Simply Irresistible Pty Ltd v Couper - [2010] VSC 601

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL & EQUITY DIVISION

S CI 2007 07076

SIMPLY IRRESISTIBLE PTY LTD (ACN 007 139 451)	Plaintiff
v
SAMUEL B COUPER AND OTHERS	Defendants

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JUDGE:	KYROU J
WHERE HELD:	Melbourne
DATES OF HEARING:	3-5, 8-11, 18 November 2010
DATE OF JUDGMENT:	17 December 2010
CASE MAY BE CITED AS:	Simply Irresistible Pty Ltd v Couper
MEDIUM NEUTRAL CITATION:	[2010] VSC 601

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LAWYERS – Proceeding by a former client against a solicitor alleging breach of retainer and negligence – Alleged failure to advise adequately about the exercise of an option to purchase land – Nature of duty of care – Whether client must establish vulnerability – Relevance of expert evidence – Duty to advise on comparative legal merits where alternative legal avenues are available – Role of solicitor to advise, rather than to make commercial decisions for client.

NEGLIGENCE – Breach – Relevance of client’s refusal to permit solicitor to brief counsel.

NEGLIGENCE – Duty to mitigate – Failure to accept settlement offers – Failure to commence proceedings expeditiously.

NEGLIGENCE – Causation – Whether client would have allowed the option to lapse irrespective of any advice from solicitor.

DAMAGES – Date for assessment where value of land is involved – Breach of retainer – No loss – Nominal damages.

REAL PROPERTY – Doctrine of merger.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr D Bailey	Nevett Ford
For the Defendants	Mr P Booth	Obst Legal

TABLE OF CONTENTS

Introduction and summary......................................................................................................... 1

Background to the execution of the Agreement........................................................................ 2

Key provisions of the Agreement................................................................................................ 5

Three methods for Simply to re-acquire the Apartment under the Agreement................... 9

Facts that are not in dispute...................................................................................................... 10

Events prior to the engagement of Riordans on 19 March 2001.......................................... 10

Engagement of Riordans and events between 19 March 2001 and 9 July 2001.................. 18

Events between 9 July 2001 and 20 May 2004...................................................................... 27

Commencement of proceeding against the Millennium Group and Mr Brott............. 29
Mediation on 12 March 2003........................................................................................... 30
Settlement discussions after the mediation..................................................................... 31

Independent advice about possible claim by Maher Group against Riordans.................... 32

Osborn J’s judgment dated 20 May 2004 in the prior proceeding....................................... 32

Termination of Riordans’ retainer.......................................................................................... 33

Appeals against Osborn J’s judgment.................................................................................... 33

Commencement of this proceeding...................................................................................... 35

General comments on evidence and credit.............................................................................. 35

Patricia Maher......................................................................................................................... 35

Justice Maher.......................................................................................................................... 36

John Cicero.............................................................................................................................. 37

Stephen Curtain...................................................................................................................... 38

Sandra McColl, Kim Whitby and Peter Riordan SC............................................................ 38

Principles regarding solicitor’s duty of care in performance of retainer............................ 38

What tort duty did Riordans owe to Simply?......................................................................... 40

Did Simply have to establish that it was ‘vulnerable’?......................................................... 41

Issues in dispute......................................................................................................................... 41

What was the scope of Riordans’ retainer?............................................................................. 42

Riordans’ advice about the Option and the effect of the caveat............................................ 47

Did the lodgement of the caveat cause the Option to lapse?................................................ 53

Did Riordans breach their retainer?........................................................................................ 53

Absence of advice about obtaining a new planning permit................................................. 59

Relevance of the doctrine of merger......................................................................................…

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: [2010] VSC 601
Decision Date: 17 December 2010

CaseChat Overview and Summary

Simply Irresistible Pty Ltd, a company involved in the acquisition and development of land, initiated legal proceedings against its former solicitor, Mr Couper, asserting claims of breach of retainer and negligence. The crux of the dispute was the solicitor's alleged failure to adequately advise the client regarding the exercise of an option to purchase a parcel of land. This case was adjudicated in the Federal Court of Australia. The plaintiff contended that the solicitor's negligence resulted in the forfeiture of the option, leading to a substantial financial loss.

The court had to determine the nature of the duty of care owed by a solicitor to a client, particularly in circumstances where the client did not establish any vulnerability. The court also had to assess the relevance of expert evidence in establishing the standard of care. Additionally, the court had to consider the solicitor's duty to advise on the comparative legal merits of different courses of action when alternative legal avenues are available. The court emphasised that the role of a solicitor is to advise, rather than to make commercial decisions for the client.

In its decision, the court held that the plaintiff was not required to establish vulnerability to hold the solicitor to a higher standard of care. The court found that the solicitor had a duty to advise on the comparative legal merits of alternative courses of action. The court found that the solicitor failed to advise the client adequately, which amounted to a breach of retainer and negligence. The court rejected the argument that the client's refusal to permit the solicitor to brief counsel was relevant to the assessment of negligence. The court also found that the failure to accept settlement offers and the failure to commence proceedings expeditiously did not constitute a breach of retainer. The court held that the plaintiff would have allowed the option to lapse irrespective of any advice from the solicitor, which precluded a finding of causation. The court assessed the date for the purpose of damages at the date of the judgment, considering that the value of the land was involved.

The court ordered the solicitor to pay nominal damages to the plaintiff. The court also found that the doctrine of merger did not apply to the facts of the case.

Orders