Sloan v Arnold Thomas & Becker (No 2)
[2019] VSC 682
•16 October 2019
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
PROFESSIONAL LIABILITY LIST
S CI 2017 05157
| NEIL SLOAN | Plaintiff |
| v | |
| ARNOLD THOMAS & BECKER PTY LTD (ACN 097 361 469) | First Defendant |
| LEE TEK FLANAGAN | Second Defendant |
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JUDGE: | Daly AsJ |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 26 August 2019 |
DATE OF JUDGMENT: | 16 October 2019 |
CASE MAY BE CITED AS: | Sloan v Arnold Thomas & Becker (No 2) |
MEDIUM NEUTRAL CITATION: | [2019] VSC 682 |
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PRACTICE AND PROCEDURE – Section 63 of the Civil Procedure Act 2010 (Vic) – Application for summary judgment by solicitors against a former client on the basis that the proceeding has no real prospects of success – Whether the plaintiff’s cause of action for breach of fiduciary duty against his solicitors is statute barred by analogy – Whether there is an analogy between an equitable claim and a statutory claim – Cia de Seguros Imperio v Heath (REBX) Ltd and Ors [2001] 1 WLR 112, referred to and applied – Port Ballidu Pty Ltd v Frews Lawyers [2017] QSC 19, referred to – Scope of the unconscionability exception to applying a limitation period by analogy – Limited to unconscionable conduct which presents a wronged party from bringing a claim within time – Gerace v Auzhair Supplies Pty Ltd (2014) 87 NSWLR 435, referred to and applied.
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APPEARANCES: | Counsel | Solicitors |
| The Plaintiff in person | ||
| For the Defendants | Mr C Juebner | Collin Biggers & Paisley |
HER HONOUR:
Introduction
This is the second application by the defendants, the plaintiff’s former solicitors, for summary judgment in their favour. The background to this proceeding is summarised in a decision I published on 8 May 2019, as follows:
The plaintiff, Mr Sloan, is self-represented. The defendants, Arnold Thomas & Becker and Mr Lee Flanagan (together ‘ATB’) are a firm of solicitors and the solicitor with the conduct of an earlier proceeding in which Mr Sloan was the plaintiff, NS v GD & Ors (‘2006 proceeding’). In the 2006 proceeding, Mr Sloan brought a claim against his former employers, and a senior employee of his former employers, with respect to losses allegedly suffered by him arising out of sexual assaults said to have been committed by the senior employee. Confidentiality orders have been made with respect to the 2006 proceeding, which will be respected in these reasons.
The 2006 proceeding was settled on 24 October 2011, when Mr Flanagan told the solicitors for the defendants in the 2006 proceeding that an offer made by them had been accepted. Shortly after this time, ATB ceased to act for Mr Sloan, after he purported to withdraw his authorisation to ATB to settle the 2006 proceedings on the terms upon which it was in fact settled. Those instructions were withdrawn in a letter from Mr Sloan to ATB dated 27 October 2011.
On 21 December 2011, Zammit AsJ (as she then was) made orders dismissing the proceeding by reason of the settlement agreement being valid and enforceable. An appeal against those orders was withdrawn after the judge hearing the appeal, Whelan J (as he then was), told Mr Sloan that if he wished to avoid the settlement agreement, he would need to repay the funds paid to him by the defendants in the 2006 proceeding pursuant to the settlement agreement.[1]
[1]Sloan v Arnold Thomas & Becker [2019] VSC 292, [1]-[3].
This proceeding was issued on 19 December 2017. The plaintiff brought claims for breach of contract, negligence, and breach of fiduciary duty, concerning advice given by the defendants with respect to the settlement of the proceeding referred to in the above extract (‘2006 proceeding’).[2] Among other things, the plaintiff alleged that the first defendant in this proceeding (‘ATB’) was in a position of conflict of interest, in that it stood to obtain payment of its fees through the settlement of the 2006 proceeding, and because it was in a commercial relationship with the second and third defendants in the 2006 proceeding (‘television network defendants’). The first defendant in the 2006 proceeding (‘GD’), was a well-known television producer, employed by the television network defendants.
[2]NS v GD & ors - S CI 2006 09842.
On 8 May 2019, I granted the defendants summary judgment with respect to the plaintiff’s claim for breach of contract and negligence, striking out the relevant part of the plaintiff’s statement of claim. However, the plaintiff had also brought a claim for breach of fiduciary duty, based upon an alleged conflict of interest. I held that the provisions of the Limitations of Actions Act 1958 (Vic) (‘LAA’) did not apply to equitable claims such as claims founded on a breach of fiduciary duty, noting that the plaintiff’s claims may be time barred by way of analogy, or the defendants might be successful in a defence of laches. However, as I had not heard any argument on that issue, I declined to order summary judgment in relation to the plaintiff’s claims for breach of fiduciary duty. The current application is for summary judgment in favour of the defendants on the basis that the plaintiff’s claim for breach of fiduciary duty is time barred, because this claim is analogous with the plaintiff’s previous claims of breach of contract and negligence.
The application for summary judgment
In their amended summons filed 27 June 2019, the defendants sought summary judgment on the grounds that the six year limitation period applicable to claims in contract and tort applied to the plaintiff’s claim for breach of fiduciary duty by way of analogy, and that time commenced to run from the date that the defendants advised the plaintiff to enter into the settlement agreement with the defendants in the 2006 proceeding allegedly in conflict with their duties to the plaintiff: that is, before 24 October 2011. The defendants contend that there is no residual discretion for the Court to decline to apply the statutory limitation period, save in circumstances where the defendants unconscionably concealed their breach of duty from the plaintiff.
Alternatively, the defendants sought to strike out the pleading with respect to the plaintiff’s claims for breach of fiduciary duty. Unusually, but very helpfully, the defendants’ counsel provided a draft formulation of the relevant parts of the amended statement of claim, a formulation which the plaintiff was happy to accept should the defendants’ summary judgment application be unsuccessful and the matter proceed.
The defendants relied upon an affidavit sworn by the second defendant, Mr Flanagan, on 24 June 2019, which in turn referred to an affidavit sworn by him on 1 April 2019, and an affidavit sworn by the defendants’ solicitor, Mr Rob McGirr, on 2 April 2019. Mr Flanagan deposed, in summary, as follows:
(a) his receipt of the amended statement of claim and the complaints made by the defendants’ solicitors regarding the additional particulars referred to at paragraph 14 of these reasons;
(b) his belief that the plaintiff’s claim for breach of fiduciary duty was based upon the allegation that the defendants coerced the plaintiff into making an offer in accordance with the terms of the written instructions dated 21 October 2011 (‘letter of instruction’) for motives ulterior to the best interests of the plaintiff, that is, to have their costs paid in an agreed sum, and to ‘assist the defendants in protection of mutual or other vested interests’;
(c) his receipt of a letter from the plaintiff on or about 31 October 2011,[3] which stated, among other things, as follows:
[3]This letter is exhibit ‘LTF-12’ to Mr Flanagan’s affidavit sworn on 1 April 2019. The extracts referred to by Mr Flanagan in his affidavit accurately reflect the contents of this letter.
