Pires v DibbsBarker Canberra Pty Limited
[2014] ACTSC 283
•20 November 2014
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Francis Pires v DibbsBarker Canberra Pty Limited |
Citation: | [2014] ACTSC 283 |
Hearing Date(s): | 3 October 2014 |
DecisionDate: | 20 November 2014 |
Before: | Refshauge J |
Decision: | 1. 3 October 2014 The application for leave to appeal be dismissed. 2. 20 November 2014 The applicant pay the respondent’s costs from 19 June 2014 to 8.30 am on 24 September 2014 on a party and party basis and thereafter on a solicitor-client basis. The stay of the sale and seizure order made in respect of the judgment entered in the ACT Civil and Administrative Appeals Tribunal on 23 May 2014 and 8 January 2014 between the applicant as judgment debtor and the respondent as judgment creditor be dissolved on and from 10.30 am on 20 November 2014. |
Category: | Principal Judgment |
Catchwords: | APPEAL - GENERAL PRINCIPLES – In General and Right of Appeal – Application for leave to appeal out of time – No question of fact or law to justify granting leave – Leave to appeal refused PROCEDURE – Costs – Calderbank offer – Self-represented litigant – Special costs order made |
Legislation Cited: | ACT Civil and Administrative Tribunal Act 2005 (ACT), ss 7, 8, 16, 17, 18, 48 Court Procedures Rules 2006 (ACT), rr 1721, 5001, Div 2.18.5, Pt 2.18 (Enforcement) |
| Cases Cited: | A v Director of Family Services (1996) 132 FLR 172 |
| Parties: | Francis Pires (Appellant) DibbsBarker Canberra Pty Limited as trustee for the John Astley Buxton Discretionary Trust, DibbsBarker Pty Limited as trustee for the Keith Chester Fleming Discretionary Trust, DibbsBarker Canberra Pty Limited as trustee for the Gulan Legal Discretionary Trust, DibbsBarker Canberra Pty Limited as trustee for the John Matthew Hill Discretionary Trust, trading as DibbsBarker Canberra (Respondent) |
Representation: | Counsel In person (Appellant) Mr K Pattenden (Respondent) |
| Solicitors Self-represented (Appellant) Pattenden Law (Respondent) | |
File Number: | SCA 59 of 2014 |
Decision under appeal: | Tribunal: ACT Civil and Administrative Tribunal Before: Appeal President WG Stefaniak Date of Decision: 23 May 2014 Case Title: Francis Pires (Appellant) and DibbsBarker Canberra Pty Limited as trustee for the John Astley Buxton Discretionary Trust, DibbsBarker Pty Limited as trustee for the Keith Chester Fleming Discretionary Trust, DibbsBarker Canberra Pty Limited as trustee for the Gulan Legal Discretionary Trust, DibbsBarker Canberra Pty Limited as trustee for the John Matthew Hill Discretionary Trust, trading as DibbsBarker Canberra (Respondent) Appeal Ref Number: AA 14/10 from XD 13/1561 |
Francis Pires, as applicant, seeks leave to appeal from a decision of Appeal President Stefaniak of the ACT Civil and Administrative Tribunal (the ACAT) made on 23 May 2014.
On 3 October 2014, I dismissed the application for leave. These are my reasons for doing so. Mr K Pattenden for DibbsBarker Canberra, the respondent, then sought a special costs order. Mr Pires, opposed any order for costs being made. I reserved my decision. I deal with that matter also in these reasons.
The hearing
The proceedings, both at first instance and on appeal, were conducted in a very informal manner. That is, indeed, a legislative requirement under the ACT Civil and Administrative Tribunal Act 2005 (ACT) (the ACAT Act). See s 7(a) of the ACAT Act.
The ACAT is not bound by the rules of evidence (s 8 of the ACAT Act) and may inform itself in any way it considers appropriate. Such provisions are common, but do not mean that the Tribunal has no constraints on its procedures. The ACAT is, for example, bound by the requirement to observe natural justice and procedural fairness (s 7(b) of the ACAT Act).
In A v Director of Family Services (1996) 132 FLR 172 at 177, Higgins J held that a provision of this kind did not render the rules of evidence irrelevant. His Honour continued “[t]hey should still be applied unless, for sound reason, their application is dispensed with”.
That approach was doubted by Miles CJ in De Domenico v Marshall (1999) 153 FLR 437 at 442-3; [26] – [27] where his Honour considered that such an approach may not be appropriate for an administrative tribunal.
