MacDonald v Grundy

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

JUDICIAL REVIEW AND APPEALS LIST

S ECI 2023 01026
S ECI 2023 01027

BETWEEN:	S ECI 2023 01026
MARK MACDONALD	Applicant
v
TERENCE GRUNDY (PRACTISING AS T F GRUNDY LAWYER)	First Respondent
KARIN MALCOLM	Second Respondent
MICHAEL WRIGHT (PRACTISING AS WRIGHTWAY LEGAL)	Third Respondent

AND

BETWEEN:	S ECI 2023 01027
MARK MACDONALD	Applicant
v
TERENCE GRUNDY (PRACTISING AS T F GRUNDY LAWYER)	First Respondent
KEVIN JONES	Second Respondent

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JUDGE:	Ginnane J
WHERE HELD:	Melbourne
DATE OF HEARING:	29 February, 1 March 2024
DATE OF JUDGMENT:	3 July 2024
CASE MAY BE CITED AS:	MacDonald v Grundy
MEDIUM NEUTRAL CITATION:	[2024] VSC 383

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APPEAL – Orders of Judicial Registrar – Self-executing orders dismissing proceedings for failure to provide transcripts in appeals from Magistrates’ Court orders – Appeal out of time – Whether explanation for delay – Whether discretion to extend time should be exercised – Whether utility in granting extensions of time – Appeals from Magistrates’ Court orders on questions of law out of time – Prospects of applicant establishing exceptional circumstances to obtain extensions of time to appeal Magistrates’ Court orders – Whether explanations for delay – Prospects of appeals succeeding – Exercise of discretion to grant extensions of time – Appeals from Judicial Registrar’s orders dismissed – Magistrates’ Court Act 1989 s 109; Legal Profession Uniform Law Application Act 2014 s 174; Supreme Court (General Civil Procedure) Rules rr 24.06, 58.09, 58.10(9) 84.06, 84.09, 84.10.

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APPEARANCES:	Counsel	Solicitors
For the Applicant	In person
For the First Respondent in proceedings S ECI 2023 01026 and for the First and Second Respondents in proceedings S ECI 2023 01027	Mr A Campbell	T F Grundy Lawyer

HIS HONOUR:

Introduction

Mr Mark MacDonald appeals from orders made by a Judicial Registrar on 12 July and 23 August 2023, including self-executing orders which resulted in these two proceedings being dismissed. The underlying dispute is between lawyers and a former client. The Judicial Registrar’s orders were made in the present proceedings in which Mr MacDonald sought to appeal orders made in two Magistrates’ Court proceedings. He commenced his appeals against the Magistrates’ Court orders out of time. He also commenced his appeal against the Judicial Registrar’s orders of 12 July 2023 out of time. The first Magistrates’ Court proceeding concerned a dispute about a sum of money which is being held in a solicitor’s trust account, which proceeding I will often refer to as the ‘sum of money proceeding’. The second Magistrates’ Court proceeding concerned a claim by lawyers for fees and disbursements for representing Mr MacDonald in a case in the Victorian Civil and Administrative Tribunal (‘VCAT’), which proceeding I will often refer to as the ‘legal fees proceeding’. As I explain, in order to decide the two appeals against the Judicial Registrar’s orders I must, in the case of the orders of 12 July 2023 in which Mr MacDonald requires an extension of time, also consider his prospects of obtaining separate extensions of time to appeal the Magistrates’ Court orders. Therefore, I must consider two separate occasions in which Mr MacDonald has sought to commence proceedings out of time.

The respondents in the first appeal, S ECI 2023 01026, are Mr Terence Grundy, a lawyer, trading as T F Grundy Lawyer, who acted as Mr MacDonald’s lawyers in the VCAT proceeding, Ms Karin Malcolm, and Mr Michael Wright, a lawyer practising as Wrightway Legal in Queensland. Ms Malcolm and Mr Wright were executors of the estate of Mr MacDonald’s late mother, Ms Barbara Armitage The respondents in the second appeal, S ECI 2023 01027, are Mr Grundy and Mr Kevin Jones of counsel, who represented Mr MacDonald in the VCAT proceedings and in these proceedings on some occasions.

An appeal against orders of a Judicial Registrar is a de novo appeal in which the Court makes a fresh decision on the material before it, without the appellant having to establish error by the Judicial Registrar.[1]
[1]Supreme Court (General Civil Procedure) Rules 2015 r 84.06.

On 19 April 2023, the Judicial Registrar directed in each proceeding that:

The appellant file and serve an affidavit in accordance with r 58.09 of the Rules, exhibiting the reasons of the Court below and any transcript of any relevant hearing, on or before 5 May 2023.

The Judicial Registrar also made orders for Mr Grundy, to file and serve any application in respect of the proceedings on or before 19 May 2023, to be made by summons supported by an affidavit, with affidavits in response.

Mr Simon Gunn, a solicitor employed by T F Grundy Lawyer, enquired of Mr MacDonald on 26 and 28 April 2023 whether he intended to have the audio recording of the Magistrates’ Court hearing professionally transcribed.[2] Mr Gunn called Mr MacDonald on 5 May 2023, who told him that he intended to transcribe the audio recording of the reasons himself with the assistance of an employee of his local community telecentre,[3] because he could not afford to have the recording professionally transcribed. Mr MacDonald proposed to transcribe only the audio recording of the reasons. Mr Gunn told Mr MacDonald that a transcript not professionally prepared was problematic from the respondents’ perspective and suggested that he contact the Supreme Court’s Self-Represented Litigants Coordinator to enquire whether it would be acceptable. Mr Gunn’s evidence was Mr MacDonald replied that ‘his proposed course of action is sufficient for his purposes’.[4]
[2]Affidavit of Simon Gunn filed 12 May 2022, [17]-[18]; Application Book 302.
[3]Affidavit of Simon Gunn filed 12 May 2022, [20]; Application Book, 303.
[4]Affidavit of Simon Gunn filed 12 May 2022, [21]; Application Book, 303.

On 12 May 2023, Mr Grundy issued a summons seeking the dismissal of the proceedings pursuant to r 58.10(9) which applies where the appeal is frivolous, vexatious or otherwise an abuse of process of the Court. That summons has not yet been heard, but it was not suggested that its existence made it inappropriate for the Judicial Registrar to make the orders that he did or for the Court to hear appeals from the Judicial Registrar’s orders.

On 15 May 2023, Mr Gunn received an AI-generated transcript of the Magistrates’ Court proceedings prepared by, or on behalf of, Mr MacDonald. Mr Gunn described the transcript as unintelligible because it failed to differentiate between speakers, was replete with inaccuracies, was incomplete, and was not in a form which could immediately assist the Court or the parties. Mr Gunn conveyed this to Mr MacDonald.[5]
[5]Email of Simon Gunn dated 15 May 2023; Application Book, 468.

At a directions hearing on 7 June 2023, the Judicial Registrar again made orders requiring Mr MacDonald to file and serve an affidavit in accordance with r 58.09 of the Rules. In the ‘Other Matters’ section of the orders, the Judicial Registrar noted that Mr MacDonald intended to make an application that Mr Grundy provide the transcript and that Mr Grundy and Mr Jones had invited the Court to make a self-executing order to dismiss the proceedings should the appellant fail to provide the transcript of the Magistrates’ Court proceedings.

On 4 July 2023, Mr MacDonald filed a summons seeking orders that the AI-generated transcript be accepted as satisfying his procedural obligations under r 58.09 or, alternatively, that Mr Grundy provide and pay for the transcript. No affidavit or submissions were filed in support of the summons.[6]
[6]Affidavit of Simon Gunn filed 23 January 2024, [16]; Application Book 459.

The hearing on 12 July 2023

The Judicial Registrar heard and dismissed Mr MacDonald’s summons on 12 July 2023 and ordered that:

1. The appellant file and serve an affidavit in accordance with r 58.09 of the Rules, exhibiting the reasons of the Court below and the transcript of any relevant hearing, by 4:00pm on 18 August 2023.
2. Should the appellant fail to comply with order 1 hereof, the proceeding stands dismissed without adjudication on the merits.

In the ‘Other Matters’ section of each order, the Judicial Registrar recorded that:

The appellant is yet to file an affidavit exhibiting the transcript of the relevant Magistrates’ Court hearing.
By summons filed on 4 July 2023 the appellant seeks orders, inter alia, that:
‘The A.I. Produced transcripts produced from the MMC Audio of the Trial of these matters being Appealed be accepted and if not I be relieved of providing such Transcript.’

The conduct of the appeal requires the production of transcript. In both this and proceeding S ECI 2023 01027 the summons filed by the appellant on 4 July 2023 is dismissed.
It is not appropriate to rely on an 'A.I. transcript' which is not intelligible and not a complete transcript of the relevant Magistrates Court proceedings. There is no reason to properly impose the cost of obtaining the transcript on the respondents given the nature of the appeal, where the Magistrate has found that the appellant is liable to pay the first respondent a substantial sum of money.
The first respondent has invited the Court, as foreshadowed at the previous directions hearing on 7 June 2023, to make a self-executing order to dismiss the proceeding if the appellant fails to provide the transcript of the relevant Magistrates Court hearing.

