Marmota Ltd v Thomson Geer - [2020] SASC 43

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Civil)
MARMOTA LTD v THOMSON GEER
[2020] SASC 43
Judgment of Auxiliary Judge Kennewell a Master of the Supreme Court
27 March 2020
PROFESSIONS AND TRADES - LAWYERS - SOLICITOR AND CLIENT - RETAINER
STATUTES - ACTS OF PARLIAMENT - INTERPRETATION
Application to fix legal costs - preliminary issues to be determined before costs adjudication can proceed.
Legal Practitioners Act 1981 (SA); Legal Profession Act 2007 (Qld); Legal Profession Act 2004 (NSW); Evidence Act 1929 , referred to.
Turner v Mitchell Solicitors [2011] QDC 061; Branson v Tucker [2012] NSWCA 310; Aretzis & Anor v Larwood & Anor [2002] SASC 367; Kowalski v Cole [2017] SASCFC 23, considered.

MARMOTA LTD v THOMSON GEER
[2020] SASC 43

On 19 March 2019, the plaintiff filed an application to fix the legal costs due to the defendant, for the provision of legal services.
The parties agreed the following list of preliminary issues which they request to be determined by the Court before the costs adjudication proceeds:
1Whether or not the invoices issued by the defendant the subject of the application are governed by any costs agreement, and if so, which costs agreement within the meaning of Schedule 3 of the Legal Practitioners Act 1981 (the Act).
2Whether any, and if so which, of the invoices the subject of the application are interim bills for the purposes of clause 35 of Schedule 3 of the Act.
3Which invoices can be adjudicated upon in the application, having regard to clauses 35 and 37(4) of Schedule 3 of the Act.
4Whether the Court has inherent jurisdiction to adjudicate the costs of its practitioners in circumstances where such adjudication would be precluded by clause 37(4) of Schedule 3 of the Act.
The matter was listed for argument on 4 and 5 December 2019. The parties filed written submissions prior to the hearing and the defendant filed further written submissions on 14 January 2020. Mr Williams gave oral evidence for the plaintiff.
The plaintiff relies upon the affidavit of Colin Rose affirmed on 27 June 2019. The defendant objected to certain parts of this affidavit. The objections were considered and ruled upon at the hearing and certain paragraphs were struck out in their entirety or in part. The affidavit has been marked accordingly.
The defendant relies upon the affidavits of Lee Scott Dewhirst sworn on 23 May 2019 and 12 July 2019, affidavits of Fraser Michael Bell sworn on 23 May 2019 and 10 July 2019, and affidavits of Matthew Roy Harders sworn on 12 July 2019 and 28 November 2019.
In the defendant’s submissions filed on 14 January 2020, the defendant applies to tender a letter dated 21 August 2019 addressed from Dr Rose to Mr Williams. The letter was marked for identification during submissions. The defendant submits that the letter is admissible and relevant as it gives the Court insight into Dr Rose’s evidence and attitude to this matter, especially his attitude to Mr Williams. The…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Marmota Ltd v Thomson Geer

Details

AGLC: Marmota Ltd v Thomson Geer [2020] SASC 43
Case: [2020] SASC 43
Decision Date: 27 March 2020

CaseChat Overview and Summary

In the case of Marmota Ltd v Thomson Geer, the plaintiff, Marmota Ltd, sought to have certain legal costs invoiced by the defendant, Thomson Geer, reviewed and potentially reduced. The primary dispute centred on the validity and scope of a costs agreement between the parties, and the applicability of the statutory provisions governing legal costs to the defendant's invoices. The matter was heard in the Supreme Court of Victoria.

The court was tasked with determining whether the costs agreement was valid and applicable to the invoices in question, as well as whether the defendant's invoices were subject to adjudication under the Legal Services Act 2007 (Vic). The court had to consider the interpretation of the costs agreement and whether it extended to the work for which the invoices were issued. Additionally, the court examined the timeliness of the application for adjudication and the jurisdiction of the court to review the defendant's invoices for overcharging and professional misconduct.

The court found that the costs agreement did not extend to the work for which the invoices were issued, as the terms of the agreement did not encompass future work conducted by the defendant. Therefore, the invoices were not governed by the costs agreement. The court also determined that the defendant had not charged in accordance with the costs agreement, and thus, any reliance by the defendant on the agreement was misplaced. The court concluded that the plaintiff was not estopped from asserting the invalidity of the costs agreement in these circumstances. The court further held that the application for adjudication was out of time for some of the invoices, and that the court did not have the inherent jurisdiction to adjudicate the defendant’s invoices on the basis of alleged overcharging or professional misconduct, as those matters were governed by the Legal Services Act.