In R v War Pensions Entitlement Appeal Tribunal; Ex parte Bott (1933) 50 CLR 228 at 256, Evatt J made the important point that the rules of evidence should not simply be ignored because they “represent the attempt made, through many generations, to evolve a method of inquiry best calculated to prevent error and elicit truth”. This, however, must be read carefully with the caution expressed by Brennan J in Re Pochi and Minister for Immigrationand Ethnic Affairs (1979) 26 ALR 247 at 256, namely:
[t]hat does not mean, of course, that the rules of evidence which have been excluded expressly by the statute creep back through a domestic procedural rule.
Where, as in this case, the ACAT is exercising a function that was formerly exercised by a court, namely debt recovery of sums less than $10,000 (ss 16, 17 and 18 of the ACAT Act, s 266A of the Magistrates Court Act 1930 (ACT)), the ACAT must have regard to the need to ensure appropriate levels of proof by reliable evidence and have regard to the reasons why particular rules of evidence exist.
In deciding its approach to evidence, it seems likely that the ACAT would be bound, for example, by common law privileges such as legal professional privilege and “without prejudice” privilege. See, for example, Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission (2002) 213 CLR 543 at 552; [10]. It would also appear that the ACAT should not rely on evidence that is irrelevant and, in order to ensure procedural fairness, may be constrained in the appropriateness of the admission of hearsay evidence, not excluding it necessarily, but ensuring that it may be required in an appropriate case to permit cross-examination.
Thus, as Kiefel J observed in Rodriguez v Telstra Corporation Ltd (2002) 66 ALD 579 at 585-6; [25], decisions must not be made without evidence having probative force, inferences must not be drawn without evidence and the tribunal must not base its conclusion on its own view of a matter which requires evidence.
Recently, the Full Court of the Federal Court of Australia has given some quite detailed consideration of the relevance of the rules of evidence in hearings by tribunals not bound by such rule. Thus, in Sullivan v Civil Aviation Safety Authority (2014) 141 ALD 540, the Court considered common law principles such as those set out in cases such as Browne v Dunn (1894) 6 R 67 at 70-1 and Briginshaw v Briginshaw (1938) 60 CLR 336 at 347, 361-2 do not apply as rules of law in such tribunals, which I consider includes the ACAT, though the underlying principles of fairness, natural justice, reliance on credible and relevant evidence which underpin those rules remain applicable. The approach is to be determined from the circumstances of the precise case.
In this case, neither party adduced any evidence on oath and much of the oral evidence was given in a rather conversational style, though it appears both parties had made written statements. This is not to criticise the procedure; indeed, such informality can be quite appropriate as long as the parties have the full opportunity to put their cases, the issues are made clear so that each party can address them and the appeal tribunal or this Court can ascertain with appropriate clarity the facts found from credible and reliable evidence and the reasons for decision.
The facts
It was not entirely clear to me what the precise facts were on some issues as copies of the written statements of the parties apparently filed in the proceedings were not provided to me on the application.
It seems to me, however, from a careful reading of the transcript, that the following facts were before the ACAT.
Mr Pires was a director of a company, Francis Pires Pty Ltd trading as Manuka Prestige Property Group, that, on 6 and 7 June 2013, had been put under external administration (liquidation, followed by receivership).
Mr Pires was contacted by the liquidator and agreed to meet him in Sydney. At the meeting, Mr Pires told him that he was to meet the receivers on 11 June 2013. The liquidator asked him, “Have you got a solicitor in Canberra? ... I know a couple of solicitors”. Mr Pires said he did not know a solicitor who could act in such matters.
The liquidator said:
Look, I know a couple. There’s a guy at Dibbs Barker, John Hill. We had a dealing with him before. If you want to ask him to come to a meeting. Have a solicitor at the meeting. He acts as a good witness and it is good for you as well. Don’t go to the meeting by yourself.
Mr Pires later rang Mr Hill and asked him for urgent advice. He must have mentioned the meeting for he said that Mr Hill offered to come to the meeting with the receivers and Mr Pires said “Yes, I would like that”. Mr Hill attended the meeting, which was not held at his office. Mr Pires said the meeting lasted for about half an hour. Mr Pires then said to the ACAT, and to me, that thereafter he did not ask Mr Hill “to do, call or act any further for me”.
He said Mr Hill rang him on another day and he told Mr Hill “I’m not too sure where I am going at the moment but please don’t do anything at the moment” or “until I come back to you further”. Mr Pires did not seem quite certain whether the call was made on 12 or 13 June 2013 though he seemed to firm up on 12 June as the original hearing progressed but said in the appeal hearing “within a couple of days of our original meeting” and later asserted that it was on Thursday 13 June 2013. In addition, though he initially said that he rang Mr Hill, he later said that Mr Hill had rung him. He seemed a little uncertain of these details.
