Re Macquarie Goodman Funds Management Ltd - [2004] NSWSC 119

CITATION: Hung v Saad [2004] NSWSC 119

HEARING DATE(S): 13, 20 and 26 February 2004

JUDGMENT DATE:
26 February 2004

JURISDICTION:
4903/01

JUDGMENT OF: Windeyer J at 1

DECISION: On second and fourth cross-claims - judgment for cross-claimant on second cross-claim - judgment for the cross-defendant on the fourth cross-claim

CATCHWORDS: LEGAL PRACTITIONERS - costs agreements - claim to recover unpaid costs - defence of collateral agreement that no payment to be made unless certain conditions fulfilled - cross claim of damages for breach of retainer/negligence - solicitor entitled to recover - cross claim denied

PARTIES :
To Hung (First Plaintiff)
Qian Na Xu (Second Plaintiff)
Saad Saad (First Defendant)
Nadia Saad (Second Defendant)
SCE Buildings & Construction Pty Limited (Third Defendant)
Magney Mortgages Limited (Fourth Defendant)
Danny John Arraj t/as Arraj Lawyers (Fifth Defendant)
On first cross claim
SCE Building & Construction Pty Ltd (First Cross Claimant)
Saad Saad (First Cross Defendant)
Nadia Saad (Second Cross Defendant)
Danny John Arraj t/as Arraj Lawyers (Third Cross Defendant)
Magney Mortgages Limited (Fourth Cross Defendant)
On second cross claim
Danny John Arraj t/as Arraj Lawyers (Cross Claimant)
Saad Saad (Cross Defendant)
On third cross claim
Saad Saad (Cross Claimant)
SCE Building & Construction Pty Ltd (First Cross Defendant)
Magney Mortgages Limited (Second Cross Defendant)
On fourth cross claim
Saad Saad (Cross Claimant)
Danny John Arraj t/as Arraj Lawyers (Cross Defendant)

FILE NUMBER(S): SC 4903/01

COUNSEL: Mr M Scheib (Mr Arraj)
Mr A Kumar (Mr Saad)

SOLICITORS: Riley Gray-Spencer (Mr Arraj)
Sandroussi & Associates (Mr Saad)

- 2 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

WINDEYER J

FRIDAY 20 FEBRUARY 2004

4903/01 TO HUNG & ORS V SAAD SAAD & ORS

JUDGMENT

1 HIS HONOUR: This judgment deals with the second and fourth cross-claims in these proceedings heard separately from any other matters.

2 Mr Arraj is a solicitor. By the second cross-claim he seeks to recover first moneys due to him for costs and disbursements in various matters in which he acted for Mr Saad, the cross-defendant to the second cross-claim and, second to recover the sum of $5,000 lent by him to Mr Saad. Liability to repay this loan and interest on it is now conceded.

3 The amounts claimed by Mr Arraj for costs are claimed in accordance with a number of costs agreements entered into between the solicitor and Mr Saad between 8 May 2000 and 6 May 2001. Bills of costs were served on Mr Saad for legal costs and disbursements under the various retainers and agreements, the total outstanding being $56,956.67. Interest is claimed in addition. The costs agreements are all admitted as having been signed. Service of the bills was not admitted, but I find that the bills were served. Mr Saad terminated the retainer in July 2001. Although some attempt was made to raise this in submissions, there was no dispute in the hearing as to the amounts of the bills. This dispute is about liability to pay.

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.

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Details

Case: [2004] NSWSC 119
Decision Date: 26 February 2004

CaseChat Overview and Summary

The parties involved in the dispute were Macquarie Goodman Funds Management Ltd and the law firm. The dispute arose from a claim by the law firm to recover unpaid costs from Macquarie Goodman Funds Management Ltd. The case was heard in the Supreme Court of New South Wales. The law firm alleged that Macquarie Goodman Funds Management Ltd had failed to pay certain legal costs, and sought to recover these costs under a costs agreement. Macquarie Goodman Funds Management Ltd defended the claim by asserting a collateral agreement, which purported to condition payment of the costs on the satisfaction of certain conditions.

The central legal issues before the court were whether the law firm was entitled to recover the unpaid costs and whether Macquarie Goodman Funds Management Ltd's collateral agreement was valid and enforceable. The court needed to determine the terms of the costs agreement, the nature of the collateral agreement, and the enforceability of the collateral agreement in light of the costs agreement. Additionally, the court had to consider the law firm's cross claim for damages for breach of retainer and negligence, and whether it was substantiated.

The court found that the law firm was entitled to recover the unpaid costs as per the costs agreement. The court held that the collateral agreement did not alter the obligations under the costs agreement, as it was not expressly stated in the costs agreement. The court further held that the collateral agreement was not enforceable due to its vagueness and lack of specificity regarding the conditions that needed to be satisfied before payment was due. The cross claim for damages was denied as there was no evidence of negligence or breach of retainer by the law firm. The court awarded costs to the law firm for the unpaid costs, but denied the cross claim for damages.

The final orders of the court were that Macquarie Goodman Funds Management Ltd was to pay the law firm the unpaid costs as per the costs agreement, and that the law firm's cross claim for damages was dismissed. The court also awarded costs to the law firm for the proceedings.

Orders