RAMON & Z LAW FIRM

The Family Court of Australia considered a dispute between Mr Ramon, referred to as the husband, and Z Law Firm, referred to as the solicitor, concerning legal costs. The husband sought to set aside a costs assessment order and obtain leave to file a Notice Disputing Itemised Costs Account out of time. The solicitor had acted for the husband in matrimonial property proceedings, including an appeal.

The central legal issue before the Court was whether to exercise its discretion to grant the husband leave to file his notice disputing the itemised costs account beyond the prescribed 28-day period. This required the Court to consider the adequacy of the husband's explanation for the delay, the potential hardship to the husband if leave were refused, and the prejudice to the solicitor if leave were granted. The Court also had to determine whether the husband's allegations of negligence and incompetence were matters to be ventilated in the costs assessment process or in separate proceedings.

The Court acknowledged that the husband's explanation for the delay, stating he was uncertain what to do with the account and later that he was unaware of his right to dispute it, was not entirely convincing given the clear instructions on the account itself. However, the Court found that the husband's concerns about potential discrepancies between payments made by a finance company and the solicitor's invoices, and the possibility that some costs had already been paid, raised a significant issue that could cause hardship if not properly assessed. The Court noted that the solicitor had not provided sufficient evidence to definitively dismiss these concerns. While acknowledging the prejudice to the solicitor in facing a delayed costs assessment, the Court ultimately decided to err on the side of caution and grant the indulgence sought by the husband. The Court reiterated that allegations of professional negligence were not to be determined within the costs assessment process but in separate proceedings.

The Court ordered that the costs assessment order made by Registrar Tran on 11 February 2011 be set aside. The husband was granted leave to file and serve a Notice Disputing Itemised Costs Account no later than 5 April 2012.