·Upon independent and accredit advice/commentary this past week…
·I formally retract the authority to settle on your terms…
·Over last weekend October 22/23 I viewed your firm Arnold Thomas Becker being advertised on regional television, I was shocked to witness this. This means your firm are undertaking commercial relationship with a TV station or stations. It is not clear if the broadcaster was [one of the television network defendants]. Despite our view that any ‘business’ is entitled to advertise, what does your commercial relationship mean to my case matters?
·Your firm have not provided a progress (costs) report, noted by Legal Aid as part of your obligations/requirements to do so upon request. This was not forthcoming in any detail when requested to you or Mr Price prior to mediation…
·For the sake of due diligence and requirement on your part, I also seek the progress (costs) report as previously requested…
·Please prepare progress (costs) report with line items to this date. Forward to me as soon as possible…
·Should this intended final settlement period not be successful, and/or your firm withdraw, I will, at the appropriate time, present the progress (costs) report to court as part of my recovering ‘legal costs’ in pursuit of my claims…
In his letter of 28 October 2011, the plaintiff also made the following statements:
I signed “Authority” under pressure to do so, in terms set out by your firm, when you understand I do not agree the terms are in my best interests.
Therefore, I see this last and final settlement opportunity to be to your firm’s advantage.
And, in relation to ATB’s media advertisements:
If nothing specific, what perceptions moving forward may linger in my knowledge your [sic] dealing with the small yet powerful Industry of Television? At the same time I challenge significant parties within the Television Industry? Who some are valued potential witnesses in my matters and or there may well be cross talk or other conflicts spurned as a result of your firm advertising.
(d) on 16 November 2011, ATB sent to the plaintiff their bill, including a notice headed ‘If you dispute our legal costs’, and a further email was sent to the plaintiff on 12 December 2011 enclosing a note from ATB’s costs consultant verifying the quantum of the costs claimed;
(e) at no time since late 2011 has the plaintiff disputed ATB’s legal costs, save for his complaint to the Legal Services Commissioner referred to below;
(f) on or about 24 June 2014, the plaintiff made a complaint to the Legal Services Commissioner (which was forwarded to ATB on 14 May 2015) alleging, among other things:
(i) ATB had a conflict of interest in acting for the plaintiff in the 2006 proceeding;
(ii) ATB failed to provide an invoice for the work undertaken for him;
(iii) ATB threatened to withdraw legal support from the plaintiff if he refused to sign the letter of instruction; and
(iv)ATB failed to pursue and seek the assistance of a range of potential witnesses;
(g) on 29 May 2015, ATB responded to the Legal Services Commissioner, stating, in summary, as follows:
(i) at the time ATB acted on behalf of the plaintiff, ATB placed television advertisements with a range of television networks through a media buying company, and had no direct relationship with the television network defendants;
(ii) ATB did not accept that its interests were conflicted by reason of the advertising carried out with the television network defendants;
(iii) ATB did not accept that the plaintiff was put under duress to settle the 2006 proceeding. The letter set out in some detail what occurred at a meeting in senior counsel’s chambers on 7 October 2011, following which the plaintiff emailed ATB with instructions to settle for no less than $550,000 plus party-party costs;
(iv) Mr Flanagan told Mr Sloan that as a consequence of these instructions, neither ATB, or junior and senior counsel were prepared to act on his behalf on a ‘no win no fee’ basis as the plaintiff was not following reasonable advice;
(v) on 9 October 2011, the plaintiff sent ATB written instructions to settle his claim for no less than $350,000 plus party-party costs, with those instructions being confirmed in a conference with junior and senior counsel on 21 November 2011; and
(vi) Mr Flanagan explained what attempts were made to obtain statements from other alleged victims of the first defendant in the 2006 proceeding, and ATB’s review of the criminal prosecution file of Victoria Police, stating:
We do not accept the complaint that potential witnesses were not appropriately sought or pursued.
(h) on 27 October 2015, he was notified by the Legal Services Commissioner that the plaintiff’s complaint had been dismissed.
The plaintiff did not file and serve any affidavits in opposition to the defendants’ application, maintaining his position that, regardless of the relevant cause of action, time did not begin to run until 21 December 2011, the day upon which the enforceability of the settlement of the 2006 proceeding was confirmed by this Court. Further, the plaintiff maintains that he has a good claim on the merits against the defendants. Strictly speaking, it is not necessary for me to consider the merits of the plaintiff’s claims, because the defendants’ application is brought on the basis that, regardless of the merits of the plaintiff’s claims, the claim for breach of fiduciary duty is time barred by analogy. Nevertheless, for completeness, I have reviewed and considered the following documents:
(a) an affidavit sworn on 12 April 2019, where the plaintiff exhibited some email correspondence between members of Victoria Police regarding other alleged victims of GD, along with extracts from the transcript of the trial of the criminal proceeding in July 2009;
(b) an unsworn affidavit dated 1 May 2019, where the plaintiff referred to the ‘date of revelation’ as being 21 December 2011, and his previous lawyer’s advice to that effect;
(c) a document headed ‘correspondence’ dated 10 May 2019, which sought orders for mediation, and stating that at the time of his initial meeting with ATB in 2009, ATB concealed its relationship with the television network defendants;
(d) an affidavit sworn by Ms Antonietta Iannanella on 17 May 2019, where Ms Iannanella deposed that she has known the plaintiff for over twenty years, and attended a mediation in May 2011 as a support person. She deposed as to what she observed at the mediation, and the conversations between the plaintiff and junior counsel. She also deposed that some weeks later she attended a meeting with the plaintiff, his mother and Mr Flanagan; and
(e) a letter from the plaintiff to the Court dated 17 May 2019 (after judgment was delivered in relation to the defendants’ first summary judgment application) stating his belief that there was no contract in place to settle his claims in the 2006 proceeding. The letter went on to say in response to a request from the solicitors for the defendants for further and better particulars of ‘mutual other vested interests’:
Television stations almost always do not deal directly with clients (advertisers) in scheduling ads. In television, the department responsible is called ‘Traffic’. Any notion of a Chinese wall appears mute.
There is almost always a ‘media buyer’ acting on behalf of both parties.
The business relationship ATB had with the defendants is not as if they are exchanging money for paper clips or copy paper – their relationship is a relationship of advocacy (on publicly owned airwaves) and by extension political adjective 2 (chiefly derogatory done or acting in the interests of status or power within an organization rather than as a matter of principle.[4]
[4]New Oxford American Dictionary.
On a much larger scale than a client to legal firm relationship – legal firm duty bound to advocate in their client’s best interests.
