Stanton v Tyler

[2015] NSWSC 797

Supreme Court

New South Wales

Medium Neutral Citation:

Stanton v Tyler [2015] NSWSC 797

Hearing dates:

22 May 2015

Decision date:

19 June 2015

Jurisdiction:

Common Law

Before:

Hall J

Decision:

(1)   The Amended Notice of Motion filed on behalf of the First Defendant, Rosana Tyler, on 20 February 2015, is dismissed.

 

(2)   The Notice of Motion filed on behalf of the Second Defendant, Lucinda Wilson, on 27 February 2015, is dismissed.

 (3)   I grant leave for the parties to make any application in respect of orders as to costs or other ancillary matters.

Catchwords:

PROCEDURE – Civil – Applications for summary dismissal of or alternatively an order striking out the Amended Statement of Claim pursuant to UCPR Rule 13.4 on the basis of advocates’ immunity from suit – First and second defendants were respectively a solicitor and barrister who had conduct of plaintiff’s proceedings in a cross-claim against an Owners Corporation in the Local Court and subsequent appeal to Supreme Court and Court of Appeal – Plaintiffs in Amended Statement of Claim alleged negligence by defendants, breach of fiduciary duty, misleading and deceptive conduct and other causes of action in relation to alleged negligent advice – Relevant advice was firstly advice to pursue cross-claim proceedings in the Local Court and secondly advice to pursue appeal to the Supreme Court – Local Court had dismissed cross-claim on the basis of an expiration of limitation period and on the plaintiffs’ lack of standing – Supreme Court appeal was also dismissed.

ADVOCATES’ IMMUNITY FROM SUIT – Defendants claimed no cause of action was sustainable because of the doctrine of advocate’s immunity – Relied on D’Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12 – Plaintiffs relied on exception to doctrine where advice went to the issue of jurisdiction or locus standi to bring and pursue a cross-claim in circumstances where the alleged damage to property related to the common property on a strata plan not the plaintiff’s property – Held that whether the doctrine applied or not was a triable issue – There was a triable issue as to whether or not the legal advice was outside the scope of the doctrine because it went to the appropriate forum to commence proceedings in – The proceedings arguable did not constitute, directly or indirectly, a challenge to or traversing of the decision of the Local Court – Applications dismissed

Legislation Cited:

Fair Trading Act 1987
Legal Profession Act 2004
Strata Schemes Management Act 1996
Trade Practices Act 1974 (Cth)

Cases Cited:

Attard v James Legal Pty Ltd [2010] NSWCA 311
D’Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1
Donellan v Watson (1990) 21 NSWLR 335
Donnellan v Woodland [2012] NSWCA 433
General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125
Giannarelli v Wraith [1988] HCA 52; 165 CLR 543
Heydon v NRMA Ltd (2000) 51 NSWLR 1
Jackson Lalic Lawyers Pty Ltd v Attwells [2014] NSWCA 335
Keefe v Marks (1989) 16 NSWLR 713
MacRae v Stevens [1996] Aust Torts Reports 81-405
Nicole Stanton v The Owners of Strata Plan 60724 [2010] NSWSC 175
Rees v Sinclair [1974] 1 NZLR 180
Saif Ali v Sydney Mitchell & Co [1980] AC 198
Symonds v Vass [2009] NSWCA 139; 257 ALR 689
Yates Property Corporation Limited v Boland (1997) 145 ALR 169
Young v Hones [2014] NSWSC 337

Category:

Procedural and other rulings

Parties:

Nicole Stanton (First Plaintiff/Respondent)
Denise Olender (Second Plaintiff/Respondent)
Steven Olender (Third Plaintiff/Respondent)
Rosana Celina Tyler (First Defendant/Applicant)
Lucinda Wilson (Second Defendant/Applicant)

Representation:

Counsel:
M Luitingh (Respondents)
DA Lloyd (Applicant)
PA Horvath (Applicant)

  Solicitors:
Noble Law (Plaintiffs/Respondents)
Kennedys (First Defendant/Applicant)
Moray & Agnew Lawyers (Second Defendant/Applicant)

File Number(s):

2014/18208

Judgment

1. The plaintiffs plead a number of causes of action, including negligence by way of an Amended Statement of Claim filed on 9 October 2014, against the first defendant (a solicitor) and the second defendant (a barrister) in relation to their conduct of the plaintiff’s proceedings in the Local Court in 2008 and 2009 and subsequently in relation to appeal proceedings brought in this Court and in the Court of Appeal.

2. This judgment is concerned with two Notices of Motion brought by the first and second defendants in which each seek an order summarily dismissing the Amended Statement of Claim pursuant to UCPR, Rule 13.4 and orders for judgment to be entered in favour of each of the defendants. The Defences filed on behalf of the applicants in relation to the Amended Statement of Claim raise defences based upon the principle of advocates’ immunity from suit.

