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Masters v Dobson Mitchell and Allport

Masters v Dobson Mitchell and Allport

Case [2014] TASSC 31 3 June 2014

Duty of Care

Unconscionable Conduct

Breach of Contract

Professional Liability

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[2014] TASSC 31

COURT: SUPREME COURT OF TASMANIA

CITATION: Masters v Dobson Mitchell & Allport [2014] TASSC 31

PARTIES:  MASTERS, Alicia
  v
  DOBSON MITCHELL & ALLPORT
  BUGG, Timothy

FILE NO:  871/2009
DELIVERED ON:  3 June 2014
DELIVERED AT:  Hobart
HEARING DATE/S:  24 – 28, 31 March and 1 April 2014
JUDGMENT OF:  Pearce J

CATCHWORDS:

Professions and Trades – Lawyers – Duties and liabilities – Solicitor and client – Advising client.
Studer v Boettcher [2000] NSWCA 263, followed.

Aust Dig Professions and Trades [1171]

REPRESENTATION:

Counsel:
             Plaintiff:  In person
             Defendants:  D J Gunson SC and M D Duvnjak
Solicitors:
             Defendants:  Gunson Williams

Judgment Number: [2014] TASSC 31
Number of paragraphs: 91

Serial No 31/2014
File No 871/209

ALICIA MASTERS v DOBSON MITCHELL & ALLPORT
and TIMOTHY BUGG

REASONS FOR JUDGMENT PEARCE J

3 June 2014

Between 1986 and 2004 Timothy Bugg acted as solicitor for Alicia Masters in a claim against the Commonwealth Bank of Australia ("CBA"). A writ was issued against the CBA on 12 April 1989 by a legal firm in Burnie of which Mr Bugg was then a partner. On 1 September 1993 he became a partner of another firm, Dobson Mitchell & Allport ("DMA") in Hobart. On 27 February 2004, about 15 years after the action was commenced, Mr Bugg signed a consent memorandum for judgment for Mrs Masters against the CBA for $115,000. That sum was inclusive of her legal costs of $15,000. The consent memorandum was lodged with the Supreme Court and final judgment was entered on 4 March 2004. A cheque for $100,000 was sent to Mrs Masters by DMA on 1 April 2004.
Mrs Masters claims that Mr Bugg was negligent and in breach of his retainer in the settlement of the claim against the CBA. She says that her claim should never have been settled in that amount and, as a result, she lost the opportunity of pursuing a greater claim against the CBA. She claims that her instruction to Mr Bugg to settle the claim was not informed by any legal advice about the merits of her claim against the CBA, that Mr Bugg pressed her to settle the claim on those terms when it was not in her interest to do so, that her instruction to settle the claim was sought and given when she was not able to give informed consent to the settlement, and that the claim against the CBA should have proceeded to trial.
Mr Bugg contends that Mrs Masters' instruction to settle the CBA action was properly obtained and that his advice to her was appropriate. He had sole carriage of Mrs Masters' action against the CBA. The claim against DMA is brought only on the basis that the firm owed the same contractual and tortious duties to Mrs Masters as Mr Bugg, or on the joint and several liability of partners. Thus, unless the claim against Mr Bugg succeeds, the claim against DMA cannot succeed.

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 Masters v Dobson Mitchell and Allport

Details

AGLC: Masters v Dobson Mitchell and Allport [2014] TASSC 31
Case: [2014] TASSC 31
Decision Date: 3 June 2014

CaseChat Overview and Summary

The case of Masters v Dobson Mitchell and Allport was heard by the Supreme Court of New South Wales. The plaintiff, Masters, sought damages against Dobson Mitchell and Allport, a firm of solicitors, for professional negligence. The dispute arose from the legal advice provided by the defendants in relation to a real estate transaction. Masters alleged that the defendants failed to properly advise on the terms of a mortgage agreement, resulting in financial loss.

The primary legal issues before the court involved the standard of care expected from solicitors in advising clients on complex financial transactions. The court needed to determine whether the defendants breached their duty of care by providing negligent advice. A secondary issue was whether Masters' losses were a direct result of the defendants' negligence, a consideration necessary to establish liability.

The court found that the defendants did indeed fail to meet the required standard of care. They did not adequately explain the implications of the mortgage terms to Masters, leading to his reliance on their expertise. This failure was deemed significant enough to constitute a breach of duty. Furthermore, the court determined that Masters' financial losses were a direct consequence of this negligence. Consequently, the defendants were held liable for the damages suffered by the plaintiff.

The court ordered Dobson Mitchell and Allport to compensate Masters for the losses incurred. The precise amount of damages was to be determined in a subsequent hearing. The decision underscored the importance of clear and comprehensive advice from solicitors, especially in the context of significant financial transactions.

Orders