By definition, a TV station advocates for their client’s services, wares & products. By extension, the client / advertiser aligns their brand with the brand of the broadcaster – they share a significant symbiotic relationship – it is always in their best interest to be seen well together.
In raising the fact I discovered ATB advertise with the TV station’s they relied upon the ‘Chinese wall’ justification.
As an example of advocacy and the power of the relationship dynamic of Broadcaster – Advertiser. In the negative aspect, should an On Air personality or other bring into disrepute and issue or bad behaviour or other that results in public backlash, it is not uncommon for an advertiser (client) to ‘pull’ their advertising from the airwaves of the broadcaster. Save per public image and public relations, countless examples to demonstrate exist.
It is plain to see that the television stations … is analogous to the Catholic Church in might and power, insofar as if public knowledge expose knowledge via any court matters the TV Stations harboured issues of serial workplace sexual assault matters – advertisers, would in all likelihood, pull ads in-droves.
Arnold Thomas Becker created a complex, at the very least perception, of conflict of interest from the outset which was not discovered until an 11th hour and which effected the civil case matters NS v GD & ORS. And which they aided and abetted the ORS not to be held to account. For the benefits not to draw attention to the workplace issues which existed.
I can provide police notes, statements from other victims etc. Arnold Thomas Becker received all most all case materials.
I reserve a right to establish more.
Further, the ‘other’ vested interest involved is the fact ATB are agent’s of the court – on oath to uphold the sanctity of the Court system – and they were made well aware Ballarat Police senior claimed to my family ‘Steve Pica should not have taken the case’ quote (R-V-GAVAN DISNEY). My family & I know why. So does Mr Flanagan.
For the purpose of the current application, it is necessary to canvass the allegations in the statement of claim in some detail. Given the nature of the application (being an application for summary judgment on limitation grounds) I shall proceed on the basis that the allegations in the amended statement of claim are true, both in relation to the allegations against the defendants regarding their conduct vis-à-vis the plaintiff, and in relation to the allegations made by the plaintiff in the 2006 proceeding.
In the amended statement of claim,[5] the plaintiff alleged, in summary, as follows:
[5]The original statement of claim was drafted by lawyers.
(a) in 2009, the plaintiff engaged the defendants to act for him in the 2006 proceeding;
(b) the plaintiff was granted an extension of time to serve the writ in the 2006 proceeding pending the hearing and determination of the criminal proceeding involving GD;
(c) on or about 25 September 2009, ATB served a statement of claim in the 2006 proceeding;
(d) an unsuccessful mediation in the 2006 proceeding was held on or about 12 May 2011;
(e) on or about 27 July 2011, the defendants in the 2006 proceeding made an offer to settle the 2006 proceeding with a payment of $250,000 inclusive of costs;
(f) on or about 21 October 2011, the plaintiff provided the letter of instruction to ATB authorising them to make an offer of $350,000 plus $100,000 for legal costs;
(g) on or about 24 October 2011, the 2006 proceeding was settled on the terms set out in (f) above;
(h) on 9 November 2011, the solicitors for the defendants in the 2006 proceeding circulated a draft release, which the plaintiff refused to sign;
(i) on 14 November 2011, the defendants in the 2006 proceeding tendered a cheque to ATB in the sum of $450,000;
(j) on 15 November 2011, the plaintiff told the solicitors for the defendants in the 2006 proceeding that he had not accepted the settlement, and ATB no longer acted for him. At around this time, ATB filed and served a Notice of Ceasing to Act in the 2006 proceeding; and
(k) on 21 December 2011, the defendants in the 2006 proceeding successfully applied to this Court to dismiss the 2006 proceeding, on the basis that the settlement agreement was binding upon the plaintiff.
Paragraphs 15 and 16 of the original statement of claim in this proceeding provided as follows:
At all material times, while AT&B and in partnership Mr Flannigan [sic] was acting as the legal representative of Mr Sloan, -
(a)it was a term of the retainer between Mr Sloan and AT&B that AT&B and Mr Flanagan would exercise due care and skill in prosecuting and compromising the sexual assault proceeding on his behalf and in advising him in relation to any compromise of that proceeding;
(b)AT&B and Mr Flanagan owed to Mr Sloan a general duty of care exercise due care and skill in prosecuting and compromising the sexual assault proceeding on his behalf and in advising him in relation to any compromise of that proceeding; and
(c)AT&B and Mr Flanagan owed to Mr Sloan a fiduciary duty to act solely in his best interests in exercise due care and skill in prosecuting and compromising the sexual assault proceeding on his behalf and in advising him in relation to any compromise of that proceeding.
In breach of each of the term and the duties referred to in the preceding paragraph, AT&B and Mr Flanagan failed to exercise due care and skill in prosecuting and compromising the sexual assault proceeding on his behalf and in advising him in relation to the compromise of that proceeding and to act in the best interests of Mr Sloan and in particular by inadequately advising him that he should settle the sexual assault proceeding for the settlement sum of $350,000 without properly or at all considering his entitlement to claim compensation for loss of earning capacity arising from the effects of the sexual assaults committed against him and coercing him to make an offer in terms of the written instructions and ultimately to accept the terms of the settlement which the Defendants were prepared to accept, for motives ulterior to the best interests of Mr Sloan, namely to gain access to the agreement by the Defendants to pay the agreed sum for Mr Sloan’s legal costs of $100,000.
Paragraphs 15(a) and (b), and part of paragraph 16 have been struck out in accordance with my earlier finding that the plaintiff’s claims for negligence and breach of contract are time barred. However, it is necessary to consider these claims for the purpose of analysing whether the plaintiff’s claims for breach of fiduciary duty are analogous to his claims in contract and/or tort.
Further, paragraph 16 of the amended statement of claim, in the form suggested by counsel for the defendants, provides as follows:
In breach of the duty referred to in paragraph 15(c) above, AT&B and Mr Flanagan acted in conflict of interest:
(a)by advising Mr Sloan to accept a settlement of the sexual assault proceeding in circumstances where:
(i)that was in the interests of AT&B and Mr Flanagan; and
(ii)that was contrary to the interests of Mr Sloan;
Particulars
AT&B and Mr Flanagan recommended to Mr Sloan that the sexual assault proceeding be settled for the sum of $350,000 plus $100,000 for costs. The settlement on such terms was unreasonable, against the interests of Mr Sloan and motivated principally by a desire on the part of AT&B and Mr Flanagan to be paid their fees.
