as to, Ms Finch’s other entitlements, in particular, in the Federal Court.
186 Ms Finch had received advice from other practitioners she had retained as to the prospects of the VCAT proceeding. Despite her evidence that she had been told she had good prospects, Ms Hamnett, barrister, in 2008, after a conference, said that even at its highest, if she were successful, she was likely to receive compensation of somewhere between $5,000 and $100,000, and probably at the lower end of that scale. Ms Hamnett suggested a counter offer of $75,000. Further, Ms Hamnett said that in the event Ms Finch did not follow her recommendation, she would elect not to represent her further.
187 EMA Workplace Lawyers, who had previously acted for her, suggested an offer of $75,000 to $100,000, inclusive of costs, be made, in June 2008.[187] Further, by letter of 6 August 2008, EMA said:
“You have been advised on a number of occasions that the terms of any proposed settlement will include all possible claims inclusive of any Federal Court proceedings (we refer to our letters dated 8th April 2008, 27th May 2008, 29th May 2008, 4th June 2008 and two telephone attendances with you during that time). To that end the matter was raised with Ms Bornstein who provided a preliminary view that was consistent with our recommendation that you provide instructions to obtain advice from a barrister with respect to the matters relevant to the personal injury and bullying allegation in Federal Court proceedings generally. We advised you that this would incur a cost to you requiring the replacement of monies in trust and have requested your instructions. You have not instructed us to obtain such advice.”[188]
[187]CB 427
[188]CB 465
188 The letter went on:
“It has become apparent to us that you continue to question our advice, conduct, judgment and commitment to your case. While we reject that we have in any way acted other than in your best interests it is equally apparent that we cannot continue to act in circumstances where you make plain that you have no trust or confidence in us or in our advice or conduct. Further, you make assertions which are plainly wrong on an examination of the file. Even in your most recent correspondence you have wrongly asserted that I have not spoken with Frank Sanna your former solicitor about offers and that you have not been advised with respect to any Federal Court matter. We note that you have not responded to our invitation to meet with you to discuss the current progress of your matter. However, as a consequence of your letter we do not believe that a meeting would establish a proper basis of trust and confidence upon which we may continue to act for you.”[189]
[189]CB 465
189 Those comments mirror Ms Finch’s subsequent attitude towards ATB.
190 Later, when ATB took over Ms Finch’s file, they received clear instructions from her in December 2008 to put an offer of $115,000 with a release against other employment claims. The letter confirmed that should a responding offer be made of $75,000 to $115,000, ATB strongly advised her to accept such an offer.[190] The offer made by ATB on Ms Finch’s behalf was undertaken after a conference with the previous barrister, Mr Harris.
[190]CB 538-539
191 There can be no doubt she was given extensive and reasonable advice by a range of legal practitioners about her prospects in the VCAT proceeding.
192 Ultimately, in the course of the mediation, Ms Finch was advised that she ran the risk of a costs order being made if she did not obtain an award of more than $75,000 given this had been offered by the solicitors for Heat. Indeed, this advice proved prophetic given the costs order made against her subsequently by her Honour Judge Harbison.
193 It is clear Mr Staindl gave advice in respect of the VCAT proceeding. Having read the Heat witness statements, he determined them as being impressive, and contradicting the version of events given by Ms Finch. Further, he considered, accurately as things turned out, that Ms Finch would not make a good witness. Even the mediator who was present during the course of the mediation advised Ms Finch that if she obtained a settlement of less than $75,000, she would be at risk as to costs. The mediator further considered that the ultimate offer of $115,000 ought be accepted.
194 Again, this was appropriate advice.
195 It was clear from the outset that Heat were only prepared to treat on the basis that Ms Finch would give a full release against any claims arising out of her employment. Such a tactic is common in proceedings of this nature, and enables a respondent to “close the books” on an ex-employee and any claims that person may have in other jurisdictions. Ms Finch’s claim that she was not advised or concerned about the nature and extent of such a release is disingenuous given she received comprehensive advice in that regard at an earlier time from Ms Oberdan of EMA.[191] Ms Oberdan said:
“… Minter Ellison indicated that their client would only be interested in resolving all issues arising out of your employment not just the VCAT matter. They will seek a standard form of release from you, which as advised to you at length, will most likely include all matters arising out of or in connection with your employment. It is my understanding that any such release will extend to any actions in other jurisdictions if the claims arise out of or in connection with your employment, but will not include your workers compensation claim as it arises out of the Accident Compensation Act which the Heat Group is unable to contract out of its obligations in relation to that legislation and superannuation legislation.”
