Kowalski v Stanley & Partners
[2015] SASC 130
•27 August 2015
SUPREME COURT OF SOUTH AUSTRALIA
(Appeal from a Master: Application)
KOWALSKI v STANLEY & PARTNERS & ANOR
[2015] SASC 130
Judgment of The Honourable Justice Bampton
27 August 2015
PROCEDURE - COSTS - TAXATION
Application for permission to appeal against a decision of a Master staying an application to tax a bill of costs as an abuse of process – Stanley & Partners acted as solicitor for the applicant in relation to claims for injuries arising out of his employment with Mitsubishi Motors Pty Ltd – Stanley & Partners issued a minor civil claim in the Magistrates Court to recover those costs in 1993 – Mr Kowalski consented to judgment and paid the judgment sum in July 1995 – Mr Kowalski’s three applications to set aside the consent judgment were dismissed by the Magistrates Court – Mr Kowalski’s application to the Supreme Court for an extension of time to appeal against the Magistrates Court dismissals was refused – Mr Kowalski made application to tax Stanley & Partners’ costs in November 2013.
1. Permission refused.
Legal Practitioners Act 1981 (SA) s 42; Supreme Court Act 1935 (SA) s 39, s 50(4); Criminal Law Consolidation Act 1935 (SA) ; Supreme Court Civil Rules 2006 (SA) r 288, referred to.
Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502; Kowalski v Bourne [2012] SASC 6; Kowalski v Bourne and R J Cole & Partners [2015] SAIRC 17; Kowalski v Lieschke & Weatherill Lawyers [2015] SASCFC 108; Rogers v Legal Services Commission (1995) 64 SASR 572, considered.
KOWALSKI v STANLEY & PARTNERS & ANOR
[2015] SASC 130Appeal from a Master: Application
BAMPTON J.
Twenty two years ago, after obtaining legal advice, Mr Kowalski consented to judgment in Magistrates Court proceedings brought by Stanley & Partners to recover their costs. Mr Kowalski made application in November 2013 to tax those costs.
Mr Kowalski seeks to appeal a Master’s decision permanently staying the application as an abuse of process.
For the following reasons I refuse to grant permission to appeal against the Master’s decision.
Background
Between 1988 and 1991, Mr Bourne represented Mr Kowalski in relation to claims for injuries arising out of his employment with Mitsubishi Motors Pty Ltd. In his affidavit sworn on 5 November 2014, Mr Bourne deposed that he no longer has a complete record of all the documents relating to his representation of Mr Kowalski, nor of the litigation, complaints and charges commenced by Mr Kowalski against him subsequently. Mr Bourne deposed that between 4 January 1979 and 30 June 2000 he was employed by, or was a partner in, the firm Stanley & Partners. Stanley & Partners ceased to practise on 30 June 2000 and since 1 July 2000 Mr Bourne has been the principal of Bourne Lawyers.
In February 1991, Mr Kowalski did not accept Mr Bourne’s advice concerning the progress of the claim for his work injury and he instructed RJ Cole & Partners to take over the conduct of the matter.
Mr Bourne initially agreed to release his Stanley & Partners file to RJ Cole & Partners on the basis that costs be agreed in the sum of $2,000 plus disbursements.
Mr Bourne was informed by RJ Cole & Partners that Mr Kowalski required the costs to be taxed. Stanley & Partners subsequently retained the services of a costs consultant to prepare a bill in taxable form. That exercise resulted in a claim for costs in the sum of $6,311.11.
Magistrates Court proceedings action no 788 of 1993
On 14 January 1993, Stanley & Partners issued a minor civil claim in the Adelaide Magistrates Court for the amount of their costs in the sum of $6,311.11. On 29 January 1993, Mr Kowalski, having been served with the proceedings, returned one copy to the Registrar of the Magistrates Court endorsed with his consent to judgment.[1] Mr Bourne deposed in his 5 November 2014 affidavit that he expected Mr Kowalski would file a defence denying liability or otherwise requesting that the costs be taxed. In a letter to the Legal Practitioners Complaints Committee dated 16 December 1994,[2] Mr Bourne explained:
With respect to costs, we are at a complete loss to understand Mr Kowalski’s complaint. We enclose a copy of a letter to us from RJ Cole & Partners dated 17th September 1991, whereby we were advised that Mr Kowalski required us to tax our bills of costs. We had a Bill of Costs in taxable form prepared by independent costing consultants, at a cost of $2,530.00. The taxable Bill was in the total sum of $6,331.11. The matter did not proceed to taxation. We commenced proceedings in the Magistrates Court, on the basis that if the amount was disputed and Mr Kowalski requested taxation, the Court would defer dealing with the matter until after taxation. In fact, we were a little surprised to receive a notice from the Registrar enclosing Mr Kowalski’s consent to judgment. … In any event, Mr Kowalski confirmed then and has confirmed in his complaint that he decided to pay the outstanding amount then $6,684.11 including costs rather than dispute the claim or request taxation.
