Stipanov v Mier

SUPREME COURT OF VICTORIA

COURT OF APPEAL

No 8156 of 2005

JULIE ANNE STIPANOV
	v
GREGORY CHARLES FRANCIS MIER

---

JUDGES:	MAXWELL ACJ, ASHLEY JA and HANSEN AJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	6 March 2008
DATE OF JUDGMENT:	25 June 2008
MEDIUM NEUTRAL CITATION:	[2008] VSCA 116

---

Solicitor and client – Breach of retainer – Common law negligence – Allegation of lost opportunity to bring proceeding for damages against former employer – Whether plaintiff’s case against solicitor upon issues of breach and causation fully considered at trial – Appeal allowed – Proceeding remitted for retrial.

---

APPEARANCES:	Counsel	Solicitors
For the Appellant	Mr J Kennan, SC with Mr A D B Ingram	Holding Redlich
For the Respondent	Mr D F R Beach, SC with Ms S Manova	Lander & Rogers

MAXWELL ACJ:

I have had the considerable advantage of reading in draft the reasons for judgment of Ashley JA. For the reasons which his Honour gives, I too would allow the appeal and remit the matter for retrial.

ASHLEY JA:

On 27 October 2006, after a lengthy trial conducted earlier that year, judgment was entered for the defendant, Gregory Mier, in a proceeding brought against him by Julie Stipanov. Now the unsuccessful plaintiff appeals.

The proceeding, commenced by writ filed 24 May 2004, was brought by a former client against a solicitor alleging breach of retainer and breach of common law duty in consequence of which, it was claimed, the plaintiff lost the prospect (or chance) of recovering damages in a common law action.

The learned trial judge found that the defendant had breached his retainer and had been in breach of his common law duty owed to the plaintiff. But her Honour found that the breaches had caused no loss of chance. The plaintiff had not established that the defendant’s breaches were a cause of her not initiating an application for a serious injury determination under s 135A of the Accident Compensation Act1985 (‘the Act’) – a successful application of that kind being the necessary precursor to common law action.

The critical issue raised by the appeal. Why the appeal should succeed

The notice of appeal attacks the reasoning of the learned trial judge in a number of respects. It is unnecessary to refer to all of them. The appeal turns, as I perceive it, upon the contention that in resolving the causation issue against the plaintiff the judge misstated - and in doing so unduly narrowed - the plaintiff’s case, and applied such findings of fact as were made to the case as misstated. Specifically, the plaintiff complains that the judge, in substance, treated her case on the causation

issue as being that she was prevented from pursuing a common law claim – which she wanted to do - because the defendant failed to advise her of the time bar set up by s 135AC of the Act.

In my opinion, the plaintiff has made good her complaint and the appeal should be allowed. My reasons are as follows.

Consideration of the plaintiff’s case as pleaded, as advanced in evidence and as closed, reveals her central contention to have been that the defendant failed to inform himself, and then to advise her, as to the merits or otherwise of bringing a serious injury application, and as to the merits or otherwise of a common law action (which, for convenience, I shall describe as ‘failure to advise as to the merits’); and that, as a part of the necessary advice, he failed to advise her as to the effect of s 135AC. The learned judge, however, did not address the alleged failure to advise as to the merits. Rather, her Honour treated the plaintiff’s case as being much narrower and the only relevant allegation as being that the defendant had failed to advise the plaintiff as to the time bar. That was something of which the plaintiff had prior knowledge,[1] and hence (as the judge saw it) that her claim must fail at the point of causation.
[1]Having been referred to a solicitor, Maurice Blackburn & Co, in the first half of 1998, and having been sent a pro forma letter which adverted, inter alia, to that matter.

But the plaintiff’s case was not so narrow. Throughout, it was that the defendant’s conduct in failing to advise her as to the merits was causative of loss. It is the fact that the plaintiff gave evidence, as did her husband, to the effect that she wanted, or desired, to bring a common law action. But that evidence was qualified by each of them saying that they needed advice as to the merits. In other words, their desire to go along the common law path was not unqualified. On the plaintiff’s case, a decision what to do would have been influenced by appropriately informed professional advice. Further, on the plaintiff’s case – this was a matter which the judge, on the view of the plaintiff’s case which she took, did not need to consider - the advice ought to have been that the plaintiff had a sound case on a ‘serious injury’ application, and in a common law proceeding.

A case so advanced was readily compatible with the circumstance that neither the plaintiff nor her husband was likely to have understood the intricacies of the serious injury regime. It was compatible also with the circumstance that, absent informed professional advice, assessment of the merits of common law action must have been at best conjectural.

The true question was this: had the plaintiff established, in the event that the defendant had advised her[2] that she had sound prospects of succeeding in a serious injury application and in a common law action, that she would probably have accepted such advice and given instructions accordingly? It was therefore necessary to decide, inter alia, whether the defendant had adequately investigated issues to do with serious injury and common law liability, what conclusions the defendant should reasonably have formed about those issues, what advice he should reasonably have given the plaintiff, and when. On the narrow view which the judge took of the plaintiff’s case, it was not necessary to make findings on any of those matters, and none were made.
[2]Based upon investigations which he had made, or which he ought reasonably to have made.

It was contended for the defendant on the appeal that the plaintiff had advanced a case which was ‘wide on breach of duty but narrow on causation.’ It was argued that the plaintiff had relied upon failure to give merits advice in proof of breach, but not in proof of causation. That submission should be rejected. It did not fit with the plaintiff’s case as pleaded, as advanced in evidence, or as closed. At least in part the submission depended upon treating the evidence of the plaintiff as having been that she had been determined to bring common law action regardless what professional advice she might have been given. As explained below, I do not accept that the plaintiff’s evidence (or the evidence of her husband) was to that effect.

Counsel for the defendant relied upon findings made by the learned judge that she was not satisfied that ‘but for the [the defendant’s] negligence [the plaintiff ] would have commenced a common law proceeding before the expiry of the relevant limitation period’; and that she was ‘not even satisfied that … but for [the defendant’s] negligence [the plaintiff] wanted to or would have issued a common law proceeding before the end of 2000’.[3] So, counsel submitted, the plaintiff must have failed to make out causation in any event – that is, even if she had been given appropriate advice by the defendant about the prospects of succeeding in a serious injury application and a common law proceeding.
[3]Reasons for judgment [107].

That submission should be rejected for a number of reasons. First, whether in the period up to December 2000 the plaintiff ‘wanted’ to go down the common law path, or ‘wanted’ the converse, really missed the point. In either situation, the ‘want’ was uninformed so long as the plaintiff was not given proper professional advice. For that reason, the failure to give merits advice was in each situation relevant to the issue of causation as pleaded. I should add that evidence given by the plaintiff, to which I will later refer, showed her to have been ill-equipped, during the period of her professional contact with the defendant, to form a soundly-based opinion about whether to take steps along the common law path in the absence of proper professional advice.

Second, although the judge’s findings were made in the context of ‘[the defendant’s] negligence’, they reflected the too narrow view which her Honour took of the plaintiff’s case on breach of duty, which had consequences for her treatment of the causation question.

Third, the learned judge treated as significant the fact that a solicitor who interviewed the plaintiff when she first attended Maurice Blackburn & Co[4] made a file note: ‘c/law unlikely’. Her Honour said that ‘it seems she was given some advice’ about the possible strength of a common law claim. The plaintiff had been cross-examined to suggest that the solicitor had expressed doubt that there was a relationship between chalk dust and asthma.
[4]See n 1.

Assuming that the solicitor did express such an opinion, and that it did influence the plaintiff into thinking that she should not go down the common law path, it was all the more important that the defendant should have given merits advice. Such advice must surely have had the effect of correcting what had earlier been said. For the defendant became possessed of medical information[5] which made it plain that there was a causal link between the plaintiff’s asthma and occupational exposure to dust.
[5]Including reports obtained by the WorkCover Authority from the respiratory physician, Professor Michael Pain.

Fourth, in making the findings which she did – I note that the plaintiff did not use the term ‘common law proceeding’ in her evidence in chief, but only answered questions in cross-examination which employed the term ‘common law’ - the learned judge relied upon the plaintiff’s[6] failure to take positive action along the common law path between mid 1999 and 2003, and failure to follow up the possibility of pursuing common law action when she consulted different firms of solicitors in 2002 and 2003. In essence, the judge reasoned that, after the plaintiff ceased to have active contact with the defendant, she had shown by her conduct that she did not want to bring common law action. As a corollary, it could be inferred that such had been her state of mind during the period of her retainer of the defendant.
[6]Personally, or by her husband.

In my respectful opinion, even apart from the significance of the matter discussed at [15] and [16], the evidence did not justify the finding which the judge made. Her Honour was clearly entitled to reject evidence to the effect that the plaintiff and her husband believed, in a period which ended not earlier than December 2000, that the defendant was protecting the plaintiff’s common law rights. That bore upon their credit. She was also entitled to conclude that the conduct of the plaintiff and her husband in the period up to December 2000 was consistent with the plaintiff wanting to step away from legal proceedings; and that the evidence of the plaintiff and her husband, as to what had and had not been said to the defendant, Ms Wilkinson and counsel, did not coincide.[7] But the fact that the plaintiff did nothing in the period up to December 2000 to pursue a successful serious injury application had to be set in context. Relevantly, in that period the plaintiff and her husband were uninformed by proper professional advice about the prospects of successfully going down the common law path.
[7]Many might think that the differences in the evidence of the plaintiff and her husband reflected their attempts to give truthful evidence, that honest recollections often enough differ, and that much of the apparent difference turned on just what language had been used by the plaintiff in conveying, as she claimed to have done, a desire to fully enforce whatever rights she had in respect of her asthma condition. But the learned judge was not compelled to that view of things.

Next, it is doubtful that anything could legitimately be made of the plaintiff’s later contact with the two firms of solicitors. The first contact had to do with possible finalisation of the plaintiff’s accident compensation entitlement. It was sparked by action on the part of the Victorian WorkCover Authority. Mention of common law proceedings was peripheral. Insofar as the topic was raised, I add, it was raised by the plaintiff. Moreover, contrary to the conclusion reached by the learned judge below, I consider that such mention as there was of the matter did not tell against the plaintiff’s evidence as to her state of mind in the period that the defendant acted for her. The second contact did involve investigation of possible common law action. But by then, other matters apart, a serious injury application would certainly have faced a greater impediment to success. In any event, the plaintiff soon thereafter consulted the solicitors who commenced the present action on her behalf.