[191]CB 469
196 Notwithstanding this advice, I am satisfied from the evidence that Mr Staindl did, indeed, provide advice to Ms Finch in respect of her other claimed entitlements. He advised her that he did not think there would be any significant claim in respect of her maternity leave and makeup pay.[192] Further, it was clear from Mr Staindl’s evidence that in advising her to resolve the VCAT proceeding for $115,000, he took account of the prospects of her entitlement in those areas.
[192]T911, 912, 916
197 It would appear that Ms Finch did have some entitlement to long-service leave, as in January, and then April 2012, she received a total of about $10,200 after she had made application to the Fair Work Ombudsman in respect of annual leave payments.[193] Accepting that the general Release which she was being asked to sign may have disentitled her to claim long-service leave, and further, factoring in that a claim she made was for a period beyond November 2009, nonetheless, the generosity of the $115,000 offer left adequate room for such a claim. In addition, it may have been Ms Finch was entitled to “makeup” pay under the Commercial Sales (Victoria) Award which provided for a maximum of nine months’ makeup pay.[194] Allowing $300 per week (which would seem very generous) for makeup pay, would allow approximately $12,000. I am again satisfied that the offer from Heat was adequate to contemplate such an allowance.
[193]Exhibit 12
[194]T1575-6
198 Amongst various claims in her affidavit was a claim for $16,200 for superannuation. In cross-examination, she was entirely incapable of justifying how the sum was arrived at.[195]
[195]T1649, 1654
199 In relation to defamation, I am satisfied that the first time Ms Finch raised this was Monday, 2 November 2009. It was apparently prompted by some of the comments made by witnesses in the Heat witness statements. She did not provide any instructions to ATB to consider a defamation proceeding. Whilst Mr Staindl agreed in evidence that he was not experienced in the jurisdiction, he nevertheless indicated to Ms Finch, presumably based on his assessment of her as a witness, that he did not think the prospect of obtaining any award in a defamation proceeding was significant.
200 All in all, ATB, her previous solicitors, and particularly Mr Staindl, gave Ms Finch advice about all of the other potential entitlements which Ms Finch considered she may be entitled to, arising out of her employment. Aside from the matter of defamation, Ms Finch was unable to suggest any other area of employment-related entitlement in respect of which she did not receive advice.[196]
[196]T1729
201 For reasons which are not clear, and having agreed to resolve the matter and signing an authority to that effect, Ms Finch withdrew her agreement on 4 November 2009. She may have received different advice from another lawyer, Mr Jacka. She may have decided that she wanted to prosecute her claim, and call Heat’s witnesses to account. She may have decided, despite all the extensive advice she had received, that she was in a better position to make an assessment of her claim than was anyone else. Whatever the reason, it was an ill-considered decision given the ultimate finding at VCAT. The decision of her Honour Judge Harbison made it clear that she did not accept the evidence of Ms Finch and preferred the evidence of the Heat witnesses. Ms Finch’s case was dismissed on all grounds.
202 After the conclusion of the VCAT case, Ms Finch took proceedings in the Federal Court.[197] There were a raft of Rulings made on various issues and eventually, Ms Finch’s claim was dismissed on a pleading summons, albeit with a right of reinstatement.[198] The application was made on the grounds that the Statement of Claim was ambiguous, had no reasonable prospects of success, was vexatious, that it was an abuse of process and did not disclose a reasonable cause of action. Ms Finch, in the Federal Court, made a number of claims for which she said she was entitled to damages. They were claims arising out of her employment with Heat, including the circumstances of a termination, the many grievances she alleged occurred in the course of her employment and warnings and reprimands to which she was subjected, contractual damages based upon alleged pecuniary loss, and defamation. Jessup J said:
“On 29 October 2008, the applicant commenced a proceeding in VCAT. All of the present respondents, save for Mr Scotti, were respondents to that proceeding. The applicant alleged that those respondents had, in contravention of the Equal Opportunity Act 1995 (Vic) (‘the EO Act’), discriminated against her by reason of her sex, her impairment and her pregnancy. She also alleged sexual harassment and victimisation. At the hearing, the applicant was represented by counsel.”[199]
[197]Finch v The Heat Group Pty Ltd VID 704 of 2012
[198]Finch v The Heat Group Pty Ltd (No 5) [2016] FCA 191
[199]Finch v The Heat Group Pty Ltd (No 5) (ibid) at paragraph [91]
203 His Honour noted the claim was dismissed, along with subsequent appellate procedures. He said:
“It is true that the applicant’s case in VCAT relied only on the EO [Equal Opportunities] Act, whereas she relies now on the common law of negligence, on contract, on the TP [Trade Practices] Act, on the OHS [Occupational Health and Safety] Act and on the law of defamation. However, any viable cause of action that the applicant had in any of these areas was available to her when she commenced, and prosecuted, her proceeding under the EO Act. I was not addressed on the question whether VCAT had jurisdiction to adjudicate on the causes of action upon which the applicant now relies; nor, for that matter, upon the question whether there was a court that had jurisdiction to adjudicate on those causes of action as well as on the applicant’s claim under the EO Act. But, assuming, favourably for the applicant, that there was no means by which she could, contemporaneously, have relied on all those other causes of action and on the EO Act, I would nonetheless hold it to be vexatious, and in that sense an abuse of process, for her now to repackage what are substantially, if not wholly, the same issues and irritations on which she lost in VCAT as an ostensibly fresh proceeding in this court.”[200]
[200]at paragraph [95]
204 His Honour struck out the pleading, albeit allowing Ms Finch to bring a further pleading confined to the allegation of termination of her employment under the Disability Discrimination Act 1992 (Cth), providing she lodged $25,000 as security for costs, such amount to be provided within 28 days. Given that sum was not paid, Ms Finch’s claim in the Federal Court stands as struck out.