[1] See page 2 of Magistrate Millard’s decision in action 93-788, exhibit TDB1 to Bourne affidavit sworn 5 November 2014 (FDN 8).
[2] Annexure K34 to Mr Kowalski's affidavit sworn 20 August 1996 in action no. 2472 of 1995.
On 26 July 1993, Mr Kowalski paid the judgment sum.
On 29 March 1995, Mr Kowalski filed an application in the Magistrates Court seeking that the judgment be set aside. The application was dismissed by Magistrate Millard SM on 7 April 1995. On 9 October 1995, Mr Kowalski filed another application seeking that judgment be set aside. That application was dismissed by Mr Johansen SM on 3 November 1995. Mr Kowalski filed yet a further application on 10 November 1995 seeking that the costs be rescinded or taxed. That application was dismissed by Mr Millard on 17 November 1995.
On 27 November 1995, Mr Millard published detailed reasons for dismissing Mr Kowalski’s application filed 10 November 1995.
In his reasons, Mr Millard referred to Mr Kowalski’s affidavit (sworn 10 November 1995) filed in support of his application. Mr Millard stated that in that affidavit, Mr Kowalski asserted that he had consented to the judgment believing that the costs had been taxed in the Supreme Court and having learned that they were not taxed, he asserted it was unconscionable for Stanley & Partners to pursue judgment in this matter. Mr Millard stated that what Mr Kowalski’s affidavit did not depose to was the earlier history of the claim for costs and the various applications before the Court in respect of that claim or the fact that he had satisfied the judgment. Mr Millard referred to the application filed on 29 March 1995 where Mr Kowalski sought an order that judgment be set aside and that he be given leave to file a defence and counterclaim. At the hearing of the application on 7 April 1995, there was no appearance by or on behalf of Mr Kowalski. Mr Millard dismissed the application and ordered that Mr Kowalski pay Stanley & Partners’ costs. Mr Millard referred to a letter that Mr Kowalski had written to the Magistrates Court by letter dated 3 April 1995 stating:
With respect to the application to action number 788/93 that judgment against the defendant be set aside I ask to withdraw this application pending a police investigation into the matter. It was confirmed by a clerk of the Court during my phone conversation on 31 March 1995 that following the potential police investigation I will be able to lodge another (my underlining) application to set the judgment aside in regards to action number 788/93.
Mr Millard also referred to Mr Kowalski’s affidavit not deposing to the fact that Mr Kowalski had also issued an application on 9 October 1995 which was dismissed by Mr Johansen on 3 November 1995. In that application, Mr Kowalski again sought an order setting aside his consent to judgment. Mr Millard referred to having informed Mr Kowalski that if he sought a review of Mr Johansen’s decision, he must institute an appeal.
Mr Millard rejected Mr Kowalski’s argument that as a bill of costs had never been taxed Stanley & Partners was not entitled to recover judgment, stating:
The plaintiff was entitled to proceed to issue these proceedings and once judgment was entered the issue of quantum and of liability was resolved thus there was no basis upon which this Court could usefully stay the proceedings pending a taxation.
Mr Millard noted that the Magistrates Court has power to determine liability for legal costs and to fix quantum of the costs, but it has no jurisdiction to tax costs in the event of a dispute as to quantum. That jurisdiction, he said, lies exclusively with the Supreme Court pursuant to s 42 of the Legal Practitioners Act 1981 (SA) (the LPA).[3]
[3] Schedule 3 of the LPA replaced the repealed Division 8 (sections 41 to 43) of the LPA on 1 July 2014. The effect of clause 9 of Part 4 of Schedule 2 to the Legal Practitioners (Miscellaneous) Amendment Act 2013 (SA) No. 44 is that repealed sections 41 to 43 of the LPA continue to apply to matters where first instructions were given before 1 July 2014.