More generally, what had to be considered in respect of the causation issue was the plaintiff’s probable reaction to being told in 1999 - as it was contended on her behalf she should have been told – that she had good prospects of succeeding in a serious injury application and in a common law action. That particular conjunction of time and advice could not be re-created.Reliance upon the plaintiff’s conduct in a particular factual and legal context, as a means of establishing her probable reaction to advice which ought to have been given at an earlier time and in a different factual and legal context, appears to me with respect to have been a speculative exercise.

Beyond what I have so far said, it is to be remembered that the judge rejected the evidence of the plaintiff that she wanted to bring common law action[8] in the period during which she retained the defendant. That conclusion influenced her Honour’s view of subsequent events. As I will later explain, I take a different view of the effect of the plaintiff’s pertinent evidence.
[8]As a matter of substance, and putting aside the plaintiff’s own choice of language.

Suvaal?

In the course of argument the question arose whether the plaintiff had been entitled to succeed in her claim if the judge rejected her evidence that she wanted to go down the common law path in the period 1998 to 2000. Reference was made to Suvaal v Cessnock City Council[9] and to the reasons for judgment of Maxwell P, in dissent, in Alcoa Portland Aluminium Pty Ltd v Husson.[10]Counsel for the plaintiff submitted that nothing in those authorities would disentitle the plaintiff to succeed in the circumstances described. Counsel for the defendant contended the contrary, submitting that the plaintiff would or might have been differently cross-examined had she advanced a case simply that a decision to take the common law path depended on her having been given informed professional advice.
[9](2003) 77 ALJR 1449.
[10][2007] VSCA 209.

In my opinion, nothing in Suvaal would deny the plaintiff the right to succeed, on the causation issue, only because she gave evidence, in effect, that she wanted to bring common law action. The plaintiff’s case was always that the defendant’s failure to give her informed professional advice was a cause of loss and damage. The plaintiff’s evidence that – at a time when she was unarmed by professional advice as to the merits - she had what amounted to a preference for going down the common law path was an inessential part of her case.[11] Its acceptance or rejection did not foreclose her claim that want of merits advice was causative of her loss and damage.
[11]Although, had the plaintiff been of the mind of which she gave evidence, it might have been more readily concluded that she would probably have accepted advice that she had sound prospects of succeeding in a serious injury application and a common law proceeding.

Again, the plaintiff was cross-examined to the effect that she did not ‘want’ to do that which she asserted. The judge acted upon that cross-examination.[12] But that left untouched the essential point at issue: had the plaintiff established that want of merits advice was a cause of her loss and damage? Compatibly with her case as pleaded and opened, the plaintiff had given evidence to such effect. The plaintiff’s claim, including that evidence, needed to be addressed.
[12]Indeed, she converted an absence of qualified want into a finding of unqualified want to the contrary.

I should add this: from a forensic standpoint, the defendant profited from the particular evidence, inessential though it was. It made available arguments upon which the defendant relied, arguments of a distracting kind. That is just one more reason for rejecting the notion that the defendant would have been denied a fair trial had the issue of causation been resolved in the plaintiff’s favour despite rejection of the evidence now under consideration.

As will already be apparent, my conclusion as to the true scope of the plaintiff’s case at trial underpins my view that the appeal must succeed. I turn to examine how the plaintiff’s case was articulated – in the pleadings, the evidence and the opening and closing addresses. I begin with the circumstances of injury.

Circumstances of injury

The plaintiff, a woman now aged 52, was employed by the Education Department as an Arts Teacher between 1979 and February 1998. She was exposed, at her workplace, to dusts and mists emanating, inter alia, from the spraying and scraping of glazes. She developed bronchial asthma, dermatitis, and a psychological disorder. The asthma first became evident in 1994 or thereabouts. The psychological upset was manifest by early 1998. She had a persuasive case that her disabilities were brought about, in one way or another, by her conditions of work. She ceased employment, on medical grounds, in February 1998. Thereafter, to time of trial in 2006, she was not in work.

Maurice Blackburn & Co

The plaintiff was paid accident compensation for a period off work in late 1995. When she ceased work in early 1998 she made a further claim for compensation. But on that occasion payments were not made.

In late April that year, referred by her union, the plaintiff consulted Maurice Blackburn & Co. She attended an initial consultation on 24 April. On 27 April the solicitors sent her a pro-forma letter. It adverted to common law action, to the time-bar impact of s 135AC of the Act, and to the need for a plaintiff to establish serious injury as a precondition to the commencement of common law action. There had been no investigation of the merits or otherwise of a serious injury application, or of a common law proceeding, when this letter was sent.

GCF Mier & Associates

The plaintiff’s husband and Gregory Mier, the defendant, were long time friends. In 1998, Mr Mier was a solicitor practising under the style ‘GCF Mier & Associates’. He was an experienced practitioner in common law and accident compensation matters. An employee solicitor, Angela Wilkinson, then had some five years experience in such work.

The plaintiff’s husband, a solicitor but not a litigation solicitor, contacted the defendant in late 1998 when the plaintiff’s compensation claim seemed to be getting nowhere. He asked whether the defendant would take over the plaintiff’s accident compensation claim.[13] The request led on to a conference between the plaintiff, her husband, counsel, the defendant and Ms Wilkinson. Counsel took sufficient instructions to enable him to advise that the plaintiff seemed to have a good claim, which would likely be admitted if a proceeding was commenced.
[13]On the plaintiff’s case , the instructions were wider than that. The judge concluded that the instructions were no wider. It is not decisive of the appeal that the judge so concluded, because her Honour held in any event that the defendant fell under a duty to advise the plaintiff about the merits or otherwise of common law action and its statutory precursor.

In early 1999 the defendant sent a formal retainer letter to the plaintiff. It set out, inter alia, fee arrangements. The plaintiff signed and returned it.

In early February 1999 a proceeding was commenced in the Magistrates’ Court by which the plaintiff sought weekly payments of compensation in respect of incapacity resulting from psychological injury and aggravation of asthma. The matter was to be heard on 19 May 1999. But, shortly before the hearing, the WorkCover Authority agreed to make payments of compensation, backdated to 5 February 1998, together with reasonable medical expenses and costs. Counsel’s forecast thus proved to be accurate.

There followed, in June and early July, correspondence between the plaintiff and the defendant’s practice concerning the payment of costs and disbursements. It ended with a letter dated 9 July 1999 sent by Ms Wilkinson to the plaintiff. Accompanying the letter was a cheque which partially reimbursed certain disbursements in respect of which the plaintiff had earlier made payment. The letter culminated in the author wishing the plaintiff all the best and asking the plaintiff to contact her if she required any further assistance.

Save that on several occasions in August 1999 the plaintiff’s husband spoke with the defendant concerning his wife’s weekly payments, that was the last professional contact between the plaintiff and the defendant. Thereafter until April 2002, when the plaintiff obtained her file from the defendant, all was silence at a professional level. That is to be distinguished from social intercourse between the plaintiff, her husband and the defendant, which persisted over the years.

No serious injury application was made

Neither during nor after the period when the plaintiff had professional contact with the defendant was any serious injury application initiated on her behalf. It follows that no common law proceeding could have been, or was, commenced by her against her previous employer.

The regime imposed by s 135AC of the Act, as inserted by Act 107/1997, was altered by the substitution of a new s 135AC by Act 26/2000. But nothing turns on that change for present purposes.

The plaintiff’s pleaded case

By her statement of claim the plaintiff pleaded that she had been employed as a teacher, that she had sustained injury in her employment, and that her injuries were caused by the negligence or breach of statutory duty of her employer.

The particulars of negligence subjoined to the allegations of breach are familiar to those with experience of claims for industrially-caused chest disease and its sequelae. Thus, inter alia –

(f)Requiring and/or permitting the Plaintiff to be exposed to dust and/or mists emanating from the spraying of glaze and/or dust and debris emitted from the scraping of glaze off clay;
(g)Exposing or subjecting the Plaintiff to unnecessary risks and in particular failing to provide areas free of dust and/or mist and/or debris emitted from glaze and scrapings thereof;
(h)Failing to provide any or any adequate ventilation at the premises at which the Plaintiff was exposed to the substances;
(i)Failing to provide any or any adequate exhaust or extractor fans or extractor system at the premises at which the Plaintiff was exposed to the substances;
(k)Failing to provide any or any suitable or adequate masks or other facial or nasal coverings to prevent or alternatively limit the inhalation of the substances;
(m)Failing to ensure that the substances would not contaminate the air in which the Plaintiff was required to perform her work;
(n)Failing to ensure that the substances would not contaminate the atmosphere of the premises at which the Plaintiff carried out her work and at which she was subjected to exposure of such substances;
(o)Causing, allowing or permitting the Plaintiff to work at premises when the concentration of the substances was excessive in relation to permissible quantities prescribed by the Harmful Gases, Vapours, Fumes, Mists and Dusts Regulations 1945 and/or the Health (Harmful Gases, Vapours, Fumes, Mists, Smokes and Dusts) Regulations 1984 of the State of Victoria.
(r)Failing to have in place any or any adequate system for cleaning of the premises at which the Plaintiff was employed;
(s)Failing to keep abreast of known research and literature relating to any health problems which might be caused by exposure to the substances;
(t)Failing to provide any or adequate supervision for the Plaintiff in the course of her employment;
(v)Failing to provide any or adequate warning to the Plaintiff of any risks associated with her exposure to inhalation of the substances;
(w)Continuing to use the substances when it was known or ought to have been known that such substances were dangerous to health;
(y)Failing to monitor properly or at all the likely exposure of the Plaintiff to the substances in her work environment;

The injury allegedly caused by the employer’s breaches of common law and statutory duty was particularised this way –

(a)      Bronchial asthma;
(b)       Breathlessness;
(c)       Loss of lung function;
(d)      Chest tightness;
(e)       Dermatitis;
(f)       Wheezing and coughing;
(g)Development of psychological responses including anxiety, depression, panic attacks and obsessive and compulsive symptoms.

Then it was pleaded that the plaintiff would have been entitled to a favourable serious injury determination in respect of the consequences of compensable injury sustained in the period 31 August 1985 and 12 November 1997. The former date marked the commencement of the Act. The latter date marked the commencement of the so-called ‘black hole’ – a period in respect of which common law action could not be brought in respect of work-related injury.

There followed paragraphs which pleaded the operation of s 135AC of the Act, and its application in the circumstances of the case. The gist of the allegations was that the plaintiff was precluded from bringing a common law proceeding, whether the matter be considered from the standpoint of s 135AC in its original form, or in its form as from May 2000.

The ensuing paragraphs of the statement of claim raised the plaintiff’s claims of actionable breach of contract and common law negligence against the defendant.

