Gentry Bros. P/L v Wilson Brown & Associates P/L
[1994] FCA 840
•21 OCTOBER 1994
GENTRY BROS. PTY. LTD. v WILSON BROWN and ASSOCIATES PTY. LTD., BRUCE JAMES
BROWN, ANSCAPE PTY. LTD., BRIAN JAMES CLARKE, JAMES GENTRY AND CIARAN GENTRY
No. QG93 of 1992
FED No. 840/94
Number of pages - 4
Solicitor's Lien
COURT
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
KIEFEL J
CATCHWORDS
Solicitor's Lien - solicitors withdraw from action - professional fees disputed - conditional release of litigation files to new solicitors.
Gamben Chemical Ltd. v. Rochem Limited (1980) WLR 614
CCOM Pty. Ltd. v. Jiejing Pty. Ltd., a decision of Cooper J, unreported, 24 June 1992
HEARING
BRISBANE, 20 October 1994
#DATE 21:10:1994
Counsel for the Applicant: Mr P Feely
Solicitors for the Applicant: Roberts Mason and Company
Counsel for the Respondent: Mr C L Francis
Solicitors for the Respondent: Sutherlands
ORDER
1. UPON the applicant's solicitors undertaking to the court:
(a) To hold all papers and documents delivered to them under this
order by Sutherlands solicitors subject to any lien of Sutherlands;
(b) To return the said papers and documents to Sutherlands
forthwith after conclusion of the action;
(c) To prosecute the action in an active manner;
(d) To allow Sutherlands, or any person authorised by that firm
reasonable access to the documents and papers for the purposes of responding to the Queensland Law Society Incorporated, preparing a bill of costs, attending to taxation of the bill of costs, and for the purpose of litigation with respect to their costs.
2. The applicant pay to the trust account of Sutherlands, the sum of
$2,087.50 in respect of Sutherlands disbursements within fourteen
(14) days from the date hereof without prejudice to their rights to recover the balance, if any, of such costs.
3. Sutherlands retain such sum in their trust account pending the
determination of taxation of their bill of costs or order pronouncing their entitlement to that sum or upon written agreement of the parties to the release of that sum.
4. Sutherlands deliver to the applicant a bill of its costs for the
period 13 October, 1992 to 9 July, 1993 in taxable form within thirty (30) days from this date, AND UPON THOSE ORDERS I DO FURTHER ORDER THAT:
5. The respondents, Sutherlands, forthwith deliver to Roberts Mason
and Company, solicitors, all papers in application G93 of 1992 and all other documents in the custody or power of Sutherlands relating to the said proceedings or belonging to the applicant or its directors.
6. The applicant pay the respondents' costs of and incidental to this
application to be taxed and paid forthwith.
NOTE: Settlement and entry of orders is dealt with in Order 36 of the
Federal Court Rules.
JUDGE1
KIEFEL J Gentry Bros. Pty. Ltd. is the applicant in proceedings against four respondents concerning the sale of some properties which proceedings have been on foot for some time. I shall not detail all of the issues in those proceedings. It is sufficient for present purposes to observe that they are reasonably complex. More relevantly, the proceedings have progressed to the point where the matter is now set down for hearing in February, 1995 for ten (10) days, and I take it the preparation of the applicant's case was reasonably well advanced at the time its former solicitors, the respondents to this application, ceased to act for them in July 1993.
The respondents, the firm Sutherlands, had acted for the applicant from the commencement of the litigation in October, 1992. During the course of a mediation in the middle of last year, one of the directors of the applicant and the person I take to have had the conduct of the action for the applicant expressed concern as to whether the respondent was acting in the applicant's best interests and said that independent advice would be obtained. The exact terms, however, of the conversations are in dispute.
The applicant then goes on to say that it continued to seek the services of the respondent and that the respondent continued to act for it, arranging a conference with senior counsel, and that it was only after that and on 20 July, 1993 that a letter was received from the respondent advising that the firm considered it could no longer continue to act in view of the statements made. The firm, then, no longer acted for the applicant.
Requests for the files relating to the litigation were made by the applicant's new solicitors in March of this year which was initially met with a refusal until payment of outstanding costs. The applicant's solicitors on 19 April wrote offering an undertaking to hold the documents without prejudice to any lien the respondent might have and offering redelivery after the hearing unless the bill of costs was earlier resolved.
The respondents, however, remained of the view that in view of the applicant's financial circumstances, if the file were given up they would not be paid. More recently, however, the respondent firm wrote again offering to release the file on undertakings and on payment of an amount which was just in excess of the amount of the outlays it had made. This was rejected by the applicant.