Mr Millard said that if there is a dispute regarding quantum the Magistrates Court will adjourn the proceedings pending the issuing of an allocutur by a Master of the Supreme Court certifying taxation of costs. He went on to say that it follows that where there is no dispute as to quantum there will be no taxation and where judgment is entered the judgment must be set aside before any question can arise as to a stay of further proceedings pending taxation. Mr Millard said he took the view that unless and until Mr Kowalski had judgment set aside, there was no basis upon which to order that costs be taxed.
Appeal against the Magistrates Court refusal to set aside judgment
In Supreme Court action number 2472 of 1995, Mr Kowalski made application for an extension of time to appeal the Magistrates Court decisions on 7 April, 3 November and 17 November 1995 dismissing his applications. By reference to the Supreme Court record, on 5 July 1996 Williams J ordered:
Matter adjourned with a direction that the applicant within two calendar months file and serve such additional affidavit material as he may rely upon and including in that material an identification of the specific items in the bill that are in dispute and the basis for dispute; with leave for the respondent, Stanley and Partners to file answering affidavits within fourteen days of the receipt of the additional material.
In accordance with that order Mr Kowalski filed an affidavit sworn on 20 August 1996. On page 7 of that affidavit, Mr Kowalski deposed:
b.1I believe that I received the summons on or about 15.1.93, which placed myself under extreme pressure.
I was being enticed to accept a settlement in regards a WorkCover matter, by a solicitor with RJ Cole and Partners, at the time that Stanley’s sued myself for the $6,684.11.
Mr L Owens, the CEO of the WorkCover Corporation refused to give his consent to the WorkCover settlement, so I refused to enter into what I was informed was an illegal settlement.
c.1Then by letter dated 18.1.93, Mr P Harris from RJ Cole and Partenrs, tried to entice myself, in breach of S119(3) of the WorkCover Act, to accept the WorkCover settlement.
I was then made to believe that if I accepted the WorkCover settlement then all of my legal costs would have been paid by Mitsubishi. Annexure marked with the letter “K30”.
d.1I approached the Legal Services Commission for assistance, on or about 22.1.93 and I was referred to a solicitor for an ½ hour free consultation.
I was given the impression that I had no option but to pay the sum that Stanley’s were suing myself for, by the solicitor, so as I did not want to enter into an illegal settlement in regards the WorkCover matter therefore dispos’g of the costs that I was being sued for, I consented to judgement on 29.1.93. Annexure marked with the letter “K31”.
(Underlining in original)
Annexure K31 to that affidavit is a copy of the Magistrates Court summons endorsed with Mr Kowalski’s consent to judgment and dated 29 January 1993.
At a hearing before Williams J on 1 November 1996, Mr Kowalski confirmed that he had consented to the judgment in the Magistrates Court. Justice Williams asked Mr Kowalski, “Before you consented to it, you had advice for about half an hour from a solicitor from Legal Services, I think, is that right?”. Mr Kowalski answered, “On referral, yes”.[4] Mr Cogan, who appeared for Stanley & Partners on 1 November 1996, told Williams J that Stanley & Partners issued proceedings in respect of the claim for costs:[5]
[4] Transcript of proceedings, Kowalski v Stanley & Partners (Supreme Court of South Australia, Williams J, 1 November 1996) at p 3.
[5] Transcript of proceedings, Kowalski v Stanley & Partners (Supreme Court of South Australia, Williams J, 1 November 1996) at p 8.
… expecting the issue of liability to be argued and the issue of quantum to be argued. Instead of that, Mr Kowalski just immediately consented to judgment, thereby avoiding the need to litigate the question of liability and avoiding the need to proceed with the taxation.
What would happen is you would appear in the Magistrates Court. The magistrate would deal with the issue of liability, if there was an issue of liability and then refer the question to the Supreme Court for taxation as to quantum.
None of that happened because Mr Kowalski consented to judgment. I think probably Stanley & Partners were more surprised than anybody about that.
Later in that hearing the following exchanges took place:[6]
[6] Transcript of proceedings, Kowalski v Stanley & Partners (Supreme Court of South Australia, Williams J, 1 November 1996) at pp 13, 14, 16.
HIS HONOUR: Well, now, so far as I can see, the only basis on which you could succeed on such an application – that is assuming that you got before the court, and time was extended – you would have to show either that there was a mistake. Now, I do not think there was a mistake. You put it on the basis of unconscionable conduct on the part of Mr Bourne.
