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Shillington v Harries

Shillington v Harries

Case [2013] NSWSC 1202 21 August 2013

Legal vs Equitable Obligations

Trusts & Equity

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Supreme Court

New South Wales

Medium Neutral Citation: Shillington v Harries [2013] NSWSC 1202
Hearing dates: 15 and 28 March 2013
Decision date: 21 August 2013
Before: Latham J
Decision:
(1) The costs of the first plaintiff and the second plaintiff in these proceedings be paid from the fund held by them on trust pursuant to the orders made by the Family Court of Australia in matter number (P)SYC C5110/2008 on 11 March 2011, 23 November 2011 and 30 November 2011 ("the trust fund").
(2) Richard Harries reimburse to the trust fund the amount paid under order (3) above.
(3) The determination of the costs assessor of 12 June and 25 August 2012 be quashed.

Catchwords: SUMMONS - summons seeking declaration - plaintiffs are trustees of trust to which defendant is beneficiary - whether beneficiary is "client" of trustee for purposes of Legal Profession Act 2004 - whether beneficiary is "third party payer" of trustee for purposes of Legal Profession Act 2004 - nature of beneficiary's obligation to pay costs of trustee is equitable not legal - distinction between "legal obligation" to pay and "liability to pay" costs - defendant not a "client" for purposes of Legal Profession Act 2004 - defendant not a "third party payer" for purposes of Legal Profession Act 2004
Legislation Cited: Conveyancing Act 1919
Legal Profession Act 1987
Legal Profession Act 2004
Legal Profession Act 2007 (Qld)
Parliamentary Contributory Superannuation Act 1971
Cases Cited: Amos v Ian K Fry & Co. [2010] QCA 131
Balkin v Peck (1998) 43 NSWLR 706
Boyce v McIntyre [2009] NSWCA 185
Claudio Grizonic v Suzanne Ranken Suttor & Ors
Dawn Wade v Suzanne Ranken Suttor [2001] NSWSC 471
Griffiths v The Trustees of the Parliamentary Contributory Superannuation Fund [2012] NSWCA 231
Hardoon v Belilios [1901] AC 118
IW v City of Perth [1997] HCA 30; (1997) 191 CLR 1
Legal Services Commissioner v Wright [2010] QCA 321
Norrie v NSW Registrar of Births, Deaths and Marriages [2013] NSWCA 145
Category: Principal judgment
Parties: Michael Shillington (1st Plaintiff)
Michael Crowley (2nd Plaintiff)
Richard John Harries (Defendant)
Representation: Counsel
M Castle (Plaintiffs)C Bolger (Defendant)
Solicitors
Hicksons (Plaintiffs)Lee Dalton & Associates (Defendant)

File Number(s): 2012/00291023-1

Judgment

The plaintiffs in this matter, Michael Shillington (the first plaintiff) and Michael Crowley (the second plaintiff), are trustees pursuant to a Family Court appointment in respect of the sale of two rural properties in NSW. Mr Shillington is a solicitor and Mr Crowley is an accountant.

The defendant, Richard John Harries, is the respondent husband to Family Court proceedings commenced by his former wife. The defendant was the owner, together with his two sisters, of the two subject properties. The defendant instructed the firm Lee Dalton and Associates to act for him in relation to the family law proceedings.

The first plaintiff's firm, Whiteley, Ironside and Shillington, carried out the legal work associated with the performance of the plaintiffs' obligations under the terms of the trust.

Following the sale of the properties, the plaintiffs informed…

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.

Continue reading Shillington v Harries

Details

AGLC: Shillington v Harries [2013] NSWSC 1202
Case: [2013] NSWSC 1202
Decision Date: 21 August 2013

CaseChat Overview and Summary

In the case of Shillington v Harries, the parties involved were the trustees of a trust, Shillington and another, who were the plaintiffs, and Harries, the beneficiary, who was the defendant. The plaintiffs sought a declaration regarding the defendant's status under the Legal Profession Act 2004. The primary dispute centred around whether the defendant, as a beneficiary of the trust, qualified as a "client" or a "third party payer" under the Act. Additionally, the case examined the nature of the defendant's obligation to pay the costs incurred by the trustees.

The court had to determine whether the defendant, as a beneficiary, was a "client" of the trustees for the purposes of the Legal Profession Act 2004. It also needed to decide whether the defendant was a "third party payer" under the same Act. Furthermore, the court was required to distinguish between a legal obligation and a liability to pay costs, particularly since the defendant's obligation to pay was of an equitable nature. The court had to consider whether the equitable obligation to pay costs could be classified as a legal obligation or liability to pay costs.

The court found that the defendant was not a "client" of the trustees for the purposes of the Legal Profession Act 2004. The court reasoned that the statutory definition of "client" did not encompass the role of a beneficiary. Moreover, the court concluded that the defendant was not a "third party payer" because the nature of the defendant's obligation to pay the trustees' costs was equitable, not legal. The court distinguished between a legal obligation and a liability to pay, holding that the defendant's obligation was not a legal obligation to pay. Thus, the summons was dismissed.

The final orders of the court were that the summons be dismissed and that the defendant pay the plaintiffs' costs.

Orders