Iloski v Boutique Lawyers Pty Ltd

[2016] VSC 349

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE
PRACTICE COURT

S CI 2016 01329

ROBERT ILOSKI	Applicant
v
BOUTIQUE LAWYERS PTY LTD	Respondent

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JUDGE:	T FORREST J
WHERE HELD:	Melbourne
DATE OF HEARING:	9 June 2016
DATE OF JUDGMENT:	9 June 2016
CASE MAY BE CITED AS:	Iloski v Boutique Lawyers Pty Ltd
MEDIUM NEUTRAL CITATION:	[2016] VSC 349

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COSTS – Application for extension of time for application for taxation assessment – Delay – Whether just and reasonable for application to be dealt with after 12 month period – Scope of proposed assessment – Upcoming Magistrates’ Court proceeding on related issues – Application refused.

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APPEARANCES:	Counsel	Solicitors
The Applicant in person
For the Respondent	Mr D. Epstein	Boutique Lawyers Pty Ltd

HIS HONOUR:

1. This is an application by Mr Iloski for an extension of time in which to file an application for costs to be taxed.

1. In August 2014, Boutique Lawyers, the respondent in this application, instituted action in the Magistrates’ Court against Mr Iloski and others for the recovery of $18,371.90 in costs.  The costs relate to work performed by Boutique Lawyers in late 2013 and early 2014.  The applicant was invoiced for various amounts totalling this sum between 5 December 2013 and 28 May 2014.  In earlier email exchanges, the applicant, on one view, may have acknowledged at least some of that debt. Despite these emails, the costs were not paid.

1. The applicant (and others) were personally served with a Complaint on 23 August 2014, and proceedings were issued in the Magistrates’ Court.  The defendants to the Magistrates’ Court proceeding (including the applicant), as I understand it, failed to provide a defence, and on 13 October 2014, Boutique Lawyers obtained default judgment in the sum of $18,371.90 plus $636.20 interest, plus costs of $416.70.

1. The applicant then engaged Behan Legal to contest the default orders, amongst other matters.  Consent orders were entered into on 5 March 2015 setting aside the default orders.  The hearing of the Magistrates’ Court proceeding was set down for 16 March 2016.

1. At the 16 March 2016 hearing the applicant appeared self-represented and requested an adjournment.  In her affidavit, Ms Terziovski deposes that the applicant told the magistrate that he had not been informed of the hearing either by the court or by his previous solicitor. The magistrate adjourned the hearing to 26 July 2016, that is about six weeks from today. The merits of the Boutique Lawyers’ claim against Mr Iloski and his associates can be tested at the 26 July 2016 Magistrates’ Court hearing.

1. It is against this background that the applicant seeks leave of this court to proceed with an application to the Costs Court to tax costs out of time.  Mr Iloski has told me this morning that he was unaware until relatively recently of the existence of the Costs Court.

1. Section 3.4.38(1) of the Legal Profession Act 2004 (‘the Act’) provides that a client may apply to the Costs Court for a review of the whole or any part of legal costs. Subsection (5) provides that an application must be made within 12 months after the bill was given, or request for payment was made, to the client. Thus time expired for the applicant, at the latest, on or about 28 May 2015, being 12 months after the final invoice was issued by Boutique Lawyers on 28 May 2014.

1. Section 3.4.38(6) of the Act provides that a judge of this court may extend time provided he or she determines that:

... having regard to the delay and the reasons for the delay, that it is just and fair for the application for a review to be dealt with after the 12‑month period.

1. The applicant argues that it is just and fair to extend time because:

a)   the work done was unnecessary and/or carelessly performed and/or not performed at all.  Paragraph 9 of the applicant’s submission sets out the particulars of the applicant’s dissatisfaction in some detail;

b)     another, unnamed, solicitor, has advised the applicant that he has been treated unfairly;

c)   the legal services provided by the respondent were apparently unsuccessful in preventing a bank from selling up properties controlled or owned by the applicant or his associates or both;

d)     the respondent retains documents that the applicant regards as relevant to a proposed proceedings against the bank; and

e)   the respondent has subsequently manufactured emails and documents that purport to document historical events.

1. The affidavit of Olivia Terziovski sets out a narrative of events relating to the impugned invoices.  Ms Terziovski goes into some detail to refute the allegations that are made against her and her firm in the applicant’s affidavits and submissions. Amongst other assertions made by Ms Terziovski, she states that the applicant or someone associated with him forged her signature on a home refinance document, and that Boutique Lawyers determined to cease acting for the applicant after this discovery.

1. I have determined that it would be neither just nor fair to extend time for the hearing of this dispute by the Costs Court.

1. The ambit of the dispute between the two parties is far wider than the mere quantum of the invoiced amount. It involves allegations of forgery, negligence, mysterious unauthorised deposits in the respondent’s trust account, and other misconduct.  It is entirely inappropriate, in my view, for the Costs Court to be used as a vehicle to ventilate such wide ranging allegations.

1. The applicant was represented by Behan Legal immediately after leaving the respondent’s firm and at no stage, I am told, did Behan query the Boutique Lawyers invoices or seek to have them taxed. It is now two and a half years since the applicant was first invoiced by Boutique and more than two years since the provision of the last invoice.  Fairness and justice are two‑way streets: I must consider the interests of both applicant and respondent, not merely the interests of the party that brings the application.

1. When confronted with a similar application in Frigger v Murfett Legal Pty Ltd [2012] WASC 447 Hall J said:

Generally speaking there are good reasons why compliance with time limits of the type relevant here should be adhered to.  Legal practitioners are entitled to assume that in circumstances where the client was aware of their rights to seek an assessment and more than 12 months has elapsed since the date of that bill, an assessment will not be sought. … It is also possible that a delay in seeking an assessment may prejudice a legal practice because memories may fade and the relevant legal personnel may move on to other positions.[1] 

…

The purpose of the provision permitting a client to apply for an assessment of costs is to protect clients against excessive charges by a practitioner, and to enable a client to be satisfied that a bill of costs is not excessive. The Act imposes time limits to prevent a client from unfairly taking advantage of the assessment provisions to delay the obligation to pay proper costs, and to avoid frivolous objections.[2]

[1]Frigger v Murfett Legal Pty Ltd [2012] WASC 447, [26].

[2]Ibid, [31].

1. With respect, I agree with those observations.

1. The application is refused.