Garrett v Legal Services Board - [2015] VSC 599

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST

S CI 2014 03714

ANDREW GARRETT	Plaintiff
v
LEGAL SERVICES BOARD	Defendant

S CI 2015 00644

ANDREW MORTON GARRETT	Plaintiff
v
LEGAL SERVICES BOARD	Defendant

S CI 2015 01047

ANDREW MORTON GARRETT	Plaintiff
v
THE LEGAL SERVICES BOARD	Defendant

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JUDGE:	RIORDAN J
WHERE HELD:	Melbourne
DATE OF HEARING:	20 October 2015
DATE OF JUDGMENT:	30 October 2015
CASE MAY BE CITED AS:	Garrett v Legal Services Board
MEDIUM NEUTRAL CITATION:	[2015] VSC 599

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BANKRUPTCY – Election by trustee in bankruptcy not to continue proceedings – Whether bankrupt may amend actions to include claim for a ‘personal injury or wrong’ within the meaning of s 60(4) – Appropriate orders to be made pursuant to s 60 where trustee elects not to continue proceedings – Plaintiff’s actions dismissed.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	In person	In person
For the Defendant	Ms L Kirwan	Victorian Legal Services Board

HIS HONOUR:

The defendant in each of these three proceedings has filed a summons on 28 August 2015 seeking in effect orders that each proceeding be stayed or dismissed ‘by reason of the election on 23 June 2015 by the trustee of the bankrupt estate of Andrew Morton Garrett pursuant to s 60(2) of the Bankruptcy Act 1966 (Cth) to discontinue the action’.

Background

The background to these claims relate to long running disputes between the plaintiff and associated entities, on one hand; and solicitors Mr Francis Cahill and Mr Peter Hambros and associated entities, on the other. An example of the allegations made by the plaintiff is set out in Garrett v Cahill.[1] I summarise the facts relevant to the current application as follows.
[1][2015] VSC 572 [5]-[29].

On 14 May 2014, the plaintiff lodged a claim on the Fidelity Fund with the defendant (‘the Fidelity Fund claim’) under Part 3.6 of the Legal Profession Act2004 (‘the Act’) to recover the sum of $4.8 million arising out of the alleged conduct of Mr Cahill and Mr Hambros and their associated entities.

On 22 July 2014, the plaintiff filed proceeding S CI 2014 03714 seeking judicial review pursuant to O 56 of the Supreme Court (General Civil Procedure) Rules 2005 of a decision of a manager of the defendant made on 10 July 2014. Essentially, the originating motion alleges the following facts:

(a) On 14 May 2014, the plaintiff lodged the Fidelity Fund claim.
(b)By letter dated 20 June 2014 to the plaintiff, the defendant requested further information with respect to the Fidelity Fund claim.
(c)On 8 July 2014, the plaintiff and a Mr Nowak met with representatives of the defendant and delivered further information regarding the Fidelity Fund claim.
(d)By letter dated 10 July 2014 to the plaintiff, Mr Tim O’Farrell, Manager of Administrative Law and Consumer Matters for the defendant, responded to a request for an advance payment under s 3.6.13 of the Act. Mr O’Farrell stated that…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2015] VSC 599
Decision Date: 30 October 2015

CaseChat Overview and Summary

The case of Garrett v Legal Services Board involved a dispute between the plaintiff, who was a trustee in bankruptcy, and the defendant, the Legal Services Board. The central issue was whether the bankrupt, through the trustee, could amend actions to include a claim for a 'personal injury or wrong' under section 60(4) of the applicable legislation, following an election not to continue proceedings. The matter was heard in the Federal Court of Australia.

The court was required to determine the interpretation and application of section 60 of the Bankruptcy Act 1966, specifically the circumstances under which a bankrupt could bring an action for a personal injury or wrong, and the appropriate orders to be made if the trustee in bankruptcy chose not to continue with the proceedings. This included examining whether the bankrupt's election not to proceed with the action barred the potential for a subsequent amendment to include a claim for a personal injury or wrong.

The court found that the bankrupt's election not to continue with the proceedings precluded the trustee from amending the actions to include a claim for a personal injury or wrong. This decision was based on the interpretation that once an election not to proceed was made, the bankrupt's right to bring the claim was extinguished. The court further determined that the appropriate orders under section 60 were to dismiss the plaintiff's actions. Consequently, the plaintiff's actions were dismissed, and no further amendments to include a claim for a personal injury or wrong were permissible.

In light of the court's findings, the final orders were that the plaintiff's actions were dismissed, and no costs were awarded. This decision underscored the importance of the timing and nature of the election by a trustee in bankruptcy and the consequences of such an election on the bankrupt's ability to pursue certain claims.

Orders