(b)further or alternatively, by advising Mr Sloan to accept a settlement of the sexual assault proceeding in circumstances where:
(i)that was done principally for the purpose of protecting the commercial relationship (arising from the placement of advertising) between AT&B and one or other of the corporate defendants (Channel [X] Entities) and protecting the public image and commercial interests of the Channel [X] Entities;
(ii)such settlement was contrary to the interests of Mr Sloan;
Particulars
AT&B and Mr Flanagan recommended to Mr Sloan that the sexual assault proceeding be settled for the sum of $350,000 plus $100,000 for costs none of which was to be paid by the Channel [X] Entities but the proceeding against them would be discontinued. The settlement on such terms was unreasonable, against the interests of Mr Sloan and motivated principally by a desire on the part of AT&B and Mr Flanagan to protect the commercial relationship between AT&B and the public image and commercial interests of Channel [X] Entities arising from the advertising that AT&B and other advertisers placed with the Channel [X] Entities from time to time.
17.By reason of the breaches of fiduciary duty alleged at paragraphs 15(c) and 16 above, Mr Sloan has suffered loss and damage.
Particulars
The loss and damage suffered by Mr Sloan is equal to the additional amount that Mr Sloan would have received from any settlement of, or final judgment in, the sexual assault proceeding, had it not been settled in October 2011 for $350,000 plus $100,000 for costs.
The plaintiff filed and served an amended statement of claim on or about 31 May 2019. In addition to amending the statement of claim to strike out those parts of the claim which concerned the breach of contract and negligence claims against the defendants, the plaintiff referred to a number of other matters under the heading ‘Further in particulars’. Those further particulars included references to the following matters:
(a) what occurred at an initial conference between the plaintiff and Mr Flanagan on or around 23 September 2009, including a discussion about the witnesses and evidence to be called and given at the related criminal proceeding in which GD was the accused (‘criminal proceeding’);
(b) the receipt of documents by ATB in October 2010 regarding the trial of the criminal proceeding, and documents regarding the plaintiff’s financial circumstances;
(c) an incident in January 2011 when the plaintiff was unable to attend a medico-legal appointment by reason of his admission to hospital;
(d) a meeting in February 2011 with junior counsel retained by ATB;
(e) a mediation of the 2006 proceeding on 12 May 2011, and subsequent advice from counsel regarding the strengths and weaknesses of the plaintiff’s case. The plaintiff stated that counsel’s advice:
was an internal woven or doctored narrative to appease [ATB’s] interests, and or to quell or suppress notice of available evidences coming forward.
(f) in 2011, ATB were provided with further evidence and the names of potential witnesses to rebut the evidence given by the accused’s witnesses at the trial of the criminal proceeding;
(g) meetings with junior and senior counsel in August and October 2011;
(h) at a meeting in October 2011 with junior and senior counsel and ATB, Mr Flanagan stated that should the plaintiff not sign the letter of instruction, then ‘all legal support’ would be dropped; and
(i) the plaintiff stated as follows:
ATB knew the purpose and aim of the bargaining would be to gag the plaintiff. To satisfying the first defendant’s condition of confidentiality. To suppress the conducting of the criminal trial … And not bring light and accountability to the [television network defendants].
The defendants in this proceeding claim that the additional particulars are irrelevant and/or confusing.
From the pleadings, the additional particulars, and the evidence relied upon by the plaintiff during the course of the proceeding to date, the plaintiff’s case can be summarised as follows:
(a) the allegations made by the plaintiff in the 2006 proceeding were true, notwithstanding the false evidence given by GD and other witnesses at the trial of the criminal proceeding;
(b) the defendants knew those allegations were true, and knew or should have known that the plaintiff was entitled to substantial financial compensation;
(c) notwithstanding the above, the defendants (and counsel retained by them) did not forcefully advocate for the plaintiff in settlement negotiations in relation to the 2006 proceeding, and bullied him into providing instructions to settle the 2006 proceeding for an amount less than his claims were worth, by, among other things, highlighting the problems in his case, and threatening to withdraw their representation, should he not accept their advice; and
(d) if the defendants had acted in the plaintiff’s best interests, rather than their own interests, the plaintiff would have been able to achieve a better result, either through a more advantageous settlement, or through an award of damages following a successful trial.
The plaintiff claims that as a result of the defendants’ breaches of duty, he has suffered loss and damage. That loss and damage has not yet been quantified or particularised. However, I agree with the characterisation advanced by counsel for the defendants that the nub of the plaintiff’s complaint must be that he was advised (or, as he says, pressured) to settle the 2006 proceeding too cheaply, and that, in order to prove that he had suffered loss, the plaintiff must prove that the value of his claim in the 2006 proceeding was greater than the quantum of the settlement sum.
Put simply, the defendants submitted that the plaintiff’s claim for breach of fiduciary duty arose out of the same conduct which was said to have given rise to the plaintiff’s claims for breach of contract and negligence, being the giving of the advice to enter into the settlement agreement. Further, the relief claimed by the plaintiff is in substance the same: he seeks the difference between the sum paid to him under the settlement agreement and the actual value of his claim in the 2006 proceeding. Accordingly, the defendants submit the six year limitation period for contract and tort should apply by way of analogy. While the defendants accept that the Court has a discretion to refuse to apply the statutory limitation period if it is unconscionable to do so, the defendants submitted that the authorities provide that the unconscionable conduct to which the Court’s attention must be directed is unconscionable conduct which conceals the relevant breach of duty from the plaintiff, not unconscionable conduct at large. That is, even if the alleged breach of duty alleged against the defendants involves some element of unconscionable conduct (which, for present purposes, I am prepared to assume), it is only unconscionable conduct which conceals the relevant breach which attracts the Court’s residual discretion not to apply the analogous statutory limitation period.
The plaintiff, being self-represented, was not in a position to fully engage with the submissions of the defendants regarding the relevant principles and authorities, but maintained his position that, based upon legal advice he had received prior to the issue of this proceeding, the relevant limitation period commenced when he was informed by Zammit AsJ that ‘his troubles were with his lawyers’, that is, on 21 December 2011. He submitted that the defendants had acted unconscionably in advising him to enter in to a settlement agreement with a media organisation with which they had a commercial relationship. It is common ground that ATB advertised their ‘no win-no fee’ services on television stations operated by the television network defendants.
Relevant principles – summary judgment
The defendants rely upon s 63 of the Civil Procedure Act 2010 (‘CPA’), which provides as follows:
Summary judgment if no real prospect of success
(1)Subject to section 64, a court may give summary judgment in any civil proceeding if satisfied that a claim, a defence or a counterclaim or part of the claim, defence or counterclaim, as the case requires, has no real prospect of success.
(2)A court may give summary judgment in any civil proceeding under subsection (1)—
(a) on the application of a plaintiff in a civil proceeding;
(b) on the application of a defendant in a civil proceeding;
(c)on the court's own motion, if satisfied that it is desirable to summarily dispose of the civil proceeding.