13.In or about November 1998 the Plaintiff instructed and retained the Defendant his servants and agents to act as solicitors to advise her as to any entitlements which she might have in respect of the injuries and to take all necessary actions and claims in pursuit of such entitlements (hereinafter referred to as “the agreement”).
14.At all material times the Defendant, his servants and agents, owed the Plaintiff a duty of care to obtain proper instructions and adequate supporting evidence to enable advice to be given and to advise the Plaintiff as to any cause of action for common law damages available to her.
15.Further or in the alternative, in the premises it was an implied term of the agreement and it was a duty of the Defendant, his servant or agents that it would exercise all due care, skill and diligence in obtaining proper instructions and necessary supporting evidence to enable adequate advice to be given and further advise the Plaintiff as to any cause of action for common law damages available to her.
16.By reason of the negligence on the part of the Defendant, his servants and agents and in breach of the implied term referred to in the preceding paragraph the Defendant his servant and agents failed to exercise any or due skill, care or diligence in obtaining proper instructions and in obtaining supporting evidence to enable adequate advice to be given and/or to advise the Plaintiff as to any cause of action for common law damages which might be available to her.
…

17.By reason of the matters aforesaid, the Plaintiff has lost the prospect of recovering damages and damages by way of interest at an appropriate date of trial from the State of Victoria in respect of the injuries and loss herein before set out and has thereby been deprived of the said damages and damages by way of interest and interest thereon and has thereby suffered loss and damage.[14]

[14]Emphasis added.

Paragraph 17, in terms, ascribed as a sufficient cause of the plaintiff’s lost prospect of recovering damages breach of the duties specified in paragraphs 14 and 15. The substance of the relevant common law duty specified in paragraph 14, and of the contractual term alleged by paragraph 15, was identical. The defendant had a duty, it was alleged, to obtain proper instructions and necessary supporting evidence to enable [adequate] advice to be given and to advise the plaintiff as to any cause of action for common law damages available to her. It was that duty which paragraph 16 alleged had been breached.

Many particulars of breach were specified under paragraph 16. I note particularly the following:

(f)Failing to arrange any or any adequate medical examinations to enable an application for the determination of the Plaintiff’s level of impairment to be made within the time specified by s 135A of the Act.
(h)Failing to assess adequately or at all the Plaintiff’s level of pain and suffering and/or pecuniary loss in order to enable advice to be given and instructions to be obtained to apply for a determination of serious injury pursuant to s 135A(2B) and/or (4)(b) of the Act at an appropriate time;

(i) Failing to take full and proper instructions from the Plaintiff;
(j)Failing to obtain any or adequate evidence to support the Plaintiff’s claim for a serious injury determination;
(k)Causing or permitting the Plaintiff’s claim for common law damages to be barred by operation of the Act;
(l)Failing to make proper searches and/or to obtain proper materials to prosecute a claim on behalf of the Plaintiff against the State of Victoria.

The breach of duty alleged to be causative of the plaintiff losing the prospect of recovering damages at common law was thus not limited to the defendant’s failure to advise the plaintiff about the time limit, that is, to advise that she must take a particular step along the common law road by 31 December 2000.[15] Nor could the particulars of breach, insofar as they did not contain a specific complaint of failure to advise, confine the plain allegation to that effect in the body of paragraph 16 – which in that respect picked up an allegation as to the practical content of the duties pleaded by paragraphs 14 and 15. Still further, as will be seen, the defendant was cross-examined about a failure to advise as to the merits of common law action.
[15]Or 1 September 2000, it matters not that the necessary action would have differed according to which regime applied.

The defence

I must mention aspects of the defence.

First, the defendant denied that the injuries which the plaintiff alleged had been caused by her employer’s negligence or breach of statutory duty.

Second, the defendant denied that the plaintiff would have been entitled to a serious injury finding in respect of the consequences of injury sustained between 31 August 1985 and 12 November 1997.

Third, the defendant admitted the retainer alleged by paragraph 13 of the statement of claim, but subject to the qualification that ‘his obligations were to act on instructions received from or on behalf of the plaintiff’.

Fourth, as to the common law duty pleaded by paragraph 14 of the statement of claim, the defendant pleaded that ‘his duty was to advise the plaintiff of the options available to her and to act on instructions received from or on her behalf’.

Fifth, concerning the contractual duty pleaded by paragraph 15 of the statement of claim, the defendant pleaded an implied term of similar content to the common law duty which he pleaded in response to paragraph 14.

Sixth, in response to the plaintiff’s plea of breach of duty, the defendant pleaded the following:

16.He denies the allegations made in paragraph 16. Further, he says that he advised the Plaintiff and her husband, who is a lawyer, of the Plaintiff’s possible right to pursue a claim for common law damages and acted on the instructions given to him during the course of his retainer, which was to pursue only the Plaintiff’s claim for payments of compensation under the provisions of the Accident Compensation Act.
PARTICULARS
On occasions during the period of his retainer, the precise dates of which he cannot now recall, the Defendant discussed with the Plaintiff’s husband and with the Plaintiff the possibility that a claim for damages should be investigated once the claim for compensation was finalised. The Plaintiff’s husband instructed the Defendant that the plaintiff did not wish to pursue such an investigation.
16AAlternatively, if the Defendant was negligent, which is denied, any loss suffered by the Plaintiff was caused by her own actions and not by the actions of the Defendant.

Seventh, in response to the plaintiff’s allegation that his breach of duty was causative of her losing the prospect of recovering common law damages, the defendant pleaded that she had suffered no loss because, having regard to the difficulties that she would have had in succeeding in a serious injury application and in proof of negligence, she was in any event better advised to maintain her entitlement in statutory benefits.

Eighth, also in response to paragraph 17 of the statement of claim, the defendant pleaded that the plaintiff had been made aware – by her previous solicitors – of the effect of s 135 AC of the Act, but had failed to take any step to bring proceedings at common law; and that she had also failed to commence such proceedings though advised she could do so (in respect of her asthma) in February 2003. In such circumstances she had suffered no loss.

Ninth, still further in response to paragraph 17, the defendant pleaded the following:

26.Further, if the Plaintiff was not given advice by the Defendant as alleged, she has suffered no loss as she did not act on advice given to her by Maurice Blackburn & Co and by Slater & Gordon and thus would not have acted on advice given to her by the Defendant.

Upon the causation question, then, the defendant pleaded that the plaintiff had suffered no loss because she had been better off maintaining her entitlement to statutory benefits, having regard to difficulties in successfully pursuing a serious injury application and then a common law action; that she had caused her own loss by not commencing a common law proceeding within the period permitted by s 135AC of the Act (of which she knew); and that she had suffered no loss because she would not have acted on advice from the defendant – advice, it must be assumed, to the effect that she had a good claim – in any event.

The plaintiff’s case as opened

Plaintiff’s counsel said this:

The defendant failed to advise the plaintiff, and failed to take action on her behalf to pursue her rights to claim damages against her employer within the limitation period with the result that she lost that right, and this claim results.

and
So there was a total failure, as far as the plaintiff’s case is concerned, for her to be given, A; any advice, and B; to have any step taken on her behalf to pursue the claim for damages.

and
The plaintiff’s claim in these proceedings is that had she been given proper advice, had the defendant taken the steps that a reasonably competent common law solicitor would have taken, she should have been and would have been advised that she had a very good claim for common law damages.

and
… [T]he negligence was compounded by the fact that notwithstanding knowledge of her complaints the steps they took were either inadequate or non-existent so far as her particular problem was concerned. So the case against this defendant is that he failed to take the steps that should have been taken to obtain the necessary information to then pursue, or obtain instructions to pursue, a serious injury application. Had he done so it’s the plaintiff’s case that that application would have been successful because it was clear at that time that the plaintiff’s injuries would have meant that she would have satisfied the test.

Unsurprisingly, given the language of the pleading, plaintiff’s counsel did not distinguish between the alleged breaches of duty – contractual or tortious – and their causal significance in the loss of prospect of obtaining damages. Importantly, those passages make it clear that counsel did not confine the plaintiff’s case to one by which it was complained that the only breach of duty of causal significance was the defendant’s failure to advise the plaintiff of the date on which the s 135AC time-bar would operate against her. Counsel made clear that, on the plaintiff’s case, a substantial and legally sufficient cause of the loss of opportunity was the defendant’s failure to give advice on the merits.

The plaintiff’s evidence

The plaintiff gave extensive evidence about her understanding of what was comprehended by a common law proceeding; of her wish – communicated to the defendant – to bring such a proceeding; of the defendant’s failure (and the failure of Ms Wilkinson) to advise her of the merits or otherwise of such a proceeding; and of the significance of such failure. I should set out a number of relevant passages. I begin with the plaintiff’s examination in chief. Thus:

COUNSEL:     As far [as] you were concerned, when Mr Mier was acting for you from the time you started, what did you – what did you see or what did you consider yourself to have entrusted him to with respect to your position legally?
PLAINTIFF:    To look after the entire case for me, legally.
COUNSEL:     t any stage prior to the hearing at the Magistrates’ Court, at any stage was any discussion that you can recollect did any discussions take places with respect to a claim for damages as distinct from weekly payments?
PLAINTIFF:    brought it up a number of times at those meetings just between – and with my husband as well.
COUNSEL:     With Mr Mier or - - -?
PLAINTIFF:    Definitely.
COUNSEL:     Julia (sic) Wilkinson?
PLAINTIFF:    Definitely during those meetings.
COUNSEL:     In what sense did you bring it up? What were the sort of things that you would say?
PLAINTIFF:    Because they were determined to go ahead with that incident on the last day, which was against my wishes, I was making it very clear that that wouldn’t affect any other lump sum compensation would it? I mean, I was very concerned that the way the case looked like it was running from my knowledge of the law, which was not very much, that it may have some influence later on. Because it wasn’t my gut feeling and I felt that it wasn’t [how] the case should run, inside.
COUNSEL:     How did you want the case to run?
PLAINTIFF:    I wanted the case all along – because what I was feeling very angry about was the fact that I had the damage to my lungs and it was obvious and I had – the asthma was the big issue with me.

and
COUNSEL:     Do you recall what if any response or what advice you were given with respect to the issue of whether you could or should bring a claim for personal injuries and if so when? That’s for damages?
PLAINTIFF:    Yes.
COUNSEL:     What’s the answer?
PLAINTIFF:    There was a – apparently a period that I had on that letter. I think it was on that letter but it was on a letter from them, stating that there was a period that I had to act within.
COUNSEL:     I’m asking you now about your discussions with Mr Mier or Angela Wilkinson?
PLAINTIFF:    Yes.
COUNSEL:     You said before you raised with them the fact that you wanted to make a claim for your damages, for the asthma condition?
PLAINTIFF:    Yes.
COUNSEL:     Do you recall what if any advice your were given about that?