On 17 July 2023, Mr MacDonald emailed Mr Gunn requesting a copy of the transcript order form. On 24 July 2023, after returning from leave, Mr Gunn advised Mr MacDonald that he did not have a copy of the order form but referred him to the Supreme Court Practice Note which he had previously provided him.[7]
[7]Email of Simon Gunn dated 24 July 2023; Application Book, 480.

On 18 August 2023, Mr MacDonald emailed the Judicial Registrar’s chambers and the other parties informing them that, while the transcript was supposed to be filed that day, the transcriber claimed that they had no record of his payment despite him paying 60 per cent of the quoted price. This situation appears to have resulted from Mr MacDonald receiving incorrect bank account details for the transcriber. However, he stated that the transcriber had confirmed that the transcript would be ready by 23 or 24 August 2023 at the latest. He advised that he had been scheduled for heart surgery on 24 August 2023 which could not be changed as he was ‘deemed a category “A” patient and [the] surgery was required to be performed within 30 days of the cardiologist referral’. He concluded the email by apologising to the Court ‘for not making the order date’ and explaining that he ‘could not have predicted the events that have subsequently occurred but more than anything [he] still wish[ed] for the hearing to proceed as set down’.[8]
[8]Email of Mark MacDonald dated 18 August 2023; Application Book, 441.

Because Mr MacDonald failed to file the affidavits by 18 August 2023 exhibiting the transcript, the self-executing orders made on 12 July 2023 took effect and the proceedings were dismissed. As a result, the orders of the Magistrates’ Court in the two proceedings, which I describe below, remain in force.

On 22 August, Mr MacDonald informed the Court and the opposing parties by email that the transcriber had confirmed that the transcript should be ready by the close of business ‘on Wednesday tomorrow 23/8/23’.[9]
[9]Email of Mark MacDonald dated 22 August 2023; Application Book, 406.

The hearing on 23 August 2023

A further directions hearing occurred on 23 August 2023 at 10:00 am. Mr Jones appeared on behalf of Mr Grundy in both proceedings and on his own behalf in the legal fees proceeding. Mr MacDonald joined the hearing remotely at approximately 10:09 am, after it had commenced and, it seems, after the costs order had been made against him.[10] The Judicial Registrar advised him of the costs orders and other matters that had occurred prior to him joining the hearing. Mr MacDonald referred to his email to the Court of 18 August 2023 and said that he had paid for the transcript and that he would have it by the end of the day and sought further time to provide it. The Judicial Registrar refused the request stating that ‘the orders are the orders’.[11] Mr MacDonald said that the Judicial Registrar then cut off his remote connection to the hearing and he that had no further chance to make submissions. It is unclear whether Mr Jones’ connection was cut off at the same time. Counsel for the respondents, who appeared at the present hearing, but not on 23 August 2023, stated his understanding that Mr MacDonald sought to agitate the issue about an extension of time and that after the Judicial Registrar had dealt with that issue, he ended the hearing.[12]
[10]Transcript of Proceedings, MacDonald v Grundy (Supreme Court of Victoria, S ECI 2023 01026; S ECI 2023 01027, Ginnane J, 29 February 2024 - 1 March 2024) (“T”), 153-154.
[11]T 113.
[12]T 153-154.

After the hearing ended, at 12:11 pm Mr MacDonald emailed the Court requesting that ‘before orders are [made] set a new mention hearing date at the next available hearing time’.[13] He described the proposed orders as ‘unjust and a denial of my natural justice’.[14] He explained his delay in obtaining the transcript and repeated that the transcriber had told him that it would be available by the close of business that day. He again noted that he was scheduled to undergo cardiac surgery in Mackay the following day. However, the Judicial Registrar proceeded to make the orders I next set out and sent them to the parties.
[13]Email of Mark MacDonald dated 23 August 2023; Application Book, 407.
[14]Email of Mark MacDonald dated 23 August 2023; Application Book, 407.

The Judicial Registrar made orders in each proceeding. In proceeding S ECI 2023 01026, the sum of money proceeding, the Judicial Registrar ordered that Mr MacDonald pay the respondents of the proceeding in accordance with the costs orders made that day in proceeding S ECI 2023 01027.

In proceeding S ECI 2023 01027, the legal fees proceeding, the Judicial Registrar ordered:

The appellant is to pay the respondents’ costs fixed in the amount of $11,492.50, which includes the cost of both this proceeding and related proceeding S ECI 2023 01026.

In the ‘Other Matters’ section of the orders of 23 August 2023, the Judicial Registrar recorded that:

On 12 July 2023 I made a self-executing order that the proceeding stand dismissed without adjudication on the merits should the appellant fail to file and serve an affidavit in accordance with r 58.09 of the Supreme Court (General Civil Procedure) Rules 2015 (“the Rules”), exhibiting the reasons of the Court below and the transcript of any relevant hearing, by 4:00pm on 18 August 2023.
The appellant has not filed an affidavit in accordance with the Court’s previous orders and in accordance with r 58.09 of the Rules. The appellant did not make application by summons to vary or extend the time to comply with the 12 July 2023 orders. The proceeding consequently stands dismissed by virtue of the order made on 12 July 2023.

The effect of the orders was to require Mr MacDonald to pay the sum of $11,492.50 for costs to Terence Grundy, practising as T F Grundy Lawyer, and Mr K Jones.

Mr MacDonald said that he did file the transcript of the Magistrates’ Court hearings. ‘within one or two days’ of 23 August 2023.[15] Counsel for Mr Grundy and Mr Jones stated that Mr MacDonald provided the transcript, including the transcript of the Magistrate’s decision, ‘just after the self-executing orders had taken effect’.[16] There was some affidavit evidence suggesting that the transcripts may have been provided considerably later,[17] but I will proceed on the basis that they were provided soon after the hearing on 23 August 2023.
[15]T 15–16.
[16]T 3 L 26, 28.
[17]Affidavit of Simon Gunn filed 23 January 2024 [29]; Application Book, 463.

The two Magistrates’ Court proceedings

Mr Grundy commenced proceeding number L11169563 in the Magistrates’ Court, which is the subject of proceeding SECI 2023 01026 in this Court, the sum of money proceeding. Mr Grundy had acted as Mr MacDonald’s solicitor in the VCAT proceeding, which concerned a dispute arising from the sale of a Lake Boga motel by H Y Ting & Sons Pty Ltd to Aussie Bush & Country Motels Pty Ltd, a company owned by Mr MacDonald and of which he was a director.[18]
[18]H Y Ting & Sons Pty Ltd v MacDonald (No 2) [2018] VCAT 477.

The defendants in the sum of money proceeding were: Mr Michael Wright, a Queensland legal practitioner practising as Wrightway Legal, and an executor of the estate of Mr MacDonald’s mother, as first defendant, Ms Karin Malcolm, who is Ms Armitage’s daughter and Mr MacDonald’s sister and also an executor of her mother’s estate, as second defendant, and Mr MacDonald as third defendant.

The sum of money proceeding concerned the amount of $50,000, which was Mr MacDonald’s distribution of his mother’s estate, from funds held by Mr Wright as executor, pursuant to an order of the Queensland District Court. Mr Wright had applied on behalf of the estate for directions about the estate funds that he held.[19] The Queensland District Court order included:

The sum of $74,059.63 held in the Trust Account of Wrightway Legal, the solicitors for the Executor Michael Wright be distributed as follows:
(i) $10,000.00 to Wrightway Legal;
…
(iv) $50,000.00 to Mark MacDonald.

[19]T 116-117.

Mr Grundy had written to Wrightway Legal asking them to hold $50,000, ‘pending his applying for a freezing order for the funds we hold in trust for you’.[20] Mr Wright subsequently transferred the $50,000 to Mr Grundy’s trust account on 15 December 2020.[21]
[20]Email on behalf of Michael Wright dated May 13 2020; Application Book, 59.
[21]Affidavit of Simon Gunn filed 23 January 2024 [25]; Application Book, 463.

Previously, on 11 October 2019, Mr Grundy had received into his trust account, the sum of $25,323 pursuant to s 181(8)(a) of the Local Government Act 1989 concerning a property at Tarraville in Victoria, over which he claimed a charge under the terms of a Costs Agreement with Mr MacDonald. Section 181(8) deals with the use or payment of amounts remaining after a Council has sold or caused land to be transferred to recover unpaid rates or charges.

Mr Grundy contended that by the terms of the written retainer contained in a Costs Disclosure statement and Costs Agreement signed on 23 September 2017, Mr MacDonald charged his entitlement to part of the estate in favour of Mr Grundy to secure outstanding, unpaid costs and disbursements incurred by him in the VCAT proceeding. He also said that Mr MacDonald had signed an ‘Irrevocable Order’ authorising the payment of that sum to him, which stated:

23 September 2017
To: Executors of the Estate of the late Barbara Armitage Wrightway Legal 8/2460 Gold Coast Highway, Mermaid Beach QLD 4218 Estate of Barbara Armitage
As a beneficiary of the Estate of my late mother, Barbara Armitage, I irrevocably order and direct you in your capacity as Executors of the Estate, and to Michael Wright as solicitor for the Executors of the Estate, to pay my Solicitor, T. F. GRUNDY LAWYER of Level 15, Suite 1502, 530 Little Collins Street, Melbourne, the whole of my entitlement by way of distribution from the net assets of the Estate.