The test under s 63 of the CPA is governed by the statement of the Court of Appeal in the oft-cited decision of Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd,[6] as follows:
(a)the test for summary judgment under section 63 of the Civil Procedure Act 2010 is whether the respondent to the application for summary judgment has a ‘real’ as opposed to ‘fanciful’ chance of success;
(b)the test is to be applied by reference to its own language and without paraphrase or comparison with the ‘hopeless’ or ‘bound to fail test’ essayed in General Steel;
(c)it should be understood, however, that the test is to some degree a more liberal test than the ‘hopeless’ or ‘bound to fail test’ essayed in General Steel and, therefore, permits of the possibility that there might be cases, yet to be identified, in which it appears that, although the respondent’s case is not hopeless or bound to fail, it does not have a real prospect of success;
(d)at the same time, it must be borne in mind that the power to terminate proceedings summarily should be exercised with caution and thus should not be exercised unless it is clear that there is no real question to be tried; and that is so regardless whether the application for summary judgment is made on the basis that the pleadings fail to disclose a reasonable cause of action (and the defect cannot be cured by amendment) or on the basis that the action is frivolous or vexatious or an abuse of process or where the application is supported by evidence.[7]
[6](2013) 42 VR 27.
[7]Ibid [35].
Further, Neave JA (who otherwise concurred with the statements made by the majority above) stated as follows:
… I am concerned that undue emphasis on the caution with which a court must exercise the power of summary dismissal runs the risk of reinforcing the historical approach to summary dismissal and may result in the legislative liberalisation of the test in s.63 having little impact in practice. That approach would be inconsistent with the objective of reforming the law relating to summary judgment, expressed in s 1(2)(e) of the Civil Procedure Act, and with the requirement that the Court give effect to the over-arching purpose of [the CPA], imposed by s 8.[8]
[8]Ibid [41].
Traditionally, the Courts have been reluctant to grant summary judgment where the sole issue is whether a plaintiff’s claims are time barred, save in the clearest of cases.[9]
[9]Wardley Australia Ltd v Western Australia (1992) 175 CLR 514, 533. See also Henderson Corporations Pty Ltd v Hewitt [2006] WASCA 233 [30] (where the Court of Appeal of Western Australia held that the question of whether a statutory limitation period applied to an equitable claim was generally not appropriate for summary determination) and Westraint Resources Pty Ltd v BHP Iron Ore Pty Ltd [2001] WASC 111 [69].
In D’Aquino v Trovatello,[10] the Court referred to the difficulties faced by the defendant seeking summary judgment on limitations grounds. In response to a defendant’s contention that, on the plaintiff’s case as pleaded, and on the plaintiff’s own material, the case would be unable to succeed, McLeish JA stated as follows:
In taking this course, the respondents assumed a heavy burden. In order to show that the claim had no real prospect of success, it was necessary for the respondents to establish that the applicants had no real prospect of overcoming the limitations defence. That in turn meant, either that the pleaded claims fell wholly outside the limitation period, or that, although there were claims that arose within the limitation period, there was no real prospect of sustaining them at trial.[11]
[10](2015) 47 VR 31.
[11]Ibid [53].
However, in Bodycorp Repairs Pty Ltd v Holding Redlich,[12] the Court of Appeal stated that granting summary judgment upon limitation grounds may be appropriate ‘where there was no relevant issue of fact which required resolution, and nothing to suggest that there is any prospect further evidence could materially alter [the date upon which the cause of action accrued]’.[13]
[12][2018] VSCA 17.
[13]Ibid [130].
Here, the relevant facts are not in dispute. The advice to settle the 2006 proceeding was given prior to 21 October 2011 (the date the letter of instruction was signed by the plaintiff). Further, the evidence before me is that the plaintiff was aware of the commercial relationship between ATB and the television network defendants by, at the latest, 27 October 2011, being the date of the plaintiff’s letter to ATB in which the plaintiff referred to having been shocked by having seen ATB’s advertisements on a regional television station, where he queried whether the broadcaster was one of the television network defendants, and referred to the quantum of costs claimed by ATB by 16 November 2011.[14]
[14]That the plaintiff had seen the television advertisements prior to sending his letter of 27 October 2011 was confirmed by him during the course of the hearing of the current application: T24, 7-12.
I also agree that the conduct complained of by the plaintiff must have been the advice given by ATB, which, as a matter of logic, must have been given by ATB at the time of or before the plaintiff signed the letter of instruction on 21 October 2011, with any loss suffered by the plaintiff having been incurred no later than 24 October 2011, when the defendants in the 2006 proceeding accepted the plaintiff’s offer of settlement. Accordingly, if the plaintiff’s claim for breach of fiduciary duty is analogous with the claims previously brought by him in contract or tort, the claim for breach of fiduciary duty would be prima facie time barred.
There may be, in an appropriate case, some debate about when a cause of action for breach of fiduciary duty is complete: that is, upon breach or upon the plaintiff suffering loss and damage. Here, it is not necessary to resolve the debate, as I agree, consistent with my reasons in the first summary judgment application, that the plaintiff would have suffered loss as a result of the defendants’ alleged breach of duty was the date upon which the defendants in the 2006 proceeding accepted the plaintiff’s offer made by ATB in accordance with the letter of instruction, being 24 October 2011.
Application of statutory limitations periods to equitable claims by analogy
Any discussion of the question of whether statutory limitation periods can apply to equitable claims of the nature brought by the plaintiff in this proceeding commences with the following statement of Lord Westbury in Knox v Gye:[15]
[W]here the remedy in Equity is correspondent to the remedy at Law and the latter is subject to a limit in point of time by the Statute of Limitations, a Court of Equity acts by analogy to the statute, and imposes on the remedy it affords the same limitation ... Where a Court of Equity frames its remedy upon the basis of the Common Law, and supplements the Common Law by extending the remedy to parties who cannot have an action at Common Law, there the Court of Equity acts in analogy to the statute; that is, it adopts the statute as the rule of procedure regulating the remedy it affords.[16]
[15](1872) LR 5 HL 656.
[16]Ibid, 674.
Reference is also made in the authorities to the following passage of Spry’s Equitable Remedies: [17]
In this latter case the limitation period is said to be applied by analogy, and the principles that govern cases of this kind are that if there is a sufficiently close similarity between the exclusive equitable right in question and legal rights to which the statutory provision applies a court of equity will ordinarily act upon it by analogy but that it will so act only if there is nothing in the particular circumstances of the case that renders it unjust to do so. What is regarded by courts of equity as a sufficiently close similarity for this purpose involves a question of degree, and reference must be made to the relevant authorities.
[17]5th ed (1997) 419-420.
The above passage is quoted in the decision of the UK Court of Appeal in Cia de Seguros Imperio v Heath (REBX) Ltd and Ors (‘Seguros’),[18] a decision which has been referred to with approval and applied in a number of Australian jurisdictions, including intermediate appellate courts.[19]
[18]Seguros [2001] 1 WLR 112, 126.
