Rombotis v Kenny (Ruling)
[2013] VCC 595
•22 March 2013 (Revised)
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE CIVIL DIVISION | Revised Not Restricted Suitable for Publication |
DAMAGES AND COMPENSATION LIST
GENERAL DIVISION
Case No. CI-12-01566
| SPIROS ROMBOTIS | Plaintiff |
| v | |
| JONATHAN KENNY | Defendant |
---
JUDGE: | HIS HONOUR JUDGE MISSO | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 8 March 2013 | |
DATE OF RULING: | 22 March 2013 (Revised) | |
CASE MAY BE CITED AS: | Rombotis v Kenny (Ruling) | |
MEDIUM NEUTRAL CITATION: | [2013] VCC 595 | |
RULING
---
SUBJECT: ANSHUN ESTOPPEL
CATCHWORDS: Plaintiff retained the defendant as a solicitor – plaintiff alleged that the defendant settled a Supreme Court proceeding without instructions – the defendant filed proceedings in the Magistrates’ Court to recover legal costs – plaintiff alleges he was not served with the proceeding – application by the defendant for an Anshun order – submission that the plaintiff should have brought the professional negligence proceeding in this court as a counterclaim to the Magistrate’s Court Proceeding – conflict in the evidence regarding service of the Magistrates’ Court Proceeding – other serious conflict in the evidence
LEGISLATION CITED: Civil Procedure Act 2010, s63
CASES CITED: Port of Melbourne Authority v Anshun (1981) 147 CLR 589; Henderson v Henderson (1843) 67 ER 313; Whelan Kartaway Pty Ltd v Donnelly & Anor [2012] VSC 45
RULING: Summons dismissed.
---
APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr J Ribbands | Defteros Lawyers |
| For the Defendant | Ms A Golding | Collin Biggers and Paisley |
HIS HONOUR:
Introduction
1 The plaintiff filed a Writ on 5 April 2012. The Writ is endorsed with a Statement of Claim in which the plaintiff alleges that in 2004, he retained the defendant “for the purpose of advising in pursuing proceedings in the Supreme Court”. He alleges that the defendant settled the Supreme Court proceeding without instructions, and as a consequence, he alleges that he had a good claim which was likely to succeed and from which he was likely to obtain damages.
2 The defendant filed a Summons on 9 November 2012 seeking an order for summary judgment pursuant to s63 of the Civil Procedure Act 2010.
3 The Ms A Golding of Counsel appeared for the applicant (“Kenny”) and Mr J Ribbands of Counsel appeared for the respondent (“Rombotis”).
4 The parties relied on the following affidavits:
· the affidavit of Kenny sworn 9 November 2012 with thirteen exhibits: Exhibit A;
· the affidavit of Kenny sworn 6 March 2013: Exhibit B;
· the affidavit of Rombotis sworn 19 November 2012: Exhibit 1;
· the affidavit of Rombotis sworn 4 March 2013: Exhibit 2.
The Relevant Background
5 The following is an uncontroversial chronology of relevant events:
· Kenny was, at the relevant times, a partner in a firm of solicitors known as Kalus Kenny (“the firm”).
· In about July 2004, Rombotis retained the firm to act on his behalf, and on behalf of some corporate entities in which he had an interest (“the Rombotis parties”), in a Supreme Court proceeding. The defendants were Paul Paraskeva (“Paraskeva”), a solicitor and a corporate entity controlled by him (“the Paraskeva parties”). The Paraskeva parties were represented by Lewenberg & Lewenberg solicitors (“Lewenbergs”).
· The Supreme Court proceeding was settled on 16 August 2005. The Paraskeva parties agreed to pay the Rombotis parties $17,500, and upon payment of that sum, Paraskeva released the Rombotis parties from an obligation to pay $11,000 in costs owing by the Rombotis parties to Paraskeva.
6 Kenny alleges that he had express instructions from the Rombotis to settle the Supreme Court proceeding on those terms. Rombotis denies that he gave any such instructions to Kenny.