I will next describe the Costs Agreement and the Costs Disclosure statement that Mr Grundy contends Mr MacDonald signed.

The first page of the Costs Agreement was a Costs Disclosure statement containing information about the costs associated with the matter and the client’s rights in relation to those costs. When read with the Costs Agreement, Mr MacDonald was provided with an estimate of Mr Grundy’s and Mr Jones’ fees and disbursements. I discuss below Mr MacDonald’s claim that, on the respondents’ case, the statement was not served within the stipulated time and therefore cannot be relied on.

The Costs Agreement dealt with the work to be carried out; the fees and disbursements; billing arrangements; trust money; the client’s right to a bill of costs; and right to fair and reasonable costs; interest charged; briefing counsel or other experts; the court awarding costs against the client; the pre-litigation requirement to seek to resolve the dispute; the termination of the agreement; electronic communication; the person who would be responsible for the work; the solicitor’s lien; security for costs and acceptance of the agreement.

The provision on security for costs in the Costs Agreement included the following paragraphs:

In consideration of our continuing to work on this matter without payment of fees being made in accordance with their usual terms, you agree to provide a mortgage and charge over any land presently owned so as to secure all fees owing as well as those to be incurred; and, you also acknowledge and consent to the registration of caveats and mortgages over the land and property referred to above.
You also agree as additional security to provide us with an irrevocable order directed to the executors of the estate of your late mother to pay your entitlement as a beneficiary to our trust account from which we can draw down legal fees and disbursements incurred as described in this Costs Agreement. You also agree that we send this Costs Agreement to the Executors and the solicitors acting for the Executors, as notice of this irrevocable order and direction to pay.

Mr MacDonald’s defence was that he did not sign the Irrevocable Order or Costs Agreement. In the alternative, he contended that if he did sign them, they were invalid because his signature was obtained by duress by the lawyers Mr Grundy and Mr Jones informing him that they would not represent him in the VCAT proceeding, commencing the following Monday 25 September 2017, if he did not sign the documents.

Mr MacDonald commenced a counterclaim in the sum of money proceeding against Mr Wright, Ms Malcolm and Mr Grundy, alleging that Mr Wright had not done what he was lawfully required to do, which was to pay him the $50,000. He alleged that Mr Wright had committed contempt of court by disobeying the Queensland District Court order. He contended that the Magistrates’ Court of Victoria did not have jurisdiction over the $50,000 as the Queensland District Court had directed that it be paid to him. He sought orders that the defendants to the counterclaim pay him $50,000 and compensate him for his losses by not having the $50,000 and also sought interest.

In his defence to the counterclaim, Mr Grundy contended that Mr MacDonald was bound by the terms of the Irrevocable Order, that the equitable charge was enforceable by the Magistrates’ Court and that he was entitled to continue to hold the sum of $50,000 on trust pending resolution of the two proceedings.[22] Mr Wright and Ms Malcolm did not participate in the Magistrates’ Court proceedings or the proceedings in this Court.[23]
[22]Notice of Defence of T F Grundy Lawyer filed 26 July 2022, [8]; Magistrates’ Court Book, 66 [8.2].
[23]T 139.

In the sum of money proceeding, the Magistrate ordered on 7 December 2022 that:

1. [Mr Grundy] be permitted to apply the Third Defendant’s funds held in the Trust Account of the First Plaintiff pursuant to the order of Magistrate Braun of 26 November 2020 in partial discharge of the judgment in Proceeding L 10150906. Stayed until 20 January [2023].[24]
2. The Third Defendant’s Counterclaim and Cross-Claim are dismissed.

[24]Order of the Magistrates’ Court, dated 8 December 2023; Application Book, 339. The copy of the Order contained in the Application Book states the date as 20 January 2022, but that is a typographical error.

The second Magistrates’ Court proceeding, the legal fees proceeding, which was proceeding L10150906, and is the subject of proceeding SECI 2023 01027 in this Court, concerns Mr Grundy and Mr Jones’ claims against Mr MacDonald for fees and disbursements for representing him in the VCAT proceeding.

In this judgment, I also often refer to Mr Grundy’s submissions and contentions. When those references are to the legal fees proceedings, the submissions and contentions were also made on behalf of Mr Jones, the second plaintiff in that proceeding, although, for reasons of concision, I usually do not so state.

Mr MacDonald’s defence was that he did not sign the documents dated 23 September 2017, being the ‘Irrevocable Order’ or the Costs Agreement. He contended that he only became aware of the Irrevocable Order when Mr Grundy emailed it to him in September 2018. He contended that he first became aware of the signed Costs Disclosure statement and Costs Agreement, dated 23 September 2017, on 12 August 2020 and knew straight away that the documents were fraudulent due to the pixelation and placement of his signature and initials.[25] However, he was reluctant to say that they were fraudulent until he had seen the originals.[26] He said that an unsigned costs agreement was sent to him on 5 December 2017.[27] He again relied, in the alternative, on the duress defence mentioned previously.
[25]MCVT 281 L 6-16; Application Book, 768.
[26]MCVT 281 L 2-5; Application Book, 768 and MCVT 275 L 1-5; Application Book, 762.
[27]MCVT 283 L 27-30; Application Book, 770.

Mr MacDonald and his company, Aussie Bush and Country Motels Pty Ltd, commenced a counterclaim and crossclaim in the legal fees proceeding against Mr Grundy and Mr Jones, alleging that they were not entitled to the fees they claimed and claiming damages from them. They relied on two allegations of unsatisfactory conduct. The first was Mr Jones’ request made during the VCAT hearing that the opponent’s witness produce a file which had not been discovered. The proceeding was adjourned for two and half months as a result. Mr MacDonald contended that he was disadvantaged by having the case adjourned and being left ‘sequestered’ and unable to speak with his lawyers for over two months, because, it appears, he was yet to give, or complete, his evidence, while the other side produced the folder.

The second allegation concerned the conduct of settlement negotiations with the opposing party which Mr MacDonald contended had denied him the opportunity to obtain a satisfactory settlement. He alleged that Mr Grundy failed to enter into negotiations on several occasions when he had sought him do so. He also complained about the advice he was given about settlement offers. He now believes that no offer was ever made by the other side. He also alleged that Mr Grundy did not provide him with a Costs Disclosure or Costs Agreement statement in a timely manner. Mr MacDonald sought orders that the sum of $75,323 being held in the trust account of T F Grundy be paid to him and that he be awarded $200,000 for negligent conduct.

In the legal fees proceeding, the Magistrate ordered Mr MacDonald to pay Mr Grundy $83,194.98 for fees, disbursements and interest, which included the fees of Mr Jones, who acted as counsel for Mr MacDonald in the VCAT proceeding in 2017 and 2018. The sum included $60,350.25 in unpaid fees, interest of $22,844.74, consisting of $4,244.13 in contractual interest upon unpaid fees, and $18,600.61 in statutory interest. The Magistrates’ Court also ordered that:

2. The Plaintiffs be permitted to apply the defendant’s funds held in the Trust Account of the First Plaintiff in partial discharge of this judgment.
…
5. Enforcement of this judgement, and the application of funds held in the Trust Account of the First Plaintiff in discharge of it, is stayed until 20 January 2023.

Mr MacDonald’s counterclaim and cross-claim were dismissed.

Were Mr MacDonald’s appeals from the Judicial Registrar’s orders commenced within time?
The appeals against the Judicial Registrar’s orders of 12 July 2023

Mr MacDonald appealed against the Judicial Registrar’s orders of both 12 July and 23 August 2023 in one notice of appeal filed in each proceedings i.e. one notice of appeal against the two orders in the sum of money proceeding and one notice of appeal against the two orders in the legal fees proceeding. Mr Grundy and Mr Jones argued that Mr MacDonald’s appeals against the orders of 12 July 2023, which contained the self-executing order, were out of time because his notice of appeals against those orders, which also appealed from the orders of 23 August 2023, were filed on 4 September 2023 in proceeding S ECI 2023 01027, the legal fees proceeding, and 6 September 2023 in proceeding S ECI 2023 01026, the sum of money proceeding.

The appeals against the Judicial Registrar’s orders of 23 August 2023

Mr MacDonald’s appeals against the 23 August 2023 orders were within time, but Mr Grundy argued that those appeals were not appeals against the self-executing orders of 12 July 2023, nor did they seek to appeal against any failure or refusal by the Judicial Registrar on 23 August 2023 to grant an extension of time to comply with the self-executing orders.

Submissions about extensions of time to appeal the Judicial Registrar’s orders of 12 July 2023

Mr MacDonald’s appeals against the Judicial Registrar’s orders are de novo appeals, so he does not have to establish an error affecting the orders. But I will summarise his challenges to the Judicial Registrar’s reasons because they have relevance to matters on which he seeks to rely in the present hearing.

