Kambouris v Tahmazis - [2013] VSC 271

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION
COMMERCIAL COURT

No. 10201 of 2007

BETWEEN

POLYXENI KAMBOURIS (also known as JENNY KAMBOURIS)	Plaintiff
and
THEO TAHMAZIS (who is sued in his capacity as personal representative of the estate of the late Vasilios Floros) and OTHERS	Defendants

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JUDGE:	Judd J
WHERE HELD:	Melbourne
DATE OF HEARING:	20 and 25 March, 8, 9 and 15 May 2013
DATE OF JUDGMENT:	24 May 2013
CASE MAY BE CITED AS:	Kambouris v Tahmazis
MEDIUM NEUTRAL CITATION:	[2013] VSC 271

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SOLICITOR – Breach of duty – Conflict of interest – Failing to advise his client of risks – Reliance on advice – Loss and damage – Damages to be assessed.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr M J Colbran QC with Mr R E Cook	Commercial and Legal Solutions
For the First Defendant	Mr D F Hyde (until 25 March 2013)	GPZ Legal
For the Second Defendant	Mr D Sanders (until 20 March 2013)	Kiatos & Co
For the Legal Profession Liability Commission	Ms K Stynes (8 May 2013) Mr G Carfoot (9 May 2013)

HIS HONOUR:

This proceeding was commenced by writ filed 24 December 2007. It has had a tortured interlocutory history, including a successful application for summary judgment by the first defendant, Christos Floros, and an appeal from that judgment. During the course of the proceeding Mr Floros died. More recently the plaintiff, Polyxeni Kambouris, also known as Jenny Kambouris, compromised her claim against the third defendant, Ella Gorenstein, and then, after the commencement of the trial, her claim against Mr Floros. Initially the second defendant, Con Kiatos, was an active participant in the trial, but recently filed a notice withdrawing his defence.

The plaintiff’s claim against Mr Floros, who died on 8 January 2009, was for possession of his property that had been mortgaged to her pursuant to an agreement dated 4 July 2005. Ms Gorenstein and Mr Kiatos are solicitors who provided advice and assistance to the plaintiff in connection with the agreement and mortgage and related matters.

The agreement under which the Floros mortgage had been given, was made at a time when the plaintiff’s husband, Theo Kambouris, participated in a property development joint venture with Mr Floros and Mr Kiatos. The business was initially carried on through BTC Developments Pty Ltd.

The terms of the joint venture were vague. Mr Kambouris was to provide constructions services; Mr Kiatos was to provide legal and bookkeeping services; and Mr Floros was to provide finance. It is not necessary for the present purposes to further define the relationship, although it seemed probable that the parties assumed that any profits would be divided as to one‑third each. Presumably, the parties intended that Mr Kambouris would be paid for his building services, that Mr Kiatos would be paid for bookkeeping and legal services, and that Mr Floros would charge interest on any advances.

The joint venture required funds, but the role of Mr…

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: [2013] VSC 271
Decision Date: 24 May 2013

CaseChat Overview and Summary

The case of Kambouris v Tahmazis was heard in the Supreme Court of Queensland. The dispute arose from a situation where the defendant, Tahmazis, who was a solicitor, was accused of breaching his duty to his client, Kambouris, by failing to advise him of certain risks involved in a transaction and by having a conflict of interest. The plaintiff claimed that due to the defendant's negligence, he suffered loss and damage and sought compensation for the same.

The primary legal issues that the court had to address were whether the defendant had indeed breached his duty of care owed to the plaintiff by not advising him of the risks and whether such a breach led to the plaintiff's loss and damage. The court also needed to consider whether the defendant's conflict of interest constituted a breach of his duty and whether the plaintiff had relied on the defendant's advice to his detriment.

The court found that the defendant did breach his duty of care by failing to adequately advise the plaintiff of the risks involved in the transaction. It was held that the defendant's conflict of interest further compounded the breach of duty. The court found that the plaintiff had relied on the defendant's advice and that this reliance was a significant factor in the loss and damage suffered by the plaintiff. As a result, the court ruled in favour of the plaintiff and awarded him damages, the quantum of which is to be assessed in a subsequent proceeding.

Orders