Lane v Trustee of the Property of Gregory William Delaney

[2007] QDC 222

DISTRICT COURT OF QUEENSLAND

CITATION:	Lane v Trustee of the Property of Gregory William Delaney and Anjavu Pty Ltd and Cupitt [2007] QDC 222
PARTIES:	DIANE LANE
(Plaintiff)
v
THE TRUSTEE OF THE PROPERTY OF GREGORY WILLIAM DELANEY, A BANKRUPT
(First Defendant) and
ANJAVU PTY LTD ACN 010 178 793
and
DIANNE LANE
(Plaintiff)
v
CZESLAW MICHAEL KOZICKI, MICHAEL ANTHONY WEBB, ANTHONY GERARD O’CONNOR, MICHAEL LESLIE BACKHAUS, PETER WILFORD GEORGE, IAN WILLIAM ALDERDICE, MARTIN NORFOLK PUNCH, JOHN DAVID ANDREW PUNCH AND RODNEY GRAY JOHANSON
(Defendants)
FILE NO/S:	Nos 1020A of 2007

1109 of 2000

DIVISION:	Civil
PROCEEDING:	Application
ORIGINATING
COURT:	District Court
DELIVERED ON:	25 July 2007
DELIVERED AT:	Brisbane
HEARING DATE:	25 July 2007
JUDGE:	M.W. Forde DCJ

ORDER:  1. Application for leave to proceed is dismissed.

CATCHWORDS:	LEAVE TO PROCEED – limitation period expired – prospects of success - fault by solicitor and client – prejudice to client – duty of care owed by Solicitor to client – explanation for delay
Uniform Civil Procedure Rules 1999 (Qld) r 389(2)
Trade Practices Act 1974 (Cth) s 6(3)
Dempsey v Dorber (1990) 1 QdR 418 – Followed Doran v Delaney [1998] 2 ILRM 1 – Considered GWA Pty Ltd v Russo [2004] QCA 326 - Followed
Quality Corp Pty Ltd v Millford Builders (Vic) Pty Ltd SC 10942/98 - Considered
Smiley v Watson [2001] QCA 269 - Followed
Tyler v Custom Credit Corporation [2000] QCA 178 – Considered
Yorke v Lucas (1985) 158 CLR 661 – Considered
COUNSEL:	Mr K. Holyoak for the Plaintiff Mr A. Morris QC for the Defendant (1109/2000) Mr D. Clothier for the Defendant (1020A/1999)
SOLICITORS:	McCowans for the Plaintiff
McCullough Robertson Lawyers for the Defendant (1109/2000)
Minter Ellison for the Defendant (1020A/1999)

HIS HONOUR: This is an application under rule 389 sub-rule 2 by the plaintiff, Diane Lane. The reason for the application is that no step has been taken for two years and thus leave of

the Court is necessary. The plaintiff is involved in two
actions, 1020A of 1999 and 1109 of 2000.

In the first action she sues the first defendant, Mr Delaney, and the second and third defendants in relation to monies which she placed with Mr Delaney for the purposes of investment in a good mortgage. For present purposes the roles of the second and third defendants are not particularly relevant.

The other action involved her claim against a firm of solicitors, Messrs Short Punch and Greatorix, who practice at the Gold Coast. In relation to the claim against them, it relates specifically to information provided by a member of the firm which it is alleged failed to reply accurately as to whether any judgments, orders, decrees or executions had been made against Lifestyle. The plaintiff alleges that the defendants' solicitors ought to have known or knew that in fact there had been a judgment entered in the Supreme Court against that particular entity.

For this application to succeed, there is a requirement that to the other parties, then that may be a basis upon which the

the plaintiff shows that she has a good cause of action and
some explanation should be offered for the delay, although
that is not necessarily fatal. (Dempsey v Dorber (1990)
1 QdR 418; see also Tyler v Custom Credit Corporation [2000]

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Court would exercise the discretion against such an application.

Dealing with firstly the question of delay, there are before

me details in the outline of submissions of the respondent	10
which are before me and marked Exhibit 3 a chronology. The
subject events occurred in 1997 and proceedings commenced on
the 18th of December 2000. Since then there have been delays
for two and half years from July 2001 to February 2004, and
two years and three months from the 31st of August 2004 to	20
21st December 2006.
The explanation for these delays is contained in an affidavit
by Mr Lane who states that he had attempted to contact the
solicitors acting for his wife on some 20 occasions by	30
telephone. It seems that it is accepted by the solicitor, Mr Dwyer, that that particular information is correct. Mr Dwyer said that he did not have any problems obtaining instructions from the plaintiff.
40
This is a type of case where there is fault both by the
solicitor and by the client, as I am not satisfied that 20
phone calls over a period of time without taking more
assertive action is something which a plaintiff ought to be
content with. If the dilatory solicitor fails to provide	50
adequate explanations, the matters cannot be allowed to run
on, but that is just one aspect of this particular case. (See
Tyler's case at [2] para 10 of list).
There is also prejudice established, in my view, on the material. In particular, a Mr Moore, who worked for Mr Delaney, was involved intimately in the transaction. He
should have been able to give evidence about the loan being
appropriately assessed and whether there were inquiries which	10
satisfied him and Mr Delaney and what were the usual type of inquiries.
Unfortunately, Mr Moore would probably not be able to
recollect such matters because of his present physical	20
condition. He has been treated for some time now and it would
appear that his condition would adversely affect any
recollection, that is if he could possibly be in a position to
give evidence when this matter is to be heard. That is not
decisive, but it would be fair to say that the medical	30
evidence supports the view that his evidence would probably be at least unreliable, if he can recall anything of these events some 10 years down the track. From what I glean, it is
unlikely that he could accurately recall the detail of these
events. (See Tyler's case at [2] para (12) of list).	40
There is also, of course, with the effluxion of time, the normal problems with recollection which Mr Delaney and Mr Johanson may suffer. Of one issue, of course, is the
inquiries made of Mr Johanson where there is a difference of	50
opinion between the defendants, Mr Delaney on one hand and the inquiries. This also would be a matter of recollection as there is no material before me one way or the other as to

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whether there were any diary notes or things of that nature.

