Jacques v Kent and Orlizki t/as Kent Attorneys (No 2)

[2014] NSWSC 778

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Jacques v Kent & Orlizki t/as Kent Attorneys (No 2) [2014] NSWSC 778

Hearing dates:

On the papers

Decision date:

11 June 2014

Jurisdiction:

Common Law

Before:

Harrison AsJ

Decision:

The Court orders that:

(1) There be no order as to costs.

(2) I decline to issue a certificate to Kent Attorneys pursuant to s 6 of the Suitors' Fund Act.

Catchwords:

COSTS - whether costs should follow event - appeal from Local Court - two issues on appeal - each party partially successful - each party successful on one of the two issues

Legislation Cited:

Civil Procedure Act 2005 (NSW), s 98
Legal Profession Act 2004 (NSW), ss 309, 317
Suitors' Fund Act 1951 (NSW), s 6
Uniform Civil Procedure Rules 2005 (NSW), rr 42.1, 42.2

Cases Cited:

Ashington Holdings Pty Ltd v Wipema Services Pty Ltd (No 3) (Supreme Court (NSW), Young J, 1 October 1998, unrep)
Cross v Peebles [2013] QCA 26
Philip Jacques v Rodney Kent & Tim Orlizki t/as Kent Attorneys [2012] NSWSC 255
Kent v Jacques [2014] NSWSC 469
National Australia Bank Ltd v Horne (No 2) [2011] VSCA 414
Valcorp Australia Pty Ltd v Angas Securities Ltd (No 2) [2012] FCAFC 52

Category:

Costs

Parties:

Philip Jacques (Plaintiff)
Rodney Kent & Tim Orlizki t/as Kent Attorneys (Defendant)

Representation:

Solicitors:
Dominic A Sisinni (Plaintiff)
Kent Attorneys (Defendant)

File Number(s):

2010/160685

Publication restriction:

Nil

Judgment

1. HER HONOUR: This is a judgment on costs. On 22 March 2012, I allowed an appeal in part from the Local Court of New South Wales; I set aside the decision of Magistrate Atkinson dated 8 July 2011, in so far as it related to the cross claim; remitted the matter to the Local Court to be determined according to law; and reserved costs in Philip Jacques v Rodney Kent & Tim Orlizki t/as Kent Attorneys [2012] NSWSC 255 (the first appeal).

1. The first appeal by Mr Jacques fell into two categories. The first category was the disclosure issue and the second category involved the cross claim. At the Local Court hearing, counsel for Mr Jacques put in issue that Kent Attorneys had not complied with the disclosure provisions namely ss 309 and 317 of the Legal Profession Act 2004 (NSW). However, as the submission on that issue developed in the Local Court, it was conceded that Kent Attorneys had sent three costs agreements to Mr Jacques and the disclosure requirements outlined in s 309 were satisfied. However, the issue was then that if the costs assessment had not been served then, the disclosures had not been made. The result being that the Local Court proceedings could not be maintained (see s 317(2)).

1. The legal argument before the Magistrate was whether the disclosure issue had been properly pleaded and, if it had not, which party had the obligation to plead compliance/non compliance with the disclosure requirements. On this issue on appeal, I decided that the Magistrate made no error of fact or law. In other words, Mr Jacques was unsuccessful on the first issue raised in the first appeal.

1. By cross claim, in the Local Court, Mr Jacques claimed that Mr Kent was negligent in failing to seek leave to join Mr George Senes as a defendant when the transfer application was heard in this Court on 18 March 2008 by Associate Justice McLaughlin in the matter of Philip Jacques v Forte Enterprises Pty Limited & Ahtram Nominees Pty Limited.

1. The Magistrate found the claim for negligence failed because it was not known if Mr Jacques would ultimately be successful in his claim against Mr Senes. However, on appeal, I decided that this was not the correct test and constituted an error of law. The cross claim was remitted to the Local Court to be determined according to law. In other words, Mr Jacques was successful on the second issue in the first appeal.