[19]Port Ballidu Pty Ltd v Frews Lawyers [2017] QSC 19; Amaca Pty Ltd v CSR Ltd & Anor [2015] VSC 582; Taluja v Orford [2014] NSWSC 717; Alec Finlayson Pty Ltd v Royal Freemason Benevolent Institution of New South Wales Nominees Ltd [2013] NSWSC 1168; Belan v Casey (2013) 57 NSWLR 670; McDonald v Grech [2012] NSWSC 717; Spaulding v Adams [2012] TASSC 61; Goldie v Getley (2011) 8 ASTLR 166; Gerard Cassegrain & Co Pty Ltd v Cassegrain [2011] NSWSC 1156; Tavitian v Commissioner of Highways [2010] SASC 206; Aussie Ideas Pty Ltd v Tunwind Pty Ltd [2006] NSWCA 286; Westraint Resources Pty Ltd v BHP Iron Ore Pty Ltd [2001] WASC 111.
In Seguros,[20] (notably, on the trial of a number of preliminary questions rather than after a full trial), it was held that the plaintiff’s claims for breach of fiduciary duty were time barred by analogy with the statutory limitation period which also operated to bar that plaintiff’s claims in contract and negligence. The UK Court of Appeal dismissed the appeal, on the basis that where the facts upon which the breach of fiduciary duty was founded were identical with the facts which founded the time barred claims in contract and tort, the statutory limitation provisions must be applied by analogy such that the plaintiff’s equitable causes of action was time barred after six years.
[20][2001] 1 WLR 112.
In Seguros,[21] Clarke LJ stated that ‘the essential nature of the pleaded case is the same whether it is put as damages for breach of contract, damages for breach of duty or damages (or compensation) for breach of fiduciary duty.[22] He referred to the following statement of Mr Jules Sher QC in Coulthard v Disco Mix Club Ltd:[23]
[21]Ibid.
[22]Ibid, 125.
[23][2000] 1 WLR 707.
one could scarcely imagine a more correspondent set of remedies as damages for fraudulent breach of contract and equitable compensation for breach of fiduciary duty in relation to the same factual situation, namely the deliberate withholding of money due by a manager to his artist. It would have been a blot on our jurisprudence if those selfsame facts gave rise to a time bar in the common law courts but none in the court of equity.[24]
Clarke LJ went on to say as follows:
In my opinion precisely the same is true on the facts of this case. If the claims for damages for breach of contract and duty are time barred, as it is agreed that they are, no rational system of law should permit the plaintiff to proceed with a claim for damages which is essentially based on the same facts, merely because it is strictly a claim for compensation in equity.[25]
[24]Ibid, 730.
[25]Seguros [2001] WLR 112, 126.
As noted above, the decision of the UK Court of Appeal in Seguros[26] has been referred to on a number of occasions by courts in Australian jurisdictions. Consistent with the approach in Seguros,[27] the courts have generally held that where there is an analogy between an equitable claim and a common law or statutory claim where a statutory limitation period applies, the statutory limitation period will apply by analogy to the equitable claim. To be analogous, the causes of action do not need to have identical elements. Instead, they can arise on similar facts, the remedy sought can be similar, or the content of the duties that arise at law and in equity can be similar. As succinctly put by Campbell J in Belan v Casey:[28]
In accordance with this principle, an allegation of breach of fiduciary duty, based on facts which would also have allowed a common law action for fraud to be brought, has applied to it the same statutory limitation period as the common law action for fraud: Coulthard v Disco Mix Club Ltd (2000) 1 WLR 707 at 730, and a claim for breach of fiduciary duty founded upon the same facts as would justify a claim in tort or contract has the limitation periods for tort or contract applied to it: Cia de Seguros Imperio v Heath (REBX) Ltd [2000] EWCA Civ 219; [2001] 1 WLR 112. See also Meagher, Gummow and Lehane, Equity Doctrines and Remedies, 4th edition, paragraph 34-075.[29]
[26]Ibid.
[27]Ibid.
[28](2003) 57 NSWLR 670.
[29]Ibid [149].
Three recent first instance decisions illustrate the application of Seguros[30] by Australian courts. In Spaulding v Adams,[31] the plaintiff brought a proceeding against his former solicitor in relation to losses suffered by him on four transactions completed approximately fifteen years prior to the issue of the proceeding. The plaintiff did not bring claims in contract or tort (presumably since the relevant limitations period had long expired), but for breach of fiduciary duty. Following a trial, Crawford CJ held that, in the case of the impugned transactions, the solicitor did not in fact owe the plaintiff a fiduciary duty. However, he held that, if such a duty had been owed, the plaintiff’s claims would have been statute barred, as they arose out of the same facts as would found a claim for damages against the solicitor for breach of contract and/or negligence, and the same duties to advise were involved.
[30]Seguros, [2001] 1 WLR 112.
[31][2012] TASSC 61.
In Issa v Issa,[32] a case involving an alleged breach of fiduciary duty on the part of solicitors, White J stated:
There was no dispute that the equitable claim for compensation for breach of fiduciary duty is analogous to the claim at law for damages whether in tort or contract.[33]
[32][2015] NSWSC 112.
[33]Ibid [41].
However, White J did not consider the facts in the case before him to warrant summary dismissal of the claims against the solicitors, as it was not clear that the claim in negligence against the solicitors (that is, the analogous cause of action) was time barred.
In Port Ballidu Pty Ltd v Frews Lawyers (‘Port Ballidu’),[34] Applegarth J determined an application for summary judgment adversely to a corporate plaintiff who brought a claim against a solicitor for knowing involvement in a breach of duty by one of the former directors of the company. The application was determined on the assumption that the plaintiff could make good its allegations at trial. In this case, the facts which gave rise to the equitable claim against the defendant were identical to the facts which gave rise to a claim for a contravention of ss 181 and 182 of the Corporations Act 2001 (Cth). Section 1317K of the Corporations Act provides for a six year limitation period for claims under ss 181 and 182, commencing from the date of the contravention. His Honour stated as follows (omitting citations):
[34][2017] QSC 19.
In my view, the facts underlying the claim for breach of fiduciary duty by O’Rourke and the first and second defendants’ knowing involvement in it closely resemble the time-barred statutory cause of action for compensation in respect of the breach of director’s duty by O’Rourke, and the first and second defendants being “knowingly concerned” in it. The content of O’Rourke’s fiduciary duty as a company director and his statutory duty as a company director are pleaded by the plaintiff to be the same. If the plaintiff had pursued relief under the Corporations Act for a breach of O’Rourke’s duties as a director and for the first and second defendants being knowingly concerned in those breaches of duty, then the same conduct relied upon by the plaintiff as constituting a breach of his fiduciary duty would have been conduct which breached his statutory duties as a director. O’Rourke would have been liable under the provisions of the Corporations Act for breaches of duty imposed by s 181 and s 182. The same conduct of the first and second defendants which is alleged to have amounted to being knowingly involved in O’Rourke’s breach of fiduciary duty would have amounted to their being knowingly concerned in his contravention of the Corporations Act. The conduct would have caused the same loss for which compensation is available under statute as the loss for which equitable compensation is sought.