3. Before dealing with the issues that arise on the Notices of Motion it is necessary to set out some background facts.

Overview

4. The plaintiffs owned Unit 27 in a strata plan which suffered water damage. As a consequence of the damage the plaintiffs ceased paying their levies to the Owners Corporation of the strata plan.

5. The Owners Corporation commenced proceedings in the Local Court against the plaintiffs for non-payment of levies. The plaintiffs cross-claimed against the Owners Corporation claiming $58,000 in relation to the water damage (“the building dispute”).

6. Before the hearing of the proceedings in the Local Court the plaintiffs and the Owners Corporation resolved the dispute over non-payment of levies. The matter accordingly proceeded to hearing on the plaintiffs’ cross-claim. On 8 April 2009, judgment was entered against the plaintiffs in the Local Court proceedings.

7. On 6 May 2009, the plaintiffs appealed to the Supreme Court in respect of the Local Court judgment. That appeal was heard on 4 December 2009 and 16 February 2010.

8. On 12 March 2010, judgment was entered by Harrision AsJ against the plaintiffs (Nicole Stanton v The Owners of Strata Plan 60724 [2010] NSWSC 175).

9. In the present applications it has been submitted that any liability which the applicants may have had to the plaintiffs (which liability is denied) arose in circumstances where each were immune from suit by virtue of the doctrine of advocate’s immunity.

The Present Proceedings

10. The applicants acknowledge that the test to be applied on an application for a summary dismissal of proceedings is whether the claim is “so obviously untenable that it cannot possibly succeed”: General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125 at 129.

11. For the purpose of these applications, the applicants accepted the facts as pleaded in the Amended Statement of Claim.

12. It was submitted for the applicants that the plaintiffs’ case could not be improved by amendment and that this is a relevant factor to be taken into account in respect of the test that is to be applied in summary dismissal applications.

13. The applications therefore proceeded upon the basis that the immunity defence relied upon was able to be determined on the pleadings. The applicants contended that the plaintiffs’ claim is largely one for wasted costs said to have arisen in respect of the proceedings in the Local Court and in the appeal proceedings which resulted in cost orders being made against them. Claims for wasted costs were noted as falling within the categories of immunity identified in D’Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1 (“D’Orta”) at [70] (discussed below).

Background

14. The plaintiffs retained Ms Tyler to act in relation to the proceedings brought in the Local Court. It is alleged that she advised the plaintiffs that the Local Court had jurisdiction to entertain the cross-claim and that there were good grounds for pursuing the claim.

15. The plaintiffs allege that they relied upon “advice” given by the applicants in pursuing the cross-claim in the Local Court proceedings.

16. As noted above, on 8 April 2009, judgment was entered against the plaintiffs in the Local Court. The plaintiffs allege that there was a finding that the cross-claim was statute-barred. However, more relevantly to the present applications, the plaintiffs allege that, contrary to advice of the applicants, the Local Court determined that the plaintiffs had no standing to seek compensation for the damage to the property in question because it was common property: Amended Statement of Claim at [13].

17. The plaintiffs’ case accordingly is that the outcome of the Local Court proceedings was caused by the appellants’ alleged negligence and breach of retainer and that they suffered loss of $58,319 paid in costs to the Owners Corporation in the debt claim and $50,709 payable for costs in the building dispute claim: Amended Statement of Claim at [13]-[14].

18. The plaintiffs further allege that the applicants advised and represented them in relation to appeal proceedings in this Court from the Local Court’s decision and also in the Court of Appeal of New South Wales.

19. In relation to the appeal to this Court, the plaintiffs were ordered to pay the Owners Corporation’s costs. The plaintiffs’ complaint is that they should have been advised not to appeal as the appeal was hopeless: Amended Statement of Claim at [41].

20. The same complaint is made in relation to the appeal to the Court of Appeal: Amended Statement of Claim at [49].

21. Alternative claims are made by the plaintiffs under the Trade Practices Act 1974 (Cth) as well as for breach of fiduciary duty and for a breach of the Solicitors’ Rules and the Legal Profession Act 2004.

22. Various heads of claim are set out in the Amended Statement of Claim at [50]. Included amongst the individual claims is a claim in respect of costs that were wasted in the Local Court, Supreme Court and Court of Appeal.

Submissions for the First Applicant (Ms Tyler)

23. Mr DA Lloyd of counsel, who appeared on behalf of the first applicant, relied upon his written submissions dated 11 May 2015, supplemented by the oral submissions at the hearing of the application on 22 May 2015.

24. As noted above, Mr Lloyd acknowledged that the test to be applied on an application for summary dismissal is well-settled, quoting from General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125 at 129 where the test was stated as being whether the claim is “so obviously untenable that it cannot possibly succeed”.

25. As earlier noted, the first applicant accepted that all of the facts pleaded in the Amended Statement of Claim, for the purposes of the summary dismissal application are accepted for the purposes of applying the requisite test: Written Submissions for the First Applicant at [3].