It appears that there had also been some discussion on 11 June 2013 in the office of Mr Pires about the need to state the appointment of external administrators on any documents issued by the company, for Mr Pires also said that Mr Hill told him in that telephone conversation “Francis, as we discussed in your office today that it [i.e. the statement] must go on the letter” and Mr Pires thanked him.
Presumably in compliance with s 269 of the Legal Profession Act 2005 (ACT), Mr Hill sent a costs agreement to Mr Pires as disclosure of his costs required under that section. While s 271 requires such an agreement to be in writing, it does not require it to be disclosed before lawyers are retained but, if not it must be provided, “as soon as practicable after”. It appears that the agreement was sent by email and also by post. There was some uncertainty about whether the actual agreement was attached to the email.
In any event, Mr Pires received the agreement on 17 June 2013.
Sometime before this, however, Mr Hill sent Mr Pires an email with which was attached a letter from the lawyers for the receivers. Mr Hill pointed out that one of the things they raised was the requirement to add to the name of the company on all documents the words “In liquidation and receivers and managers appointed”. Mr Hill added “I note we discussed that at some length yesterday”, a further reference to the provision of advice.
In the email, Mr Hill also requested Mr Pires to return the costs agreement and to arrange for $3,000 to be deposited into his firm’s trust account for costs incurred and anticipated.
Mr Hill also sent Mr Pires a lengthier email with some detailed advice that day, possibly including a report of the meeting with the receivers.
Mr Pires responded by email on 19 June 2013 as follows:
John, currently I am not in a position to deposit any money in your trust account due to my situation. Thank you for your advice and I will come back to you soon.
This, clearly, confirmed the oral instruction he had given on 13 June 2013 that he did not want Mr Hill to do any further work until he asked him to do so.
On 4 July 2013, Mr Hill sent Mr Pires an account for the work he had done. The bill totalled $2,012.10. The bill included the following advice:
You may apply to have all or any part of our legal costs assessed under division 3.2 of the Legal Profession Act 2006. Any such application must be made not later than 12 months after the date this bill was given to you, the request for payment was made, or either a bill was given or a request for payment made not later than 12 months after the day that the costs were paid. You may apply to the Supreme Court under section 288 of the Act to have any costs agreement or revision as to any costs agreement entered into between us to be set aside on the basis that it is not fair and reasonable.
Mr Pires did not seek to have the bill assessed, nor did he pay the bill. Accordingly, the law firm commenced the proceedings in the ACAT. I understand that he may subsequently have done so.
Mr Pires did send an email to the lawyers on 29 August 2013 in response to a reminder that the account was due and not paid. In it, he said:
I do not intend to pay for the invoices attached as I was very disappointed with the very poor advice I received. I think John was more interested in scoring points with his club members. I don’t mean to be rude but that is how I feel, however, the outcome will be the proof. I always only pay for services received.
Mr Pires, was however, unable to identify for me what it was about the advice that was “very poor”. He certainly did not articulate that to the ACAT.
The decision
The original decision found in favour of the lawyers and ordered Mr Pires to pay the account plus the costs which appear to be the filing fee.
In the original decision, the ACAT rejected the bases Mr Pires put forward for defending the claim and which had been raised by Mr Pires. In the first place, the ACAT held that it had no jurisdiction to review the amount of costs which the lawyers had claimed because that was a function of the Supreme Court which has, under Div 3.2.7 of the Legal Profession Act, jurisdiction to assess such costs. Thus, the ACAT rejected Mr Pires’ suggestion that it consider whether certain items were chargeable and at what rate. It appears to be correct to have done so as I explain below (at [83]-[86]).
The second defence was that the failure to sign and return the costs agreement by Mr Pires meant that there was no costs agreement and so no claim for costs could be made. The ACAT said that “the cost [sic] agreement is effective whether you signed it or not”. That is, in fact, not what the legislation provides. Section 282(3) of the Legal Profession Act provides:
A costs agreement may consist of a written offer in accordance with subsection (4) that is accepted in writing or by other conduct.
While it is correct to say that a costs agreement may be made notwithstanding that the written agreement is not signed, there must be relevant conduct, specified in the agreement (s 282(4)(c) of the Legal Profession Act), such as continuing to instruct the lawyers after receipt of the agreement to constitute an acceptance of the offer contained in the agreement to constitute an acceptance of the offer contained in the agreement. There was, however, no such conduct in this case. Thus, there was no binding costs agreement in this case.