In light of the findings, the court ruled that the application for adjudication was not valid for certain of the invoices due to the time constraints imposed by the Legal Services Act. The court did not entertain the defendant’s submission regarding overcharging and professional misconduct, as these matters fell outside the court’s jurisdiction under the statutory framework.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

The defendant argues that the plaintiff is estopped from asserting that the costs agreement is invalid or otherwise does not to apply. I have determined that the costs agreement does not as a matter of construction extend to any future work conducted by the defendant for the plaintiff. Therefore, any reliance placed upon the costs agreement by the defendant was misconceived. In any event, the defendant did not charge in accordance with the costs agreement and therefore it cannot be said that there was reliance upon it. I am not persuaded that there is any basis that the plaintiff should be estopped from asserting that the costs agreement is invalid or does not apply in these circumstances.Conclusion The defendant asserts that its costs are to be adjudicated by reference to a costs agreement between the plaintiff and defendant. The plaintiff contends that the costs agreement is comprised of the Letter and Terms of Engagement sent by email dated 17 March 2016 to Mr Williams. I have found that this Offer was not accepted by the plaintiff. The Offer not having been accepted, it cannot bind the plaintiff for any future matter. Therefore, the invoices are not governed by the costs agreement.Whether any, and if so which, of the invoices the subject of the application are interim bills for the purposes of clause 35 of Schedule 3 of the Act. The plaintiff concedes that bills 2 and 4[11] relate to disputes with a company known as Australian Mineral and Waterwell Drilling and certain other individuals (AMWD Disputes) and relate to a matter that was finally billed in April 2017, and are therefore out of time to be adjudicated upon under the Act.[11] A table referencing the 12 bills is contained in paragraph 3.5 of the Defendant’s Outline of Submissions (FDN 10). The plaintiff and defendant are agreed that bills 5 to 11 are interim bills to bill 12. There is a dispute as to the status of bills 1 and 3. The plaintiff submits that bills 1 and 3 are also interim bills to the final bill sent on 23 October 2018 (bill 12). The defendant contends that bill 1 is an interim bill to bill 3 (issued on 11 May 2017) which is a final bill with respect to the Land Access Matter as it covered all the legal services the defendant was retained to provide at that time, namely to secure and implement a right of access in favour of the plaintiff. The defendant asserts that the period 14 April 2017 until 6 September 2017 (inclusive) was a natural rest period. During this period, the plaintiff did not instruct the defendant and no time was recorded against the file. The defendant did not provide legal services to the plaintiff or issue any invoices to the plaintiff.[12][12] First Affidavit of Michael Bell (FDN5) [12]. The plaintiff submits that the bill issued on 11 May 2017 was not a final bill as it was not treated as a final bill by the solicitors. The file was not closed. When further work was done in October 2017, the same file number and the same title were used. The plaintiff further submits that the action had not concluded as further steps were required to get access to the land and it was subject to an obligation to pay compensation which had not been finalised.

Ratio Decidendi

Legal Principle Established

The defendant further submits that overcharging and professional misconduct by a legal practitioner are provided for by the Act and the Commissioner is given powers to deal with unsatisfactory professional conduct and professional misconduct, and powers to deal with complaints of overcharging by legal practitioners.[21] Therefore, the Court has no inherent jurisdiction to adjudicate the defendant’s invoices on the basis of actual or alleged unsatisfactory professional misconduct, or overcharging as that jurisdiction has been displaced by the Act. In the alternative, the defendant submits that the mere overcharging does not, as a matter of course, automatically invoke the inherent jurisdiction of the Court to allow it to settle the overcharged costs. Any overcharging must be enough to establish a prima facie case of professional misconduct by overcharging.[21] Part 6, Subdivision 2 and Subdivision 4 of the Act.Consideration Clauses 37(4) and (5) provide:(4)An application by a client or third party payer for an adjudication of costs under this clause must be made within 6 months after—(a) the bill was given or the request for payment was made to the client or third party payer; or(b) the costs were paid if neither a bill was given nor a request was made.(5) However, an application that is made out of time, otherwise than by—(a) a sophisticated client; or(b) a third party payer who would be a sophisticated client if the third party payer were a client of the law practice concerned,may be dealt with by the Supreme Court if the Court, on application by the client or third party payer who made the application for adjudication, determines, after having regard to the delay and the reasons for the delay, that it is just and fair for the application for adjudication to be dealt with after the 6 month period. I am of the view that Branson v Tucker,[22] which concerned a barrister suing for his fees as a debt may be distinguished. The New South Wales Court of Appeal was there considering an appeal from the District Court from a decision to refuse to strike out the defence. The defence pleaded that the fees were excessive, the hours charged were in excess of what was reasonably and necessarily required and the barrister had breach the implied term of the retainer, to exercise reasonable care and skill, by charging for more hours than was reasonable or necessary. The Court held that although the statutory time limit for an assessment of the legal costs under the Legal Profession Act 2004 (NSW) had expired, the general jurisdiction to assess the reasonableness of the legal costs was not precluded.[22] [2012] NSWCA 310. Campbell JA with whom the other members of the Court agreed referred to s 366 of the Legal Profession Act 2004 (NSW) and stated:… in so far as s 366 provides that "this Division does not limit the power of a court or a tribunal to determine in any particular case the amount of cost payable" it is talking about the whole of Division 11. Read in accordance with that ordinary meaning it has the effect that Division 11 does not remove the power of the District Court in exercising "the ordinary jurisdiction of the Court in dealing with contested claims", to determine the amount of costs payable.[23] [23] Ibid [103].