205 Thus it is clear there was little merit in any of Ms Finch’s claims to damages in the Federal Court. However, it is not appropriate to consider the matter with the wisdom of hindsight. What is relevant was the advice Ms Finch received in the course of a mediation in November 2009. The Judgment of her Honour Judge Harbison in 2010, and the Ruling by Jessup J in the Federal Court in 2016 do suggest the advice given by ATB and Mr Staindl was sound and reasonable.
206 Further, to the extent Ms Finch claims she was entitled to a range of employment-related awards, be it maternity leave, makeup pay, long service leave or any other amounts under awards or entitlements, and in respect of defamation, there was no evidence, particularly expert evidence, that she had any real prospect of success or entitlement to damages. It was simply Ms Finch’s assertion to that effect. I do not accept her evidence or her assertions that she had any viable claims.
207 In all respects, Ms Finch’s claim in respect of the advice with which she was provided, or the conduct of ATB fails.
Conclusions
Various other claims alleged by Ms Finch
208 According to her Counterclaim, Ms Finch alleges ATB repudiated the retainer without good cause, which repudiation was subsequently accepted by Ms Finch. Given my findings that the retainer came to an end by Ms Finch determining it, this allegation does not have merit.
209 Ms Finch further alleged ATB was guilty of misleading and deceptive conduct in trade or commerce, in that ATB represented it would act in the VCAT proceedings on a “no win, no fee” basis, which representation Ms Finch relied upon. She further claims that given ATB unilaterally withdrew its services without good cause, the representation was false. Further, in demanding counsel’s fees of $18,000 in October 2009, despite the terms of the retainer that counsel would be retained on a “no win, no fee” basis, and acting upon that representation, again, ATB was guilty of misleading and deceptive conduct.
210 Again, given my findings as to fact that the retainer was brought to an end by the conduct and statements of Ms Finch, and further, that there was a further oral amending term of the retainer that counsel would be briefed on a fee-paying basis in the event no counsel was prepared to act on a “no win, no fee” basis, there was no representation relied upon by Ms Finch to her detriment.
211 Ms Finch alleges an equitable estoppel arose by reason of the representations made by ATB as above. Again, my findings as to fact preclude any such estoppel as arising.
Damages
212 Even if she had made out any breach of duty of care, breach of retainer or any other cause of action, I am not satisfied that any conduct by ATB was causally related to any alleged loss and damage. The fact of the matter was that when Ms Finch and ATB parted company on 4 November 2009, Ms Finch retained other solicitors to act on her behalf. Ms Finch has not established that any conduct by ATB had anything to do with the dismissal of her claims at VCAT. Given the findings of his Honour Judge Macnamara, ATB were not entitled to charge professional fees in relation to the VCAT proceeding. Given what transpired in the course of the mediation, in my view, it was probable Ms Finch would have engaged other solicitors in any event.
213 Ms Finch has not established that any conduct by ATB resulted in any significant change to the way that the proceeding would have continued.
214 While it is not necessary to determine the issue finally, I am not satisfied that Ms Finch has proved that, even accepting the conduct of ATB was negligent or in breach of its retainer, that any damage arose as a result. Her claim to “lost settlement opportunity damages” is entirely without merit. There is no evidence to suggest that the conduct of ATB during the mediation lost the chance to secure a more favourable settlement. Equally, her claim for general damages for anxiety, inconvenience, distress and depression is without any evidentiary basis or merit. Her claim for “replacement legal damages” and “consequential replacement damages” is based upon a claim that she was compelled to retain new solicitors on a fee-paying basis. However, again, it is based on the tenet that it was ATB who terminated the retainer, and not Ms Finch. She determined ATB should not act further and it was her choice to retain other solicitors.
215 In summary, no loss and damage is proved.
216 Consequently, Ms Finch’s counterclaim fails.
217 I shall hear from the parties as to costs, and other consequent orders.
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