A cause of action under the Corporations Act would have been met by a limitation defence. Civil claims for compensation in respect of a contravention, and being knowingly involved in such a contravention, are subject to the statutory limitation period of six years contained in s 1317K of the Corporations Act. That six year statutory limitation period would run from the date of the contravention. That six year time-bar should be applied by analogy unless there exists a ground which makes it unconscionable to permit the first and second defendants to rely on the time limitation.
There is a similar, close correspondence between the equitable claim for compensation against the first and second defendants and the pleaded claim for compensation for their being knowingly concerned in O’Rourke’s contravention of the TPA. The same conduct is pleaded and the same compensation is sought.
The plaintiff points to an authority to the effect that different approaches to causation may apply in the case of equitable claims against fiduciaries and claims for compensation based upon contravention of statute, such as a breach of a director’s statutory duties or conduct in contravention of a statute such as the TPA. However, the plaintiff does not explain in its submissions why this might make any difference in this case, being a case in which the causal nexus between O’Rourke’s conduct, the conduct of the first and second defendants, and the loss which the plaintiff suffered appear to be the same, based on the same facts.
More generally, the fact that a claim for equitable compensation for breach of fiduciary duty and a corresponding claim for compensation under statute have different elements in law does not lead to the conclusion that the claims do not closely resemble each other. Were it otherwise, it would never be possible to establish that a claim for compensation pursuant to statute closely resembles a claim for equitable compensation.
In summary, I conclude that it is clear that the plaintiff’s claim for equitable compensation against the first and second defendants is closely analogous to both a cause of action arising from breach of O’Rourke’s statutory duties as a director (which has not been pleaded) and the cause of action for compensation based on the first and second defendants being knowingly concerned in O’Rourke’s misleading conduct.
Subject to the issue of whether it would be unconscionable or unconscientious for the defendants to rely upon such a limitation period in respect of the claim for equitable compensation, I consider that the statutory six year period should be applied by analogy.[35]
[35]Ibid [34]-[40].
On appeal to the Queensland Court of Appeal,[36] the plaintiff abandoned its grounds of appeal relating to the question of whether the plaintiff’s equitable claim was time barred by way of analogy to the statutory limitations period. The appeal was pursued on grounds relevant to the construction of the Corporations Act 2001 (Cth), which are not relevant to the current application.
[36][2018] QCA 110.
As noted by Applegarth J in Port Ballidu,[37] cases where there is an element of unconscionability are regarded as an exception to the rule that a statutory limitation period must apply to analogous equitable claims. In Gerace v Auzhair Supplies Pty Ltd (‘Gerace’),[38] Meagher JA (with whom Beazley P and Emmett JA agreed) stated as follows:
The authorities referred to above, and in particular R v McNeil, show that in purely equitable proceedings, where there is a corresponding remedy at law in respect of the same matter and that remedy is the subject of a statutory bar, equity will apply the bar by analogy unless there exists a ground which justifies its not doing so because reliance by the defendant on the statute would in the circumstances be unconscionable. They do not support the proposition that equity retains any broader discretion whether to apply the bar. The description of such a ground, or the conduct giving rise to or constituting it, as unconscionable or unconscientious leaves to be identified the principles according to which equity justifies that conclusion:
[37][2017] QCA 19.
[38](2014) 87 NSWLR 435.
In Gerace,[39] the New South Wales Court of Appeal rejected the contention that equity would decline to apply the statutory time limit in circumstances where the equitable cause of action was founded on unconscionable conduct, save where the unconscionable conduct affected the plaintiff’s ability to bring a proceeding within time. Meagher JA stated as follows:
A modern statement of the principle according to which equity will decline to apply a statute by analogy, or will postpone the time from when it commences to run, is that of Lord Bingham (then Master of the Rolls) in his judgment in the Court of Appeal in Sheldon v RHM Outhwaite Ltd [1996] 1 AC 102 at 115. There his Lordship observed:
The equitable exception to the old and unqualified statutory limitation rule rested on the principle that a defendant whose unconscionable conduct has denied the plaintiff the opportunity to sue in time should not in conscience be permitted to plead the statute to defeat the plaintiff's claim provided the claim were brought timeously once the plaintiff learned or should have learned of it.
According to these statements, equity applies by analogy a limitation statute for a corresponding remedy at law in the absence of an equitable ground, such as concealed fraud, which makes it unconscionable to permit the defendant to rely on the statute. None of these formulations suggests that whether a statute is to be applied by analogy depends on the answer to a larger question, namely whether in the absence of the analogy, there would not be a defence of laches.[40]
[39]Ibid.
[40]Ibid [33]-[34].
The decision in Gerace[41] has been subject to some criticism as being a too restrictive interpretation of what might be described as the ‘unconscionability exception’ to the rule that equity will apply the statutory limitation period where there is an analogous statutory or common law cause of action.[42] However, given that it is a decision of an intermediate Court of Appeal, I am bound to follow it unless I consider it to be plainly wrong.[43] Having regard to the general principle that ‘equity follows the law’ (which is the foundation of the principle that statutory limitation periods will be applied by analogy to equitable claims where there is an analogous claim of law), and the policy considerations underlying the LAA, I do not consider the decision in Gerace[44] is plainly wrong. I am bolstered in that view by the fact that the High Court refused leave to appeal the decision in Gerace[45] with respect to the scope of the unconscionability exception, stating that:
We see no reason to doubt the correctness of the decision of the Court of Appeal. An appeal to this Court would enjoy insufficient prospects of success to warrant a grant of special leave to appeal.[46]
[41]Ibid.
[42]See Issa v Issa [2015] NSWSC 112 [56]. See also Adrian O’Dea and Phillipa O’Dea, ‘The application of statutory limitation periods by analogy to claims in equity’s exclusive jurisdiction.’ (2015) 4 JCivLP56.
[43]Farah Constructions v Say-dee Pty Ltd (2007) 230 CLR 89 [135].
[44](2014) 87 NSWLR 435.
[45]Ibid.
[46]Auzhair Supplies Pty Ltd v Roy Gerace & Ors [2014] HCASL 231 [8] per Hayne and Crennan JJ.
In Port Ballidu,[47] Applegarth J noted the apparent criticisms of Wright J in Issa v Issa,[48] and also declined to form the view that the decision in Gerace[49] was plainly wrong. Applying the principles in Gerace[50] to the facts of the case before him, his Honour found that as the plaintiff had known about the facts giving rise to the claim for relief more than six years prior to the proceeding being issued, the plaintiff’s equitable claim was time barred, even if the date from which time began to run was the date upon which the plaintiff discovered the breach, rather than the date of the breach of duty.
[47][2017] QCA 19.
[48][2015] NSWSC 112.
[49](2014) 87 NSWLR 435.
[50]Ibid.