PLAINTIFF:    No.
COUNSEL:     You don’t recall it or there was none given?
PLAINTIFF:    From them to me?
COUNSEL:     Yes?
PLAINTIFF:    No, I don’t recall any.

and
COUNSEL:     Ms Stipanov, at any stage at all over the time that Mr Mier or Angela Wilkinson were acting on your behalf, did you ever say to them that you did not want to take proceedings against your employer? Against the school or the Education Department or the State of Victoria in respect of your asthma problem?
PLAINTIFF:    Definitely not.
COUNSEL:     What was your attitude throughout the whole of that period with respect to whether or not a claim for damages for your asthma problem would be taken?
PLAINTIFF:    I wanted one to be taken.

and
PLAINTIFF:    I can’t give you the exact date but I was with my husband at Greg’s 40^th, and I was actually with my husband when we raised the issue with Angela Wilkinson about the personal injury claim and ---
COUNSEL:     What was said?
PLAINTIFF:    Pardon?
COUNSEL:     Can you tell us what was said?
PLAINTIFF:    That we wanted to remind her that we wanted to get on with that, and she actually said to us that, “Don’t worry you’ve got plenty of time yet”.
COUNSEL:     You say this was at a 40^th birthday party?
PLAINTIFF:    Yes.
COUNSEL:     Of Mr Mier?
PLAINTIFF:    Yes.
COUNSEL:     You were there as guests obviously?
PLAINTIFF:    Yes.
COUNSEL:     The date of that was 5 June 1999?
PLAINTIFF:    I can’t ---

I turn to cross-examination:

COUNSEL:     Is it correct that you gave evidence on Friday in this case that you were adamant to Mr Mier and his barrister – I’m sorry the barrister Mr Lindsay Paine, that you wanted to bring a common law claim?
PLAINTIFF:    Yes.
COUNSEL:     You were adamant about it?
PLAINTIFF:    Yes.

and
COUNSEL:     Are you sure you were adamant about it?
PLAINTIFF:    Yes.
COUNSEL:     So you were aware when you first saw Mr Mier that you had an entitlement to bring a common law claim?
PLAINTIFF:    Sorry, could you ---
COUNSEL:     You were aware when you first saw Mr Mier that you were entitled to bring a common law claim?
PLAINTIFF:    Yes.
COUNSEL:     And that you wished to do so?
PLAINTIFF:    Yes.
COUNSEL:     How did you become aware that you were entitled to bring a common law claim?
PLAINTIFF:    Because my memory is that my husband told me that we could, but we would have to wait for my symptoms to settle and I think that was from the same office of the person that you’ve just read the letter from. It may have been but I don’t know how, telephone or letter, but it’s my memory.
COUNSEL:     In any event, by the time you – as a result of correspondence received from Maurice Blackburn & Co you were aware of an entitlement to seek to bring common law damages?
PLAINTIFF:    I’ve always been aware that if you’ve been injured in a car accident or at work ---
COUNSEL:     You were aware as a result of your correspondence with Maurice Blackburn – or your dealings with Maurice Blackburn & Co, before you saw Mr Mier, that you were entitled to seek to bring a claim for common law damages?
PLAINTIFF:    I think that’s correct.

and
COUNSEL:     … had you or your husband asked Mr Mier to act on your behalf in pursuing a common law claim as well as weekly benefits?
PLAINTIFF:    I asked at the very first meeting in his office which was I – I can’t remember but I asked him to look after the legal case for me. And he told me just to worry about getting better, or something to those effects.
COUNSEL:     Well you asked him to look after the legal case, you’re not saying you asked him to look after your – any common law claim?
PLAINTIFF:    I’m telling – sorry, I have to – I’m telling you that I didn’t – I wasn’t specific as into the exact name.

and
COUNSEL: Did you have in mind by January 1999 the possibility of making a claim for common law for general damages for pain and suffering?
PLAINTIFF: I always wanted to do that.

and
PLAINTIFF: To me a lump sum just meant not weekly payments. It meant a sum of money that you’re awarded for your injury and I was after that for my lungs.

and
PLAINTIFF: My understanding has always been that a lump sum will refer to a settlement for your pain and suffering for injuries, like from a car accident or from a – in my case industrial disease. I understood it as something very different to weekly payments but also very different to the very small amount that WorkCover had – there was also a very small amount that I know had been mentioned to me and was – I never – for me lump sum meant the major payment which is what I always wanted to guard myself from one day – one day obtaining.

and
COUNSEL: Did you tell Mr Paine that you were happy to proceed to appeal the decision refusing you weekly payments as long as it did not affect your capacity to bring a common law claim? Did you tell him that?
PLAINTIFF: Something to that effect.

and
COUNSEL:     You tell Her Honour that you explained to Mr Mier and to Mr Payne that you wanted to issue a claim for damages, don’t you? For personal injuries damages, general damages? Your case is that you told that to Mr Mier and you told it to Mr Paine, isn’t it?
PLAINTIFF:    I wanted to ---
COUNSEL:     Can you answer that question “yes” or “no”?
PLAINTIFF:    Yes.
COUNSEL:     You agree with me?
PLAINTIFF:    I don’t know if I put it in that exact terms – those exact words I’m sorry, I can’t say that.
COUNSEL:     No, I’m not suggesting those exact words ---?
PLAINTIFF:    Right.
COUNSEL:     - - - But words to that effect that you wanted to issue a claim? That’s your case isn’t it? Are you able to answer that question?
PLAINTIFF:    Well I wasn’t insisting on doing that, I was seeking their advice. It was my opinion.
COUNSEL:     Isn’t your case – “I believe I had a claim and I wanted them to issue proceedings”?
PLAINTIFF:    My case now?
COUNSEL:     Yes, now?
PLAINTIFF:    Yes.

and
COUNSEL:     No one told you that you did have a common law claim, did they?
PLAINTIFF:    Excuse me, nobody told me - - -
COUNSEL:     No one, not one person told you you had a common law claim?
PLAINTIFF:    I can’t say that for sure.
COUNSEL:     Can you tell Her Honour anyone who did tell you that?
PLAINTIFF:    I think Holding Redlich said that it’d be possibility.

and
COUNSEL: I put it to you that on numerous occasions when Mr Mier was acting for you, he told you that he wanted to look at the question of common law and you told him you did not want to do that?
PLAINTIFF: That is an absolute lie.

Finally, I come the plaintiff’s re-examination. Thus:

COUNSEL:     Did you ever have any discussion with Mr Mier in which he suggested to you it was time to look at the common law aspect?
PLAINTIFF:    No.
COUNSEL:     Did Mr Mier ever at any stage give you any advice about whether or not you had a common law claim?
PLAINTIFF:    No.
COUNSEL:     Did he ever give you any advice as to whether you would have – there would be sufficient evidence available to satisfy a court to obtain a series (sic) injury certificate?
PLAINTIFF:    Not to my knowledge.
COUNSEL:     Did he explain to you the procedure at common law that you have to first of all get a serious injury certificate then bring a claim for damages?
PLAINTIFF:    No.
COUNSEL:     Did the employee, Ms Wilkinson, who you were told is an expert in this field, did she give you any advice on these matters?
PLAINTIFF:    No.
COUNSEL:     Any of them?
PLAINTIFF:    No.
COUNSEL:     Was it ever suggested to you that the issue of proving that you had a serious injury might be difficult?
PLAINTIFF:    No.
COUNSEL:     Because of any time limits?
PLAINTIFF:    No.
COUNSEL:     Was it ever discussed with you that there was what lawyers then were calling the black hole in terms of a period of time?
PLAINTIFF:    No.
COUNSEL:     Have you ever heard that description up to now?
PLAINTIFF:    Yes.
COUNSEL:     When did you first hear it?
PLAINTIFF:    Black hole, I think it might have been through Michael Schaeffer.
COUNSEL:     Were you were told that you would have to show, to have a common law claim for damages, that you would have to show that your injuries were caused by employment before a specified date in November 1997, 12 November?
PLAINTIFF:    No.
COUNSEL:     Ever told by Mr Mier or Ms Wilkinson?
PLAINTIFF:    No.
COUNSEL:     Were you ever given any advice at all from anyone at Mr Mier’s office about a common law claim?
PLAINTIFF:    No.

The learned trial judge characterised the plaintiff’s evidence as being that she ‘wanted a claim for damages for her physical injury to be commenced’.[16]
[16]Reasons [108].

Her Honour rejected aspects of the plaintiff’s evidence. She rejected the evidence of the plaintiff and her husband that they had spoken with Ms Wilkinson in early June 1999, on the occasion of the defendant’s 40^th birthday party, about not forgetting a common law claim.

Rejecting also evidence of the plaintiff and her husband that they had instructed the defendant to act for her in a common law claim, or that they thought the defendant was so acting, the judge said –

Of course, the fact that I do not accept [that] evidence … does not of itself prove that [the plaintiff] did not want to bring a common law claim prior to the expiry of any relevant limitation period. But it goes very much to their credit as witnesses.[17]

[17]Reasons [124].

Again, her Honour called in aid events which occurred ‘after the expiry of the limitation period’ as supporting a conclusion that the plaintiff ‘would not have issued a common law proceeding’. The events related to the plaintiff’s attendance on different firms of solicitors in April 2002 and February 2003. According to her Honour, a solicitor’s file note made in December 2002 tended to confirm her ‘earlier conclusion that [the plaintiff] was not interested in pursuing a common law claim prior to the end of 2000’;[18] whilst the plaintiff’s failure to follow-up advice which she received in early 2003 that there was still a possible basis for commencing common law proceedings in respect of her asthma ‘tend[ed] to belie her evidence that she always wanted to and intended to bring common law proceedings.’[19]
[18]Reasons [137].
[19]Reasons [148].

In the event, the learned trial judge rejected[20] evidence that, in the period of her dealings with the defendant, the plaintiff wanted to bring common law action.
[20]At least implicitly.

In my opinion, an examination of the plaintiff’s evidence reveals that the defendant’s alleged failure to investigate adequately the prospects of her succeeding in a serious injury application and in a common law action – and in any event the defendant’s alleged failure to advise her about those prospects – was of real importance to her case upon the issues of breach and causation.

That is so for this reason: The plaintiff’s understanding of the subject matter of a common law action, and hurdles which must be cleared to make out such an action, was shown by her evidence to be imperfect and confused. She appears to have had no understanding of what must be proved to establish ‘serious injury’ for the purposes of the Act, and no understanding of the need to prove negligence or other breach of duty in substantive common law proceedings. Her evidence shows that what she ’wanted’ was a lump sum for what she considered to be her major injury – that is, her asthma; a condition which she regarded as being devalued by the defendant, Ms Wilkinson and counsel.

