| JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA LOCATION : PERTH CITATION : McPHEE -v- PEARCE [2014] WADC 19 CORAM : EATON DCJ HEARD : 3 FEBURARY 2014 DELIVERED : 7 FEBRUARY 2014 FILE NO/S : APP 78 of 2013 BETWEEN : MICHAEL JOHN McPHEE Appellant
AND
ALAN FRANCIS PEARCE
TODD ANDREW PEARCE
Respondent
ON APPEAL FROM:
Jurisdiction : MAGISTRATES COURT OF WESTERN AUSTRALIA Coram : MAGISTRATE SCUTT File No : PER 15820 of 2012 Catchwords: Practice and procedure - Appeal from the interlocutory decision of a magistrate - Application for further discovery - Relevance of documents sought to be discovered - Application of s 74 of the Interpretation Act 1984 Legislation: District Court Rules 2005
Legal Practice Act 2003
Legal Profession Act 2008
Magistrates Court (Civil Proceedings) Act 2004 Result: Appeal dismissed
Representation: Counsel:
Appellant : In person
Respondent : Mr I R Gillon
Solicitors:
Appellant : Not applicable
Respondent : Lawton Gillon
Case(s) referred to in judgment(s):
Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592
Campbell v Backoffice Investments Pty Ltd [2009] HCA 25
1 EATON DCJ: Michael John McPhee (the appellant), a legal practitioner, made a general procedure claim in the Perth Magistrates Court in September 2012 claiming $21,255.88 from the defendants being the balance of legal fees said to be owed by them to the appellant pursuant to a costs agreement. On 25 October 2012 Todd Pearce gave notice of an intention to defend. On 31 October 2012 Alan Pearce gave notice of an intention to defend.
2 There was a pre-trial conference on 7 January 2013. Orders were made for the lodging of a claim, a defence and discovery on oath. On 18 January 2013 the appellant lodged a claim. On 31 January the respondents lodged a defence and counterclaim seeking $40,252.14. On 11 February 2013 the appellant lodged a notice of intention to defend the counterclaim and a statement of defence to it. 3 On about 14 March 2013 the appellant gave discovery of documents. On 9 April 2013 the respondents gave discovery of documents. On 3 July 2013 the parties attended a listing conference before Magistrate Scutt. She directed that any further application for discovery be lodged within a specified period of time. 4 On about 15 July 2013 the appellant filed an application for further discovery in the following terms: The Defendants and each of them do within 14 days from the date of such Order make and file an Affidavit stating whether they or either of them has or has had at any time in his or their possession, custody, or power, any document of the class of documents ('documents' being defined to include any communication, note or memoranda held or sent electronically by email or otherwise) specified in the schedule hereto, and if the said document or documents has been but is not now in his or their possession, custody, or power, stating when they or either of them parted with same and what has become of same, and that the costs of this Application be paid by the Defendants.
Schedule:
1. All or any documents involved in the negotiation of and effecting a settlement of Supreme Court Action CIV 2046 of 2007 consolidated with Supreme Court Action CIV 1770 of 2008 [costs] and without limiting the generality of that request documents in the following classes: A) Letters or emails proposed and/or accepting settlement prior to the settlement being effected or afterwards; and any notes or other memoranda dealing with the settlement; B) Legal advice given to the Defendants or either of them in relation to such proposed settlement or as effected; and any notes or memoranda or such legal advice; C) Any deed/s of settlement, or copies thereof, or drafts made prior to completion; D) Any Court papers (e.g. Notices of Dismissal or Discontinuance) effecting the settlement; E) Any document or copies thereof effecting the settlement, such as transfer of shares, appointment of the First Named Defendant as a Director of International Mining Technologies Pty Ltd, or such documents in relation to the Second Named Defendant as may exist. 2. All or any documents relating to the approaches to the Australian Government Department known as 'AusIndustry' and the responses from the Department to such approaches, without limiting the generality of that request, documents of the following classes; A) Letters of documents (including notes or memoranda) relating to the approaches to AusIndustry; B) Letters or documents (including noties [sic] or memoranda) relating to the response from AusIndustry; C) Letters or documents (including notes or memoranda) relating to the use of the responses from AusIndustry. 5 In August 2013 the respondents responded to the application, contending that: Nothing that occurred after 25 January 2010 can be relevant to the claimant's claim … Whatever took place in Supreme Court action CIV 2046 of 2007 and Supreme Court Action CIV 1770 of 2008 after 25 January 2010 cannot be relevant to the Claimant's claim. All the documents the claimant now seeks be discovered, if in fact they exist, came into existence after 25 January 2010. The respondents opposed the orders sought by the appellant. 6 The appellant's claim is in respect of legal work carried out by the appellant for the respondents between 15 September 2009 and 5 January 2010. The respondents contend that documents in their litigation after 25 January 2010 cannot be relevant. On 6 September 2013 Magistrate Scutt dismissed the appellant's application for further discovery and awarded costs to the respondents. The appellant seeks to overturn that decision. 7 Section 40 of the Magistrates Court (Civil Proceedings) Act 2004 provides that a party to a case that is not a minor case may appeal to this Court against any order made by the Magistrates Court in the course of proceedings in the case or the judgment of the Magistrates Court in the case. The matter before me is not a minor case. An appeal cannot be commenced more than 21 days after the date of judgment, unless the District Court gives leave to do so. An appeal must be conducted in accordance with rules of court made by this court. This court must decide the appeal on the material and evidence that was before the Magistrates Court. 