Legal Practitioners Complaints Committee and Reyburn - [2009] WASAT 86

JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL

STREAM: VOCATIONAL REGULATION

ACT: LEGAL PRACTICE ACT 2003 (WA)

CITATION: LEGAL PRACTITIONERS COMPLAINTS COMMITTEE and REYBURN [2009] WASAT 86

MEMBER: JUSTICE J A CHANEY (PRESIDENT)
MS M CONNOR (MEMBER)
MR M ODES QC (SENIOR SESSIONAL MEMBER)

HEARD: 21 APRIL 2009

DELIVERED : 5 MAY 2009

FILE NO/S: VR 194 of 2008

BETWEEN: LEGAL PRACTITIONERS COMPLAINTS COMMITTEE
Applicant
AND
JOHN HENRY REYBURN
Respondent

Catchwords:

Legal Practitioners - Alleged overcharging - Agreement to obtain probate - Proceedings becoming contentious - No further written agreement in relation to contentious work - Client aware additional costs to be incurred - Reasonable charges for work done

Legislation:

Legal Practice Act 2003 (WA), s 180(1)

Result:

Complaints dismissed

Category: B

Representation:

Counsel:

Applicant: Dr AF Dickey QC (with Ms PE Le Miere)
Respondent: Mr MJ Hawkins

Solicitors:

Applicant: Legal Practitioners Complaints Committee
Respondent: Nicholson Clement

Case(s) referred to in decision(s):

Nil

REASONS FOR DECISION OF THE TRIBUNAL:

Summary of Tribunal's decision

The Legal Practitioners Complaints Committee brought allegations that a legal practitioner, John Henry Reyburn, had charged a client an amount in excess of that which he was entitled to charge under a written costs agreement, and an amount that was grossly excessive.
The client asserted that she thought, at all times, that she would only be charged the amount specified in the costs agreement, namely $1,000, notwithstanding that she received and paid, apparently without complaint, accounts well in excess of that amount.
The costs agreement related to services to obtain a grant of probate. The practitioner did, and charged for, the work usually required for a non-contentious grant of probate. Because a caveat was lodged against the grant by the client's daughter, it was necessary to commence contentious proceedings. Although the practitioner did not, as he should have, obtain a new or varied written cost agreement the client knew of this, and instructed the practitioner that he was to do everything necessary to obtain probate whatever the cost. The practitioner proceeded accordingly, and the charges he raised were reasonable for the work done.
The Tribunal found the client's evidence to be unreliable, and in all the circumstances found that the complaints were not made out, notwithstanding that the practitioner deserved criticism for his failure to obtain a written variation to the costs agreement.

Issues

The Legal Practitioners Complaints Committee (Committee) has referred a complaint against John Henry Reyburn (the practitioner) in terms of s 180(1) of the Legal Practice Act 2003 (WA) to the Tribunal alleging that he is guilty of unsatisfactory conduct by unprofessional conduct and/or gross overcharging when acting for a client, Ms O (complainant) on two grounds. Specifically the Committee alleges that:
(a)on or about 21 February 2006, the practitioner sent, or had sent, to the complainant an account for $1,100.00 for professional costs in relation to obtaining a grant of probate in circumstances where a charge for this amount was not justified by the Client/Lawyer Costs Agreement which the parties had entered into on 16 December 2005 (Costs Agreement);
(b)the practitioner sent, or had sent, to the complainant accounts totalling $11,381.85 by way of professional costs, which total amount was, in all the circumstances grossly excessive and further or in the alternative was not justified by, but was grossly in excess of that provided by the Costs Agreement.