That does not affect the decision of the ACAT, however, for costs can be claimed without a costs agreement. Even if the costs claimed were calculated in accordance with the costs agreement, they are still liable to be assessed by the Supreme Court if challenged by Mr Pires. That they were calculated in this way does not prevent them from being fair and reasonable even if there is no costs agreement or the agreement is set aside: s 288(6) of the Act. As I have noted above, there was no request by Mr Pires for the costs to be assessed by the Supreme Court under the Legal Profession Act, though he may since have done so.
The third basis rejected by the ACAT was that the work was inadequately done or of no value. The ACAT suggested that Mr Pires could not complain to the ACAT about the advice; his only redress was to complain to the Law Society. That is not correct. A client may defend a claim for costs on the basis that the lawyer was negligent. See Cachia v Isaacs (1985) 3 NSWLR 366 at 371. Other defences might include that the contract was an entire contract which was terminated without just cause: Smits v Roach (2004) 60 NSWLR 711 at 749-52; [78]-[85]. Other contractual defences may apply.
I deal with this issue below (at [70]-[72]).
In any event, the appeal decision is, however, the decision that is to be challenged in the proceedings Mr Pires wished to bring, as is set out below (at [47]). I turn them to the appeal in the ACAT.
The ACAT on appeal set out the facts. At the appeal, Mr Pires did not challenge the chronology of events found in the original decision in any substantial or relevant way.
As to his challenge to the “very poor advice”, he said he received from the lawyers the ACAT on appeal correctly found “[t]here is nothing to indicate one way or the other what the advice was”. Mr Pires did not specify what it was that he challenged about the advice. The highest it came was when, in acknowledging the further meeting he had with Mr Hill at a coffee shop after seeing the receivers, Mr Pires said that at that meeting, there was a discussion about the statement that had to appear on all documents of the company.
He told the ACAT on appeal:
Then I said, “All I want to know is that it does have to go on the letter” and he said, “Yes.” That’s all. I said, “But the receivers have already told me to do that.”
The ACAT on appeal rejected the argument of Mr Pires that because he had not signed the costs agreement he did not have to pay any costs.
The ACAT on appeal found that there was a contract of retainer and that work was performed under it. It also suggested that, if there was negligence, Mr Pires could complain to the Law Society. For the reasons I have set out above, that is incorrect, but the ACAT on appeal found that there was no professional negligence shown of which Mr Hill was guilty.
The ACAT on appeal further analysed the claims including items for which a charge was made and found that there was nothing untoward about them.
Accordingly, the amount claimed was found to be due and judgment was entered for $2,362.10, inclusive of costs.
Leave to appeal
Mr Pires then sought leave to appeal from the decision of the appeal tribunal of the ACAT. That is required under s 86(1) of the ACAT Act. Where the appeal president has dismissed the appeal under s 80 or declined to deal with it under s 85, then the appeal is from the original decision. Neither apply here, so the appeal sought to be taken is from the appeal decision.
I set out in Faull v Commissioner for Social Housing for the ACT (2013) 277 FLR 61 at 75-7; [78]-[87] the principles to be applied in considering whether leave should be granted. That was a decision in which an appeal could only be taken on a question of law. In this case, the appeal may be taken on a question of law or a question of fact. Taking this difference into account, it seems to me that the following principles are those which apply:
·the need for leave is to reduce the number of appeals and provide a filter so that only those of some substance or where there is a miscarriage of justice should be able to be heard, though the test should be applied “in a liberal manner, and not begrudgingly”: Perry v Smith (1901) 27 VLR 66 at 68;
·whether leave should be granted or not must depend upon the justice of the case;
·the application for leave must identify the question, of fact or law, which the applicant for leave claims arises and which is important to the substantive appeal succeeding or failing;
·the applicant need not show error – that is for the appeal itself – but must show that there is a real or significant argument to be put that error exists;
·when a question has been identified which bears directly on the relief which will be sought on the appeal and once it has been shown that there is sufficient doubt attending the question to justify the grant of leave to appeal, leave will ordinarily be granted if the order below is a final order or final in effect;
·the public importance of any question of fact or law is relevant but not decisive as to the question of whether leave to appeal should be granted;
·it may be relevant to show that the error, if uncorrected, would impose substantial hardship.
I note that Mr Pires was unrepresented. I set out in Maher v Carpenter (2012) 7 ACTLR 216 at 224-5; [40]-[41] the relevant considerations that I must take into account when hearing the application by Mr Pires. In particular, I must ensure that any claim identifiable on the material before me is properly raised and considered even if not recognised by Mr Pires.
I have endeavoured to identify the questions which Mr Pires wishes to argue would arise for consideration on appeal and will consider each in turn. These seem to me to be:
·that there was no retainer that required Mr Pires to be liable for costs;
·that the work done was worthless – arguably a failure of consideration – or negligently performed;
·that work was done for which there was no instruction;
·that the amount charged was excessive.
