Peters and Peters Lawyers and B Investments Pty Ltd and Anor

[2012] FamCA 855

FAMILY COURT OF AUSTRALIA

PETERS & PETERS LAWYERS & B INVESTMENTS PTY LTD AND ANOR [2012] FamCA 855

FAMILY LAW— COSTS – costs agreement – limitation of action – acknowledgement by one of three promisors does not discharge the limitation period with respect to the others

Family Law Act 1975 (Cth)
Limitation Act 1969 (NSW)

APPLICANT: Peters & Peters Lawyers

1^ST RESPONDENT: B Investments Pty Limited

2^ND RESPONDENT: Mr Jensen

FILE NUMBER: SYF 2153 of 2001

DATE DELIVERED: 9 October 2012

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Fowler J

HEARING DATE: 25 September 2012

REPRESENTATION

SOLICITOR FOR THE APPLICANT: Mr Paul

COUNSEL FOR THE 1^ST AND 2^ND RESPONDENTS:
Mr Jarrett

Orders

1. The Application in a Case filed 4 September 2012 is dismissed.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Peters & Peters Lawyers & B Investments Pty Ltd and Anor has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYF 2153  of 2001

Peters & Peters Lawyers 

Applicant

And

B Investments Pty Limited

1^st Respondent

And

Mr Jensen

2^nd Respondent

REASONS FOR JUDGMENT

1. These proceedings are proceedings by a solicitor claiming to be a creditor of the respondents for work done on their behalf in relation to the primary proceedings before the Court.  Those proceedings have settled but this claim remains outstanding.

2. Before the Court is an Exhibit BB which is a series of documents which the solicitor says comprises the agreement made between himself, the respondents and the company C Pty Ltd.

3. The agreement the solicitor says was made with the respondents in relation to the claims made in the primary proceedings.  The Court finds that the first and second respondents entered into the agreement with C Pty Ltd in pursuit of a common interest in the proceedings, although it appears clearly the case that C Pty Ltd was the primary litigant and it was that company’s interests which were proximately involved in the litigation.

4. The solicitor has rendered invoices to the respondents and C Pty Ltd in respect of the work done by him he says on their behalf.  It is asserted that no work was done on behalf of the respondents to this application and that assertion is denied by the solicitor.

5. It is not necessary for the Court to determine the multiple issues which arise in this matter as to the form of the retainer and the nature of the liability of the parties to the agreement entered into by the solicitor with the clients.

6. It is conceded by the solicitor that the work done for the clients was payable on invoice and that the invoices were rendered at a time which means that the claims by the solicitor are statute barred.  The solicitor says however that because the liquidator of C Pty Ltd paid monies on account of the amount claimed by the solicitor subsequent to the expiry of the period set by the Limitation Act 1969 (NSW) (“Limitation Act”) that operated to revive the right to take action upon the contract of retainer against the present respondents.

7. The solicitor provided a document to the Court setting out his claim and the amount due to him.  The document is set out below:

($)
Amount due to 25/5/06	20,585.18
Interest thereon in accordance with Family Law Rules June 2012 varied, but say 8%	8,234.07
Less payment on 12/7/12	(3,293.62)
Less payment on 30/8/12	(823.41)
Plus account 20/6/06	1,631.97
Plus interest (say):	652.40
Plus account 25/3/09	970.06
Plus interest (say):	232.80
Plus amount as per account 30/9/11	9,191.53
Interest thereon (say):	735.32
$38,116.30

1. The Limitation Act speaks of the right to claim after the period of limitation has expired. That is contained in Section 54. That section provides:

   54 Confirmation

   (1)       Where, after a limitation period fixed by or under this Act for a cause of action commences to run but before the expiration of the limitation period, a person against whom (either solely or with other persons) the cause of action lies confirms the cause of action, the time during which the limitation period runs before the date of the confirmation does not count in the reckoning of the limitation period for an action on the cause of action by a person having the benefit of the confirmation against a person bound by the confirmation.