7 Kenny alleges the following:
· On 15 August 2005, a solicitor from Lewenbergs telephoned him and offered to settle the Supreme Court proceeding for $17,500 with a waiver of the costs owed by the Rombotis parties to Paraskeva amounting to $11,000.
· On 15 August 2005, he telephoned Rombotis and informed him of the offer. Rombotis instructed him to accept the offer. Kenny drafted terms of settlement and forwarded them to Lewenbergs later that day. Exhibit “MJK-7” to Kenny’s affidavit comprises two handwritten diary notes which are cryptic and indecipherable, to say the least, but which Kenny says represent a record of the two telephone conversations. The other documents in the exhibit are a letter, terms of settlement and notices of discontinuance of the Supreme Court proceeding, all dated 15 August 2005.
· On 16 August 2005, he received the executed terms of settlement from Lewenbergs containing two minor changes.
· On 16 August 2005, he telephoned Rombotis and informed him that two minor changes had been proposed to the terms of settlement. He alleges he obtained instructions from Rombotis to agree to the changes and to execute the amended terms of settlement. Exhibit “MJK-8” to Kenny’s affidavit comprises a letter from Lewenbergs dated 16 August 2005, a cryptic and indecipherable diary note bearing the same date, and a letter bearing the same date from Kenny informing Lewenbergs that Rombotis agreed to the amendments to the terms of settlement. The amended terms of settlement were executed and forwarded to Lewenbergs.
· To meet Rombotis’s denial that he spoke to him by telephone, Kenny exhibited his firm’s telephone records demonstrating that he telephoned Rombotis’s mobile phone on 15 and 16 August 2005. Rombotis admits that the mobile telephone number was the number of a mobile phone which he was using at the time when it is alleged that calls were made.
· To meet Rombotis’s allegation that he did not have instructions to settle the Supreme Court proceeding, he referred to a letter he prepared for Rombotis dated 8 September 2006 (“MJK-10”) and another letter he prepared for Rombotis dated 21 March 2007 (“MJK-11”). The second of those letters was a letter from Rombotis to the Legal Services Commissioner complaining about the conduct of Paraskeva.
· That he had a conversation with Rombotis in a restaurant in South Yarra in late 2009, when Rombotis is alleged to have suggested to him that he (Rombotis) should sue Kenny in negligence. Kenny should admit the claim, and that they would each share in the proceeds of that damages claim.
8 Rombotis alleges the following:
· He denies he spoke to Kenny on 15 and 16 August 2005, and if he did, he denies that he gave instructions to Kenny to settle the Supreme Court proceeding.
· He denies requesting Kenny to prepare the letters dated 8 September 2006 and 21 March 2007.
· He admits that he saw Kenny in a restaurant in South Yarra, but denies that he spoke to him, and he denies suggesting a conspiracy to defraud Kenny’s professional indemnity insurer.
9 Both Ms Golding and Mr Ribbands referred me to other correspondence exhibited to Kenny’s first affidavit. Ms Golding submitted that some of the correspondence pointed to contradictions in the position occupied by Rombotis. I have read the correspondence, but I am not convinced that the correspondence informs me of much more than the content of the summary I have given of the position of both Kenny and the firm, and Rombotis.
Kenny's Proceedings
10 The firm commenced a proceeding in the Magistrates’ Court against Rombotis for its outstanding legal fees amounting to $31,072.60 referable to the Supreme Court proceeding. Rombotis did not defend the proceeding. Judgment in default was obtained by the firm on 7 July 2009 for $58,204.48. A copy of the order is exhibited to Kenny’s affidavit (“MJK-13”).
11 Kenny alleges that on 28 July 2009, he served a bankruptcy notice on the plaintiff in the presence of Mr George Defteros, Rombotis’s solicitor.
12 Rombotis denies that he was served with the Magistrates’ Court proceeding. He says that he became aware of it and the order made pursuant to it when Kenny served a bankruptcy notice on him. He admits that he was in the company of Mr Defteros at a conference in Kenny’s office at the time when service was affected.