No retainer
Both in the original decision and on appeal, the ACAT held that there was a contract of retainer. Mr Pires denies that.
A retainer is simply a contract for the provision of legal services for a fee as pointed out by Stein JA in Wong v Kelly (1999) 154 FLR 200 at 206; [36]. The New South Wales Court of Appeal pointed out also in Beach Petroleum NL v Kennedy (1999) 48 NSWLR 1 at 48; [208] that the ordinary law of contract applies to the retainer and so the contract must be proved in the ordinary way, including that it may be implied from conduct.
Mr Pires, on all the evidence, approached Mr Hill and asked for advice. He had been recommended to contact him by the liquidator to be a witness at the meeting Mr Pires was to have with the receiver. It is clear that he mentioned the meeting. Mr Hill offered to attend and Mr Pires accepted the offer.
Mr Pires submitted to me that there was no retainer and that he thought that Mr Hill was going to act for no fee. He gave a number of examples of what he said were analogies.
For example, he said that “when you take a car for a drive it doesn’t mean that you guaranteed to buy it”. That is, however, not an analogy for what you are going to contract for in that situation is the ownership of the car. To test drive a car is not to gain or obtain ownership.
He also referred to the free advice that is often provided by bank managers but bank managers rarely if ever charge for their advice. They are remunerated differently, as Mr Pires, a businessman of some twenty years’ experience, would know.
In approaching a solicitor for advice, a prospective client is seeking, in being provided with that advice, to obtain that which the lawyer sells.
I am not satisfied that Mr Pires had any real basis for the assumption that by contacting Mr Hill and asking for legal services he was not accepting responsibility to pay for the services received.
Mr Pires had dealt with solicitors previously. He was aware of the issues for he said that he had previously challenged a claim by one of the solicitors he had consulted and the Court ruled in his favour in relation to a costs agreement.
It was also put to him that, when he accepted Mr Hill’s offer to attend the meeting, he could not be thinking that Mr Hill would attend “for nothing”. His answer was illuminating. He responded:
No, I don’t think he did that for nothing. It’s just simply that I haven’t signed the cost [sic] agreement.
Later, he said also:
I don’t agree to pay the money. I agree to pay some. Mr Hill says he took half an hour – but certainly nowhere near the money.
It is clear that Mr Pires was aware that, by seeking advice from Mr Hill and accepting Mr Hill’s offer to attend the meeting, he would have to pay some fees. There was, therefore, good consideration for the contract of retainer.
It seems to me that, on the evidence, there was a contract of retainer. The terms may not have been those set out in the costs agreement; instead there may have been what may be regarded as the “statutory terms”, that the fees be fair and reasonable (s 300(1)(c) of the Legal Profession Act).
Mr Pires then suggested that his company, not he, had engaged Mr Hill. Of course, as the company was in liquidation, Mr Pires had no authority to cause it to enter into contracts; his authority as a director had been suspended: s 471A of the Corporations Act 2001 (Cth). It seems to me that it is highly unlikely that, in the meeting he had with the liquidator, Mr Pires had not been told that.
It seems to me that there is no question of fact or law as to whether he had retained Mr Hill and that, as a result, he was contractually bound to pay fair and reasonable costs of the legal services provided. Thus, there was no basis for a grant of leave to appeal.
The work done
Mr Pires initially approached Mr Hill for advice. He also clearly had in mind that he should have, as recommended by the liquidator, a witness at the meeting with the receivers.
Mr Pires claimed that he had not received any valuable legal services. He said:
I’m not here to run anybody down but we all expect to get some goods in return, some service [or] goods in return for the money we pay. I’m not happy then. I received no benefit whatsoever.
That is, of course, incorrect. He received in return what the liquidator had recommended and he had sought – a witness at the meeting with the receivers. Indeed, he said to the ACAT, “I wanted more than anything else, a legal witness to attend the meeting I was having with ... the receivers-managers”. That the attendance at the meeting did not change anything or reverse the external administration is not to the point.
Mr Pires also acknowledged that he had received advice from Mr Hill, to which I have referred above (at [23]). There can be no case that there was a total failure of consideration.
Insofar as there is a complaint about the quality of the work provided, it comes no higher than a suggestion that Mr Hill engaged in some personal point scoring at the meeting. Mr Pires’ complaint, when chased for payment of the account, was no more than:
... I was very disappointed with the very poor advice I received. I think John [Hill] was more interested in scoring points with his club members.