The background facts

On 7 July 2005, the complainant's mother engaged the practitioner to prepare her will in terms of which the complainant was appointed executrix and sole beneficiary to her mother's estate (the will).
The will was executed on 2 December 2005 but the mother died 10 days later. The death certificate revealed that a contributory cause of death was Alzheimer dementia.
The complainant then instructed the practitioner to obtain a grant of probate to the will and to assist in the administration of the estate. Pursuant to that instruction, the Client/Lawyer Costs Agreement (Agreement) was entered into between the practitioner and the complainant on 16 December 2005. The Agreement provided for the performance by the practitioner of two services:
(i)to obtain a grant of probate of her mother's will; and
(ii)to assist in the administration of that estate.
The Agreement further provided for a fixed fee of $1,000 plus $100 GST (exclusive of disbursements) for obtaining the grant of probate and an hourly rate, set out in item 4A of the Agreement, for the administration of the estate.
Other terms of the Agreement relevant to the complaint were that the Agreement was binding on the parties and could not be varied except in writing (cl 18) and that the complainant had to pay for the practitioner's services in accordance with invoices sent by him even though all the legal services in terms of the Agreement had not been completed (cl 3).
On or about 10 January 2006, the practitioner filed an application with the Supreme Court of Western Australia for a grant of probate supported by an affidavit sworn by the complainant.
On 24 January 2006, the practitioner's firm received a requisition notice from the Supreme Court informing it that a caveat had been lodged by Ms E, the complainant's daughter, who in effect claimed that at the time of executing the will, the complainant's mother lacked testamentary capacity.
In a letter dated 24 January 2006, the daughter's solicitors wrote to the practitioner, who had been one of the witnesses to the will, expressing the view that he should discontinue acting for the complainant by reason of a conflict of interest as a potential witness in any proceedings to prove the will in solemn form.
The practitioner denied that there was a conflict but sought an opinion in July 2006 from counsel on the steps to be taken to obtain a grant of probate in light of the caveat and on the validity of the allegation that there was a conflict of interest and whether he should continue to act for the complainant.
When he received counsel's account for the opinion, the practitioner requested payment by the complainant, which she duly did. The sum involved was $275.
On 31 July 2006, the practitioner filed a writ of summons to have the probate of the will proved in solemn form and in a letter to the complainant dated 1 August 2006, he set out the history of the problem and the steps to be taken and evidence to be addressed to have the caveat removed (Exhibit 1, page 53).
At a status conference held in the Supreme Court on 13 October 2006, the Registrar presiding raised the question of whether it was appropriate for the practitioner to act for the complainant as he was a potential witness in the proceedings. The complainant who was present at the time was unaware of any conflict of interest issue until then. She then terminated the practitioner’s mandate and requested the return of her file.
It is common ground that the practitioner did not succeed in obtaining a grant of probate of the will.
From time to time commencing 21 February 2006, until 23 October 2006, the practitioner rendered accounts to the complainant, charging the sum of $6,222.99 in respect of the probate services and the sum of $5,527.98 in respect of services for administering the estate, making a total of $11,750.97 (stated to be $11,381.85 in the grounds). Of these, the complainant paid the practitioner a total of $10,117.77 plus disbursements totalling $327.57.

The Practitioner's response

In the practitioner's Response to Application (Response) he alleged that he held two retainers. The first one was contained in the Agreement which he stated he made clear to the complainant at the time, involved simply an application to a Registrar on paper, not involving an appearance by either a lawyer or the complainant. He alleges (at para 8 of the Response) that he explained to the complainant that sometimes requisitions are issued by the court which would involve extra costs to be dealt with.
When he received the court requisition, he informed the complainant that further evidence would be needed to satisfy the court and the caveator that the complainant's mother was competent to make the will when it was executed. He states he received the complainant's approval to proceed which he did (para 12 - para 15 of the Response).
When the caveat was not removed notwithstanding the further evidence, the practitioner states that he advised the complainant in writing that it was necessary 'to change tack and seek a grant of a disputed nature ... in a contested court action' (para 20 of the Response).
In para 21, he states 'The client authorised me, verbally [sic] to proceed. That amounts to the entering into the second retainer'. The practitioner alleged 'There was no costs agreement associated with the second retainer' (para 22 of the Response).
The practitioner states that the further work rendered by him pursuant to the second retainer 'simply built on [the work of the first retainer] as part of the second retainer' (para 26 of the Response).
For present purposes, it is relevant merely to note that the practitioner pleaded that he costed his work at an appropriate scale and denied that he overcharged for legal services rendered (para 34 - para 35 of the Response).
The practitioner gave evidence which substantially supported the matters asserted in the Response.