It is clear enough that the plaintiff, on her account, ‘wanted’ to bring a common law action – although, as I noted earlier, that was not her language in examination in chief – and, on her account, that she told both the defendant and Ms Wilkinson what she ‘wanted’. But clear also it is, on her account, that professional advice whether she should in fact pursue common law action was relevant to whether her ‘want’ would have been translated into instructions to take the precursor step; and, if that was successful, then to initiate a common law action. At no point in her evidence did the plaintiff say unequivocally that she had instructed the defendant to institute common law proceedings. The closest she got to it was in her evidence, which the judge rejected, of a conversation which she and her husband had with Ms Wilkinson at the defendant’s 40^th birthday party. In my view, her evidence overall rose no higher than saying, in effect, ‘This is what I want to do, if it is a course which you tell me has reasonable prospect of success’.

In the event, as I have already said, the plaintiff did not advance a case at trial which was ‘wide as to breach but narrow as to causation.’ That is, the plaintiff did not advance a case which, as to breach, relied upon the defendant’s alleged failure to adequately investigate the merits or otherwise of a serious injury application and of a common law proceeding, and upon the defendant’s alleged failure to advise her about those matters, but which as to causation focussed only upon the defendant’s failure to advise her as to the time-bar effect of s 135AC of the Act. Quite apart from the import of the plaintiff’s evidence, there would have been no point to a case thus constructed. For breach would be irrelevant if it had no causal effect.

Evidence of the plaintiff’s husband

Because the plaintiff’s husband was the person with whom the defendant mainly dealt, I should refer to evidence which he gave relevant to the issue of causation.

Lachlan McBain qualified as a lawyer in about 1982. He worked in solicitors’ offices between 1983 and 1987, but not in litigation work. In 1987 he commenced employment with the Hospitals Superannuation Board as an in-house legal officer. About ten years later he took on employment with Australia Post as Superannuation Compliance Manager. In 2002 he began employment as Superannuation Compliance adviser with RACV. Thus, in the period that the defendant was actively carrying out professional work for the plaintiff, Mr McBain had been out of general legal work for more than a decade.

He and the plaintiff met in October 1993. They married in May 1995.

The witness gave evidence that his wife appeared to be progressively suffering from respiratory problems from about 1994 onwards.

It was his belief, he said, as at 1995 (when his wife had time off work) that her symptoms were related to dusts and sprays which she described encountering at her workplace. By then, her symptoms included wheezing and coughing during the night.

At that stage, according to the witness, his wife was becoming very anxious because of her asthma; but most of all because she seemed to be having a problem getting a response from her employer about what she claimed were unsatisfactory features of her workplace.

The witness gave evidence that his wife’s condition did not improve through 1997 and into 1998. Despite medication and reduced hours of work, her symptoms persisted and her energy level was lower. She told him about continuing exposure to dusts and fumes, and about difficulties in getting her workplace conditions improved.

In late January 1998, the witness said, after her first day back at work the plaintiff was ‘hoarse and croaky’. She was also upset that she had been allocated a particular class-room on a full time basis.

The following day he took his wife to a doctor. She was finding it hard to take deep breaths, and was ‘naturally in a state of anxiety as well’. He attributed her anxiety to a combination of ‘the way the school were treating her and the fact that she had the asthma’.

According to the witness, his wife went back to work but told him that the day had been unsatisfactory. The principal’s reaction to a note written by the doctor had been ‘fairly unhelpful’, and she had found her classroom to be dustier than before.

The witness said that his wife went to work on 5 February 1998. He received a phone call that morning, in which he was told that his wife had collapsed at school. He went home from his work and found his wife. She was sitting in a chair, ‘almost inert really, found it hard to even speak’. Later, he took her to the doctor.

Thereafter, according to the witness, his wife had not worked. Her asthma had slightly improved, ‘once she was removed from the stimuli in the classroom’. Her anxiety ‘was still there’.

Pausing for a moment, the witness’s evidence thus far at least implied that he knew little about assessing the merits of a prospective common law action for personal injuries, that he knew nothing about the ‘serious injury regime’ set up by the Act, and that he had only a rudimentary understanding of the conditions in which his wife worked.

The witness said that he had seen the Maurice Blackburn & Co letter of 27 April 1998, which mentioned the need to establish ‘serious injury’ before common law damages could be recovered, and which mentioned the time-bar set up by the Act. He said that he had a conversation with a solicitor at Maurice Blackburn. Mainly it was about securing accident compensation payments. But he ‘also briefly discussed the issues raised in the letter about claiming damages at common law and that discussion did not proceed very far’. The solicitor said they must wait until his wife’s condition stabilised before they did anything.

Dissatisfaction with progress of the compensation claim led the witness to contact the defendant, someone he had known since primary school. His purpose, he said, was to let the defendant ‘know about [the plaintiff’s] position with WorkCover and that she wanted to take action against them …’.

There was a first conference with counsel. Asked what was said about what his wife wanted, the witness answered that he and his wife ‘just wanted full compensation’.

The witness referred to an area of dispute between himself and his wife on the one hand and their legal advisers on the other.

They wanted the compensation claim to proceed by reliance both on the asthma and the psychiatric condition. Counsel, particularly, was resistant to that. He told the witness and his wife that he believed it would be hard to prove a direct link between her work conditions and her asthma, especially when attacks occurred at night.

His wife, the witness said, was not pleased with the advice that the matter should proceed essentially on a psychiatric basis. She said so, and the witness separately conveyed her displeasure to the defendant.

Nonetheless, the compensation claim, which had been formulated so as to place the plaintiff’s psychiatric injury at the forefront,[21] continued, as the witness understood it, to be advanced on that basis up to the time of settlement.
[21]So much is clear from the Statement of Claim in the Magistrates’ Court proceeding.

Mr McBain gave evidence - which the learned trial judge did not accept - that he told Ms Wilkinson, on the occasion of the defendant’s 40^th birthday party- ‘Don’t forget we want to take common law action’; and that she told him ‘not to worry, that there was plenty of time yet’.

The witness said that he had no discussion with the defendant about that matter. He denied that he had discussion about common law rights after the ‘cessation’ of the Magistrates’ Court proceeding. He also denied a suggestion which was made later in cross-examination that on an unidentified occasion the defendant had told him that $1500 would be needed for reports if the prospect of common law action was to be investigated.

Mr McBain further denied that, during the period when the defendant was acting for his wife, the latter had raised with him the prospect of exploring whether or not she had a common law claim. Neither, he said, had the defendant done so on any occasion when he and his wife together had met the defendant.

The witness further gave evidence about advice which he alleged had not been given – for example, about the need to obtain a serious injury certificate before a common law proceeding could be taken, and about the need to obtain medico-legal opinion to determine whether the plaintiff had the prospect of obtaining damages.

Notwithstanding his evidence that almost nothing had been said about prosecution of a common law claim between the plaintiff and himself on the one hand and the defendant and Ms Wilkinson on the other, the witness said that he had no relevant discussion about such a claim after the occasion of the defendant’s 40^th birthday party because ‘it was in their hands’ and ‘I’ve trusted them to look after all aspects of [the plaintiff’s] compensation’. He and his wife ‘still felt … there was plenty of time ahead … to wait for [the plaintiff’s] condition to settle down before doing anything.’

Despite the 1998 letter from Maurice Blackburn & Co having mentioned the time-bar imposed by the Act, the witness gave evidence that, when December 2000 came along, he was ‘oblivious to it’.

The witness was extensively cross-examined.

He admitted that he understood the concept of a limitation period, and that the Maurice Blackburn & Co letter advised about the existence of a time-bar.

His initial instructions to the defendant, he said, had been that he and his wife wanted the defendant to act for them ‘in getting the weekly payments for [the plaintiff] and Workers’ Compensation matters generally’. He took the latter to include ‘the possibility of common law damages’.

He did not agree with what was claimed to have been his wife’s evidence that on a number of occasions, when he was present, she had engaged in discussions ‘with respect to a claim for damages as distinct from weekly payments.’ On the occasions in question, he said, his wife had stressed the importance of her asthma. She did not want ‘that injury to be devalued in the overall case that was going to be presented, either for the weekly payments or for any subsequent action’. He did not believe that the words ‘common law’ had been used.

The witness further denied that, in effect, he had rebuffed the defendant’s suggestion, made to him in ‘conversations’ – plural - after the compensation claim had been settled, that his firm would now ‘look at the common law’.

Despite lack of follow-up by either him or the plaintiff, the witness said that they expected Ms Wilkinson ‘to keep the common law action in mind’.

It was put to the witness that he could not say categorically that the plaintiff would have issued proceedings if he had not forgotten the time-bar. He replied: ‘ … [T]hat would depend on the solicitors. I wouldn’t have been in a position to issue them on her behalf myself’. He went on to say that the plaintiff ‘certainly had intended to take action in respect of all her rights under statute and common law’. Had he remembered the deadline he ‘would have discussed that with her’. He said also that ‘had we been advised properly at the time … we would have issued proceedings’.

Later, the witness denied that he and the plaintiff were unwilling to undertake common law proceedings at any stage prior to 2003.

The witness was cross-examined at length to show that, in the period 2002 and early 2003, the plaintiff had consulted other solicitors; but that, until she engaged her present solicitors, she had overlooked advice which suggested there remained a possibility of bringing a common law proceeding. The gist of the cross-examination was that this conduct showed that the plaintiff had not wished to bring a common law proceeding until 2003.

The witness was cross-examined about his role in dealings with the defendant. He said that it was one of communication, not giving instructions except if authorised to do so. In re-examination he accepted a description of his role as ‘a conduit’. The plaintiff, he said, had not really been ‘capable of managing these things on a day to day basis’.

The learned trial judge, as I have said, rejected aspects of Mr McBain’s evidence. She rejected his evidence that the plaintiff in the relevant period ‘wanted’ to bring common law action, that she ‘intended’ to do so, and that the ‘possibility’ of her doing so had been raised[22] with the defendant. Mr McBain had not, however, suggested that the plaintiff had given, or would have given, instructions for the commencement of a common law proceeding (or its precursor, a serious injury application) without informed professional advice. He said, in substance, that what would have been done ‘depended on the solicitors’; and he said also that, had he and his wife ‘been advised properly at the time,’ the plaintiff would have issued proceedings. Nor was Mr McBain’s evidence to the effect that his wife had been determined to take the common law path come what may.
[22]Albeit, according to Mr McBain’s evidence, in ambiguous language.