Now, you did have advice before you consented to the judgment, and you would have to show that Mr Bourne did something that lacked bona fides. Actually it is stronger than that, but it is probably, it may even have to amount to fraud. But, certainly, it would have to show that he did something dishonourable. I do not know that on the face of this file you have shown that.
…
HIS HONOUR: I am putting it at its very lowest. I think it is fraud that would have to be demonstrated before granting an extension of time. It seems to me that I should be satisfied that there was at least some basis for the claim, I would not need to be satisfied that the claim would succeed, all I am looking for is to find something on which Mr Kowalski can hang his hat in terms of an argument.
MR COGAN: Something.
HIS HONOUR: At the moment I cannot see anything that is on the face of it. He had independent advice. That, of course, does not put the matter beyond doubt. But, I think I will give Mr Kowalski one last chance to bring forward an affidavit that demonstrates, if he can, a lack of bona fides on the part of Mr Bourne.
…
HIS HONOUR: … I am going to direct that that material be filed within seven days. We will bring the matter on again. We’ll adjourn the matter for a fortnight until Friday, 15 November at 9.30 a.m. when I would expect to hear further argument and to dispose of the matter.
I should tell you that at the moment you will not succeed because before giving an extension of time, I would need to be satisfied that there was some prospect of success and at the moment there is none because there is that absence of material on the face of the file. But, I am not going to shut you out without giving you a full opportunity.
At the conclusion of the hearing on 1 November 1996, Williams J ordered:
That Mr Kowalski within 7 days file any further affidavit upon which he relies, in particular any material upon which he relies to establish lack of bona fides of Mr Bourne on or before 29 January 1993 which may have led Mr Kowalski to consent to judgment as he did on 29 January 1993.
Mr Kowalski filed a further affidavit sworn on 7 November 1996. Exhibited to that affidavit is a copy of a letter dated 10 April 1996 from the solicitor Michael W Speck to the Legal Practitioners Complaints Committee. In that letter, Mr Speck said:
Mr. Kowalski attended at our office on 22 January 1993 with a summons from Messrs Stanley and Partners whereby they were seeking to recover their costs in relation to a workers compensation claim.
Mr. Kowalski had elected to change solicitors to Messrs. R.J. Cole and Partners and there was a dispute with respect to the fees outstanding to Messrs. Stanley and Partners.
We advised Mr. Kowalski that we had assumed that Stanley and Partners had calculated their account for the amount of the summons pursuant to the Supreme Court Scale and that they could substantiate this. We indicated that if he lodged a defence they would be left with no option by to tax their costs. We pointed out that if Stanley and Partners could back up their claim for costs, then he would be left with a greater debt by reason of the additional costs associated with the taxation.
On the other hand he may well have been able to reduce the amount that Messrs. Stanley and Partners were seeking to recover from him by the proceedings issued. We indicated that it was very much a decision for him.
…
In relation to this point we did not see or hear from Mr. Kowalski again.
At the adjourned hearing on 15 November 1996, Williams J, in refusing Mr Kowalski’s application for an extension of time to appeal, said:[7]
Having previously adjourned the hearing to give Mr Kowalski the opportunity to adduce further evidence by affidavit, I have reached the conclusion that Mr Kowalski is not able to demonstrate even an arguable case. I consider that it would be oppressive, from the point of view of Stanley & Partners, that this matter should be allowed to proceed further in those circumstances. Accordingly, the application for extension of time is refused.
[7] Transcript of proceedings, Kowalski v Stanley & Partners (Supreme Court of South Australia, Williams J, 15 November 1996) at pp 1-2.
On 8 July 1997, Mr Kowalski made application to Williams J to “reopen” the order he made refusing the extension of time within which to appeal.[8] Justice Williams refused Mr Kowalski’s application, stating there was nothing before him which would justify reopening the decision he made on 15 November 1996.
[8] Kowalski v Stanley & Partners (Unreported, Supreme Court of South Australia, Williams J, 25 July 1997) at p 1.
On 11 July 1997, Mr Kowalski made yet another application seeking to set aside the order made by Williams J. On 25 July 1997, Williams J said:
I have reviewed the proceedings of 8 July 1997 in light of Mr Kowalski’s complaint. Having heard Mr Kowalski this morning I am satisfied there is nothing new which he can advance. After further discussion today Mr Kowalski intimated that he does not wish to argue that any further formal step need be taken to put on the court record the material upon which I have relied.