The Committee's case

At the commencement of the hearing, a Book of Documents prepared by the Committee and containing the correspondence, the Agreements, the accounts and other documents referred to by the witnesses in their statements was tendered in (Exhibit 1).
In support of its case, the Committee, represented by Dr Dickey QC (assisted by Ms Le Miere) called two witnesses, being the complainant and her husband.
Evidence in chief was affected by tendering the signed statements of the witnesses which each confirmed on oath. The complainant duly confirmed her signed statement dated 8 April 2009 (Exhibit 2) some two weeks before the hearing.
In cross-examination the complainant stated she was not told that the grant of probate would have to be litigated in court by leading evidence and that the costs payable to the practitioner would be more than the amount previously agreed. She stated further that when she received the accounts for considerably more than the agreed amount, she and her husband were compelled to sell their home to pay the fees rendered by the practitioner (Exhibit 2, para 23).
Her evidence under cross-examination was directly in conflict with her evidence in chief in several important respects. In chief she admitted having received an earlier letter in February 2006 in which she was told that her daughter had lodged a caveat and that she would have to get her daughter to withdraw it if the complainant was to receive her inheritance 'without a court case' (Exhibit 2, para 20).
In cross-examination, she denied having been told that she would need to launch an action and stated that she did not remember receiving the letter in February alerting her to the possibility of a court action.
When shown two letters sent to her by the practitioner of 31 July 2006 and 1 August 2006 (Exhibit 1, page 52 and page 53 respectively) which clearly set forth that the matter would have to be litigated because her daughter had refused to remove the caveat, she stated (and repeated) that she had not received those letters and that she had not been told that the grant of probate was no longer a non-contentious application. In fact she stated that she had never seen the August letter before.
The complainant's attempts to explain the non-receipt (and knowledge) of these letters were unconvincing especially since both letters were admittedly received by her and dealt with in her evidence in chief (see Exhibit 2, para 28 - para 30).
In addition the complainant's evidence of the need to sell her home after receipt of the practitioner's bills of amounts in excess of the Agreement is not borne out by the documents. It is apparent that the contract for the sale of her house was executed on 12 February 2006 (Exhibit 4), some nine days before the practitioner rendered his first account on 21 February 2006 (Exhibit 1, page 35). We find that the claimant's evidence on this aspect is unreliable. We find, on the probabilities that if, in February 2006, the complainant believed that the sum total of her exposure to fees for the grant of probate was $1,000 she would not have sold their home for $358,000 in order to pay that amount or thereabouts. The probabilities strongly support the view that once her daughter refused to remove the caveat, she was informed and became aware that the matter would have to be litigated and that the costs would be considerably more than $1,000.
We find, on the probabilities, that it was that knowledge and realisation at a very early stage before the first bill was rendered, which prompted the sale of the house.
Further, a handwritten note (Exhibit 3) (according to her husband written by him at the complainant's dictation) is instructive. Notwithstanding her husband's evidence that he regularly wrote notes or letters for his wife, and that she was familiar with his handwriting, and notwithstanding that the complainant apparently signed the note, she was reluctant in cross-examination to accept that she had ever seen the note before it was shown to her at the hearing or that she had given it to Mr Reyburn. We consider her evidence in that regard to be unreliable. We find the note was hand delivered to the practitioner's firm and contains her instructions 'to her solicitor' at some period after her daughter lodged the caveat in late December 2005 or when the caveat was re-lodged in early April 2006. In the note, she instructs her solicitor inter alia as follows:
If these conditions (removal of caveat) are not met within 6 working days, we will have no option other than to take it to court ... I am prepared to spend every last cent of my inheritance to get justice.
The animosity between the complainant and her daughter is patent and deep-seated and she was determined - as she stated in cross-examination - that she would do whatever it took to ensure that her daughter got nothing.
The complainant's husband, who in his evidence did not remember a great deal, did however recollect his wife saying to the practitioner that the latter had to do everything possible to obtain probate and not to make any concessions.
The handwritten note, coupled with her husband's evidence indicates the complainant's resolve to obtain probate at all costs, a resolve not to settle or compromise the dispute with her daughter. That evidence is inconsistent with the complainant's version that she was unaware that the matter would have to go to court and that she would be charged no more than the $1,000 reflected in the Agreement.
What is further significant is that, save for the very last account rendered by the practitioner, the complainant at no stage complained about the fees charged or that she was being overcharged. Indeed when she ultimately complained to the Committee, there is nothing in the interchange of correspondence between the practitioner and the Committee to indicate that overcharging was the issue to be investigated. The complaint related to the practitioner's instruction to counsel (according to the complainant without her knowledge or consent) and a conflict of interest issue, totally unrelated to overcharging. (The interchange of correspondence is to be found in Exhibit 1, page 89, page 99, page 103, page 104 and page 122.)
The practitioner admitted in cross-examination that there was nothing in writing varying the Agreement although there were a number of occasions on which he could have done so and that it was a mistake on his part not to have the Agreement amended in writing. He sought to explain this on the basis that he did not think the daughter would ultimately go to court. We deal more fully below with the criticism levelled at the practitioner on this aspect. We nevertheless accept his evidence after examining the correspondence and the probabilities that the complainant knew that the matter would go to court, that it would cost more and that she authorised the practitioner to go ahead.
We accordingly find the complainant to be an unreliable witness. We find (as deposed to by the practitioner) that when the caveat was lodged and later renewed, the complainant was informed by him that the issue would have to be litigated and that it would cost considerably more than agreed on a non-litigious basis. We find that the complainant was determined to ensure that the validity of the will would be upheld and that the caveat would be removed and that she was prepared to finance that litigation to achieve her objective, at whatever the cost.
In the first ground of the complaint (sending an account for $1,000 which was not justified), Dr Dickey contended that the parties were bound by the Agreement. He argued that the practitioner’s mandate was to obtain probate at a cost of $1,000 plus GST, and that he was not entitled to charge a fee until he had actually obtained probate.
We do not agree that the practitioner was not entitled to charge any fee until he had completed his mandate. The Agreement in cl 3, referred to in [10] above, obliged the complainant to make periodic payment as and when accounts were rendered even though all the services had not been performed. The evidence reveals that the practitioner had prepared the application with supporting documentation which, but for the caveat, would have entitled the applicant to a grant of probate. The practitioner was criticised for not dealing more fully in the affidavit with the testatrix's Alzheimer's condition as a contributory cause of death, bearing in mind that she died shortly after executing her will. That aspect was in fact fully canvassed in later affidavits when the caveat was re-lodged. The criticism may well be justified but that is not conduct with which the practitioner has been charged.
It may be argued that the practitioner was not entitled to charge the full fee but we find that he had substantially performed his mandate under the Agreement entitling him to charge $1,100. There was nothing more for the practitioner to do which would have achieved a grant of probate but for the caveat. We therefore are to the view that the first ground relied upon has not been established.
In relation to the second of the two grounds relied upon, (sending accounts totalling $11,381.85 which were grossly excessive alternatively grossly in excess of that provided by the Agreement) Dr Dickey conceded that he had no basis for contending that the practitioner did not render the services for which he charged a fee nor was he able to contend that the rates which he charged were unreasonable or excessive. Indeed he admitted that had the practitioner varied the Agreement in writing or concluded a new written agreement dealing with the litigation aspects which had developed as a result of the lodging of the caveat, the Committee would have had no cause for complaint.
In effect and in substance the Committee's complaint on this ground was a failure by the practitioner to vary the Agreement in writing in order to deal with the altered circumstances. The practitioner was cross-examined at length on why he had not varied the Agreement in writing and was criticised for not having done so. The criticism was - in our view - justified. He should have entered into a varied written agreement as required by the Agreement. After all, the very purpose of requiring a cost agreement is not only to apprise clients of the services which are to be rendered and the rates to be charged but also to protect both parties from disputes which commonly occur in the absence of such documentation.