26. Reference was made to authority said to support an approach where determination of a defence of immunity from suit would be a sufficient ground to dispose of a negligence action of itself: Donnellan v Woodland [2012] NSWCA 433 at [276] per Barrett JA.

27. Mr Lloyd’s written submissions helpfully set out in summary form some general principles relating to advocates’ immunity at [22]-[27].

28. The submissions for the first applicant were developed around the proposition that the plaintiffs’ case:

“… largely is one for wasted costs arising from what is said to be the conduct of first instance and appeal proceedings which have been concluded by the entry of orders by the court and thus the claim falls into the categories identified in D’Orta at [70] …” (Written Submissions for the First Applicant at [7])

29. Mr Lloyd described the “essence of the claim” as relating to costs paid and payable in the Local Court, in the Supreme Court and the Court of Appeal, being in the nature of “wasted costs”. Reliance was placed upon a number of authorities to support the proposition that disputes about wasted costs should not be permitted because they could involve direct or indirect challenge to the outcome of the original proceedings: Written Submissions for the First Applicant at [30]-[32].

30. In support of the proposition that the plaintiffs’ case falls within the scope of the immunity, it was contended that, in essence, the plaintiffs’ claim was that if Ms Tyler had taken different steps in preparing the plaintiffs’ case in the Local Court, their claim against the Owners Corporation would have been resolved differently and they would have obtained a different and better outcome: Written Submissions for the First Applicant at [35]. A claim of that kind it was said was one that falls within the immunity. Reliance in this respect was placed upon the observations in Symonds v Vass [2009] NSWCA 139; 257 ALR 689.

31. It was contended that the plaintiffs’ claim falls within the immunity “… because the allegation involves an attack on the decision of the Local Court that the plaintiffs had no standing to sue in respect of common property …”: Written Submissions for the First Applicant at [39].

32. In respect of the claim under the Trade Practices Act it was submitted that this claim was:

“… hopeless as the Act did not apply to Ms Tyler. Even if it were recast under the equivalent State legislation it has been settled that the immunity applies to statutory causes of action of that kind.”

33. Even if the allegation was recast under the Fair Trading Act 1987 (NSW), it was submitted that it is settled that the immunity also applies to statutory causes of action of that kind: Young v Hones [2014] NSWSC 337.

34. It was further submitted that the alleged breach of fiduciary duty similarly falls within the immunity: Written Submissions for the First Applicant at [45].

35. Reference was made to the judgments of the High Court including D’Orta, supra. In that case the plurality of the High Court (Gleeson CJ, Gummow, Hayne and Heydon JJ) affirmed the principle established by the High Court in Giannarelli v Wraith [1988] HCA 52; 165 CLR 543, that an advocate cannot be sued by his or her client for negligence in the conduct of a case, or for work out of court which is intimately connected with the conduct of a case in court.

36. The immunity extends to solicitors as well as barristers: D’Orta at [25].

37. It was acknowledged in the submissions for the first applicant that it is sometimes difficult to draw the line between work that is intimately connected with the conduct of the case in court and work which is remote from the conduct of the case in court. The Court of Appeal in Donnellan v Woodland, supra, it was noted, cited with approval the statement in Rees v Sinclair [1974] 1 NZLR 180 at 187 per McCarthy P where his Honour described the conduct which fell within the immunity as being:

“…work so intimately connected with the conduct of the cause in Court that it can fairly be said to [be] a preliminary decision affecting the way that cause is to be conducted when it comes to a hearing.”

38. Reference was made to the observations of the plurality in D’Orta at [87] in the following terms:

“As Mason CJ demonstrated in Giannarelli, [97] ‘it would be artificial in the extreme to draw the line at the courtroom door’. And no other geographical line can be drawn that would not encounter the same difficulties. The criterion adopted in Giannarelli accords with the purpose of the immunity. It describes the acts or omissions to which immunity attaches by reference to the conduct of the case. And it is the conduct of the case that generates the result which should not be impugned.”

39. The first applicant submitted that the plaintiffs’ claim of alleged negligent advice occasioning costs liabilities in the Local Court, the Supreme Court and the Court of Appeal, falls squarely into the category of wasted costs claims. Reliance was placed upon a number of authorities to support the proposition that wasted costs claims are in a class of their own. As noted above, it was argued that such claims are never to be permitted lest a dispute about wasted costs becomes the vehicle for a dispute about the outcome of the litigation in which it is said that the costs were wasted. Reliance, in particular, was placed upon observations in Attard v James Legal Pty Ltd [2010] NSWCA 311 at [2] per Beazley JA (as her Honour then was) and at [24]-[25] per Giles JA.

40. It was submitted for the first applicant that the allegation in the present case plainly fell within the immunity because the allegation involved an attack on the decision of the Local Court that the plaintiffs had no standing to sue in respect of common property: Amended Statement of Claim at [12](b). Reliance was placed upon dicta in Symonds v Vass, supra, per Ipp JA at [116].