I have explained to Mr Kowalski there is in place a monetary judgment which entitles Stanley & Partners to take steps to recover money. I have refused to extend time to allow Mr Kowalski to apply to set aside the judgment which was originally entered by consent after Mr Kowalski obtained legal advice.
I have also explained to Mr Kowalski that this matter has now been exhaustively investigated before me and that as matters now stand I would not be prepared to consider any further application to vary my earlier orders. …
I have drawn the attention of Mr Kowalski to his right to apply for leave to appeal against my decisions. However, Mr Kowalski has indicated that he does not wish to take the matter further.
The application is dismissed.
Complaint to the Legal Practitioners Disciplinary Tribunal
Mr Kowalski complained about Mr Bourne to the Legal Practitioners Disciplinary Tribunal on 8 May 2010 and 4 April 2012. The Tribunal resolved to make no finding of unprofessional conduct.
Federal Magistrates Court proceedings
Mr Kowalski also commenced proceedings against Mr Bourne in the Federal Magistrates Court in May 2010. Mr Kowalski sought to re‑agitate his claim for recovery of costs on the basis of alleged fraud. The Federal Magistrates Court application proceeded to trial before Federal Magistrate Lindsay on 24 August 2010. The application was dismissed and Mr Kowalski was ordered to pay Mr Bourne’s costs in the sum of $9,675.
Mr Bourne deposed in his 5 November 2014 affidavit that in light of Mr Kowalski’s apparent impecuniosity and the certainty that pursuing costs would result in additional litigation and cost to him, he has elected to date not to pursue recovery of the costs awarded by the Federal Magistrates Court.
Appeal to the Federal Court against Federal Magistrate’s decision
Mr Kowalski appealed the Federal Magistrates Court decision to the Federal Court. The appeal was dismissed by Logan J on 28 March 2011. In his reasons for decision, Logan J stated that given the appeal’s complete absence of merit, Mr Bourne should have his costs on an indemnity basis.
Mr Bourne is yet to formulate his claim for costs and disbursements in respect of the appeal to the Federal Court.
Complaints to the Legal Practitioners Disciplinary Tribunal about Mr Bourne’s counsel
Mr Bourne stated in his 5 November 2014 affidavit that he was represented by Mr Camatta of Camatta Lempens in the Federal Magistrates Court action and, as a result of Mr Camatta acting for him, Mr Kowalski laid a charge against Mr Camatta in the Legal Practitioners Disciplinary Tribunal alleging unprofessional conduct.
Further, as a consequence of appearing for Mr Bourne in the Federal Court appeal, Mr Kowalski laid a complaint in the Legal Practitioners Disciplinary Tribunal against Ms Nelson QC alleging unprofessional conduct.
Industrial Relations Court proceedings
In Industrial Relations Court action 1114 of 2011, Mr Kowalski sought declarations to the effect that Stanley & Partners and Mr Bourne did not have any legal right to sue him for legal costs and disbursements in the sum of $6,684.11 in the Adelaide Magistrates Court and a declaration that the sum was obtained by fraud, unconscionably and illegally.
Mr Bourne made application for summary dismissal of the proceedings which was heard by Judge Hannon on 15 June 2011. For reasons published on 23 August 2011, the summons was summarily dismissed.
Appeal to the Full Court of the Industrial Relations Court
Mr Kowalski’s appeal against Judge Hannon’s decision was heard on 27 November 2014 by the Full Court of the Industrial Relations Court. In its reasons delivered on 29 May 2015, the Full Court dismissed the appeal noting that to allow the matter to proceed would be an abuse of process and that it was plainly vexatious. The Court permanently stayed the proceedings.
Private prosecution
In September 2011, Mr Kowalski commenced a private prosecution against Mr Bourne alleging that Mr Bourne had committed 11 contraventions of the Criminal Law Consolidation Act 1935 (SA). That prosecution was dismissed by Dr Cannon SM on 7 November 2011.
