Legal Services Commissioner v Baker (No 2)

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SUPREME COURT OF QUEENSLAND

CITATION:

Baker v Legal Services Commissioner [2006] QCA 145

PARTIES:

MICHAEL VINCENT BAKER
(respondent/appellant)
v
LEGAL SERVICES COMMISSIONER
(applicant/respondent)

FILE NO/S:

Appeal No 9533 of 2005
SC No 9619 of 2004

DIVISION:

Court of Appeal

PROCEEDING:

Appeal against order of Legal Practice Tribunal

ORIGINATING COURT:

Legal Practice Tribunal

DELIVERED ON:

5 May 2006

DELIVERED AT:

Brisbane

HEARING DATE:

29 March, 2006

JUDGES:

McPherson and Jerrard JJA and Douglas J
Separate reasons for judgment of each member of the Court, each concurring as to the order made

ORDER:

Appeal dismissed

CATCHWORDS:

PROFESSIONS AND TRADES – LAWYERS – MISCONDUCT, UNFITNESS AND DISCIPLINE – APPEAL AGAINST DECISION OF LEGAL PRACTICE TRIBUNAL – where tribunal ordered appellant’s name be removed from the roll of legal practitioners – whether solicitor acted dishonestly in claiming to be entitled to fees – whether finding of guilt of professional misconduct should be disturbed – whether wrongful charging of professional fees and disbursements where none properly chargeable and dishonest rendering of account constituted professional misconduct – where firm’s conduct misleading and deceptive – where solicitor aggressively and remorselessly pursued unsophisticated and inexperienced clients for fees conceivably owed – where tribunal ordered respondent practitioner pay costs – whether withdrawal or failure of some charges warranted an apportion of the quantum of costs – whether “exceptional circumstances” exist such as to defeat the mandatory requirement of s 286(1) of the Legal Profession Act 2004 (Qld)

CONTRACT – PARTICULAR PARTIES – SOLICITOR AND CLIENT – RETAINER – where terms of retainer “no win no fee” – circumstances where solicitor entitled to unilaterally terminate retainer – breach or repudiation – circumstances where solicitor entitled to charge professional fees – whether solicitor entitled to claim fees for work done before frustrating event – whether client liable in restitution for work done of which the client takes advantage after discharge of retainer

Legal Profession Act 2004 (Qld) s 286

Adamson v Queensland Law Society Incorporated [1990] 1 Qd R 498, cited
Appleby v Myers (1867) LR 2 CP 651, cited
Attorney-General v Bax [1999] 2 Qd R 9, cited
Baker Johnson v Jorgensen [2002] QDC 205, cited
Bluck v Lovering & Co (1887) 35 WR 232, cited
Cachia v Isaacs (1985) 3 NSWLR 366, considered
Caldwell v Treloar (1982) 30 SASR 202, considered
In Re Continental C & G Rubber Co Pty Ltd (1919) 27 CLR 194, cited
Cutter v Powell (1795) 6 TR 320, cited
Re Elfis & Somers (OS 270 of 1981) 7 May 1982 (Qld Sup Ct, unreported), cited
Gamlen Chemical Co Ltd (UK)  v Rochem Ltd [1980] 1 WLR 614, cited
Gange v Sullivan (1966) 116 CLR 418, cited
ex p Maxwell (1955) 72 WN NSW 333, considered
Meehan v Jones (1982) 149 CLR 571, cited
Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221, cited Planche v Colburn (1831) 8 Bing 14, cited
R v Lindsay [1963] Qd R 386, cited
State Rail Authority of New…

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Details
Case
[2006] QCA 145
Decision Date

CaseChat Overview and Summary

In the case of Legal Services Commissioner v Baker (No 2), the appellant, Baker, sought to appeal against the decision of the Legal Practice Tribunal, which had ordered that his name be removed from the roll of legal practitioners due to findings of professional misconduct. The central issues in this case were whether Baker had acted dishonestly by claiming fees he was not entitled to and whether the tribunal's finding of guilt of professional misconduct should be overturned. The case also examined whether the wrongful charging of fees and the dishonest rendering of accounts constituted professional misconduct. Additionally, the court considered the solicitor-client relationship, specifically whether the solicitor was entitled to charge fees for work done before the retainer was terminated and whether the client was liable for work done after the retainer was discharged.

The reasoning of the court involved a detailed analysis of the written agreement between the parties, particularly focusing on clauses 3(a), 7(i), and 11. The court examined the nature of the retainer agreement, which included a "no win no fee" provision. The court found that the terms of the retainer did not allow the solicitor to unilaterally terminate the agreement or claim fees for work done before the retainer was terminated. The court also found that the retainer was frustrated due to the discovery of a conflict of interest, which made it impossible for the solicitor to continue acting for either party. Consequently, the court held that Baker's actions constituted professional misconduct and dismissed the appeal.

The court's decision upheld the tribunal's findings and ordered that Baker's name be removed from the roll of legal practitioners. The court also directed that Baker pay the costs of the appeal, noting that although some charges were withdrawn or failed, the overall circumstances did not warrant a reduction in the costs. The court found that there were no exceptional circumstances that would defeat the mandatory requirement of s 286(1) of the Legal Profession Act 2004 (Qld).

Orders

Orders of the court

Appeal dismissed

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

The written agreement in this instance includes in cl 3(a) a provision that, so far as material, for all professional work done by the firm the client agrees to pay “fees … together with all outlays and other charges upon the successful conclusion of the work undertaken …”. Clause 7(i) states that accounts will be issued “upon completion of the matter/judgment or settlement of the action”. Clause 11 provides: The terms of the retainer do not displace, but plainly confirm the general rule that professional fees for litigation are not chargeable until the matter (or in this case perhaps matters) is concluded and, in the light of cl 3(a), “successfully” concluded. In that respect it does not differ from the “no win no fee” agreement made by the firm in the cases of Nutley and Jorgensen. The only departure from the general rule is contained in cl 11(ii) and cl 11(iv). The latter entitles the firm to all outstanding fees and costs up to termination. It is, to my mind not perfectly clear that a fee is “outstanding” in terms of cl 11(vi) if it has not become due and payable at or prior to termination. The fees here were not due and payable when the firm discovered the conflict of interest and then advised Ms Robertson of it on 13 October 1999. Mr Davis urged that we should not read cl 11(iv) in this way, submitting that it fell to be interpreted in the context of cl 11(ii), which conferred on the firm a power to terminate this agreement for “lawful cause”. In substance his Honour accepted this view of the contract saying (para 148) that in the circumstances the firm had no option [but] to act as it did, and in para 149 of the reasons that, “although a practitioner who terminates for good cause, as occurred here, is not precluded from seeking payment of a fee ... the charge should only be made in respect of items of work which will not need to be duplicated by the new solicitor”. However, I am with respect not able to agree that the contract here was terminated by the firm for just cause under cl 11(ii), or that the client was liable for work not needing to be duplicated. The discovery that the firm was acting for both parties in the prospective litigation produced the inevitable result that it became unlawful, or certainly improper, for the firm to continue acting for either party in the matter. Neither client could have insisted that the firm continue to act for him or her. It became impossible for the firm to do so. In that way, the contract of retainer with Ms Robertson became impossible of performance. Both she and the firm were discharged by frustration from their obligations to perform it. But this was the consequence not of the firm’s decision to terminate it, but of the operation of the rule of frustration of contracts, which takes effect independently of any action by the parties. The retainer was frustrated when the conflict of interest arose or was discovered irrespective of, and before, the notice relying on cl 11(iv) was given on 13 October 1999.

Ratio Decidendi

Legal Principle Established

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