1. Both parties agreed that the claim and cross claim were each the subject of detailed argument in the first appeal.

1. On 18 October 2012, following the matter being remitted, the Local Court gave judgment. That decision was appealed to this Court (the second appeal) in Kent v Jacques [2014] NSWSC 469 before Campbell J. His Honour allowed the appeal and ordered Mr Jacques to pay the costs of that appeal.

1. This judgment deals with the issue of costs on the first appeal. On 2 May 2014, I made orders that the costs issue be dealt with by way of written submissions. Both parties have now furnished written submissions.

Costs generally

1. In the Local Court, Kent Attorneys sought to recover moneys due for which six invoices were issued and remained unpaid by Mr Jacques in the sum of $46,515.99.

1. Section 98 of the Civil Procedure Act2005 (NSW) relevantly reads:

"98 Courts powers as to costs

(1) Subject to rules of court and to this or any other Act:

(a) costs are in the discretion of the court, and

(b) the court has full power to determine by whom, to whom and to what extent costs are to be paid, and

..."

1. Uniform Civil Procedure Rules 2005 (NSW) ("UCPR"), rr 42.1 and 42.2 read:

"42.1 General rule that costs follow the event

Subject to this Part, if the court makes any order as to costs, the court is to order that the costs follow the event unless it appears to the court that some other order should be made as to the whole or any part of the costs.

42.2 General rule as to assessment of costs

Unless the court orders otherwise or these rules otherwise provide, costs payable to a person under an order of the court or these rules are to be assessed on the ordinary basis."

1. The parties have now sought that I determine the costs of the first appeal.

Submissions

1. Kent Attorneys seeks their costs of the first appeal.

1. Kent Attorneys submitted that their success in relation to their claim for fees was total and unequivocal in the Court below and in this Court. Kent Attorneys also submitted that the ultimate failure of Mr Jacques' cross claim was total and unequivocal. In relation to Mr Jacques' partial success in having the cross claim remitted to the Local Court, Kent Attorneys say that it should be viewed with reference to that failure and that the remitter and the appeal ordering the remitter were an exercise in futility.

1. Mr Jacques denied that his original claim in negligence and his defence of the appeal was "an exercise in futility", but rather simply was an exercise of his right to have a genuine issue in dispute determined by the Court. Mr Jacques submitted that he had an arguable case on the question of Kent Attorneys' alleged negligence, which were evidenced by my findings and the findings of Magistrate Atkinson. Mr Jacques seeks an order that each party pay their own costs.

1. Alternatively, Kent Attorneys seek an order that there be no order as to costs, on the basis of the respective levels of success achieved by the parties on this appeal. In the event that I order Kent Attorneys to pay Mr Jacques' costs of the appeal, Kent Attorneys submitted that they should receive a certificate pursuant s 6 of the Suitors' Fund Act 1951 (NSW) on the basis that their conduct was not responsible for the Magistrate's error.

1. In Valcorp Australia Pty Ltd v Angas Securities Ltd (No 2) [2012] FCAFC 52 at [4] to [5], it was held that in cases where there are two issues and each party is successful on one issue each, there should be no order as to costs: see also Cross v Peebles [2013] QCA 26 at [47]; National Australia Bank Ltd v Horne (No 2) [2011] VSCA 414 at [3] and Ashington Holdings Pty Ltd v Wipema Services Pty Ltd (No 3) (Supreme Court (NSW), Young J, 1 October 1998, unrep).

1. In the exercise of my discretion, where there were two issues and each party was successful on one issue, an order that costs follow the event is not appropriate. The costs order that best reflects the justice of the case is that there be no order as to costs. I make an order that there be no order as to costs.

1. In the exercise of my discretion, as part of the decision was not set aside, I decline to issue a certificate to Kent Attorneys pursuant to s 6 of the Suitors' Fund Act.

The Court orders that:

(1) There be no order as to costs.

(2) I decline to issue a certificate to Kent Attorneys pursuant to s 6 of the Suitors' Fund Act.

**********

Amendments

16 June 2014 - The words "whether each party pays their own costs" deleted from catchwords

Amended paragraphs: Cathwords

Decision last updated: 16 June 2014