Appeal to the Supreme Court
Mr Kowalski then appealed to the Supreme Court against the dismissal of his prosecution. The appeal was heard by Kourakis J (as he then was) on 13 January 2012. In his ex tempore reasons, Kourakis J allowed the appeal for the limited purpose of changing the form of the order from one dismissing the Information, to an order staying it until further order on the basis of an abuse of process. In his judgment,[9] Kourakis J said:
It is common ground on this appeal that a consent judgment for that amount was entered in the Magistrates Court in proceedings brought by Mr Bourne, as plaintiff, against Mr Kowalski, as defendant, seeking that sum by way of legal fees. It is also common ground that Mr Kowalski later brought an application in the Magistrates Court to have that judgment set aside, but was unsuccessful. I understand from Mr Kowalski’s submissions that the application was made on the grounds that the judgment was obtained by fraud.
The existence of that judgment is, in my view, an insuperable obstacle to the success of the information filed by Mr Kowalski. It is not open in criminal proceedings to find that an offence has been committed by the receipt of money payable under a judgment which has not been set aside. For that reason alone the information is bound to fail and should be stayed as an abuse of process.
His Honour also noted that the offences alleged were then about a decade old and that:[10]
Finally, it appears from the history of litigation of which I have been informed, and the content of Mr Kowalski’s submissions, that Mr Kowalski bears a great personal animosity towards Mr Bourne and is anxious to bring proceedings to harass him in any jurisdiction in which it is possible to do so.
[9] Kowalski v Bourne [2012] SASC 6 at [8]-[9].
[10] Kowalski v Bourne [2012] SASC 6 at [13].
It should also be noted that the Full Court of the Industrial Relations Court stated in its reasons:[11]
Like Kourakis J in Kowalski v Bourne it appears to us from the history of litigation between the appellant and Mr Bourne and the content of the appellant’s submissions that Mr Kowalski bears a great personal animosity towards Mr Bourne. For the same reasons is also appears that the appellant bears a great personal animosity towards RJ Cole. It appears that the appellant is anxious to bring proceedings to harass them in any jurisdiction in which it is possible to do so. In our view the irresistible inference to be drawn is that the proceedings were instituted for that purpose.
[11] Kowalski v Bourne and RJ Cole & Partners [2015] SAIRC 17 at [92].
Permission to appeal decision of Kourakis J refused
On 20 February 2012, Mr Kowalski’s application for permission to appeal against the decision of Kourakis J was refused.
Application for extension of time to appeal decision of Williams J
On 1 March 2012, Mr Kowalski sought an extension of time in action number 2472 of 1995 to file a notice of appeal against Williams J’s 15 November 1996 decision refusing an extension of time. That application was dismissed by David J on 9 March 2012.
Application to tax costs filed 28 November 2013
In his reasons for decision permanently staying Mr Kowalski’s application to tax a bill of costs, Judge Dart also noted the long history of this matter that has vexed Mr Bourne and his firm for many years.
Judge Dart determined that the issues of liability for costs and the quantum of such costs merged into the consent judgment entered in the Magistrates Court. His Honour said he did not doubt that if Mr Kowalski had challenged the bill of costs in 1993, a number of items may have been taxed off. However, by consenting to a judgment, the right to do so was lost. He said that to attempt to go behind the judgment by way of a taxation of costs, to achieve a different result, is an abuse of process.
Judge Dart also stated that it was 22 years since the last of the costs were incurred and Stanley & Partners had not traded since 2000. He said the partners of the firm are entitled, after such a lengthy period, to regard the affairs of the firm as finalised. His Honour said that had he not held that the matter was an abuse of process, he would, in any event, have declined to proceed with the taxation.
Finally, Judge Dart said that the application for taxation was also an abuse because it was being used as a vehicle by Mr Kowalski to contest liability issues, rather than simply for a taxation of the costs.
Accordingly, Judge Dart ordered that the application for taxation be permanently stayed as an abuse of process.
Mr Kowalski must obtain permission to appeal Judge Dart’s decision
In Kowalski v Lieschke & Weatherill Lawyers,[12] Mr Kowalski sought to appeal the dismissal of an appeal from a Master who had made a provisional costs order for taxation of his former solicitor’s costs. The Full Court determined that Mr Kowalski required permission to appeal pursuant to rule 288(1)(b) as his proposed appeal was limited to questions of costs.[13]
[12] [2015] SASCFC 108.
[13] Kowalski v Lieschke & Weatherill Lawyers [2015] SASCFC 108 at [10].
As this proposed appeal is limited to the question of legal costs and the refusal to tax those costs, Mr Kowalski must obtain permission to appeal Judge Dart’s decision.