Evidence of the defendant

Although the plaintiff’s principal complaint, on the appeal, is that the learned trial judge only considered part of her case on the issue of causation – a matter essentially turning on the plaintiff’s case as pleaded, as opened, as addressed in evidence adduced for the plaintiff, and as closed – I should refer to evidence adduced for the defendant upon the causation issue.

Mr Mier gave evidence that he was approached by the plaintiff’s husband in late October 1998. They met over lunch. He was told that the plaintiff’s condition was ‘a respiratory/asthma/mental anxiety problem’, and that the plaintiff ‘worked in a dusty classroom due inter alia to chalk dust and pottery dust’. He was told also that an occupational health and safety representative had been scathing about the conditions in which the plaintiff worked.

Asked in evidence-in-chief what conversations, if any, he had with either the plaintiff or her husband ‘about rights other than entitlement to weekly payments’, the defendant replied that –

The first conversation that touched upon common law was actually the first conversation that I had with [the plaintiff’s husband].

He had explained, he said, how the system worked:

You know, weekly payments, medical and like expenses, possible common law, et cetera.

The witness was asked if there had been any discussions about common law [entitlement]. He gave this reply:

There were conversations and they weren’t repeated because he is a solicitor and we’d spoken about it. It wasn’t a matter of harassing him about the issue but I did raise common law on a couple of occasion through the course of the matter in telephone conversations with him. Then we were successful, thankfully, in the weekly WorkCover case and – weekly WorkCover payments case, and after we had been successful I rang [the plaintiff’s husband] and asked him what he wanted to do about looking at whether there was a common law claim or not, whether he wanted to investigate that – excuse me – he – I told him that for us to investigate it we would require the workplace assessment by a specialist in that area. We would also require a medicolegal opinion from a respiratory specialist and I indicated that that would probably be a cost, I mean it’s an estimate, but a cost in around about $1500, something along those lines. I indicated to him that if we were do that then we would need him to, or Julie to pay those funds into trust to protect he [sic] firm against he [sic] cost of those reports. He wasn’t interested in pursuing common law. He made it plain that Julie, being quite stressed by the WorkCover case [had] really had enough of the court cases, and that he wasn’t really minded to put those funds up.

He was asked this further question and gave this reply:

Did you have any other conversation with him about common law after that? ---No

I should refer also to this evidence given by the defendant in the course of his examination-in-chief:

Do you know whether you had any telephone conversations or other conversations with Julie Stipanov in relation to her employment and claim in the absence of her husband?---There may have been one or two calls that were placed by her to me. And I think it was literally one or two calls. Every other communication was with [the plaintiff’s husband] unless she was in a conference with [her husband] and Lindsay Paine and I. The calls that she placed were not long calls. They were I think “how long before it gets to court” that sort of conversation. There was nothing in-depth discussed.
Did she ever say to you that she wished to issue common law proceedings?---No.

Again, in examination-in-chief certain evidence given by the plaintiff’s husband was recounted to the defendant, and he was asked to comment upon it:

He was asked … “Did you put it more broadly than that?” He said, “Well yes. But we wanted them to act for that and also any common law entitlement”. Did he ever use any words like that or to that effect to you?---No he did not.
He was asked, “So you told him your evidence is, I told him I wanted to act for her in any common law entitlement, is that your evidence? He said, of that, something of that nature, yes, any compensation she may be entitled to either under the Act or otherwise”. Did he ever use words to that effect to you?---No.
Then he said, “Well the words as best I remember was that we wanted them to act for us in getting the weekly payments for Julie and workers compensation matters generally”. Did he ever use words to that effect to you?---No, his discussion was about weekly payments.

Cross-examined, the witness agreed that in so much of the plaintiff’s file as he had retained, or re-created, there was no reference at all to a claim for damages.

He was asked these questions, and gave these answers:

Certainly, any solicitor in this field worth his salt would consider not only the issue of weekly payments but the prospect of suing for damages at common law?---Correct.
Any solicitor, if he is doing his job properly, would give proper advice, full advice, to the plaintiff as to the prospect of taking such proceedings?---Yes.
That would include advice as to the steps that would have be taken, including getting a serious injury certificate?---Yes.
Did you do that?---Yes.
When?---When I spoke to [the plaintiff’s husband] after the WorkCover case had been concluded.

The witness was further questioned about this conversation:

… [D]id you start off with common law or did you tell you [sic] him about serious injury? What did you tell him in this conversation?---Asked him what he wanted to do with respect of the common law aspect which had been raised previously but we’d never really got into it because we were more concerned and [he] was more concerned to get he[sic] weekly payments up first.
But what was the advice you gave him? You’ve told us you gave him advice about serious injuries and common law. What advice did you give him?---The advice I gave him was that it was not a lay down misere common law claim, that for us to be able to give definitive advice we would need the further reports that I’ve mentioned earlier in my evidence. I said to [him] that if we were to be gaining that further evidence we would need him to put the funds into a trust account to cover the cost of those reports and that one we had those reports we would then be in a better position to give him a real thumbs up or thumbs down about the likely success of a common law claim.
What was his response to all of this?---He said that Julie had been quite stressed by the WorkCover case. She’s had enough and made it quite clear that they weren’t interested in pursuing a common law claim …

The defendant admitted that his bill of costs made no reference to giving advice in respect of common law action; and that it was a logical conclusion that there had never been a file note of any relevant advice being given. The explanation was, the defendant said, that he and the plaintiff’s husband had been lifelong friends. But that explanation was, I think, undermined by his later agreement that he had even charged the plaintiff for the first, informal discussion he had with the plaintiff’s husband, at a lunch paid for by the husband.

The defendant admitted that there was no record of the plaintiff having attended his office. His contact with her had been in one or two telephone calls, and at conferences with counsel. He said that he had not given the plaintiff, directly, any advice at all with respect to a common law claim. His recollection was that his discussions on the common law aspect were always through the plaintiff’s husband.[23]
[23]Compare paragraph 16 of the defence, and cross-examination of the plaintiff.

In the first conference with counsel, the defendant said, counsel had explained to the plaintiff and her husband that the extant claim was one for weekly payments. He had referred, inter alia –

… to the fact that you know, you’ve always got to keep in the back of your mind there maybe a possibility of a common law claim, and that we would look at the common law claim further down the track, because really the main game and what he was instructed to advise on was the weekly payments and we needed to establish that causal link firmly before we moved on to look at the common law, but they should keep that in mind because a common law claim once made may wrap up some of the other benefits that we were then dealing with. But it wasn’t – it wasn’t in any way a detailed advice on common law.

No note, it seems, was taken by the defendant of what counsel had said at that conference. Counsel’s written advice, perhaps unsurprisingly, said nothing about common law action.

The defendant was cross-examined as to what information he possessed pertinent to a common law proceeding at the time which, as he claimed, he had raised with the plaintiff’s husband the need to obtain further reports – a workplace assessment and a medico-legal opinion from a respiratory specialist – if he was to offer definitive advice. The cross-examination, and the documents to which reference was made in the course of it, show very clearly, in my opinion, that by the time of the particular alleged conversation the defendant had lay and medical evidence which provided a strong basis for an expression of opinion that the plaintiff had well-founded common law entitlement. Some of the defendant’s evidence, in which he asserted a need to obtain further medico-legal opinion, was to my mind very unconvincing. He said, inter alia, that he had been so advised by counsel who had been briefed in the accident compensation proceeding. There was no written advice, or note of advice, to that effect.

The defendant was cross-examined as to whether he had conveyed the effect of s 135AC of the Act to the plaintiff’s husband. He said that, in the telephone conversation which followed the conclusion of the accident compensation proceeding, he had told the plaintiff’s husband that ‘he didn’t have forever to consider’ a common law claim. The witness then improved upon that answer. He had told the plaintiff’s husband that ‘there was a limitation period in relation to applying for serious injury certificates’.

The defendant was cross-examined as to the emphasis which had been laid in the accident compensation proceeding, on counsel’s advice, upon psychological injury which occurred in February 1998. It is evident from the plaintiff’s evidence that it was an issue which loomed large in her thinking. Mr Mier agreed that this ‘tactical’ emphasis was contrary to the plaintiff’s position; but he asserted that her husband had agreed with it.

There were, in my opinion, a number of quite unsatisfactory aspects of the defendant’s evidence. I have earlier mentioned one of them. I mention two more, which is not to suggest that the list is thereby exhausted. First, the defendant’s evidence did not make good the basis of certain cross-examination of the plaintiff. Counsel for the defendant had put to the plaintiff that his client had told her on ‘numerous occasions’ that he wanted to look at the question of common law, and that she told him that she did not want to do that. Second, the evidence contained an account, which improved in the re-telling, of a single conversation between the defendant and the plaintiff’s husband, after the accident compensation proceeding had been settled, in which the latter rejected the idea of investigating – at a cost – common law action. But that account, in its variant detail, had had not been put to Mr McBain. Rather, it had been put that there had been ‘conversations’, after the accident compensation claim had settled, in which Mr McBain had said ‘no’ to a proposal by the defendant that he ‘would look at the common law now’; and there had been a suggestion that, on some unidentified occasion, reference had been made to an amount of $1500 for reports. Further, I agree with the submission by plaintiff’s counsel at trial that paragraph 16 of the defence, particularly by reference to the subjoined particulars, did not convey the burden of the case advanced by the defendant in evidence in reliance upon post-settlement conversation.

For the purposes of resolving this appeal, however, it is not necessary to conclude that such account should be rejected. What is clear is that the defendant was cross-examined, in substance, to show that –

·The defendant knew that it was part of his retainer to advise the plaintiff about her common law rights.
·Such advice necessarily encompassed him advising her about her prospects of mounting a successful serious injury application.
·Contrary to his evidence, he possessed sufficient information to advise the plaintiff about her common law rights by the time the accident compensation proceeding was heard.
·He had not advised the plaintiff, or her husband, about her common law rights.
·He should have advised the plaintiff that she had a sound and substantial common law claim, and that a serious injury application should succeed.
·As part of the advice which should have been given to the plaintiff about her common law rights, she should have been alerted to the effect of s 135AC of the Act.

The issues raised - as the plaintiff’s case had been pleaded, opened, and developed in evidence - bore upon both breach of duty and causation. The reference in cross-examination to s 135AC was but part of the plaintiff’s complaint that she had not been given advice, as she should have been, concerning her common law rights.