Mr MacDonald argued that the Judicial Registrar denied him procedural fairness at the hearing on 23 August 2023 by not giving him the opportunity to submit that the self-executing orders of 12 July 2023 should not be enforced or to seek an extensions of time in which to comply with them. He was unaware that he had to file a summons in order to seek such orders. He said that he could not have known that he would be unable to provide the transcript by 18 August 2023. He argued that the Judicial Registrar had a predetermined opinion about the effect of the self-executing orders and had failed to consider his emails explaining his delay. Nor, he submitted, did the Judicial Registrar take into account his age, that he was self-represented, that he had been recently scheduled to undergo cardiac surgery on 24 August 2023 and was taking seven different tablets daily.

Mr MacDonald explained his delay in obtaining the transcript, his attempts to have an AI-generated transcript accepted, that it took him time to raise the $5,000 cost of the transcript and the confusion that occurred in obtaining the transcriber’s bank account details to enable him to transfer the amount of the deposit. He obtained $1,000 through an advance on his pension, which resulted in his fortnightly pension payment being reduced to about $950. He also obtained a personal loan of $5,000 which he had to repay at $500 per month.[28] He submitted an order form for the transcript, dated 1 August, and transferred to the transcriber the initial payment of 60 per cent on 7 August.[29] However, due to an error in banking details,[30] the transcriber did not receive the deposit until after 7 August and therefore the transcript took a further nine days to complete.[31] He referred to his emails of 18 and 22 August 2023 to the Court and the respondents, to which I have previously referred, about his problems in obtaining the transcript and when it would be provided.[32]
[28]Email of Mark MacDonald dated 23 August 2023; Application Book, 20.
[29]Email of Mark MacDonald dated 7 August 2023; Application Book, 13.
[30]T 13 L 1-3.
[31]T 13 L 16- 18.
[32]Email of Mark MacDonald dated 18 August 2023; Application Book, 403.

Mr Grundy argued that Mr MacDonald had not explained his delay in appealing the orders of 12 July, nor his failure to comply with the self-executing orders. He knew early on that he would not be able to provide the transcript by 18 August 2023. On 31 July 2023, the transcriber quoted him the amount of $5,414.40 to provide the transcript. Knowing that the proceeding would be dismissed if he did not file the transcript by 18 August, Mr MacDonald did not submit the required form until 3 August and did not pay the deposit until 7 August 2023.

Analysis of the significance of Mr MacDonald’s delay in filing appeals from the Judicial Registrar’s orders of 12 July 2023

The first issue is whether Mr MacDonald’s appeals against the self-executing orders of 12 July 2023 were filed out of time.

Mr MacDonald filed one notice of appeal from the Judicial Registrar’s orders and determinations of 12 July and 23 August 2023 in proceedings S ECI 2023 01026 on 6 September and one notice of appeal from the orders and determinations in proceeding S ECI 2023 01027 on 4 September 2023. Insofar as the notices of appeal were from the orders and determinations of 12 July 2023 they were out of time as the 14 day appeal period for such appeals had expired on 27 July 2023. The notices of appeal against the orders of 12 July 2023 were 41 days out of time in proceeding 01026 and 39 days in proceeding 01027. The appeals against the Judicial Registrar’s orders of 23 August 2023 were within time.

Rule 84.09 enables the Court to grant an extension of time for the filing or service of a notice of appeal against a determination by a Judicial Registrar. In oral submissions, Mr MacDonald sought such an extension of time to appeal the Judicial Registrar’s orders of 12 July 2023.

The following matters are relevant in exercising the discretion to grant extensions of time under r 84.09: the extent of the delay and its explanation; whether there is any utility in granting the extension, including the prospects of the appellant succeeding; the extent of any prejudice to the other parties if the extension of time is granted and what the overall justice of the case requires.[33]
[33]Hughes v National Trustees, Executors & Agency Co of Australasia Ltd [1978] VR 257, 263; Jackamarra v Krakouer (1998) 195 CLR 516; Gajic v Harb [2011] VSCA 132.

In my opinion, Mr MacDonald has adequately explained his delay in providing the transcripts. He had limited financial means and unsuccessfully attempted to rely on an AI-generated transcript. It took him time to obtain a bank loan to pay for the transcript and to obtain permission to use part of his pension and he used incorrect bank account details for the transcriber. He was a self-represented litigant with health problems who was facing significant surgery.

Mr Macdonald’s appeals against the 23 August 2023 orders were in time, but for those appeals to have any effect that might assist him, save possibly in respect of the costs that he was ordered to pay, he needed to obtain a variation or setting aside of the self-executing orders of 12 July 2023. Under r 24.06 the Judicial Registrar had power to set aside the self-executing order and extend the time allowed for providing the transcript.[34] I could exercise that power on appeal. The respondents submitted that the order of 23 August did not refuse an extension of time. While Mr MacDonald did not file a summons seeking an extension of time to provide the transcripts, he appears to have sought an extension of time to do so during the hearing on 23 August 2023. The Judicial Registrar apparently advised him that his requests could not be granted as the proceedings had already been dismissed by operation of the self-executing orders.[35] I therefore treat his appeal against the orders of 23 August 2023 as including an appeal against the refusal of his application made during the hearing of 23 August for an extension of time.
[34]Mitrov Homes v Mustafa (No 2) [2023] VSC 386.
[35]T 34 L 17.

Mr MacDonald did not appeal the Judicial Registrar’s orders of 12 July 2023 with the 14 day period permitted, but there was no reason for him to do so until 18 August or, perhaps, 23 August 2023. As he submitted, the self-executing orders did not come into effect unless he failed to provide the transcript by 18 August 2023. As stated I consider that he adequately explained his delay in providing the transcript and I also consider that he has explained his delay in commencing his appeals against the Judicial Registrar’s orders of 12 July 2023.

The utility of granting Mr MacDonald extensions of time to appeal the Judicial Registrar’s orders of 12 July 2023

Having accepted that Mr MacDonald has adequately explained his delay, I will next consider other matters raised by the respondents relevant to the exercise of the discretion to extend the time for him to appeal the 12 July 2023 self-executing orders. They are the utility of granting such extensions, any prejudice to them from the grant of extensions and what the overall justice of the case requires.

I will first deal with the utility of granting Mr MacDonald extensions of time to appeal the Judicial Registrar’s orders of 12 July 2023. The determination of that matter requires consideration of the separate issue of Mr MacDonald’s prospects of being granted extensions of time to appeal the underlying Magistrates’ Court orders of 7 December 2022 and the related issue of the prospect of such appeals succeeding. In the circumstances of this case, Mr MacDonald’s primary application for an extension of time to appeal the orders of 12 July 2023 can only have utility if he has prospects of successfully appealing the Magistrates’ Court orders of 7 September 2022 because they are the orders which his Supreme Court appeals challenge. Therefore, the Court is required to consider the utility of two connected extension of time applications, that concerning appeals from the Judicial Registrar’s orders of 12 July 2023 and that concerning appeals from the Magistrates’ Court orders of 7 December 2022. The utility of both applications depends, at least in part, on Mr MacDonald’s prospects of appealing the Magistrates’ Court orders.

The prospects of Mr MacDonald establishing exceptional circumstances for the purposes of obtaining extensions of time to appeal the Magistrates’ Court orders

The prospects of Mr MacDonald being granted extensions of time to appeal the Magistrates’ Court orders requires first consideration of his prospects of being able to establish exceptional circumstances as required by s 109 of the Magistrates’ Court Act1989 in order to obtain extensions of time. The onus is on Mr MacDonald to establish that he has prospects of establishing exceptional circumstances justifying the grant of extensions of time.

I proceed on the basis that s 109 of the Act requires that the exceptional circumstances must have contributed to his delay in filing the notices of appeal.

Legislation

Section 109 of the Magistrates’ Court Act permits appeals on questions of law to this Court from a final order of the Magistrates’ Court which must be instituted no later than 30 days after the day on which the order complained of was made. Section 109 states:

(1) A party to a civil proceeding in the Court may appeal to the Supreme Court, on a question of law, from a final order of the Court in that proceeding.
(2) An appeal under subsection (1)—
(a) must be instituted not later than 30 days after the day on which the order complained of was made; and
(b) does not operate as a stay of any order made by the Court unless the Supreme Court so orders.

(3) Subject to subsection (2), an appeal under subsection (1) must be brought in accordance with the rules of the Supreme Court.
(4) An appeal instituted after the end of the period referred to in subsection (2)(a) is deemed to be an application for leave to appeal under subsection (1).
(5) The Supreme Court may grant leave under subsection (4) and the appellant may proceed with the appeal if the Supreme Court—
(a) is of the opinion that the failure to institute the appeal within the period referred to in subsection (2)(a) was due to exceptional circumstances; and
(b) is satisfied that the case of any other party to the appeal would not be materially prejudiced because of the delay.