Submissions for the Second Applicant (Ms Wilson)

41. Ms PA Horvath of counsel appeared on behalf of the second applicant. Ms Horvath relied on her written submissions dated 17 April 2015. These were supplemented by further submissions made at the hearing on 22 May 2015.

42. The written submissions conveniently set out the relevant factual matters relating to her client. In this respect it was stated that on or about 1 October 2008, the second applicant was retained by the first applicant to advise whether the plaintiffs should continue to pursue their cross-claim against the Owners Corporation in the Local Court proceedings. Advice was provided by her by way of Memorandum of Advice dated 1 October 2008. The plaintiffs allege this contained the negligent advice and omission concerning steps to be taken in relation to the Local Court proceedings.

43. The written submissions on behalf of the second applicant addressed the relevant provisions of the UCPR and the well-known principles that apply to a summary judgment application. The submissions also set out the principles and dicta from D’Orta on the advocates’ immunity from suit principle, also relied upon by the first applicant.

44. Ms Horvath submitted that the claim against her client, pleaded in the Amended Statement of Claim filed on 9 October 2014, should be dismissed. Any liability, it was submitted, that Ms Wilson as a barrister may have to the plaintiffs (which was denied) arose in circumstances where her client was immune by virtue of the advocates’ immunity from suit.

45. The nature of the allegations set out in the Amended Statement of Claim were addressed in the written submissions at [4]-[8].

46. The plaintiffs, it was noted, alleged that the second applicant had breached her duty in a number of ways, including, in particular:

1. Advising the plaintiffs that they had a good defence against the Owners Corporation and failing to advise them that they had no defence to the claim for outstanding levies.

2. Advising the plaintiffs that they had a good damages claim against the Owners Corporation in relation to water damage and failing to advise them that they had no standing to sue the Owners Corporation for damage to the walls and floor of their unit.

3. Failure to advise the plaintiffs that they should have brought proceedings in the Consumer Trader and Tenancy Tribunal or the Supreme Court.

47. The second applicant’s submissions noted that the further allegations by the plaintiffs set out in the Amended Statement of Claim include:

1. Advising the plaintiffs (between 8 and 15 April 2009) that they had a good basis to appeal the Local Court judgment and failing to advise them that they in fact had no prospects on the appeal.

2. Advising the plaintiffs on 17 March and 17 May 2010 that they had a good basis to appeal to the Court of Appeal in respect of the Supreme Court judgment, and failing to advise them that the appeal was out of time and had no prospects of success.

48. It was submitted on behalf of the second applicant that in essence the plaintiffs appeared to have two complaints:

1. First, that they had a “wrong final result” because, although they obtained a lawful result, it was not a result in which they received damages from the Owners Corporation.

2. Second, that they “wasted costs” in what was otherwise a lawful result: Written Submissions for the Second Applicant at [20].

49. It was submitted that each of these complaints, irrespective of the cause of action relied upon, fall squarely within the immunity. It was submitted that the complaints arise because of forensic decisions made during preparation for, in the course of, the Local Court proceedings. Further, it was submitted that those forensic decisions fall squarely within the ambit of “work done out of court which lead to a decision affecting the conduct of the case in court” or “work intimately connected with work in court”. It was contended that they could not sensibly be characterised in any other way: Written Submissions for the Second Applicant at [21].

49. Reference was made to the principles applied in what was said to be similar cases: at [22]. The cases cited included the well-known authorities: Keefe v Marks (1989) 16 NSWLR 713, 718-720; Yates Property Corporation Limited v Boland (1997) 145 ALR 169; Symonds v Vass [2009] NSWCA 139.

50. It was submitted that the advocates’ immunity can extend to a negligent omission: Jackson Lalic Lawyers Pty Ltd v Attwells [2014] NSWCA 335 at [25].

51. It was contended that any failure by the second applicant to advise the plaintiffs as alleged was of critical importance to the conduct of the Local Court proceedings.

52. The central justification for advocates’ immunity, it was observed, is the principle that controversies once resolved are not to be opened except in a few narrowly defined circumstances: D’Orta at [45]. Dealing with the advocates’ immunity argument at an interlocutory stage, it was submitted, assists in the maintenance of this principle.

53. It was argued that the present case was an appropriate one for the Court to dismiss the proceedings on the pleadings, without the case being permitted to proceed to a full hearing: Donnellan v Woodland, supra.

Submission for the Plaintiffs/Respondents

55. Mr M Luitingh, of counsel, relied upon his detailed written submissions dated 19 May 2015, and his oral submissions at the hearing.

56. In his written submissions at [1]-[11], Mr Luitingh identified the matters which he, in effect, contended were central to the disposition of the summary judgment application. They included the following points;

1. The plaintiffs do not dispute generally that advocates and solicitors have immunity from suit where negligent conduct has affected the conduct of a case in court and that the immunity extends to work done out of court which leads to a decision affecting the conduct of the case in court.