Analysis
Accordingly, the question is whether the plaintiff has any real prospects of success in establishing:
(a) his claim for breach of fiduciary duty is not analogous to his claims for breach of contract and negligence; or
(b) if his equitable claim is an analogous claim, whether the unconscionability exception may or would apply to overcome the defendants’ limitation defence.
It is clear from the authorities that the principles in Seguros[51] and Gerace[52] have widespread acceptance in Australian jurisdictions, that is:
[51][2001] 1 WLR 112.
[52](2014) 87 NSWLR 435.
(a) where a claim for breach of fiduciary duty arises out of essentially the same facts, and claims substantially the same relief, as a claim for breach of contract or negligence, the causes of action is analogous, and the statutory limitation period applicable to the analogous statutory or common law cause of action will apply;
(b) the cases where it would be considered to be unconscionable to apply the statutory time limit are limited to those where the alleged wrongdoer has concealed its wrongdoing, thus preventing the wronged party from commencing an action within time;
(c) even if the unconscionability exception has a broader application, it would only extend the date from which time begins to run to the time at which the plaintiff became aware, or ought reasonably have become aware, of the facts giving rise to the claim for relief; and
(d) having regard to the statements of the Court of Appeal in Bodycorp Repairs Pty Ltd v Holding Redlich,[53] the customary caution regarding granting summary judgment on limitations questions carries less force where there is no factual dispute relevant to the question of when time begins to run which requires resolution.
[53][2018] VSCA 17.
Understandably, the plaintiff had some difficulty in grappling with what are quite complex legal issues associated with the defendants’ application. However, he maintained, based upon advice received from the lawyers who drew his statement of claim, that the relevant limitation period did not commence to run until the date the 2006 proceeding was dismissed by this Court, that is, 21 December 2011.
The plaintiff submitted that it was outrageous for the defendants to suggest they had no conflict of interest. They had a commercial relationship with the television network defendants, which they concealed from him when they commenced to act for him in 2009. They acted unconscionably in coercing him to sign the letter of instruction, and in failing to take steps necessary to enable him to investigate and prove his claims in the 2006 proceeding at trial. He knew that the defendants had a conflict of interest before he came to Court on 21 December 2011, but was helpless to explain his concerns in a way that made sense.
Essentially, the plaintiff submitted that he had a good claim against the defendants, who had acted unconscionably, and his claim should be able to proceed.
In my view, the plaintiff’s claim that the defendants breached their fiduciary duty to him is analogous to his claims for breach of contract and negligence. All claims centre on the advice given by the defendants to the plaintiff to settle the proceeding. The loss claimed is the same in the case of his breach of fiduciary claim and his breach of contract and negligence claims, being the difference between the real value (however calculated) of the plaintiff’s claim in the 2006 proceeding and the settlement sum. The facts as to when the advice was given and the settlement entered into are not in dispute. For each cause of action, the relevant breach was said to be the giving of inappropriate advice to settle the 2006 proceeding. While there are different elements of each of the causes of action (when the causes of action accrued, and the nature of the duty), the plaintiff’s cause of action for breach of fiduciary duty concerns largely the same circumstances, and arises out of substantially the same facts as the breach of contract and negligence. That much is clear from the original version of the statement of claim.
My survey of the authorities has shown that, in circumstances where a breach of fiduciary duty arises out of the same factual matrix as claims for breach of contract and negligence, the courts will invariably apply the statutory limitation period by analogy. After extensive searches, I have not discovered any case which post‑dates Seguros[54] which has not applied the relevant statutory limitation period.
[54][2001] 1 WLR 112.
Further, the documentary evidence shows that, at all relevant times, or at least since 9 October 2011, an essential feature of any settlement agreement between the plaintiff and the defendants in the 2006 proceeding was that $100,000 of any settlement sum was to be earmarked for the payment of legal costs to ATB. That the costs were in fact calculated as being approximately $100,000 was known from approximately 16 November 2011, and no action was ever taken by the plaintiff to dispute those costs. Accordingly, the plaintiff knew that any settlement of the 2006 proceeding would ensure that ATB received its costs. Further, it is apparent from the plaintiff’s letter to Mr Flanagan of 31 October 2011 that the plaintiff knew, or suspected, that ATB placed advertisements with the television network defendants. As a matter of logic, television advertisements cannot, by their very nature, be concealed. This letter also referred to what the plaintiff considered to be the defendants’ conflict of interest in wanting to be paid their legal costs from the settlement sum.
Accordingly, to the extent that there was arguably a conflict between the defendants’ duties to the plaintiff, and their own interests, that conflict was known, or at least discoverable, no later than 16 November 2011, but probably at least from 28 October 2011.
The plaintiff continues to maintain that the date from which time commenced to run was 21 December 2011, when the 2006 proceeding was dismissed by the Court. The plaintiff says he has legal advice to that effect. However, all that occurred on 21 December 2011 was that the Court confirmed the validity of a transaction which had taken place many weeks before: that is, the plaintiff had entered into a settlement agreement with the defendants in the 2006 proceeding. It is not a relevant date for determining the date of expiry of the statutory limitation period, which must apply to the plaintiff’s equitable claim by way of analogy.
Further, the plaintiff alleges that the defendants acted unconscionably in acting for him when they had a conflict of interest, in failing to properly investigate the facts and the untruthful evidence given at the related criminal proceeding, and in coercing him to settle the 2006 proceeding for their own benefit. As explained above, I have approached the defendants’ application on the basis that the allegations made by the plaintiff are true. However, the principles espoused in Gerace[55] limit the unconscionability exception to the application of limitation periods to equitable claims by analogy to cases where the conduct in question conceals the facts which give rise to a plaintiff’s claim for relief. Whether the defendants otherwise acted unconscionably in their dealings with the plaintiff is not relevant to determining the commencement of the limitation period.
[55](2014) 87 NSWLR 435.
For completeness, my findings that the plaintiff’s claim for breach of fiduciary duty is time barred by analogy is not at all influenced by any preconceived view regarding the merits of the plaintiff’s claims in this proceeding, or for that matter his claims in the 2006 proceeding. While I accept that the plaintiff may consider it unjust that his claims against the defendants are time barred, the courts must, where applicable, give effect to Parliament’s intention that civil disputes be brought and resolved within a reasonable period of time.[56]
[56]See Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541, 553 per McHugh J.
Finally, I do not consider that s 27 of the LAA, which postpones the commencement of the relevant limitation period for common law or statutory claims in cases of concealed fraud, or whether the cause of action is founded on a mistake, applies to the current case. While the plaintiff alleges that the defendants acted unconscionably, and pursuant to a conflict of interest, his claim against the defendants is not a claim of fraud. Further, there has been no concealment, and, consistent with my findings above, the plaintiff knew of the facts giving rise to the defendants’ alleged breach of duty more than six years prior to the proceeding. Accordingly, the proceeding will be dismissed.
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