Authorities

The ‘exceptional circumstances’ referred to in s 109(5) of the Magistrates’ Court Act are something that rarely occurs and which are outside normal occurrence and contemplation.[36] In applying s 109(5), the fact that a successful party has a vested right to the judgment must be kept in mind.[37]
[36]Mako’ochieng v Kirk [2017] VSC 459 [9].
[37]Kalb v Magistrates’ Court of Victoria [2014] VSC 137 [13], dealing with s 272(8) of the Criminal Procedure Act 2009.

In Popal v Asset Control Management Services Pty Ltd,[38] Hargrave J described considerations which are relevant to the determination of whether an extension of time should be granted under s 109(5) as follows:

As the review of the applicable law demonstrates, the Court must answer three questions in order to determine Mr and Mrs Popal’s application:
(1) Have exception[al] circumstances been demonstrated;
(2) Will the grant of leave cause material prejudice;
(3) If there are exceptional circumstances and no material prejudice: Should the Court exercise its discretion to grant leave?
His Honour also stated:[39]
…As appears above, s 109 places an onus upon an applicant for leave to appeal to demonstrate both exceptional circumstances and the lack of any material prejudice to the other parties. However, even if both limbs of this onus are satisfied, the Court retains a discretion to grant or refuse leave. Section 109(5) provides that the Court ‘may grant leave’ if the two elements are established. The discretion is unfettered, and the Court may take into account all relevant circumstances, within and outside the 30 day period.

[38][2010] VSC 412 [18].

[39][2010] VSC 412 [18].

In Mako’ochieng v Kirk,[40] McDonald J addressed the steps involved in establishing ‘exceptional circumstances’ in the following terms:
[40][2017] VSC 459 [9] (authorities omitted).

The principles governing the exceptional circumstances threshold under s 109(5) of the Act are well-established:
The granting of an extension of time is not automatic. Upon the expiry of the time for the lodgement of the appeal, a respondent has a vested right to retain the judgment unless the application is granted;
The onus lies on the applicant to satisfy the test of exceptional circumstances;
Although ‘exceptional’ is defined as meaning ‘unusual, special, out of the ordinary course’ in the Oxford English Dictionary, in the context of the Act, the circumstances must be such that they can be said to ‘rarely occur’ and ‘perhaps be outside reasonable anticipation or expectation’;
The inquiry is confined to the circumstances relevant to the applicant’s failure to appeal within time (ie 30 days) and whether they may be characterised as exceptional;
As part of that inquiry, a court will examine the conduct of the applicant (and his or her agents) in the prosecution of the appeal and the explanation for failing to lodge the notice within time;
The inquiry in determining whether exceptional circumstances exist as required by s 109(5) is not a consideration of all matters germane to the appeal;
That which must be established is that the failure to institute the appeal within the statutory period was due to exceptional circumstances;
The exceptional circumstances must relate solely to the explanation for the delay;
By use of the expression ‘exceptional circumstances’, the legislature intended to place a considerable bar in the way of an applicant before leave will be granted. The bar is a ‘significant hurdle’, which requires a ‘persuasive explanation’, to be demonstrated by ‘clear and cogent proofs’.

Mr MacDonald’s explanation for his delay in appealing the Magistrates’ Court orders and his case concerning exceptional circumstances

On 8 December 2022, the day after the Magistrate delivered judgment, Mr MacDonald suffered a heart attack in Townsville and was admitted to a hospital emergency department.[41] He suffered two subsequent heart attacks, and, on one occasion, his heart monitor flat lined and he had to be revived. It took five days for him to be stabilised and to be able to return to his home in Collinsville in the Whitsundays.[42] He underwent scans and ultrasounds and underwent heart surgery in the Mackay Hospital on 24 or 25 August 2023 and stayed in the hospital recovery ward on 25 August 2023, one or two days after the hearing before the Judicial Registrar. He was restricted from driving as a result of the surgery.[43]
[41]T 104 L 17.
[42]T 104 L 28.
[43]T 24 L 23–25.

The Magistrate told Mr MacDonald of the appeal period after he delivered judgment on 7 December 2022. He sought the Magistrate’s written reasons and said that until he obtained them, he could not prepare his notices of appeal. He was informed that no written reasons existed but that he could apply for the audio recording of the hearing.[44]
[44]Affidavit of Mark MacDonald filed 15 March 2023, [3]; Application Book, 170.

Mr MacDonald gave different accounts of when he commenced preparing notices of appeal from the Magistrates’ Court orders. He informed this Court that he prepared draft notices of appeal from the Magistrate’s Court orders over the 2022 Christmas period and finalised them on 16 January 2023. He said that he had corresponded with the Court about whether he would have to pay filing fees or would receive a fee waiver.[45] However, in an affidavit filed in these proceedings, he said that he commenced writing the notices of appeal on 16 January 2023 and completed them on 17 January.[46] He sought to file the notices of appeals through the Court’s RedCrest system the following day, but they were rejected on the ground that they did not contain questions of law. He rewrote the notices of appeal, but they were again rejected on 10 February 2023,[47] because they did not provide a Victorian address for service. He was then informed by Court staff that he would have to seek leave to appeal out of time.
[45]T 105-107.
[46]Affidavit of Mark MacDonald filed 15 March 2023, [4]; Application Book, 170.
[47]T 106 -107.

Mr MacDonald eventually filed his proposed notices of appeal on 15 March 2023, about 9 weeks out of time. It appears that he did not serve the notices of appeal on the respondents until 14 April 2023.[48]
[48]Affidavit of Simon Gunn filed 12 May 2023, [15] Attachments, 45-47; Application Book, 301.

Mr Grundy’s submissions on exceptional circumstances

Mr Grundy argued that the grant of extensions of time to appeal the 12 July 2023 orders would be futile because Mr MacDonald’s appeals against the Magistrates’ Court orders made on 7 December 2022 were themselves out of time and he had not established exceptional circumstances as s 109(5) of the Magistrates’ Court Act requires to obtain extensions of time.

Mr MacDonald had wrongly argued that because he had been granted a stay of the Magistrates’ Court orders until 20 January 2023, that he had thereby been granted an extension of the time in which he could appeal. But, the stay did not grant him an extension of time in which to appeal.

Mr Grundy argued that Mr MacDonald had failed to establish that exceptional circumstances existed justifying him being granted extensions of time. Nor had he established that no material prejudice would be caused to him and Mr Jones by the grant of an extension of time. Section 109(5) required consideration of the causes of the litigant’s failure to appeal within time. Any exceptional circumstances must have existed during the entire appeal period of 30 days, in this case from 7 December 2022 to 6 January 2023.

Mr Grundy relied on the Magistrate having informed Mr MacDonald on 7 December 2022 of the 30 day appeal period, and that he had only commenced work on his notices of appeal on 16 January 2023 and had unsuccessfully attempted to file them on 17 January 2023. He eventually filed notices of appeal, or applications for leave to appeal, which complied with the rules, on 15 March 2023, more than two months out of time. Lack of funds was not an exceptional circumstance, nor was ignorance of the law. An unrepresented party is subject to the same rules and time limits as other litigants.

Mr Gunn, a solicitor employed in Mr Grundy’s office, gave evidence by affidavit that Mr MacDonald served notices of appeal on 19 January 2023, neither of which contained the Supreme Court’s seal. He also stated that on 7 March 2023, during a hearing of a summons for taxation filed by Mr MacDonald on 25 January 2023, a Judicial Registrar advised Mr MacDonald that the Costs Court could not proceed with the taxation of the respondents’ bills for legal fees because the Magistrates’ Court orders had dealt with their quantum and that he would therefore have to appeal and have those orders overturned before a taxation could occur. Mr MacDonald advised the Judicial Registrar that notices of appeal had been filed and therefore an appeal was on foot. Counsel for the respondents advised the Court that they had not received any sealed notices of appeal. After the Judicial Registrar’s associate made enquiries and a short adjournment occurred, Mr MacDonald advised the Court that the notices of appeal had in fact been rejected because they did not address any questions of law and issues with respect to the parties named on the notices of appeal. The Judicial Registrar ordered that the summons for taxation be adjourned for three months to allow Mr MacDonald to pursue his appeals prior to proceeding with the summons.[49]
[49]Affidavit of Simon Gunn, filed 15 May 2023, [12]; Application Book, 300.

Analysis of the exceptional circumstances issue

I emphasise at this point that I am not deciding whether Mr MacDonald should be granted extensions of time to commence his appeals from the Magistrates’ Court orders. If I am persuaded that extensions of time should be granted to permit appeals against the Judicial Registrar’s orders of 12 July 2023, which is one of my present tasks, and those appeals are allowed, then at a later time, his applications for leave to appeal the Magistrates’ Court orders out of time and any subsequent appeals will be heard.

This judgment concerns whether Mr MacDonald should be granted extensions of time to appeal the Judicial Registrar’s self-executing orders of 12 July 2023 and whether his appeal against the orders of 23 August 2023 should be allowed. Such extensions of time will only have utility if Mr MacDonald has some prospects of successfully appealing the Magistrates’ Court orders, including prospects of gaining an extension of time to commence such appeals.