   (2)       For the purposes of this section:

   (a)         a person confirms a cause of action if, but only if, the person:

   (i)        acknowledges, to a person having (either solely or with other persons) the cause of action, the right or title of the person to whom the acknowledgment is made, or

   (ii)       makes, to a person having (either solely or with other persons) the cause of action, a payment in respect of the right or title of the person to whom the payment is made,

   (b)         a confirmation of a cause of action to recover interest on principal money operates also as a confirmation of a cause of action to recover the principal money, and

   (c)         a confirmation of a cause of action to recover income falling due at any time operates also as a confirmation of a cause of action to recover income falling due at a later time on the same account.

   (3)       Where a person has (either solely or with other persons) a cause of action to foreclose the equity of redemption of mortgaged property or to recover possession of mortgaged property, a payment to the person of principal or interest secured by the mortgage or a payment to the person otherwise in respect of the person’s right or title to the mortgage is a confirmation by the payer of the cause of action.

   (4)       An acknowledgment for the purposes of this section must be in writing and signed by the maker.

   (5)       For the purposes of this section a person has the benefit of a confirmation if, but only if, the confirmation is made to the person or to a person through whom the person claims.

   (6)       For the purposes of this section a person is bound by a confirmation if, but only if:

   (a)         the person is a maker of the confirmation,

   (b)         the person is, in relation to the cause of action, a successor of a maker under a devolution from the maker occurring after the making of the confirmation,

   (c)         where the maker is, at the time when the person makes the confirmation, (either solely or with other persons) a trustee of the will or of the estate of a deceased person-the firstmentioned person is at the date of the confirmation or afterwards becomes a trustee of the will or of the estate,

   (d)         where the maker is, at the time when the person makes the confirmation (either solely or with other persons) a trustee (other than a trustee of the will or of the estate of a deceased person)-the firstmentioned person is at the date of the confirmation or afterwards becomes a trustee of the trust of which the maker is a trustee, or

   (e)         the person is bound under subsection (7).

   (7)        

   (a)         Paragraph (b) applies to a confirmation of a cause of action:

   (i)                   to recover property, being goods,

   (ii)                  to recover property, being land,

   (iii)                 to enforce in respect of property an equitable estate or interest in land,

   (iv)                 to foreclose the equity of redemption of mortgaged property,

   (v)                  to redeem mortgaged property,

   (vi)                 to recover principal money or interest secured by mortgage of property, by way of the appointment of a receiver of mortgaged property or of the income or profits of mortgaged property or by way of sale, lease or other disposition of mortgaged property or by way of other remedy affecting mortgaged property, or

   (vii)                to recover trust property or property into which trust property can be traced.

   (b)         Where a maker of a confirmation to which this paragraph applies is, on the date of the confirmation, in possession of the property, the confirmation binds a person in possession during the ensuing period of limitation, not being, or claiming through, a person other than the maker who is, on the date of the confirmation, in possession of the property.

1. It was argued by the solicitor that the right to claim had been revived by the part payment by C Pty Ltd’s liquidator, that payment being made on 12 July 2012 of $3,293.62 and 30 August 2012 of $823.41.  He argued that the payment having accrued for the benefit of the liability of each of the other defendants that it had a reviving effect on the cause of action against them notwithstanding that there was no payment by them or that either of the respondents had made an acknowledgement in writing.  The Court finds that such payment by the liquidator does not constitute an acknowledgment on behalf of the other respondents.

2. The Court takes the view that having regard to the limited operation of the provisions of section 54 of the Limitation Act the assertion of the solicitor cannot be upheld and that the action must fail given that his last invoice was on 22 June 2006 and the proceedings were commenced on 4 September 2012 and that the liability of the respondents (if any) arose for that purpose at the time of invoice.

3. Whilst the solicitor claims that he did not pursue the respondents in the meantime because he wanted to determine how much he could recover from the company in liquidation that is not a basis for saying that the period of limitation against the respondents does not run from the date of invoice.  It was always open to the solicitor to bring proceedings against the respondents within time and he failed to do so.  His motivation whilst it might be altruistic and honourable is unfortunately from his point of view not a matter which assists him in respect of this claim.

4. Accordingly, the Court finds that the claims of the solicitor against the defendants are statute barred and cannot succeed and accordingly dismisses the application of the solicitor.

I certify that the preceding twelve (12) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Fowler delivered on 9 October 2012.

Associate:

Date:  9 October 2012