2. The plaintiffs contend that there are exceptions to the immunity from suit defence and that the circumstances of their claim fall within those exceptions.

3. The plaintiffs’ claim “at its lowest threshold” arose from incorrect and negligent advice provided in relation to specific questions of appropriate jurisdiction.

4. Where the immunity from suit does not apply and the negligent conduct of the solicitor and barrister has resulted in loss, then all consequences of the conduct flow from the negligent conduct and are recoverable at law.

5. The applicants in their submissions did not identify the nature of the negligent conduct complained of. By reason of that omission the submissions fail to deal with the exceptions to the immunity from suit defence which is critical in the present case as the immunity depends on the substance of the wrong which was done.

6. The submissions for the applicants assume that advocates and solicitors have “blanket immunity” and have incorrectly assumed that the cause of action was based upon “wasted costs”.

7. The present applications are to be determined upon the basis of the matters alleged in the Statement of Claim.

8. If the plaintiffs are able to demonstrate that there is a serious issue to be tried then the present applications cannot succeed.

9. The plaintiffs’ contention is that the applicants provided incorrect advice in relation to matters of jurisdiction. This in turn was predicated on their failure to understand that the unit itself, namely its ceilings, walls and floors, were common property over which the Local Court had no jurisdiction.

10. The second applicant provided Memoranda of Advice which endorsed the “erroneous views” in respect of the Local Court which compounded the damage associated with erroneous jurisdictional advice on appeal.

11. The negligent conduct, as alleged, falls outside the immunity from suit defence. In particular, reliance was placed upon the observations of McHugh J in D’Orta at [95].

57. It was submitted on behalf of the plaintiffs that decisions of the High Court establish that there is no absolute immunity and that there are circumstances in which practitioners are held liable for the consequences of negligent advice such as circumstances where a review of the conduct complained of does not call into question the finality of the judgment or a re-agitation of the issues at the trial: Plaintiff’s Written Submissions at [62].

CONSIDERATION

58. Before consideration of the parties’ submissions, it is necessary to identify the basis of the cause of action in tort (negligence) and alleged misleading or deceptive conduct (Trade Practices Act 1974) and the other causes of action pleaded by the plaintiffs in the Amended Statement of Claim filed on 9 October 2014.

The Amended Statement of Claim

(a) The Retainers

59. There are four retainer agreements pleaded and relied upon by the plaintiffs:

1. The retainer with the first defendant (solicitor) made on or around 31 January 2008 concerning the “building dispute”, that is, the cross-claim in the Local Court: Amended Statement of Claim at [4].

2. The retainer agreement with the second defendant (barrister) for advice as to the cross-claim against the Owners Corporation in the building dispute: Amended Statement of Claim at [23].

3. The retainer of April 2009, which was a pro bono retainer agreement in respect of an appeal to the Supreme Court from the decision of the Local Court (No. 12417 of 2009). The retainer is relied upon in respect of both defendants: Amended Statement of Claim at [35].

4. The fourth retainer alleged to have been made on or around 17 March 2010 in relation to an appeal to the Court of Appeal from the judgment of the Supreme Court in the proceedings referred to in (3) above: Amended Statement of Claim at [43].

(b) The Facts in Respect of Alleged Breach and Damage

60. In relation to the first retainer, the plaintiffs plead the following:

1. That judgment was entered against them in the Local Court in Proceedings No. 53/05, that Court having held that the plaintiffs had no standing in the claim by them, the property in question being common properly under the relevant Strata Plan.

2. Costs orders were made in favour of the Owners Corporation against them.

3. Alleged negligent advice in respect of (a) the debt dispute and (b) the building dispute. As noted above, as to the latter, the plaintiffs alleged, inter alia, negligent advice by the applicants, in particular, advice that the plaintiffs had standing to sue for damages in respect of damage to what was common property [16(b)] and that such damages were claimable in the Local Court (the Cross-claim [16(c)]).

61. In relation to the second retainer, similar allegations as to damage and breach as pleaded against the first applicant were relied upon.

62. In relation to the third retainer, it is alleged by the plaintiffs, inter alia, that the applicants advised that they had “a good basis” to appeal the above judgment of the Local Court. It is alleged that the defendants should have, but did not, advise them that they had no standing to sue for the damages claimed and that they did not advise, as allegedly they should have advised, that the appeal had no prospects of success. As noted above however, judgment was entered against them in and an order was made in favour of the Owners Corporation against them in respect of the costs of the appeal proceedings.

63. In respect of the fourth retainer, it is alleged that the applicants represented to them that they had “a good basis to appeal the judgment of the Supreme Court to the Court of Appeal of New South Wales”.