I am not satisfied that Mr MacDonald has established that he has any real prospect of establishing exceptional circumstances that satisfy s 109(5) of the Magistrates’ Court Act that would justify granting him extensions of time to file the notices of appeal against the Magistrates’ Court orders. In my opinion, he has not adequately explained his delay in filing his notices of appeal. I am prepared to accept that he commenced preparing his notices of appeal over Christmas 2022, but he did not attempt to file them until 16 January 2023. After the Registry refused to allow their filing, he did not file any proposed notices of appeal in a valid form for another two months. I have taken into account his hospitalisation on 8 December 2022, but he presented no medical evidence that his ongoing medical condition prevented him from preparing or filing notices of appeal.

The additional requirement – the exercise of the discretion under s 109(5) to grant extensions of time

In any event, even if contrary to my conclusion, Mr MacDonald had prospects of establishing exceptional circumstances that satisfied s 109(5) of the Magistrates’ Court Act, an additional issue would remain, whether he has prospects of the Court exercising its discretion under s 109(5) to grant him extensions of time to appeal the Magistrates’ Court orders. If proposed appeals do not have sufficient prospects of success, or there will be substantial prejudice to the respondents if an extension of time is granted, then the Court may decide not exercise the discretion in the applicant’s favour.

In order to assess the prospects of Mr MacDonald’s appeals against the Magistrates’ Court orders succeeding if extensions of time are granted, it is necessary next to consider the Magistrates’ reasons and Mr MacDonald’s proposed questions of law and grounds of appeal.[50]
[50]Mr MacDonald appeared remotely in the Magistrates’ Court hearings.

The main issues in the Magistrates’ Court proceedings were: whether Mr MacDonald signed the Irrevocable Order and the Costs Agreement; whether the Irrevocable Order was valid; whether the Magistrates’ Court had jurisdiction over the sum of $50,000 and whether the Irrevocable Order required that it be paid to Mr Grundy and whether Mr Grundy or Mr Jones was liable in negligence for conduct when representing Mr MacDonald in the VCAT proceeding. Another issue of whether his counterclaim against Mr Wright and Ms Malcolm in the sum of money proceedings should have been dismissed. In written submissions of April 2024, and in his notice of appeal in the legal costs proceeding, Mr MacDonald also contended that he had not been provided with a Costs Disclosure statement as required by law and therefore, that any Costs Agreement that he did sign was void and the respondents would be prohibited from seeking to recover their fees until they had been assessed in the Cost Court.

The Magistrate’s reasons

On 7 December 2022, the Magistrate delivered his reserved judgment orally. In proceeding S ECI 2023 01026, the sum of money proceeding, he found for Mr Grundy and dismissed Mr MacDonald’s counterclaim and cross claims. In proceeding S ECI 2023 1027, the legal fees proceeding, he found for the plaintiffs, Mr Grundy and Mr Jones, and dismissed Mr MacDonald’s counterclaim. I have previously set out the terms of those orders.

The Magistrate found that the weight of evidence supported the conclusion that Mr Grundy and Mr Jones were telling the truth about the signing of the Irrevocable Order and the Costs Agreement. The evidence on the balance of probabilities suggested that Mr MacDonald attended at Mr Jones’ chambers and signed the Irrevocable Order and the Costs Agreement.[51] Mr Grundy and Mr Jones had provided Mr MacDonald with legal services and they wanted to secure their fees. They acted in accordance with the law and the Court’s orders to respond to challenges to those fees and recover them.[52]
[51]Transcript of Proceedings, Terrence Grundy & Ors v Mark MacDonald & Ors (Magistrates’ Court of Victoria, Magistrate Robinson, 26 October, 28 October, 3 November, and 7 December 2022) (“MCVT”), 316 L17-21; Application Book, 804.
[52]MCVT, 326 L11-15; Application Book, 814.

The Magistrate accepted Mr Jones as an honest witness, who had a reasonably accurate recollection of important events, including Mr MacDonald signing the documents.[53] He found Mr Leo Seward, a junior lawyer employed by Mr Grundy, who was also present on 23 September 2017 when the documents were said to have been signed, to be an earnest and honest witness and accepted his evidence that he witnessed Mr MacDonald signing the Irrevocable Order and that he had signed it himself.[54]
[53] MCVT, 318 L12- 319 L1; Application Book, 806-7.
[54]MCVT, 318 L1-10; Application Book, 806.

The Magistrate accepted that the Irrevocable Order was valid and authorised the trustees to act in accordance with Mr MacDonald’s authorisation. He found that Mr MacDonald had irrevocably ordered the trustees to pay Mr Grundy’s firm the $50,000 to which he was entitled under the Queensland District Court order.[55] Mr Wright paid the disputed sum into Mr Grundy’s trust account and a Magistrates’ Court order provided that the money be held, pending the outcome of the proceedings.[56] The Magistrate noted that Mr MacDonald had not called any expert evidence to show that the trustees had breached Queensland law and he did not accept that they had. The proper place for any such claim would have been in a Queensland court.[57] The money was now under Victorian jurisdiction awaiting the outcome of the Magistrates’ Court proceedings.[58]
[55]MCVT, 322 L 30-31, 323 L1-6; Application Book, 810-11.
[56]MCVT 323 L2-6; Application Book, 811.
[57]MCVT, 323 L 18-20; Application Book, 811.
[58]MCVT, 324 L14-16; Application Book, 812.

The Magistrate found that Mr MacDonald’s continued engagement of Mr Jones and Mr Grundy and the professional services that they continued to provide supported the finding that he did sign the documents to give them comfort.[59] However, he sought to have the benefit of their services without paying for them.[60] The Magistrate did not accept that Mr MacDonald signed the documents under duress, as that was not proved by the respondents seeking to have Mr MacDonald sign the documents to ensure that they would be able to recover their fees.[61]
[59]MCVT, 316, L 23-31, 320 L 15-24; Application Book, 804, 808.
[60]MCVT, 322 L 8-10; Application Book, 810.
[61]MCVT, 316 L 23-31, 320 L 15-24; Application Book, 804, 808.

Given that the Magistrate found that Mr MacDonald signed the Costs Agreement, he found that Mr Grundy and Mr Jones were entitled to sue on the bills for legal costs as a debt, as a lump sum. Mr MacDonald might be entitled to seek taxation of the bills in the Costs Court out of time, but that did not prevent Mr Grundy and Mr Jones’ claims being determined by the Magistrates’ Court.[62]
[62]MCVT, 320 L 3, 5-32; Application Book, 808-809.

The Magistrate dismissed Mr MacDonald’s counterclaim in the legal fees proceeding which alleged that Mr Grundy and Mr Jones had engaged in ‘unsatisfactory professional conduct’, when representing him in the VCAT proceeding. Mr MacDonald relied principally on two matters. The first was Mr Jones’s request for the production of a document during his cross-examination of a witness called by the opposing party, which resulted in the VCAT proceeding being adjourned for more than two months. During that time, Mr MacDonald said that he was ‘sequestered’, apparently being excluded from the hearing room and discussions with his lawyers because his evidence was not commenced or completed. The Magistrate found that Mr Jones had acted perfectly reasonably in requiring the production of documents,[63] noting that there was no expert evidence to support the negligence claim. He found it unnecessary to decide whether the barrister’s actions were protected by advocate’s immunity.[64]
[63]MCVT, 325 L 21-29; Application Book, 813.
[64]MCVT, 326 L 4-5; Application Book, 814.

The Magistrate also rejected Mr MacDonald’s allegations against his lawyers that they had lost him the opportunity to settle the VCAT proceeding for about $200,000 and had thereby engaged in unsatisfactory conduct. Mr MacDonald alleged that Mr Grundy failed to enter into negotiations on several occasions when he sought him to do so. The Magistrate found that Mr MacDonald had not established that his lawyers’ advice about settlement was negligent or had caused him damage. He had not established that he had lost an opportunity to settle the case and his claim was merely speculative.[65] It appeared that the opposing party did not in fact make any offer of settlement. It was again unnecessary to consider whether advocate’s immunity applied in the circumstances.[66]

Mr MacDonald’s proposed questions of law and grounds of appeal in respect of the Magistrates’ Court orders

[65]MCVT, 325; Application Book, 813.

[66]MCVT, 325 L 18-20; Application Book, 813.

I next consider Mr MacDonald’s proposed questions of law arising from the Magistrate’s orders, which he elaborated on in his submissions. The grounds of appeal raised similar issues to the questions of law and describe the arguments on which he relied.

In the sum of money proceeding, Mr MacDonald’s questions of law concerned whether the Magistrates’ Court of Victoria had jurisdiction to decide who should receive funds payable from a deceased estate; whether it could overturn a Queensland District Court order; whether Mr Wright and Ms Malcolm, had breached the Queensland District Court order by Mr Wright paying the $50,000 to Mr Grundy’s trust account; whether the Irrevocable Order was valid and whether the Magistrates’ Court could strike out the claims against Mr Wright and Ms Malcolm. Mr MacDonald sought the setting aside of the Magistrates’ Court orders, the payment to him of the $50,000 from his mother’s estate, and that Mr Grundy, Ms Malcolm and Mr Wright pay him a further $50,000.