8 Rule 50 of the District Court Rules 2005 provides that an appeal to the court must be by way of a reconsideration of the evidence that was before the primary court unless the parties agree otherwise. In the matter before me there is no such agreement. 9 It is the case that the respondents, by their defence to the claim, assert that the appellant was engaged by them to provide legal services to them on or about 5 September 2007. So far as the appellant's fees for those services were concerned, the contention of the respondents is that invoices raised in that regard were governed by the provisions of the Legal Practice Act 2003 (the Act). The respondents claim that the appellant failed to issue invoices to them in accordance with the Act and that, in consequence, they have not been in a position 'to seek assessment of the claimant's tax invoices' and the appellant is 'not in a position to recover the amounts the subject of his tax invoices'. 10 The non-compliance complained of by the respondents is in respect of s 232(1) of the Act. It provided that where a bill of costs contains detailed items, the legal practitioner must include a notice to the person charged in the following form: Within 30 days of receiving this account you may require me by notice in writing to submit the bill of cost to a taxing officer of the Supreme Court for review of the amount of costs charged to you, the subject of this bill of costs. Section 232(2) required that the notice must appear on the face page of each bill of costs in at least 10 point type size. 11 Section 230 of the Act provides that a legal practitioner must not sue for recovery of any services, fee, charges or disbursements until a bill for those items has been served upon the party charged. The section further provides that the bill may contain detailed items or may be for a lump sum. 12 Given that pt 13 div 3 of the Act deals with taxation and recovery of costs by legal practitioners, I infer that a legal practitioner may not sue for recovery of any services, fee, charges or disbursements if he or she fails to comply with s 232 of the Act. I conclude that non-compliance with that section is likely to found a good defence to a practitioner's action for recovery of services, fee, charges or disbursements. 13 In his written submissions presented in support of his appeal the appellant concedes that some, but not all, of the subject invoices rendered by him to the respondents were non-compliant with the Act in that they included a notice to the client in compliance with what was required by the Legal Profession Act 2008 (the 2008 Act) rather than in compliance with the Act. Since 1 March 2009 the remuneration of law practices and the making of costs agreements has been regulated by the 2008 Act. The Act was repealed by s 598 of the 2008 Act. Section 616 of the 2008 Act provides that pt 13 of the Act continues to apply to a matter if the client first instructed the law practice in the matter before the commencement day of the 2008 Act. 14 The notice to the client required under the 2008 Act is different from that which is required under the Act. The form of words prescribed is found in sch 1 of the Legal Profession Regulations 2009. 15 In his written submissions in support of his appeal the appellant contends that the issue of compliance with the Act is the only issue as between the parties, there being no issue as to the whether or not the work the subject of the invoices was done or as to the quality of that work. The respondents appear to accept that contention. 16 Both parties appear to agree that the efficacy of the con-compliant invoices is to be determined having regard to s 74 of the Interpretation Act 1984. It provides that where a form is prescribed or specified under a written law, deviations therefrom not materially affecting the substance nor likely to mislead shall not invalidate the form used. 17 The section refers to a form prescribed or specified under a written law. The Interpretation Act does not define the term 'form'. In general usage the word 'form' has a number of meanings. For example, it may refer to a shape or an arrangement of parts or it may refer to a school class. The Australian Oxford Dictionary defines 'form' in a number of ways, including those mentioned. The fifth definition is 'a printed document with blank spaces for information to be inserted. b a regularly drawn document'. 18 Section 231 and s 232 of the Act required a legal practitioner to include in a bill of costs, whether the bill be for a lump sum or for detailed items, a notice to the person charged. The words of the notice, in each case, were prescribed by each section. In s 232 the notice is to appear on the face page of each bill of costs in a particular type size. 19 It is clear that the sections do not prescribe the use of a form in the sense of a prescribed or specified document. What is required is that the practitioner give a notice to his or her client, the terms of which are prescribed, and which must appear in particular type on the face page of the document. 20 It is clear to me that s 74 of the Interpretation Act is directed to the use of a prescribed or specified form, being a document, as opposed to a notice. The purpose of the notice required in s 232 of the Act is to give the client certain very important information about his or her rights upon receipt of the bill of costs from the practitioner in precise terms. Section 74 of the Interpretation Act refers to a 'form' meaning a prescribed or specified document, as opposed to a 'form of words' prescribed for the purpose of providing important information to the client of a legal practitioner. In my view, the consensus as between the parties, as to the applicability of s 74 of the Interpretation Act to the issue of non-compliance with the Act is misguided. 21 Having arrived at that conclusion, and having regard to the narrow compass of the issue between the parties, I am of the view that the documents sought by the appellant by way of further discovery would be completely irrelevant. On that basis I would dismiss the appeal. 