That does not appear to approach close to a sustainable case of negligence. In any event, what he was seeking was a witness at the meeting; that is what he got. The advice that Mr Hill also gave Mr Pires was correct; indeed, Mr Pires acknowledged that.
As the ACAT properly found, there was no negligence made out.
Thus, the defences claimed by Mr Pires, insofar as they can be construed as a total failure of consideration or a claim of negligence, were not made out. There was no evidence to sustain either defence and so no question of fact or law that would justify a grant of leave to appeal.
Work done for which there was no instruction
Mr Pires submitted that he did not ask Mr Hill “to do, call or act any further for me”.
Nevertheless, he said in relation to the subsequent call to Mr Hill, which apparently occurred on 13 June 2013, that he told Mr Hill “please don’t do anything at the moment”. This is a clear indication that he had retained Mr Hill more generally; the comment does not otherwise make sense.
He complains of a letter received by Mr Hill from the lawyers for the receivers and managers, but they were bound to write to Mr Hill as Mr Pires apparently, by having Mr Hill accompany him to the meeting with the receivers, made it appear to them that he had a lawyer acting for him. The receivers’ lawyers were bound to communicate with those lawyers, not directly with Mr Pires. See r 28 of the Legal Profession (Solicitors) Rules 2007 (ACT).
Mr Hill would also ordinarily be required to report to Mr Pires about the meeting and its implications. He would also be authorised under the retainer to receive calls from the liquidator and the lawyers for the receiver and manager until the retainer was terminated.
There was nothing shown in the work done prior to the termination of the retainer that was not within its terms.
Mr Pires suggested that Mr Hill had overserviced, but the terms in which he put it do not justify that. He said to the ACAT at the appeal hearing:
... you can see from the chronology of events John Hill was really pushing himself on me. Now, how many phone calls did I make to John Hill to act for me? One. One phone call on Tuesday the 11th in the morning. Now, this is very clear that John Hill really wanted to act for me.
This is not, however, a basis for the allegation. So far as signing the costs agreement is concerned, Mr Hill was bound to follow that up. So far as relaying information sent by the liquidator and lawyers for the receivers and managers is concerned, that was his duty as a solicitor. So far as reporting to him about the meeting and providing advice that had been sought, this also comes within the terms of the retainer.
The work done by Mr Hill and for which he charged ended on 13 June 2013, clearly as a response to the telephone call Mr Pires made.
In an assessment of costs under Div 3.2.7 of the Legal Profession Act, the precise value of work done can be evaluated. There is, however, nothing in what Mr Pires put to the ACAT that shows there was work done for which there were no instructions. There is no question of fact or of law that would justify the grant of leave to appeal.
The amount charged was excessive
Both in the original decision and the appeal decision of the ACAT, it held that it had no jurisdiction to assess the costs as to whether they were fair and reasonable. I agree.
Although it does not say it explicitly, the structure and terms of the Legal Profession Act makes it clear that this is the exclusive work of the Supreme Court. Section 300C of the Act provides that the amount assessed is taken to be a judgment of this Court and may be enforced accordingly. That assessment, under s 300 includes a determination of whether it was reasonable to carry out the work to which the legal costs relate.
This is reinforced by the fact that s 294A of the Legal Profession Act permits an application for a costs assessment to be made even if the costs have been completely or partly paid and s 298 provides that a lawyer cannot start a proceeding to recover costs where an application for a costs assessment has been made until the costs assessment has been completed.
I also rely on the fact that any costs assessment must be sought no later than twelve months after the bill is delivered: s 294A(5) of the Legal Profession Act. An extension of time is permitted. If a client could simply wait to be sued and then by a defence require, in effect, a bill to be assessed in court, the scheme and time limits would be quite undermined.
There is no question of fact or law raised by Mr Pires which would justify the grant of leave to appeal.
Conclusion on leave to appeal
As a result of my findings, there was no question of fact or law raised by Mr Pires that would justify a grant of leave to appeal from the decision of the ACAT.
It was for these reasons that I dismissed the application.
Costs
The ordinary rule in the ACAT is that each party should bear his, her or its own costs. See s 48(1) of the ACAT Act. Section 48(2)(a) provides that if the ACAT finds in favour of an applicant, it may order the other party to pay the filing fee.
That is what happened in the ACAT. Mr Pires was ordered to pay the filing fee as costs but no other costs.
The position is otherwise in this Court. Rule 1721 of the Court Procedures Rules 2006 (ACT), made applicable to such proceedings by r 5001, provides that the costs of proceedings are at the discretion of the Court. The settled practice, set out in Ritter v Godfrey [1920] 2 KB 47 at 52 is that, in the absence of special circumstances, successful litigants should ordinarily have their costs. See also Oshlack v Richmond River Council (1998) 193 CLR 72 at 86.