In the legal fees proceeding, Mr MacDonald’s questions of law concerned whether the Magistrates’ Court possessed jurisdiction to determine a dispute over legal fees between a client and their lawyers; whether the Irrevocable Order and Costs Agreement had been signed on 23 September 2017; whether the Magistrate wrongly took into account the consequences of perjury for particular professional witnesses as being relevant as to whether they had told the truth; whether the Magistrate erred in his rulings that the lawyers had not been proved to be negligent and whether the Cost Disclosure statement was valid as it had not been provided to Mr MacDonald as soon as practicable after he initially gave instructions.

Mr Grundy argued that Mr MacDonald’s proposed appeals were futile and had no real prospects of success and that the proceedings should not be allowed to continue. To allow that to occur would be contrary to the overarching purpose of the Civil Procedure Act 2010 for the just, efficient, timely and cost-effective resolution of the real issues in dispute. He emphasised that appeals from orders of the Magistrates’ Court are limited to questions of law and that Mr MacDonald was impermissibly seeking to rely on new evidence.

Mr Grundy also argued that Mr MacDonald’s ground of appeal challenging the finding that he had signed the Costs Agreement could only succeed if there was no evidence to support it. But the finding was supported by the evidence of Mr Jones and Mr Seward. In cross-examination, Mr MacDonald agreed that he could have been presented with the documents and might have signed them in the following passage of his evidence:

Mr MacDonald, let me just get the question answered. Where do you make an allegation to Mr Grundy that the document you sign, the irrevocable authority, was forged? Where did you make that allegation of Mr Grundy? Did you make the allegation or not?
[Mr McDonald]---After October 2021 I made the allegation because I was comfortable at that point in being sure that it was fraudulent. Up to then - yes, up to then I might have attended on 21 September after meeting with Mr Jones and Mr Grundy, and after signing the cheque, before leaving the office, I might have been presented with the documents and asked to sign. And the memories of the –[67]

[67]MCVT, 279; Application Book, 766.

There was no arguable claim that the Magistrates’ Court lacked jurisdiction to determine the dispute about the $50,000. In the Irrevocable Order, Mr MacDonald directed that his entitlement be paid into Mr Grundy’s trust account. Any challenge to that payment would have to have been made by an application in the Queensland District Court against the trustees alleging breach of the Court’s orders. That had not occurred.

Mr Grundy’s additional submissions about the appropriate exercise of the discretion to grant extensions of time to appeal

Mr Grundy also argued that he and Mr Jones would be prejudiced by the grant of extensions of time because Mr MacDonald had owed them fees for 7 years for their representation of him in the VCAT proceeding. Nor did they have any prospect of recovering the further significant costs that they had incurred in this continuing litigation. It was in the interests of justice that the litigation proceed no further. Mr Grundy also contended that Mr MacDonald’s conduct of his defence had caused repeated and protracted delays to the resolution of the proceedings, which had caused significant prejudice to him and to Mr Jones.[68]

Analysis of Mr MacDonald’s prospects of this Court exercising its discretion to grant him extensions of time to appeal the Magistrates’ Court orders

[68]Affidavits of Simon Gunn filed 19 May 2023, 1-3, and filed 23 January 2024, 1-4; Application Book, 299, 459.

Appeals from Magistrates’ Court orders can only be brought on questions of law. Findings of fact by a Magistrate can only be challenged if there was no evidence to support them.[69]
[69]Kostas v HIA Insurance Services Pty Ltd (2010) 241 CLR 390, 418 [91].

This principle is particularly relevant to Mr MacDonald’s claims that he did not sign the Irrevocable Order and the Costs Agreement. The Magistrate made findings of fact based on the evidence of Mr Jones and Mr Seward that Mr MacDonald had signed those documents. Their evidence supports the Magistrate’s finding and therefore the ‘no evidence’ challenge cannot succeed.

The Irrevocable Order was valid although it was only signed by Mr MacDonald. He was the person giving the authority and it did not need to be signed by anyone else to be valid. His signature was witnessed by Mr Seward.

It follows that the Magistrate was entitled to find that Mr MacDonald gave the authorisation contained in the Irrevocable Order and that, therefore, Mr Wright was authorised by Mr MacDonald to pay the sum of $50,000 to Mr Grundy’s trust account. Therefore, the Queensland District Court order and Queensland law had not been breached.

The Magistrate found that the claims of negligence made against Mr Grundy and Mr Jones in connection with the VCAT proceeding were not made out. There was no evidence that counsel’s request for the document which led to the adjournment was negligent. There was no evidence that the opposing side was willing to enter into settlement negotiations. No expert evidence was produced about those issues to support claims of professional negligence. The appeal grounds making claims of negligence or professional misconduct therefore have no prospects of success.

I will next consider Mr MacDonald’s claim contained in his counterclaim in the legal fees proceeding and his affidavit of 14 April 2024 that he was not given a Costs Disclosure statement as required. He submitted that even on Mr Grundy’s case, that document was provided to him on Saturday 23 September 2017, some two months after he first gave him instructions and two days before the VCAT hearing commenced. The Costs Disclosure statement was therefore not provided ‘when or as soon as practicable after instructions are initially given’ in the matter as required by s 174(1) of the Legal Profession Uniform Law Application Act 2014. If that argument were accepted, the Costs Agreement would be void and Mr MacDonald would not be required to pay the legal costs until they had been assessed or any costs dispute had been determined by the designated local regulatory authority. This argument appears to have received little attention in the Magistrates’ Court hearings. Nevertheless, I will state my views about its relevance to the issues that I have to decide.

Mr MacDonald’s evidence relevant to this issue was as follows. He first contacted Mr Grundy by phone at the end of July 2017 and then sent him details of the VCAT case in which he wanted him to act as instructing solicitor to Mr Jones. On 22 August 2017, he rang Mr Grundy’s firm and told them his mother had passed away and that he was expecting an inheritance. Mr Grundy responded by email requesting details of his assets, which details Mr MacDonald provided by email on 5 September 2017 to Mr Seward. Mr Grundy pointed to a line dated 31 August 2017 on T F Grundy’s tax invoice to him charging $20 plus GST for ‘perusal of template for Costs Disclosure Statement to issue to Mark MacDonald’. He said that on 5 December 2017 he was emailed costs documents identical to those he was alleged to have signed on 23 September 2017, save that the figure for fees of $12,000 was changed to $18,000. He suspected that those documents were sent under the pretext that the previous agreements needed to be updated because the VCAT hearing had been extended by two days, when in fact there were no earlier documents to update. A file note of 21 September 2017 about the meeting that day stated ‘We discussed the need for a costs agreement – MM to sign this Friday 22 Sept’.[70] Mr MacDonald said that at that meeting Mr Grundy told him that costs would be $5,000 and that he paid him a retainer of $1,500, but he did not receive any costs documents. His case was that Mr Grundy told him that he would need to sign a Costs Agreement and Costs Disclosure statement, that he agreed to do so, but that no such documents were available for signing and none were given to him to take away.
[70]Magistrates’ Court Book, 273.

Mr MacDonald said that he had no recollection of attending a meeting or signing any documents at Mr Jones’ chambers on 23 September 2017 and denied that any such meeting occurred. He alleged that Mr Grundy did not provide a Costs Disclosure statement and Costs Agreement in a timely manner. He relied on Mr Grundy’s contention in his defence to his counterclaim that the retainer commenced on or around 23 August 2017 when he received instructions from Mr MacDonald, first orally in a phone conversation in which he disclosed a fee estimate, and then in an email that he received from Mr MacDonald. Mr Grundy’s defence also contended that the retainer was then reduced to writing in a Costs Disclosure statement and Costs Agreement that Mr MacDonald signed on 23 September 2017. Then, on or about 5 December 2017, T F Grundy Lawyer provided Mr MacDonald with an updated Cost Disclosure statement and Costs Agreement.

Mr MacDonald appeared to accept that 21 September 2017 was, at least arguably, the last possible opportunity when Mr Grundy’s provision of a Costs Disclosure statement and Costs Agreement, if that had occurred, might be considered as the provision of the documents to him in accordance with the statutory requirements. He referred in an affidavit to various dates and stated that:

‘21/9 last possible opportunity for provision of CD/CA to be considered asap.’[71]

[71]Affidavit of Mark MacDonald filed 26 April 2023, [16(e)]; Application Book, 185.

However, Mr MacDonald’s stance on when he retained Mr Grundy varied. In paragraph 4 of his counterclaim in the legal fees proceeding, he stated that he engaged T F Grundy Lawyer as his instructing solicitor on Thursday 21 September 2017,[72] although he had first spoken to Mr Grundy at the end of July and Mr Grundy appeared to suggest that the retainer commenced on 23 August 2017 and had charged fees on, and from, that day. However, if the retainer commenced on 21 September as Mr MacDonald’s counterclaim contends, the provision of a Costs Disclosure statement to him two days later on 23 September may well have been ‘as soon as practicable’ after instructions were initially given in the matter so as to comply with s 174 of the Legal Profession Uniform Law Application Act.
[72]Counterclaim of Mark MacDonald in Magistrates’ Court Proceeding, filed 30 May 2024, 2 [4]; Magistrates’ Court Book, 31.