22 Should my conclusion be wrong, and s 74 of the Interpretation Act does have application, I am of the view that the use of the notice required under the 2008 Act is a departure in substance from that which was required of the practitioner under the Act. In order for the form to escape invalidity under s 74 the deviation must not only not materially affect the substance of it but also must not be such as would be likely to mislead. In my view, the deviation by the use of the wrong notice does materially affect the substance of the notice. 23 In my view, also, the question of whether the deviation is likely to mislead, is a question to be objectively considered. The appellant submits that the experience and circumstances of the respondents should be taken into account to assist in the assessment of whether or not they were misled. The question of whether or not the respondents were actually misled is, in my view, a quite irrelevant consideration. 24 It is the case that, following the cessation of the solicitor/client relationship between the appellant and the respondents, the respondents engaged alternative legal representation and the matters before the Supreme Court were settled. In the final paragraph of his written submissions the appellant contends: All of these matters submitted are matters for trial and the material the subject of the summons should be allowed for the plaintiff to have the benefit of the information as to what actually happened in this settlement, in an objective sense, from the documents so that these matters can be put to the respondents on the question of what impact the invoices had on them – that is the only issue left. 25 In my view that submission is also misguided. Section 74 of the Interpretation Act clearly requires a consideration of whether the deviation in the form was 'likely to mislead'. That requires an objective consideration of the purpose and import of the form and the substance of the deviation, as opposed to a consideration of whether, as a matter of fact, any particular person was actually misled by the deviation. 26 The authorities relied upon by the appellant in support of his contentions are almost all related to the Trade Practices Act 1974 (Cth) or to the Fair Trading legislation of the States. In my view the appellant's submissions tend to confuse issues of the characterisation of particular conduct with issues of causation. 27 In Campbell v Backoffice Investments Pty Ltd [2009] HCA 25 French J said [24] – [25]: The question whether conduct is misleading or deceptive or likely to mislead or deceive within the meaning of s 42 of the Fair Trading Act is logically anterior to the question whether a person has suffered loss or damage thereby for the purposes of s 68. The distinction between characterisation of the conduct and determination of the causation of the claimed loss said to result from it must be maintained.In so saying, it is necessary to acknowledge that there may be practical overlaps in the resolution of these logically distinct questions. The characterisation of conduct may involve assessment of its notional effects, judged by reference to its context. The same contextual factors may play a role in determining causation. Characterisation is a task that generally requires consideration of whether the impugned conduct viewed as a whole has a tendency to lead a person into error. It may be undertaken by reference to the public or a relevant section of the public. In cases of misleading or deceptive conduct analogous to passing off and involving reputational issues, the relevant section of the public may be defined, according to the nature of the conduct, by geographical distribution, age or some other common attribute or interest. On the other hand, characterisation may be undertaken in the context of commercial negotiations between individuals. In either case it involves consideration of a notional cause and effect relationship between the conduct and the state of mind of the relevant person or class of persons. The test is necessarily objective. 28 His Honour went on to say [28]: Determination of the causation of loss or damage may require account to be taken of subjective factors relating to a particular person's reaction to conduct found to be misleading or deceptive or likely to mislead or deceive. A misstatement of fact may be misleading or deceptive in the sense that it would have a tendency to lead anyone into error. However, it may be disbelieved by its addressee. In that event the misstatement would not ordinarily be causative of any loss or damage flowing from the subsequent conduct of the addressee. 29 In Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592the approach to characterisation of conduct directed to identified individuals was set out in the joint judgment of the majority as follows at (604 - 605) (Gleeson CJ, Hayne and Heydon JJ): The plaintiff must establish a causal link between the impugned conduct and the loss that is claimed. That depends on analysing the conduct of the defendant in relation to that plaintiff alone. So here, it is necessary to consider the character of the particular conduct of the particular agent in relation to the particular purchasers, bearing in mind what matters of fact each knew about the other as a result of the nature of their dealings and the conversations between them, or which each may be taken to have known. 30 In the matter before me there is no issue as to a causal link between the deviation in the bill of costs and any loss suffered by reason of that deviation. There is no conduct. There are words on a page in the form of a notice to the recipient of the bill. The matter is entirely one of the characterisation of the deviation in terms of whether it was 'likely to mislead'. Given that the purpose of the notice was to provide a client with quite specific information as to his or her rights upon presentation of a bill of costs, my view is that to provide incorrect information was, objectively, likely to mislead and amounted to a very material deviation of substance. 31 In my view the question of whether either respondent was actually misled is irrelevant to the proper application of s 74 of the Interpretation Act. As such, the appellant's wide-ranging application for further discovery, putting aside the oppressive nature of it, having regard to the scope of what is sought by way of discovery, is seeking discovery of documents quite irrelevant to the issue in the action. The appeal is dismissed.
|