The account of costs which is disputed has been delivered and it claims an amount of $7,500.00 for professional fees and $2,087.50 for disbursements. It does not itemise the costs for the work done in such a way as would enable the client or its advisers to properly consider it and any necessary taxation, and is not, I consider, in taxable form - a matter which the respondents' counsel was almost prepared to concede.
The solicitors have, however, sued on the account in the Magistrates Court but these proceedings have not concluded. The applicant's need for the file and the position of jeopardy in which it would otherwise be placed in the forthcoming hearing has quite properly been recognised by the respondent. That a court would in these circumstances order delivery on undertakings and perhaps conditions is clear - see Gamben Chemical Ltd. v. Rochem Limited (1980) WLR 614 at 622 and CCOM Pty. Ltd. v. Jiejing Pty. Ltd., a decision of Cooper J. of 24 June 1992.
In those circumstances, it would seem that all that was here necessary to consider was the imposition of those conditions and the terms of the undertakings. The applicant, however, is now adamant that it pay nothing which may reflect or result from its financial position or its now sense of injustice at the respondents' actions or both. Consequently, the matter was rather generously argued. The applicant submitted that the respondent has no lien at all since the firm has repudiated a contract described as entire in the sense that it was for the whole of the litigation by discharging itself, and as a result, is not entitled to any fees at all.
Even accepting the legal description of the contract, the question as to whether the firm has in fact repudiated or, as the respondent asserts, the applicant itself repudiated will turn upon findings as to what in fact was said, and more particularly as to the sequence and timing of the events thereafter. That is, at present, quite unclear on the material before me.
Whilst I accept that the failure of the respondent to deliver a properly itemised bill affects its rights to recover costs, charges and disbursements, it does not, I consider, bar the retaining lien which remains until costs to be taxed are paid - see Halsbury 4th edition volume 44 paragraph 228 - although the court may make orders to have this effected more promptly.
There are in existence allegations about the quantum of the fees in the Magistrates Court proceedings but I am not in a position to assess their strength or whether they are seriously made in circumstances of a complete breakdown of the former relationship of the parties. On the other hand, I am unable to assess the bill itself or speculate as to what might be found proper on taxation. The applicant has frankly conceded it is in financial difficulties and this is not contested by the respondent, and it is said to require full payment of the bill as a condition of release may effectively prevent the applicant having the access it needs.
In these circumstances, I propose to order as a condition of the release, and subject to other undertakings, that the applicant pay to the respondent the amount of the outlays $2,087.50 and that the respondent is to hold that sum in its trust account pending the determination of the taxation of its bill of costs or other order pronouncing its entitlement to that sum. This is in the absence of an agreement being reached and reduced to writing between the parties. The respondent, in turn, will be ordered to deliver to the applicant a bill in taxable form within fourteen (14) days.
As to costs, the respondents, whatever their earlier conduct, made an offer which would have rendered this application unnecessary and no satisfactory explanation was provided as to why it was not accepted, but I infer the applicant thought that it could achieve a result whereby it would pay nothing. It has not; it will be ordered to pay the respondents' costs. The orders then to be made, upon the undertakings from the applicant's solicitors:
THE COURT ORDERS THAT:
1. UPON the applicant's solicitors undertaking to the court:
(a) To hold all papers and documents delivered to them under
this order by Sutherlands solicitors subject to any lien of Sutherlands;
(b) To return the said papers and documents to Sutherlands
forthwith after conclusion of the action;
(c) To prosecute the action in an active manner; (d) To allow Sutherlands, or any person authorised by that firm
reasonable access to the documents and papers for the purposes of responding to the Queensland Law Society Incorporated, preparing a bill of costs, attending to taxation of the bill of costs, and for the purpose of litigation with respect to their costs.
The applicant pay to the trust account of Sutherlands, the
sum of $2,087.50 in respect of Sutherlands disbursements within fourteen (14) days from the date hereof without prejudice to their rights to recover the balance, if any, of such costs.
Sutherlands retain such sum in their trust account pending
the determination of taxation of their bill of costs or order pronouncing their entitlement to that sum or upon written agreement of the parties to the release of that sum.
Sutherlands deliver to the applicant a bill of its costs for
the period 13 October, 1992 to 9 July, 1993 in taxable form within thirty (30) days from this date,
AND UPON THOSE ORDERS I DO FURTHER ORDER THAT: 5. The respondents, Sutherlands, forthwith deliver to Roberts
Mason and Company, solicitors, all papers in application G93
of 1992 and all other documents in the custody or power of Sutherlands relating to the said proceedings or belonging to the applicant or its directors.
The applicant pay the respondents' costs of and incidental
to this application to be taxed and paid forthwith.
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