SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY COURT OF APPEAL
Case Title:
Ryan v Vizovitis
Citation:
[2017] ACTCA 3
Hearing Dates:
9 and 10 November 2015
DecisionDate:
1 February 2017
Before:
Murrell CJ, Penfold and Perry JJ
Decision:
1. The appeal is dismissed.
2. The appellant is to pay the respondent’s costs of the appeal.
Catchwords:
COSTS – agreement as to costs between solicitor and client – whether primary judge erred in finding that costs agreement was unfair and unreasonable – where agreement intended to increase solicitor’s fees retrospectively – where failure to explain terms of costs agreement and ensure agreement was understood.
PRACTICE AND PROCEDURE – where respondent was allowed to re-open case – where further evidence led in reply over appellant’s objection – where appellant not permitted to lead further evidence in response – whether appellant was denied procedural fairness before the primary judge - whether intervention of trial judge gave rise to apprehension of bias – whether unfairness in the conduct of the trial.
PRACTICE AND PROCEDURE – case management in civil trials – where appellant substantially contributed to delays and costs of the hearing.
[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.
Continue reading Ryan v Vizovitis
Sign in free to access the full text
Details
AGLC
Ryan v Vizovitis [2017] ACTCA 3
Case
[2017] ACTCA 3
Decision Date
CaseChat Overview and Summary
The appeal concerned a dispute between a solicitor, Ms Ryan, and her former client, Ms Vizovitis, regarding the fairness and reasonableness of costs agreements entered into between them. The solicitor had acted for the client in two personal injury claims arising from motor vehicle accidents. Initially, there was an oral agreement regarding hourly rates, which was later superseded by written costs agreements in 1999 and 2002. The solicitor contended that these agreements were intended to apply retrospectively to the commencement of the retainer, while the client argued they were unfair and unreasonable, particularly due to the failure to adequately explain their terms and intended retrospective effect. The matter came before the Supreme Court of the Australian Capital Territory.
The primary legal issues before the court were whether the Master erred in finding that the costs agreements were unfair and unreasonable, and whether the appellant solicitor was denied procedural fairness during the trial. This included considerations of whether the respondent client was wrongly permitted to re-open her case, whether the introduction of further evidence over the appellant's objection was permissible, and whether the appellant was denied the opportunity to lead further evidence in response. Additionally, the court considered whether the intervention of the trial judge gave rise to an apprehension of bias and whether the overall conduct of the trial was unfair, particularly in light of the appellant's alleged contribution to delays and costs.
The court dismissed the appeal, upholding the Master's findings. It was reasoned that the Master had not erred in concluding that the costs agreements were unfair and unreasonable, particularly given the solicitor's failure to adequately explain the retrospective application of the higher hourly rates and the lack of a clear understanding by the client. The court found that the solicitor had not been denied procedural fairness, as the Master had appropriately managed the case, and any perceived unfairness in the conduct of the trial was not of a nature that warranted intervention. The appellant's objections to the admission of certain evidence were also found to be without merit.
Consequently, the appeal was dismissed, and the appellant solicitor was ordered to pay the respondent client's costs of the appeal.