Evidence of Ms Wilkinson

Ms Wilkinson gave evidence that –

·She had no particular memory of the plaintiff. She recalled the plaintiff’s name, that it was a WorkCover matter, and that it related to an asthma condition.
·She had no recollection of meeting the plaintiff other than in conference with counsel.
·The plaintiff’s husband looked ‘vaguely familiar.’
·She had no independent recollection of considering - she did it as a matter of course - ‘any entitlements the worker had under the Act, whether that be a claim for weekly payments, a lump sum, or common law.’
·On odd occasions, clients said that they did not wish to pursue a common law claim; ‘but it would still be considered and if they did not wish to pursue it you would normally confirm that in writing.’
·She attended the defendant’s 40^th birthday party. She had no recollection of speaking to Mr McBain on that occasion. But, if he had told her not to forget the common law claim, she would have addressed the issue. ‘There would be something in writing’.
·The defendant, she thought, took additional interest in the matter because of his friendship with the plaintiff’s husband.

The learned judge concluded that, had the plaintiff or her husband mentioned the subject of common law rights at the birthday party, Ms Wilkinson would have done something about it. Although Ms Wilkinson could not recall what, if any, conversation she had with Mr McBain on that occasion, the judge concluded, because she had not done anything in respect of the plaintiff’s possible common law entitlement thereafter, that the evidence of the plaintiff and her husband on the point should be rejected.

That matter apart, the evidence of Ms Wilkinson did not impact upon the question now before the Court.

Closing address for the plaintiff

Counsel submitted, at the outset of his address –

The plaintiff alleges that the – she went to the defendant, for him to look after her legal affairs … obtain for her all her full legal entitlements. And that involved the giving of appropriate advice, and taking of appropriate action. We say that neither of those steps were in fact complied with, that there wasn’t appropriate advice given and they’re steps with respect to any proceedings, in particular a serious injury application, was simply not taken.

He went on –

Now the response to that by the defendant, is well, in a sense, I think it’s contended that [he] did give advice, although we’ll look at that in more detail in a moment, but more importantly, it seems to be, well, we didn’t have an obligation to go on and do the matters that are alleged because our retainer was terminated, because we were told that the plaintiff would not be interested in pursuing the matter.
Now, our case is that firstly, that that conversation never took place and that the instruction was never given, certainly never given by the plaintiff, let alone even an indication by her husband but we say in any event, even if there had been a phone call, which that discussion was given, … - the defendant was still in breach of his duty in the way he behaved in firstly, failing as a result of that conversation, failing to properly advise the plaintiff in writing of the prospects of success in a common law action and a serious injury application. He failed in failing to, by not confirming the instructions in writing that he says he’d received from Mr McBain.
He failed also to ascertain whether the plaintiff’s intention as he says, was expressed by Mr McBain in that phone call, was irrevocable. And finally, he failed to give any advice and in particular, in writing as to the applicable time limits. And that as a result of those failures, the proceedings were not taken within the appropriate time with resultant loss to the plaintiff.

In my opinion it is crystal clear that counsel was here contending that the plaintiff must succeed, upon the issue of causation, regardless whether a post-settlement conversation took place as the defendant alleged in his evidence; and regardless whether the defendant was then told that the plaintiff (and her husband) did not wish to pursue a common law claim. Further, it is quite clear that counsel cast a broad net in respect of allegedly causative breaches. Certainly he did not limit the causative breach to a failure to advise the plaintiff as to ‘the applicable time limits’.

Counsel next adverted in his address to the circumstance that the plaintiff’s pleaded case did not directly deal with the remarks attributed to Mr McBain in the course of the alleged post-settlement telephone conversation. Counsel submitted, understandably, that when the plaintiff’s statement of claim was formulated nothing was known about this alleged phone conversation. Nonetheless, counsel submitted, the particulars of negligence were sufficiently wide to address the circumstances which would arise if the learned judge accepted the defendant’s account.

The learned judge then directed attention to particular of negligence (k), which alleged that the defendant had caused or permitted the plaintiff’s claim for common law damages to be barred by operation of the Act. The following interchange took place:

HER HONOUR: … It’s not [the defendant’s] obligation to, I mean to talk of causing or permitting her claim to be barred, it’s ultimately her choice. Your criticism is that he failed to advise about the relevant limitation period.
COUNSEL: But he failed to take action and advise and take action. Any solicitor acting reasonably, competently for this plaintiff in the absence of written instructions, we say, would have ensured that proceedings were taken prior to the limitation period ---
HER HONOUR: Unless the client said, “I don’t want to”.
COUNSEL: Unless there was express and proper instructions given on proper grounds, on a proper basis, with a proper understanding, when the solicitor had complied with his obligations with respect to advice. We say that’s what didn’t happen.

Here, in my opinion, were the seeds of what I have called the mistakenly narrow view which the learned judge took of the plaintiff’s case on causation. Although the particular interchange addressed particulars of breach, it developed out of a submission of plaintiff’s counsel which interrelated breach and causation.

Thereafter, the learned judge pressed counsel as to what particulars of breach he relied upon. In part, it went this way:

COUNSEL: Your Honour, I’m not going to indicate that any are not pressed. Pressed in my submission is not an appropriate position that I should be [put] in. I will be relying ---
HER HONOUR: Then what I’m going to do is ---
COUNSEL: --- upon some of the particulars and obviously many others I will not be relying upon. The ones that will be relied upon are those that support the claim as I’ve just enunciated to Your Honour and in particular, they would be particulars H, particular K.
And if it’s considered that the particulars and indeed the statement of claim doesn’t sufficiently cover the matters that I put to Your Honour earlier, then, if it’s necessary, I would seek leave to amend to do that. I would submit that probably it’s not necessary for that to be done, but we’re not cast in stone with respect to that issue.

Counsel submitted, upon the question of breach, that the plaintiff’s case was that neither she nor her husband was given any ‘effective advice at all with respect to the common law proceedings’. She had been entitled ‘pursuant to the retainer to receive all appropriate advice with respect to all her legal entitlements including common law’ and ‘entitled to expect advice that proceedings should have been issued’.

Counsel developed his submissions that the defendant should have given the plaintiff advice generally about her common law rights, against the background that, on the plaintiff’s account, she ‘wanted’ to bring a claim for damages. He said:

But on the issue of what advice was given, we submit that when you look at what Mr Paine had done and when you look at what, in terms of his memorandum, when you look at what the other objective material discloses, there is nothing to support a contention that the plaintiff was given appropriate advice by the defendant, either on his own or in conference with Mr Paine with respect to common law entitlements.
Clearly, we say by the time of the Magistrate Court proceedings, there was more than enough information available to lead any competent solicitor to the conclusion that this was potentially a very strong and a very large common law claim. And that advice should have been given to Mrs Stipanov.

The learned judge raised the circumstance that the plaintiff had not followed up the question of a common law claim with the defendant. This bore upon the issue of causation. Counsel observed that her Honour was ‘falling into the trap that [counsel for the defendant] wants to set for you’. He went on:

… [H]er conduct and the conduct of her husband has to be looked at in the light of the fact that they were not given the information that they should’ve been. They were going along – they’d been lulled into a sense of security. They hadn’t been given the advice about the prospect – the strength of their case. They hadn’t been told what time limits there were. They hadn’t been told a thing about serious injury applications, not a thing.

This submission bore directly upon causation. It need not have been accepted in its entirety. But that is another matter. The scope of the plaintiff’s case on the issue of causation was thus reinforced.

Her Honour asked whether, the plaintiff having received the Maurice Blackburn & Co letter which ‘had told her that there were limitation periods’, it had been necessary for the defendant ‘to effectively repeat the advice’. Counsel replied in the affirmative. Two points should be made. First, the judge was here addressing what I have referred to as the narrow view of the plaintiff’s case. Second, counsel’s response did not mean that he thereby confined the plaintiff’s case on causation.

The reasons for judgment

It is only necessary to refer to limited parts of her Honour’s reasons for judgment.

Her Honour said this:

Mrs Stipanov’s primary case was that she suffered loss due to Mr Mier’s failure to advise her of the limitation period under s 135AC(a).

For reasons already given, I respectfully disagree. The plaintiff’s case, as pleaded and as presented at trial, was substantially founded on the defendant’s failure to give advice on the merits.

Having so described the plaintiff’s case on the issue of causation, the judge referred to the Maurice Blackburn & Co letter of 27 April 1998. She said this:

The … letter is of some significance in this case and will be considered further later in these reasons.

The judge mentioned the letter which Ms Wilkinson sent to the plaintiff following the successful resolution of the plaintiff’s accident compensation claim, and the lack of any response to it:

After receiving the cheque and letter from Ms Wilkinson in July 1999, neither Ms Stipanov nor her husband contacted Ms Wilkinson or Mr Mier to discuss with either of them the bringing of a common law claim.[24]

[24]Reasons [38].

For reasons which I have earlier described, her Honour rejected the evidence of the plaintiff and her husband about a conversation with Ms Wilkinson on the occasion of the defendant’s 40^th birthday party.

The judge next found that –

… the initial retainer was a retainer to act for Ms Stipanov only in relation to her weekly payments claim.

and that, when (as she found) the defendant’s retainer came to an end by mid-August 1999 at latest, the defendant –
had not received any instructions to act for Ms Stipanov in relation to any other matter, in particular, in relation to common law proceedings.

Nonetheless, her Honour accepted the defendant had been under an obligation to advise the plaintiff ‘as to any entitlements she might have’, including ‘suing for common law damages’.

Then the learned judge embarked upon an analysis of what advice a competent solicitor ought reasonably to have given with respect to the operation of s 135AC. In that connection, her Honour expressed these conclusions:

[65]In this case, Mr Mier alleges that, after discussing the possibility of a common law claim on several occasions, Mr McBain instructed him that his wife did not want to pursue a common law claim at all. I agree with Ms Ross[25] that, in such a case, a prudent solicitor should have advised as to the applicable time limits and confirmed the instructions directly with the client, in case she changed her mind subsequently. That might have been done by a face to face meeting with the client or by letter.

and
[67]In the first instance, the solicitor’s duty of care requires the solicitor to give proper advice to the client, so as to enable the client to make an informed decision and give informed instructions. The solicitor would also have a duty of care in carrying out instructions given by the client. But a solicitor does not have a duty to take steps such as instituting proceedings without instructions from the client to do so. In so far as many of the particulars of negligence in paragraph 16 of the statement of claim seem to suggest otherwise, they are misconceived.

This analysis of what the defendant as a reasonable solicitor should have done to abide his duty of care connected with the plaintiff’s case on the issue of causation as her Honour understood it to be.

[25]A legal practitioner called for the plaintiff.

Then her Honour turned to the question: what advice was given about common law? She referred to the dispute whether the post-settlement discussion of which the defendant had given evidence had occurred. She said that she did not need to resolve that dispute.