64. Those appeal proceedings were instituted on 20 May 2010. The plaintiffs allege that the appeal was brought out of time, that they had no standing to sue for the damage claimed and had no prospects of success in the appeal.

65. In consequence, the plaintiffs say they have suffered loss and damage, the appeal having failed.

The Decision of the Local Court

66. The decision in the Local Court given on 8 April 2009, was contained in transcript of that date, a copy of which formed Annexure A to the Affidavit of Sharon Susan Armstrong, solicitor, affirmed 20 February 2015. It is unnecessary here to set out in any detail the reasons for the decision in the four-page transcript. In pages 1-3 the nature of the proceedings and the matters alleged therein were canvassed with observations being made on certain aspects of the evidence called to support the cross-claim. The presiding magistrate, Magistrate O’Shane, observed that the damage to the property was alleged to have occurred by reason of inaction on the part of the Owners’ Corporation (at p 3).

67. Her Honour also observed that the cross-defendant had submitted that the relevant areas of the unit said to have been water-damaged “… constitute, in fact, common property …” (at p 4). Her Honour concluded:

“The submission goes further to state that she (the cross-claimant) does not have standing to seek damages in relation to repair costs of property belonging to another entity, and I think that is a well-established, time-honoured principle of law in these types of matters. Once again, the court accepts that that [sic] sufficient alone is sufficient to dispose of the claim.” (at p 4)

68. Accordingly, the court made an order by way of a verdict being entered for the cross-defendant.

69. Annexed to Ms Armstrong’s Affidavit and marked “B” was a copy of the judgment delivered in this Court by Harrison AsJ on 12 March 2010. The grounds of appeal were identified at [10] of the judgment. Her Honour made orders affirming the orders of the Local Court and dismissing the appeal.

Categories of Cases

70. In D’Orta, supra, the plurality referred to the categories of case where clients initiate proceedings against their former legal advisors where an adverse consequence befalling the litigants cannot be corrected within the litigation in which the client or clients was/were engaged: D’Orta at [66]-[69].

71. As the plurality observed, the consequence may take a number of forms. These were categorised at [66] by what appeared to be the three chief consequences:

1. A wrong final result;

2. A wrong intermediate result; and

3. Wasted costs.

72. Their Honours observed at [69]:

“A client may wish to say that the conduct of the advocate was a cause of the client incurring unnecessary expense. That may be because a costs order was made against the client or because the unnecessary costs were incurred in taking a step in the litigation.”

73. It was, as indicated earlier, the third category, wasted costs, which the applicants submitted was the essence of the claim made by the plaintiffs. The plurality in D’Orta observed in relation to claims of that kind that, at first sight, it might be thought that seeking to recover wasted costs would not cut across any principle of finality. However, their Honours added at [83]:

“… but it is necessary to recall that the general rule is that costs follow the event. To challenge the costs order, therefore, will often (even, usually) involve a direct or indirect challenge to the outcome on which the disposition of costs depended ….”

74. I will return below to examine the contention made that the plaintiffs’ claim is essentially a claim for wasted costs.

General Principles

75. The existence and scope of the immunity was confirmed by the High Court in D’Orta, upholding the Court’s earlier decision in Giannarelli v Wraith, supra. The Court in D’Orta discussed the basis for the immunity of suit, in particular, the rationale for its existence based on public policy in favour of finality of judicial decisions: D’Orta at [25]-[30], [34], [43] and [45] (the plurality) and McHugh J at [95], [97], [143], [144], [162], [164].

76. The plurality in D’Orta referred to the principle of finality being “finality in the quelling of disputes by the exercise of judicial power” at [25] and “the general principle that controversies, once quelled, may not be reopened” at [35]. In relation the scope of the immunity, their Honours stated at [37]:

“The criterion adopted in Giannarelli accords with the purpose of the immunity. It describes the acts or omissions to which immunity attaches by reference to the conduct of the case. And it is the conduct of the case that generates the result which should not be impugned.”

77. Their Honours at [25] set out the Court’s conclusion in Giannarelli that:

“… at common law, an advocate cannot be sued by his or her client for negligence in the conduct of a case, or in work out of court which is intimately connected with the conduct of a case in court.”

See also observations at [86].

78. At [89], their Honours in D’Orta, observed:

“Because the immunity now in question is rooted in the considerations described earlier, where a legal practitioner (whether acting as advocate, or as solicitor instructing an advocate) gives advice which leads to a decision (there the client’s decision to enter a guilty plea at committal) which affects the conduct of a case in court, the practitioner cannot be sued for negligence on that account.”

79. In D’Orta, McHugh J identified a number of examples of work held to be intimately connected with the conduct of a case at [154].