Orders
Orders of the court
1. The appeal is dismissed.
2. The appellant is to pay the respondent’s costs of the appeal.
Background
Background to the litigation
BACKGROUND As earlier mentioned, the solicitor acted for the client in two actions for damages for personal injuries in the Supreme Court arising from two separate motor vehicle accidents on 2 April 1994 and 3 April 1996 respectively. In each case, the client was the driver of a car struck from behind by another car. The client instructed the solicitor in relation to the first accident in March 1995 and later in relation to the second accident. It was not in issue that at that time there was no written agreement about fees, although it was agreed orally that the solicitor would charge $180.00 per hour if the client paid her accounts as she went along, or $220.00 per hour if she opted not to pay the legal costs until her claim was finalised (the Master’s reasons at [40], [185], [200]). The parties accepted that, by virtue of s 190(3) of the LP Act, the 1995 oral agreement about hourly rates was not a binding costs agreement (the Master’s reasons at [415]). The fees charged by the solicitor under this arrangement included almost $3,000.00 in professional costs billed in 1995 and 1996 which were paid by the client at the time (the Master’s reasons at [421]). It appears that in late 1997, the client was defaulting on payment of fees and disbursements owing to the solicitor with respect to the motor vehicle accidents. As a consequence, correspondence emanated from the solicitor to the effect that she presumed the client wished her to carry the unpaid account to completion of the matter at the rate of $220.00 per hour and requested that the client execute the enclosed agreement to that effect. No such agreement was ever entered into, although on 15 February 1999 the solicitor rendered accounts for costs and disbursements calculated at the higher rate (the Master’s reasons at [198]). On 3 March 1998, a file note records a telephone attendance between the solicitor and the client. With respect to that note, the Master found at [193] and [194] that “[t]he note is cryptic and deals with seven topics with a single line for each topic. The last item on the note reads ‘pay to date costs – then carry – change to A rate’... The item number [sic] three in the note reads ‘costs – wants to put it out soon’.” Ms Ryan gave evidence that her attempts to have the client sign a costs agreement “had been going on for years” by the beginning of 1999. On 23 March 1999, the solicitor and the client signed a document headed “Agreement as to costs” (the 1999 agreement) which provided for fees to be assessed at the rate of $280.00 per hour for the “principal barrister and solicitor”. Subsequently on 10 December 2002, the solicitor and client entered into a costs agreement which provided for fees to be assessed at the hourly rate of $380.00 (plus GST where applicable) for the “principal barrister and solicitor” (the 2002 agreement). The solicitor gave evidence that in each case she intended that the written costs agreements would apply retrospectively to 1995, with the 2002 agreement therefore wholly replacing the 1999 and 1995 agreements as the sole basis on which fees were to be charged for the handling of the two claims aside from those fees already paid by the client. As will later be explained, the Master held that the intended retrospectivity of the two costs agreements was unreasonable and the failure to explain this to the client was unfair.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
On 3 July 2012, the solicitor filed an application seeking (relevantly) that the Master disqualify himself from the further conduct of the matter. That application was heard on 24 September 2012, with Mr MJ Neil QC appearing for the solicitor and the client being represented by Mr JM Hill, a member of the firm acting for the client. The solicitor relied upon a 60 page affidavit sworn by her in support of the application, most which was said by Master to consist of submissions rather than evidence. The Master delivered his ruling dismissing the application on 19 October 2012: Vizovitis v Ryan [2012] ACTSC 155 (the Disqualification judgment). Following delivery of the Disqualification judgment, the matter was called on for directions before the Master on 31 October 2012. At that hearing, the Master directed that the expert witnesses, Mr Travers and Mr Hardman, meet to endeavour to resolve any disagreement between them and to produce for the court’s use a document identifying the matters on which they agree and disagree, and the reasons for disagreement on any matter. That did not however occur. As the Master found (at [61]): When the hearing resumed on 17 December 2012, the solicitor was represented by Mr Benjamin O’Donnell of the Sydney Bar. The Master observed at [95] that no reasons were given as to why neither Mr Neil QC nor Mr Toomey QC (who had represented the solicitor at an earlier stage of the trial) were continuing to appear in the matter for the solicitor. On 18 December 2012, the solicitor objected to Mr Travers’ evidence on two bases. First, Mr O’Donnell submitted that Mr Travers was not a witness in reply. Secondly, he submitted that his evidence introduced a new issue, namely, the likely result on taxation which had no bearing on whether the original costs agreements were unfair and unreasonable. As such, Mr O’Donnell for the solicitor contended that Mr Travers’ evidence was irrelevant. On 18 and 19 December 2012, counsel for the client cross-examined the solicitor’s expert, Mr Hardman, on the foreshadowed evidence of Mr Travers and in particular on which items were costed at an inflated amount or might not be allowed on a taxation. Mr Hardman explained that he was not in a position to comment on the opinion of Mr Travers about how a taxing officer would have approached the assessment of costs in the ACT because he had no experience of taxation in the ACT: “It’s just never part of what I do”. An objection to Mr Travers’ evidence on 20 December 2012 based on an alleged conflict of interest was dismissed after cross-examination of Mr Travers on a voir dire. It appears that the Master indicated that it was his view Mr Traver’s evidence was not inadmissible. An application under r 6201 of the Court Procedures Rules was then made by the solicitor to remove the case from the Master to a judge of the Supreme Court so as to enable the judge to rule on whether Mr Travers evidence should be excluded. That application was heard by Refshauge J on 21 December 2012. Refshauge J dismissed the application to remove the case, with costs, on the same day and delivered ex tempore reasons: Vizovitis v Ryan (No 2). In so holding, his Honour considered that in the event that the evidence was wrongly received, Mr Travers’ evidence could be unravelled from the remainder of the evidence, and that it was for the Master to determine the use to be made of Mr Travers’ evidence (at [21]).