The second notice of appeal
Mr Kowalski has filed a second notice of appeal. He asserted he did so pursuant to permission granted by Blue J. Justice Blue has only given Mr Kowalski permission pursuant to s 39 of the Supreme Court Act to apply in this action to amend the notice of appeal. I gave permission to file and serve the second notice of appeal at the hearing before me on 27 August 2015.
In the second notice of appeal, Mr Kowalski purports to seek only a line by line taxation and appears to concede liability to pay costs.
Conclusion
Judge Dart did not err in permanently staying the application for taxation as an abuse of process. The application to tax Mr Bourne’s costs is undoubtedly an abuse of process.
The consent judgment entered on 29 January 1993 is a judgment on the merits for the purpose of res judicata. As noted by Lander J, with whom Cox and Prior JJ agreed, in Rogers v Legal Services Commission:[14]
There are circumstances where a plea of res judicata will be good even though there has been no investigation of the merits of the matter by the Tribunal. In cases where consent orders or judgments are entered, notwithstanding that the Court has been relieved of the obligations of carrying out the investigation, that consent judgment will operate as a bar to subsequent proceedings based upon the same subject matter.
[14] (1995) 64 SASR 572 at 595.
In Chamberlain v Deputy Commissioner of Taxation,[15] where a taxpayer had consented to judgment in proceedings brought by the Deputy Commissioner, the High Court said:[16]
The fact that a judgment is entered by consent may on occasion make it hard to say what was necessarily decided by the judgment, especially where it is the defendant who wishes to bring action at a later date. … But the principle of res judicata holds good in such a case.
[15] (1988) 164 CLR 502.
[16] (1988) 164 CLR 502 at 508 (Deane, Toohey and Gaudron JJ, with whom Brennan J relevantly agreed).
As Mr Millard correctly observed, before a taxation can take place pursuant to s 42 of the LPA the consent judgment has to be set aside. Mr Kowalski made three unsuccessful applications seeking to set aside the judgment in the Magistrates Court. He did not attend the hearing of the first of those applications as he was pursuing a “police investigation” and he asserted in correspondence to the Court that he would be able to lodge another application after the potential investigation.
Mr Kowalski’s application for an extension of time to appeal against the Magistrates Court refusals to set aside the consent judgment was refused by Williams J on 15 November 1996. He attempted without success to seek an extension of time to appeal against Williams J’s refusal on 9 March 2012. As noted by Williams J, Mr Kowalski consented to the judgment in the Magistrates Court after obtaining legal advice. That legal advice is set out in the letter from Michael W Speck referred to in [19] above.
Mr Kowalski has relentlessly made applications and commenced different actions in an attempt to subvert the consent judgment.
The Federal Magistrates Court has ordered Mr Kowalski to pay Mr Bourne’s costs in the sum of $9,675. The Federal Court has made an indemnity costs order against Mr Kowalski. Judge Dart said he did not doubt that if Mr Kowalski had challenged the bill of costs in 1993, a number of items may have been taxed off. If this matter were not an abuse of process, and assuming a taxation did take place, Mr Bourne would, in my view, be entitled to in effect set off any amount taxed off his bill of costs against the costs Mr Kowalski has been ordered to pay him by various courts. Even after set off, Mr Kowalski would still have significant amounts to pay to satisfy the costs orders.
As the application is clearly an abuse of process, I refuse permission to appeal. The consent judgment was entered 22 years ago, after Mr Kowalski obtained legal advice, which advice included the topic of taxation of costs. In the past 22 years, Stanley & Partners and/or Mr Bourne have been burdened with defending proceedings in the Magistrates, Federal Magistrates and Industrial Relations Courts. They have also had to defend appeals to the Supreme Court, the Full Court of the Industrial Relations Court and the Federal Court as well as complaints to the Legal Practitioners Disciplinary Tribunal.
It is abundantly clear from the history of litigation between Mr Kowalski and Mr Bourne, Mr Kowalski’s submissions and conduct during the hearings before me in this matter that Mr Kowalski bears great hostility towards Mr Bourne. Like the Full Court of the Industrial Relations Court in Kowalski v Bourne and RJ Cole & Partners,[17] I too am led to drawing the irresistible inference that Mr Kowalski is determined to bring proceedings to harass Mr Bourne in any jurisdiction in which it is possible to do so.
[17] [2015] SAIRC 17.
There must be finality to this matter.
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