80. At [156], McHugh J referred to examples of conduct held not to fall within the immunity, namely:

1. Failing to advise as to the availability of possible actions against third parties (Saif Ali v Sydney Mitchell & Co [1980] AC 198 at 216, 224, 232);

2. Failing to advise commencing proceedings in a particular jurisdiction (MacRae v Stevens [1996] Aust Torts Reports 81-405);

3. Negligent compromise of appeal proceedings leading to the loss benefits gained at first instance (Donellan v Watson (1990) 21 NSWLR 335); and

4. The giving of advice not for the purpose of litigation (Heydon v NRMA Ltd (2000) 51 NSWLR 1)

81. McHugh J in D’Orta stressed the need to have regard to the conduct, rather than the form of the negligence. At [167], his Honour pointed to the need also to look at the particular decision which is said to have affected the conduct of the case in court, not at the way in which the particular allegations are framed.

82. In the present case, the plaintiffs’ pleaded causes of action asserting that the advice given to them by the applicants to cross-claim in the Local Court in respect of the building dispute was wrong advice, given that they did not have any locus standi to claim in respect of damage to what was common property and that the Local Court had no jurisdiction to grant the remedy sought or any remedy.

83. In determining the application of the principles of advocates’ immunity in the present case it is necessary to apply the appropriate test as to whether or not the alleged conduct by the applicants in respect of the litigation in the Local Court, the Supreme Court and in the Court of Appeal, can be said to have been work so intimately connected with the conduct of the cause in those courts that it can be fairly said to be a decision affecting the way that the cause was to be conducted when it came to a hearing or is otherwise within the scope of the immunity. To that end, in applying the principles it is necessary to determine the limits or boundaries of the immunity to work done in or out of court.

84. In MacRae v Stevens, supra, the appellant’s solicitor had briefed the respondent barrister in a personal injury matter in July 1980. The client had been injured in the course of his employment in 1977 in Queensland. The relevant limitation period in Queensland was three years. The first respondent negligently failed to advise that the Queensland limitation period would expire in less than a month. He also negligently advised that the proceedings could only be brought in Queensland. Proceedings could, however, have also been brought in New South Wales, where the limitation period was six years. The plaintiff client brought an action against both their solicitor and barrister.

85. In the course of her judgment, Beazley JA (as her Honour then was) considered whether the immunity applied in that case. As her Honour stated, the answer was to be found on the proper analysis of the conduct of the first respondent (the barrister).

86. Her Honour identified the twofold basis for the first respondent’s negligence. First, advice as to the course taken meant that the Queensland limitation period was likely to expire. Second, his advice that the claim would have to take place in Queensland was wrong. Beazley JA observed:

“… In my opinion, even if the first act of negligence was part of the ‘management’ of the case, so as to attract the immunity, the second was not. It did not involve advice as to choice or forum for tactical reasons such as the possibility of obtaining higher damages in one or other jurisdiction (indeed, he advised damages were lower in Queensland than in New South Wales) or because of the availability of procedures in a particular jurisdiction which might have been thought advantageous to the client. The effect of the advice was simple. Queensland was the place where the client had to proceed. It was implicit in that advice that there was no other jurisdiction in which the claim could be brought. In my opinion it would be an artificial construct to say such advice ‘leads to a decision affecting the conduct of the case in court’, merely because it can be said to have a connection with litigation. In my opinion, this conduct does not fall within the immunity. It neither falls within the test enunciated by Mason CJ nor is required by any policy consideration based upon the proper and efficient administration of justice.” (at pp 9-10)

87. In MacRae v Stevens, Priestley JA agreed, stating:

“I would add that, in my opinion, the reasons of each of the judges of this Court’s decision in Keefe v Marks (1989) 16 NSWLR 713 supports the view that the question in the present case whether the barrister was immune from proceedings for negligence fell to be answered by the test whether or not what he did was so intimately connected with the conduct in court of the proposed proceeding that it could fairly be said to be a preliminary decision affecting the way the proceeding would be conducted when it came to a hearing: see 16 NSWLR at 19-720, 723, 724 and 729.

In my opinion the application of this test to the facts of the present case leads to the conclusion reached by Beazley JA that at least the barrister’s advice that the ‘claim will obviously have to take place in Queensland’, which was clearly negligent, was not within the area of a barrister’s immunity.” (at pp 1-2)

88. The bringing of the cross-claim in the Local Court on the alleged advice of the defendants was, at least upon the facts stated in the Amended Statement of Claim, doomed to failure. The plaintiffs did not have locus standi to claim damages in respect of common property in the strata plan and the Local Court did not have jurisdiction to grant relief.

89. The appeal to this court was, again on the pleading in the Amended Statement of Claim, said to have faced insurmountable problems in seeking to establish relevant error in the Local Court’s decision. The institution of proceedings in the Court of Appeal seeking to challenge the dismissal of the proceedings in this Court, faced similar problems and outcome.

90. The nature of any alternative and proper jurisdiction and remedy, as for example an action under the Strata Schemes Management Act 1996, whether it be a remedy in the nature of an order for performance of work or otherwise need not be here considered or resolved. The fact of the matter remains that on the basis alleged in the Amended Statement of Claim there was no remedy available as sought in the cross-claim in the Local Court.