Mr K Pattenden for the respondents, DibbsBarker Canberra, sought an order for costs and ordinarily the respondents would be entitled to such an order.
He asked, however, for a special order for costs as he had, on behalf of the respondents, made an offer of compromise to Mr Pires, an offer which Mr Pires did not accept.
In Calderbank v Calderbank [1976] Fam 93, the UK Court of Appeal held that where an offer of settlement in litigation is unreasonably refused, the party making the offer (the offeror) is entitled to a special order for costs, that is, the offeror may either be awarded its costs to be assessed at a more generous rate or may be awarded costs despite otherwise not ordinarily having such an entitlement.
This approach has been followed widely now and, since the Full Court of this Court adopted those principles in Quirk v Bawden (1992) 112 ACTR 1, it is common for such an approach to be applied by this Court.
The letter of offer is commonly called, therefore, a “Calderbank letter”, though there are some principles surrounding such letters and not just any letter of offer will suffice. I have set out some of these principles in Financial Integrity Pty Ltd v Farmer (No 4) [2014] ACTSC 145 at [24]-[46]. They may briefly, not exhaustively, be summarised as follows:
·the letter must be either an open letter or marked “without prejudice save as to costs” and thus be able to be tendered at any hearing or an application for costs;
·the offer in the letter must be a genuine compromise;
·the offer must be in clear terms and be a final offer, not subject to any further negotiation;
·generally an offer should not be “inclusive of costs”, though the authorities are not uniform on this issue;
·the letter must state expressly that, if the offer is not accepted, then a special order, such as for indemnity costs, will be sought;
·the offer must be open for a reasonable period, which is generally, though depending on the circumstances of each case, about 14 days;
·the offer must give the offeree a reasonable chance to consider the strength of the offeror’s case, so that the earlier in the proceedings the offer is made, the more information about the strength of the offeror’s case and the weakness of the offeree’s case should be provided;
·the Court, when asked to take into account the rejection of an offer made in a Calderbank letter, has a wide discretion and is not bound to make a special costs order;
·a very important consideration is whether the judgment is more favourable to the offeror than the offer in the Calderbank letter and the extent to which it is more favourable; and
·an almost equally important factor is whether, in all the circumstances, the offeree’s rejection of the offer was reasonable; that may involve a consideration of the extent of the compromise as compared to the strength of the cases of the offeree and the offeror.
In Financial Integrity Group Pty Ltd v Farmer (No 5) [2014] ACTSC 194 at [3], I considered that, in principle, the date from which any special order should be made is the last date on which the offer is open for acceptance by the offeror.
One issue which I had not earlier considered is the position where the offeree is a litigant in person. In such circumstances, this may be a relevant factor. In Zepinic v Chateau Constructions (Aust) Ltd (No 2) [2014] NSWCA 99 at [26], the NSW Court of Appeal considered that the fact that the offeror was
an unrepresented litigant, but never squarely and succinctly told ... why his motion and amended motion were doomed to fail
was a relevant factor which, with others, led to the Court declining to make a special costs order.
Mr Pattenden did deliver to Mr Pires a Calderbank letter. It was, relevantly, in the following terms:
Your application for leave to appeal and your appeal are in my view destined to fail because you:
(a)have failed to identify any error in the ACAT decision; and
(b)appear to be making the same submission that has failed on two occasions at the ACAT, namely, that you did not engage my client to provide legal services to you.
The above is intended to highlight some of the problems that you will face if you proceed with your appeal.
I am instructed that my client is prepared to accept payment in the sum of $1,500.00 plus costs as assessed or agreed between the parties to resolve this matter (the “offer”). This offer is open for acceptance until 8.30am on 24 September 2014 unless it is withdrawn sooner. If it is not accepted within this time it is withdrawn.
Given that my client presently holds a judgment in the amount of $2,102.10 (plus certain costs) the offer represents a genuine compromise and it would be unreasonable for you to refuse the offer in these circumstances.
The offer is made pursuant to the principles set out in Calderbank v Calderbank (1975) 3 All ER 333 and Cutts v Head (1984) 1 All ER 597 and applied in Quirk v Bawden (1992) 112 ACTR 1. If you do not accept the offer and my client achieves an outcome that is better than the offer, my client will seek an order that you pay its costs on a full indemnity basis for the period after the expiration of the offer (and on the ordinary party party basis prior to that date). If it is necessary to do so, I will tender this letter in support of my client’s application for indemnity costs.
It is, it appears to me, a Calderbank letter and complies generally with the considerations I have set out above.