The other matter which concerns me is the prospects of success
in this case for the plaintiff. Although the Trade Practices

Act is relied upon against Short Punch and Greatorix, the	10
solicitors, it seems that the relevant letter may have been sent by a courier which, given that there is no other bases for involving them as pleaded in any breach of the Trade
Practices Act, then section of the Trade Practices Act would
not assist the plaintiff. (s 6(3)).	20
There was a faint suggestion that section 75B may be invoked,
but I am dealing with this case on the pleadings. What may or
may not be pleaded in the future is problematical, and that
applies to both sides.	30
In relation to the duty of care, counsel for the plaintiff
with his industry, has found an Irish case which supports the
view that a duty of care may be owed by a solicitor in the
position of Short Punch and Greatorix, namely if it is assumed	40
that the letter was sent by them through Mr Johanson as to whether there is a breach of duty of care.
There is some support as mentioned in the texts, Laws of
Australia, 27.3.12 published by Thompson. The learned author,	50
Geoff Masel, initially and currently refers to the case of Doran v. Delaney [1998] 2 ILRM 1, which is the Irish Supreme Court, and there was also support proposition by Duncan and Another in Professional Liability and Property Transactions,

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4.3.3 for that view.

One is somewhat tentative in relying on textbook writers in an
area of this nature, but they support the proposition put

forward in the Irish case which was referred to at	10
particularly the passage:

"It is also clear that the transmission by a solicitor
to a third party of information which turns out to be

inaccurate and upon which the third party relied to his detriment, does not of itself afford a cause of action in negligence for the injured third party. The	20
factors necessary to give rise to liability were set out by Jauncy Lord Justice in the passage so frequently referred to in the present case in Midland Bank v. Cameron, Thom Peterkin v. Duncans [1998] SLT 611 as follows at 616:

'In my opinion four factors are relevant to a
determination of the question whether in a
particular case a solicitor, while acting for a

client, also owed a duty of care to a third	30
party;
(1) the solicitor must assume responsibility for the advice or information furnished to the third party.
(2) the solicitor must let it be known to the
third party expressly or impliedly that he
claims, by reason of his calling, to have the
requisite skill or knowledge to give the advice	40
or furnish the information.
(3) the third party must have relied upon that
advice or information as a matter for which the
solicitor has assumed personal responsibility;
and
(4) the solicitor must have been aware that the third party was likely so to rely.'"
50

Those matters are not pleaded in detail nor proved in the present case which would allow one to readily infer that the factual stratum has been established on the pleadings in the present instance, and therefore the weight which one can give

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to the authority is limited by the pleadings at this
particular juncture. One could not say there were strong
prospects of success, certainly on the duty of care. It would
still be problematical. I am not accepting that the Trade

Practices Act applies to Mr Johanson's firm or his partners.	10
However in a case of this nature one does not have to be definitive, but that is one factor which has to be looked at.
As far as Mr Delaney is concerned, he made due inquiry of
another firm of solicitors and he acted upon that advice. The	20
duty of care owed by him one might think had been discharged at that point in time absent any other knowledge. It is not pleaded that he did have that knowledge, but rather that he
has failed in his duty of care as such.
30
There is also reference to the Trade Practices Act in that
section 75B is relied upon given the involvement of the second
defendant, but it is in that context that it could be relied
upon. However, in relation to the other conduct, section 6 of
the Trade Practices Act may assist in that the letter there	40
was sent by Mr Delaney to the plaintiff.
However, if he had made those enquiries, which it is accepted
that he did, then it is difficult to see how he could be
misleading or deceptive in that sense by relying upon a	50
statement by another firm of solicitors relating to what they knew and as set out in the requisitions as such, notwithstanding, that the Judgment had been entered, could not be said that, clearly, that by making such an enquiry of the

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other solicitors that, therefore, Mr Delaney was misleading and deceptive in that sense. (See Yorke v Lucas (1985) 158 CLR 661 at 666; Quality Corp Pty Ltd v Millford Builders (Vic)
Pty Ltd SC 10942/98 per McMurdo J at [32]).

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Whether he should have made other enquiries or not is
problematical but at the end of the day there seems to be a
weak case against him. To that extent, therefore, and having
referred to the other relevant matters in this instance, there

has been, in my view, a failure to properly explain a delay.	20
Smiley v Watson [2001] QCA 269 at [20]. There is, clearly, prejudice in this case and the case as pleaded does not show a strong case at all: GWA Pty Ltd v Russo [2004] QCA 326.
For those reasons, the application for leave to proceed is	30
dismissed. Costs.
...
HIS HONOUR: So, in relation to costs, leave to the parties to	40
deliver submissions within 14 days. And there will be no need to attend then, I shall just look at it and if there is a need I will call on the parties to attend.
...	50
HIS HONOUR: So, that will be actions 1020 of 1999 and SD1109 of 2000 are dismissed. 25072007 D.01 T(2)16-17/SLI/BNE M/T BRIS17 (Forde DCJ)

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...

HIS HONOUR: Well, it will just be, leave to the parties to deliver submissions re costs and you can take that that

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includes that.

...

HIS HONOUR: So, the application for costs is adjourned just

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to allow the parties to formulate that.

...

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