91. It is, as discussed at the hearing of the application, relevant to observe that the plaintiffs do not assert error in the Local Court’s decision, nor seek to mount a collateral challenge to the judicial determination of the Local Court in the present proceedings. In that sense the proceedings, at least arguably, do not directly or indirectly seek to challenge or re‑litigate by way of collateral proceedings, issues determined in the principal proceedings. The plaintiffs accept the Local Court’s decision as correctly establishing their lack of standing and therefore the inability of the Local Court to grant the relief sought by them in the cross-claim.

88. Whilst Mr Lloyd in the course of his oral argument properly acknowledged that fact, he sought to argue that there remains the possibility that the defendants would be able to challenge and attack the judgment below: T 22 May 2015 at p 15:1-20.

89. So far as the present application is concerned, on the basis of the submissions made in that respect, I consider that argument is a mere possibility, if not speculation. When asked to identify a particular basis upon which the defendants could contend error in the Local Court, no particular or sound ground was identified.

90. Mr Luitingh responded to the argument made in Mr Lloyd’s oral submissions in this way:

1. Accepting that the immunity principle has been described as applying to “work done out of court which leads to a decision affecting the conduct of the case in court” and to “work intimately connected with work in court”, once it is established that the Local Court did not have jurisdiction in the proceedings to grant relief, there was no question as to “decisions” concerning the conduct of the case such as whether evidence was called, the issue of subpoenas etc. Accordingly the conduct relied upon did not affect the conduct of the case in court: T 22 May 2015 at 34.

2. On that basis, the question then was how the issue of wasted costs introduces or can involve an attack upon the Local Court’s decision: Mr Luitingh contended it could not: T 34:30-40. He submitted that Mr Lloyd’s submissions failed to link the “jurisdictional issue” to the conduct of the case in court: T 35:35-45.

95. Mr Luitingh in reply also submitted that insofar as Mr Lloyd suggested that once a decision of a court has been made there cannot be any way or basis upon which the immunity can be excluded. Mr Luitingh observed that no authority was cited to support such a broad contention: T 35:10-20.

96. In Symonds v Vass, supra, Giles JA discussed at [26] the rationale enunciated by the High Court in D’Orta and the potential width of the application of the immunity. His Honour there referred to the fact, based upon the abovementioned rationale, that there cannot be re-litigation asserting that, but for the negligence, a different result would have been reached, stating:

“… the re-litigation is regarded as challenging a lawful result and so as offending the finality principle, distinguished from challenge by appeal because it would be re‑litigation ‘of a skewed and limited kind’.” (D’Orta at [45])

97. The reach or boundaries of the immunity where none of the relevant work actually took place in court has been the subject of discussion in a number of authorities, some of which have been discussed above. See e.g. Attard v James Legal Pty Ltd, supra.

98. In my opinion, in a case such as the present, a summary dismissal application is not an appropriate vehicle to determine the boundaries or reach of the immunity and whether, on its particular facts and circumstances, the case is or is not beyond the immunity.

99. In the Amended Statement of Claim the alleged negligence and other causes of action are pleaded upon the basis of legal advice allegedly given to commence proceedings in an incorrect jurisdiction or where the client had no standing to make the claim. Alternatively, an alleged failure to commence proceedings in another jurisdiction is pleaded.

100. The plaintiffs additionally contend that the proceedings do not involve a challenge to the costs order made by the Local Court and that this is not a case involving a direct or indirect challenge to the outcome on which the disposition of costs depended.

101. I consider the matters referred to in [99] and [100] constitute triable issues arising on the immunity defences pleaded by the applicants.

102. For the purposes of evaluating the strike out or summary dismissal application, I do not consider that the applicants have discharged the onus of establishing that the plaintiffs’ proceedings are untenable on the basis of the advocates’ immunity principle. I consider that the plaintiffs’ contention that the conduct of the defendants as alleged in the Amended Statement of Claim, falls outside the scope of the immunity is a reasonably arguable one. That, in other words, is a triable issue.

103. Additionally, I have, as I have stated, concluded, for the purposes of the disposition of the present applications, that the claims brought by the plaintiffs on the bases pleaded in the Amended Statement of Claim, at least arguably, do not involve work done out of court which led to a decision affecting the conduct of the case in court or conduct by the defendants that can be categorised as conduct intimately connected with the conduct of the case.

Orders

104. Accordingly, I make the following orders:

1. The Amended Notice of Motion filed on behalf of the First Defendant, Rosana Tyler, on 20 February 2015, is dismissed.

2. The Notice of Motion filed on behalf of the Second Defendant, Lucinda Wilson, on 27 February 2015, is dismissed.

3. I grant leave for the parties to make any application in respect of orders as to costs or other ancillary matters.

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Decision last updated: 19 June 2015