13 Kenny swore a second affidavit on 6 March 2013 taking issue with a number of matters deposed to by Rombotis in his first affidavit. One of those matters is with respect to the service of the Magistrates’ Court proceeding. Kenny alleges that he served a true copy of the proceeding on Rombotis on 13 December 2005 at his office. He referred to an affidavit of service which he swore on 24 June 2009 referring to service of that proceeding (“MJK-17”).
14 Ms Golding informed me that the Rombotis parties have not taken any steps to set aside the Magistrates’ Court order nor the bankruptcy notice. However, there is nothing in the affidavits sworn by Kenny to demonstrate what steps have been taken to execute on Magistrates’ Court order and what steps have been taken by the firm in connection with the bankruptcy notice.
Kenny’s Submissions
15 Ms Golding provided me with written submissions which traversed the affidavits sworn by Kenny and Rombotis and relevant principles of law. Essentially, she submitted that I should simply not accept any of the matters deposed to by Rombotis because they are implausible, and in particular, she referred to:
· The telephone records of the firm demonstrating that telephone calls were made to Rombotis’s mobile phone coinciding with the diary notes which Kenny made on 15 and 16 August 2005.
· Kenny’s diary notes are proof of the content of the conversations had between Kenny and Rombotis on 15 and 16 August 2005.
16 Ms Golding also referred to other aspects of matters deposed to by Kenny which were not answered by Rombotis, and that Rombotis’s denial that Kenny assisted him in writing the letter dated 21 March 2007 cannot stand, because he has not denied in his affidavit that the letter bears his handwritten annotations to a draft of that letter.
17 In addition to traversing the affidavits sworn by Kenny and Rombotis, Ms Golding submitted that I should apply the principle of law in Port of Melbourne Authority v Anshun[1]. Gibbs CJ, Mason and Aicken JJ applied the principle enunciated in Henderson v Henderson[2] that litigation of an issue might be shut out when it could and should have been litigated in earlier proceedings.
[1](1981) 147 CLR 589 at 598
[2](1843) 3 Hare at 115; 67 ER 319, applied in a number of subsequent cases. I was also referred to Whelan Kartaway Pty Ltd v Donnelly & Anor [2012] VSC 45, the judgment of Davies J at paragraphs 21-23
18 Ms Golding submitted that the Rombotis parties should have brought the professional negligence claim against Kenny by way of counterclaim to the proceeding commenced by the firm against the Rombotis parties in the Magistrates’ Court.
19 If it were not for the breadth of the denials by Rombotis that he did not give instructions to Kenny to settle the Supreme Court proceeding, that he was not served with the Magistrates’ Court proceeding, that he did not engage Kenny to assist him in writing the letters dated 8 September 2006 and 21 March 2007, and that he only discovered the existence of the Magistrates’ Court order when he was served with the bankruptcy notice, then I would have been sympathetic to the submission made by Ms Golding.
20 The Magistrates’ Court proceeding was based upon a retainer and legal services provided pursuant to that retainer. The professional negligence proceeding filed in this Court arises out of that very same retainer. If I could be satisfied that the Rombotis parties were served with the Magistrates’ Court proceeding then I think the principal enunciated in Anshun would probably apply and would estopp Rombotis from pursuing the professional negligence claim in this Court.
21 However, what prevents me from making such an order are the denials made by Rombotis of all the critical allegations made by Kenny except that he was served with the bankruptcy notice. Mr Ribbands submitted that if Rombotis is correct in his denials, then they seriously call into question the conduct of Kenny. He submitted that whether the diary notes were created by Kenny on 15 and 16 August 2005 is in issue, as is his allegation that he served Rombotis with the Magistrates’ Court proceeding, and assisted him in writing the letters dated 8 September 2006 and 21 March 2007.
22 I am not in a position to resolve the conflict in the evidence. I agree with the submission made by Mr Ribbands that it is for the trial judge to determine whether Rombotis or Kenny are to be believed, that telephone conversations occurred on 15 and 16 August 2005 in which Rombotis gave instructions to Kenny to settle the Supreme Court proceeding, and whether Rombotis was served with the Magistrates’ Court proceeding.
Conclusion
23 For the reasons set out above, the summons must be dismissed.
24 I will now hear the parties on the question of costs.
---
0
3
0