Mr MacDonald said that he signed a Costs Agreement[73] with Mr Jones for $4,400 fees and that Mr Jones told him that he would have a better estimate of the costs after he appeared at VCAT and would provide an updated costs estimate as soon as he was able. He was provided with an updated costs estimate of $38,500 nearly three months later. He signed the updated estimate on 22 July 2016. He said that he paid Mr Jones $4,400 in May 2016. He claimed credits towards the $38,500, including those based on adjustments he had calculated of the actual times chargeable and from his assessment of the costs he had incurred because of the adjournment of the VCAT proceeding. The credits, on his calculations, reduced his bill to $23,863.29.
[73]He called it a CD/CA, presumably referring to a Costs Disclosure Costs Agreement. ‘Asap’ refers to ‘as soon as practicable’.

I do not consider that this issue of the timing of the provision of Costs Disclosure statements assists Mr MacDonald’s prospects of his appeal in the legal fees proceeding succeeding. The Magistrate did not decide the issue and it appears to have received little legal argument in those hearings. Mr MacDonald’s case in his counterclaim in the legal fees proceeding is that he retained Mr Grundy on 21 September 2017. In addition, as mentioned, he appeared to accept that it was, at least arguable, that the provision of a Costs Disclosure statement even on 21 September, when he met with Mr Grundy, may have satisfied the statutory test of ‘as soon as practicable’.

Furthermore, the determination of what was ‘as soon as practicable’ in any case is likely to depend on evidence of the circumstances. For instance, Mr Seward gave evidence that Mr MacDonald was ‘a bit hard to communicate with so there was a difficulty’ in the period prior the VCAT hearing.[74] In the absence of the issue having been explored in evidence in the Magistrates’ Court hearing, and in view of the fact that the Magistrate did not decide the issue, and Mr MacDonald’s apparent suggestion that he may have retained T F Grundy Lawyer on 21 September 2017, I do not consider that the issue about the provision of a Costs Disclosure statement assists, or is likely to assist, Mr MacDonald’s applications for extensions of time.
[74]MCVT, 169-70; Application Book, 655-656.

I will next express my conclusions about whether other issues that Mr MacDonald raised might assist his applications for extensions of time to appeal the Magistrates’ Court orders. First, I do not consider that it is likely to be found that the Magistrate erred in dismissing Mr MacDonald’s claims against Mr Wright and Ms Malcolm. The Magistrate found, in my opinion correctly, that the trustee was entitled to transfer the amount of $50,000 to Mr Grundy’s trust account and that finding meant that Mr MacDonald had no claim against Mr Wright and Ms Malcolm.

In my opinion, the Magistrate had jurisdiction to hear and determine Mr Grundy and Mr Jones’ claims for legal fees as Mr MacDonald had not made an application for the assessment of those fees within time.

The Magistrate did not err in his assessment of the lawyers’ evidence that Mr MacDonald had signed the costs documents and the Irrevocable Order. He did not give any additional weight to the fact that they were lawyers and explained the basis on which he accepted their evidence.

The Magistrate’s conclusion that Mr MacDonald could not rely on a defence of duress, if it was found that he was told that Mr Grundy and Mr Jones would not represent him at the VCAT hearings if he did not sign the Irrevocable Order and the Costs Agreement, cannot be successfully challenged. They were entitled to seek to secure the costs that they would incur in representing Mr MacDonald and their actions did not constitute illegitimate pressure or duress in its legal sense.[75]

Conclusion about Mr MacDonald’s application for extensions of time to appeal the Judicial Registrar’s orders of 12 July 2023

[75]Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40 at [46]; Electricity Generation Corporation T/As Verve Energy v Woodside Energy Ltd [2013] WASCA 36 at [23]-[27]; Re Australian Builders Group Pty Ltd [2022] VSC 254 at [45].

For the reasons that I have given, I consider that on the evidence before me and having considered the contents of the proposed questions of law and grounds of appeal, if Mr MacDonald was granted an extension of time to commence his appeals against the Judicial Registrar’s orders of 12 July 2023, he would have no real prospects of success of setting aside the Magistrates’ Court orders and obtaining alternative orders.

This conclusion also applies to Mr MacDonald’s appeals against the Judicial Registrar’s orders of 23 August 2023, insofar as they involved a refusal to extend the time for compliance with the self-executing orders of 12 July 2023. Mr MacDonald did not establish any utility in granting such an extension of time as his underlying proposed appeals from the Magistrates’ Court orders have no real prospects of success.

I have also taken into account the prejudice that Mr Grundy and Mr Jones would suffer from further delays that are likely to follow from the grant of extensions of time. They remain unpaid for the fees that they claim for their work in 2017 and 2018 in connection with the VCAT proceeding.

The appeal against the Judicial Registrar’s costs order of 23 August 2023

There is another issue that requires decision. Mr MacDonald also appealed the costs orders made by the Judicial Registrar on 23 August 2023, which require him to pay a total of $11,492.50 costs to Mr Grundy and Mr Jones. Mr MacDonald commenced that appeal in time. It is also a de novo appeal and, therefore, I am required to make a fresh decision as to whether Mr Grundy and Mr Jones should be awarded costs and, if so, in what amount. I consider, as it appears the Judicial Registrar did, that the Court, if it can, should assess those fees at this point, rather than sending the parties to the Costs Court for assessment of those costs, which would result in further costs being incurred.

Mr MacDonald argued that T F Grundy Lawyer incorrectly informed the Judicial Registrar that it acted for Mr Grundy and Mr Jones, whereas they should have been taken to be acting for themselves, and thus not be able to claim legal costs.[76]
[76]Bell Lawyers Pty Ltd v Pentelow (2019) 269 CLR 333.

Mr Grundy and Mr Jones accepted that they could not claim costs for acting for themselves so they claimed only half of their total fees for acting for each other. The proportions of costs claimed by Mr Grundy acting for Mr Jones and Mr Jones appearing for Mr Grundy were calculated by reference to their parties’ respective interests in the quantum of the Magistrate’s Court claim.[77]
[77]Affidavit of Simon Gunn of 23 January 2024, [23]; Application Book, 462.

Mr Grundy argued that the costs of $11,492.50 ordered by the Judicial Registrar were reasonable. They were discounted by 50 per cent to take account of the fact that the barrister and the solicitor were also representing themselves. Mr Gunn’s second affidavit of 23 January 2024 explained the costs orders made by the Judicial Registrar and counsel for the respondents provided further information during the hearing. The costs awarded included costs relating to both appeal proceedings. The amount of $11, 492.50 consisted first of counsel’s fees, (Mr Campbell’s fees) of $5,280 for appearances at directions hearings on 19 April and 7 June 2023 and preparation for those hearings. Those costs are below the maximum scale costs. I consider them to be reasonable and appropriate for the appearances and work involved. The orders that I will make will dismiss Mr MacDonald’s appeals against the Judicial Registrar’s orders, so Mr Grundy and Mr Jones are entitled to recover costs associated with the directions hearings before the Judicial Registrar.

The second element of the costs awarded was $937.50 being Mr Jones’ fees for appearing for Mr Grundy on 23 August 2023 calculated at 50 per cent of his hourly rate which totalled $937.50. He appeared on that day for Mr Grundy only in the sum of money proceeding, but appeared for both Mr Grundy and himself in the legal fees proceeding. I consider the amount claimed to be reasonable and appropriate as it is 50 per cent of an amount that was below maximum scale rate. There is no principle preventing counsel who appears for himself in a proceeding seeking the recovery of fees from also representing his instructing solicit who is seeking to recover their own fees.

The third element of the costs awarded was Mr Grundy’s fees of $5,275 for acting for Mr Jones in the legal fees proceeding to 23 August 2023 calculated as 50 per cent of the total fees that Mr Grundy had incurred in that proceeding. Again there is no principle preventing such a claim being made. I have considered the information contained in the Application Book about the work that was undertaken in the proceedings up to, and including 23 August 2023, and the applicable scale of costs. The work between January and August 2023 appears to have included perusing versions of the proposed notice of appeal, assembling material for the appeal, preparing Mr Gunn’s two affidavits and dealing with the transcript issue. Four directions hearings were required, including that on 23 August 2023, when with most appeals from Magistrates’ Court orders, only one such hearing will be needed. Taking a broad approach, the fees claimed appear reasonable and the 50 per cent claimed appears appropriate.

Mr MacDonald’s appeal against the Judicial Registrar’s costs order of 23 August 2023 is dismissed.

Conclusion

In proceeding S ECI 2023 01026, the Notice of Appeal dated 29 August 2023 and filed 6 September 2023 is dismissed.

In proceeding S ECI 2023 01027, the Notice of Appeal dated 28 August 2023 and filed 4 September 2023 is dismissed.

I will hear the parties about costs.

[2024] VSC 383

3 July 2024