However, the failure to enter into a written variation agreement is not the misconduct with which the practitioner has been charged.
The complaints related to charging grossly excessive fees in the sum of $11,381.85 alternatively in an amount grossly in excess of that provided in the Agreement. As adverted to above, it was conceded that no challenge could be levelled at the services rendered by the practitioner and the rates charged by him. In light of:
a)the finding that the complainant was informed by the practitioner and was aware that a court action would be necessary and that it would cost more than the sum reflected in the Agreement; and
b)the concession that the practitioner rendered the services for which he charged a fee and that the rates charged were reasonable.
We have come to the conclusion that there is no basis for a finding of unsatisfactory conduct by unprofessional conduct and/or gross overcharging and that the second ground of complaint must also be dismissed.
In conclusion, it must be noted that in the course of his crossexamination, the practitioner admitted that the issue for which he sought counsel's opinion was a personal one for which the complainant should not have been charged. The practitioner agreed to repay the complainant the sum of $275 being the fee of counsel paid for by her.
The practitioner also handed in a list of five items totalling $153 (Exhibit 7) which he conceded he should not have charged the complainant. He undertook to repay the total sum of $428 to the complainant. No doubt that undertaking will be met.

Orders

The Tribunal therefore makes the following orders:
The application by the Legal Practitioners Complaints Committee is dismissed.

I certify that this and the preceding [54] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
___________________________________
JUSTICE J A CHANEY, PRESIDENT