Kowalski v Stanley & Partners - [2015] SASC 130

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 130
Appeal 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.

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: [2015] SASC 130
Decision Date: 27 August 2015

CaseChat Overview and Summary

In the case of Kowalski v Stanley & Partners, the applicant sought permission to appeal against a decision of a Master, which had stayed an application to tax a bill of costs as an abuse of process. The applicant had been represented by Stanley & Partners in claims for injuries arising from employment with Mitsubishi Motors Pty Ltd. Following a consent judgment in the Magistrates Court in 1993, the applicant later sought to tax the costs but this was refused. The applicant appealed to the Supreme Court, which also dismissed the appeal. Subsequently, the applicant applied to tax the costs again in 2013, leading to the current application for permission to appeal against the Master's decision.

The central legal issue was whether the applicant had a right to tax the costs without first setting aside the consent judgment. The court needed to determine if the application to tax costs was an abuse of process and whether the applicant had an alternative remedy to challenge the costs.

The court held that the application to tax costs was indeed an abuse of process because the consent judgment had not been set aside. The court reasoned that the applicant had a remedy available in the form of setting aside the judgment before seeking to tax costs, but had not pursued this remedy. The court noted that if there was a dispute regarding quantum, the Magistrates Court would adjourn the proceedings pending the issuing of an allocutur by a Master of the Supreme Court for taxation of costs. However, since there was no dispute as to quantum, and judgment had already been entered, the court could not order that costs be taxed until the judgment was set aside. The court found that the Master's decision was correct and denied the application for permission to appeal.

The court's final orders were to refuse permission to appeal against the Master’s decision.

Orders

Orders of the court

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Background

Background to the litigation

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.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

BAMPTON J

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.

Ratio Decidendi

Legal Principle Established

Established by: BAMPTON J

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