There were, thereafter, further negotiations. On the same day, Mr Pires sent back a counter-offer of $600 which he says he had already made. I construe this counter-offer to be inclusive of costs.
Mr Pattenden, on instructions, rejected the offer the next day and confirmed the offer in the Calderbank letter. On 23 September 2014, Mr Pires made a further offer of $1,000 inclusive of costs “[t]o minimise time and stop wasting more time”. Later that day, Mr Pattenden rejected the offer but made a further offer of $1,500 plus costs, open until 8:30 am the next day. Mr Pires then made a further offer of $1,500 inclusive of costs. He made some negative comments about Mr Hill.
That offer made by Mr Pires was rejected in an email in which Mr Pattenden said:
I advise I am instructed to reject your offer. However, as you indicated in our above telephone conversation that you are not prepared to agree to an unspecified amount of costs, I advise my client’s costs are about $2,500.00 plus disbursements of $307 (filing fee for the Seizure and Sale order). Notwithstanding, with the view to resolving this matter my client is prepared to accept the amount of $1,500.00 plus cost of $1,250.00 and disbursements of $307.00 (total $3,057.00) in full and final settlement of this matter. I advise this offer is open for acceptance until 9.00 am on 24 September 2014. If it is not accepted in that time it is withdrawn. This offer represents a significant compromise on the part of my client in respect of both the judgment sum and costs. As a result, if you do not accept this offer my client reserves the right to rely on this email in support of any application for cost including an application that you pay its costs from 9.00 am on 24 September 2014 on an indemnity basis. I trust this will not be necessary and look forward to your acceptance of this offer.
In my view, the time limit for a response probably means that, despite the circumstances of the case, I would not ordinarily be prepared to rely on it as a Calderbank letter particularly made to a litigant in person. The proceedings were in Court on 24 September 2014, although they were unlikely to be completed on that day as the transcript of the decision of the appeal president at the ACAT had not been received.
The respondents did not, however, withdraw the Calderbank letter of 10 September 2014, which could still have been accepted by Mr Pires.
Mr Pires, in a rather intemperate and abusive email, for which abuse I could see no basis in the material before me, Mr Pires rejected this offer and re-offered $600 apparently inclusive of costs.
The dismissal of the application for leave to appeal means that the judgment of $2,102.10 (plus costs being the filing fee of $260) remains in force and thus DibbsBarker Canberra have achieved a more favourable result than their offer. The difference is a significant amount, indeed more than the $600 which was the final offer made by Mr Pires.
I take into account also that Mr Pires was unrepresented at all the hearings before me, though he had consulted two lawyers in the course of the matter between adjournments. Neither, however, appeared before me. I assume that they would have advised Mr Pires about the letter of offer and its consequences, though, as I cannot make a positive finding about that, I do not rely on it.
The Calderbank letter does, however, show with reasonable clarity the basis for showing that the case made by Mr Pires is weak and does direct him to the precise issues he was required to consider.
I am satisfied that a special order should be made. Since, however, I have not seen any material to show the cost arrangements between DibbsBarker Canberra and its lawyers, I am not prepared to make an order for indemnity costs. For the reasons set out briefly by Harper M in Jones v Walker [2013] ACTSC 117 at [31], I consider that without details of the practical effect of an order for indemnity costs, I should not make one. I consider, however, that DibbsBarker Canberra are entitled to solicitor and client costs from 8:30 am on 24 September 2014.
Since reserving my decision, an issue has arisen as to the form in which I gave directions on 24 September 2014 in preparation for the hearing of the application by Mr Pires for leave to appeal.
Briefly, the respondents, having obtained the judgment from the ACAT, proceeded to enforce it. Under s 71 of the ACAT Act, an order of the kind made in this case is taken to be filed in the Magistrates Court and enforceable under Pt 2.18 (Enforcement) of the Court Procedures Rules.
As a result, the respondents had issued a Seizure and Sale Order under Div 2.18.5 of the Court Procedures Rules. I stayed that order pending the hearing and determination of the application for leave. The words that appear on the bench sheet, however, appeared as
HH orders that the stay on the sale & seizure order made by the Magistrates Court in proceedings CS 14/0020 be extended until after 4.00 pm on 3 October 2014. (Emphasis added).
My intention was to limit the stay until the application for leave had been heard. If leave was granted, I would have continued the stay. If, as happened, leave was not granted and the application dismissed, I anticipated that the stay would end.
As there is doubt and the Magistrates Court apparently considers that the stay remains, I shall dissolve it.
I shall make orders accordingly.
| I certify that the preceding one hundred and seventeen [117] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Justice Refshauge. Associate: Date: 20 November 2014 |
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