Having specified the occasions on which there had been some reference by counsel or the defendant to common law proceedings – whether the reference had been fleeting or otherwise, whether central or peripheral to the issue then at hand - the judge expressed these conclusions –

[82]Even if I accepted in its entirety Mr Mier’s evidence as to the post-settlement discussion and the earlier conversations, in my opinion he did not take sufficient steps to discharge his contractual or tortious duties of care to Ms Stipanov.
[83]A prudent solicitor in his position ought to have advised Ms Stipanov as to the problems with respect to bringing a claim for psychiatric injury as distinct from asthma and the problems associated with “the black hole” period, about which matters he gave no advice at all.
[84]Even in relation to those matters in respect of which Mr Mier says he did provide advice, in my opinion Mr Mier failed to take reasonable steps to ensure that Ms Stipanov was in a position to make an informed decision about a common law claim. According to Mr Mier, the post-settlement discussion was the first occasion on which he advised as to the limitation period and provided any detail as to what would be involved in bringing a common law claim. He said that without even referring back to his wife, Mr McBain said that she was not interested in pursuing a common law claim. I accept that Mr McBain played the role of messenger, and probably also interpreter, between his wife and the lawyers. However, there is no evidence that Ms Stipanov ever informed Mr Mier that he could act solely on her husband’s instructions or did not have to advise her of significant matters.
[85]Mr McBain was a solicitor and a long-time friend of Mr Mier. Whilst Mr Mier might have justifiably felt confident that Mr McBain understood any advice he gave him, it was Ms Stipanov who was his client. A prudent solicitor ought to have had regard to the fact that, although an intelligent woman, she was clearly in an emotionally fragile state throughout the weekly payments proceeding. He should have made sure that any significant advice was conveyed to her in such a way as to ensure that she understood it. Written advice would have been one obvious way of achieving that result. Alternatively, he could have spoken to her personally about the matter.

With respect, I consider that the content of the defendant’s duty – to give advice sufficient to enable the plaintiff to make ‘an informed decision about a common law claim’ – extended well beyond advice on ‘problems’ of the kind referred to in paragraph [83] of her Honour’s reasons.

I turn to her Honour’s conclusions concerning loss. The first of them was this:

[87]Notwithstanding the breadth of the allegations in the statement of claim, it was not suggested, and no evidence was led, that Ms Stipanov suffered any loss as a result of any failure to advise her about the procedures for bringing a common law proceeding or obtaining a serious injury certificate, the need to obtain medico-legal or other evidence, or the problems of the black-hole. Her case was really argued on the basis that Mr Mier’s failure to advise her as to the relevant limitation period caused her to lose the opportunity to bring common law proceedings within time.

As I have said, the plaintiff’s case upon the issue of causation was much wider than this. As pleaded and presented, it was not a case simply about s 135AC, nor was it a case limited to a complaint that the defendant had not advised the plaintiff about procedural matters.

Having so characterised the plaintiff’s case, her Honour referred to arguments advanced for the defendant why it must fail. Thus:

[89]Mr Mier denies that any breach of duty by him caused Ms Stipanov any loss. He relies on the following arguments:
(a)He pleads that she could have seen another lawyer about her damages claim at any time after 9 July 1999 and before the expiry of the relevant limitation period. She did not do so, therefore the cause of her loss is her own failure to see another lawyer before the limitation period expired.
(b)The MBC letter, which Ms Stipanov had received before she engaged Mr Mier, advised Ms Stipanov of the applicable limitation period and the need to seek a serious injury determination. Notwithstanding that advice, she took no relevant steps before the expiry of the limitation period. There is no reason to think she would have done anything different had Mr Mier given the same advice.
(c)One of her later solicitors, Slater & Gordon, advised her on 12 February 2003 of a way in which she could still bring common law proceedings in relation to her asthma. Notwithstanding that advice, she took no steps to do so. Her failure to do so is therefore the cause of her loss.
(d)Ms Stipanov was not interested in and would never have issued common law proceedings within time, even if he had not been in breach of his duties.

Her Honour rejected the first of those arguments. She upheld the defendant’s other contentions.

Concerning the Maurice Blackburn & Co letter, the judge relevantly found –

(a)The advice in the MBC letter was correct at the time it was given in April 1998. It was still correct at the time that Mr Mier’s retainer (and duties of care) ended around August 1999.
(b)Had Mr Mier given proper advice to Ms Stipanov about the limitation period, that advice need have gone no further than that contained in the MBC letter.
(c)Ms Stipanov and Mr McBain received and read the MBC letter. They understood the advice about the limitation period of 31 December 2000. They continued to have that understanding throughout the period of Mr Mier’s retainer and beyond.
(d)Ms Stipanov took no steps to commence a serious injury application or a common law claim prior to the expiry of the limitation period. She and her husband offered several explanations for her failure to do so, none of which are attributable to negligence on the part of Mr Mier.
(e)In so far as Ms Stipanov or Mr McBain said that they believed that the firm was supposed to be pursuing the common law claim on her behalf, I do not accept their evidence.

For the reasons I have given, these conclusions did not dispose of the plaintiff’s case on the issue of causation.

Thereafter, in the context of consideration of the Maurice Blackburn & Co letter, the judge addressed the explanations of the plaintiff and her husband why it was that the plaintiff had not instituted a serious injury application before December 2000. Her Honour made it plain that she regarded both of them as unreliable witnesses. She did not impute deliberate dishonesty to the plaintiff. She reserved her harshest criticism for the plaintiff’s husband. She described some of his evidence as ‘simply implausible’. She referred to his ‘smirking response’ to a particular question.

These criticisms concerned evidence which addressed the timing issue. The plaintiff’s case on causation had to fail, so it was held, because the plaintiff and her husband knew, or should have remembered, that time ran out in late 2000. The Maurice Blackburn & Co letter had told them that.

For completeness, I should refer to another passage in her Honour’s reasons dealing with the significance, as it was perceived, of that letter:

[102]… [E]ven if Ms Stipanov did intend to and would have issued common law proceedings had she and her husband not forgotten about the limitation period, that is not something for which Mr Mier is responsible. Had Mr Mier not been negligent, had he given Ms Stipanov adequate oral or written advice about the relevant limitation period, it need have gone no further than the MBC letter. When Mr Mier’s retainer ended, Ms Stipanov still had the MBC letter, and her husband (if not also Ms Stipanov) still remembered and understood the contents of the MBC letter. There was no evidence to suggest some reason why they might have remembered advice from Mr Mier, when they did not remember the same advice from MBC. In that case, the cause of Ms Stipanov’s loss is the fact that she and her husband forgot the legal advice they had been given about the limitation period.

Her Honour’s conclusion was thus that the defendant’s breach of duty – presumably, whatever its content - could not have been a cause of the plaintiff’s lost chance so long as the plaintiff should be taken to have known the period set by s135AC. That, with respect, was by no means necessarily so. Moreover, her Honour appears to have expressed a concept of single causation – ‘the cause of [the plaintiff’s] loss’ – which in my opinion was wrong in point of principle.

Then the learned judge analysed the plaintiff’s intentions up to the end of 2000. I set out her Honour’s key findings at [12], and I have detailed circumstances, including events subsequent to December 2000, which in her Honour’s view ‘tended to support the conclusion that [the plaintiff] would not have issued a common law proceeding.’ I have also explained what I perceive to be the problems with her Honour’s analysis.

I should add little to what I have already said concerning the plaintiff’s attendance on solicitors in 2002 and early 2003. The judge said that the plaintiff had given two explanations why it was that she (in fact her husband) had collected her file from the defendant in April 2002, and thereafter consulted a firm of solicitors named Wilsons. The file of that firm was put in evidence. It is clear that in fact the plaintiff went to the firm because she had received a letter from the WorkCover Authority dated 29 April 2002, which advised her of a so-called ‘intensive case review program’ under which certain injured workers were to be eligible to receive a lump sum in lieu of continuing weekly payments.

The plaintiff, the file shows, had some desultory contact with Wilsons up until late December 2002. On more than one occasion, it appears, she raised the question of common law action. A file note dated 15 May 2002 said this:

6. She wanted to know whether she could sue for asthma.
I advised her that in general the legal action must be commenced within 6 years of her first knowing that she had suffered injured (sic) and those injuries caused by employers act or omission.

Further, a solicitor noted this in a file note dated 23 December 2003:

Now wants to pursue c/l
Only been able to deal w the issue about 2 weeks ago due to her mental ill health

The judge concluded that, if the latter file note was accurate, it tended ‘to confirm [her] earlier conclusion that [the plaintiff] was not interested in pursuing a common law claim prior to the end of 2000. With respect, focusing only upon the later file note was apt to create a false impression. At the plaintiff’s first interview, although she had attended the solicitors ostensibly in relation to an accident compensation issue, she had raised the issue of possible common law action. Moreover, she had then been given limitation period advice which was, in context, misleading.

On 23 December 2002, Wilsons wrote to the plaintiff’s union, advising that it had given the plaintiff detailed advice on her options, including access to common law damages. The advice was evidently wrong in part; and because the solicitors were not fully instructed, it plainly could not have included an evaluation of the prospects of the plaintiff succeeding in a common law action. Neither again is there any suggestion that consideration was paid in such advice to the operation of s 135AC. In my opinion, the giving of partly wrong and substantially incomplete advice in late December 2002 was not a reliable basis for inferring the plaintiff’s state of mind in a period which ended, at latest, in December 2000.

In early February 2003, the plaintiff consulted Slater & Gordon. She was provided with a detailed letter of advice dated 12 February that year. It adverted to possible common law action. It raised the prospect – I do not say it was non-existent, but it must certainly have faced difficulties – that the plaintiff might yet be able to sue her employer.[26]
[26]It depended upon s 135AC(b) being successfully invoked.

The plaintiff did not follow up the matter with Slater & Gordon. The judge concluded, notwithstanding that the plaintiff consulted her present solicitors within a relatively short time thereafter, that the failure of follow-up tended ‘to belie her evidence that she always wanted to and intended to bring common law proceedings’.

The defendant’s counsel at trial conceded that not much could be made of the plaintiff’s attendance on Slater & Gordon. In my opinion, the concession was rightly made. This attendance provided little if any guidance as to the plaintiff’s state of mind had the defendant abided his duty to properly advise her upon the merits of a common law action in the first half of 1999.

Orders

For the reasons which I have given, I consider that the appeal should be allowed.

Counsel for the plaintiff argued that if the appeal succeeded this Court could – and should- proceed to decide the issues on liability. Specifically, he contended, we should decide that, but for the defendant’s negligence, the plaintiff would have been given favourable advice on the merits of her common law claim and, on the probabilities, would have given instructions for a proceeding to be commenced. In those circumstances, the only aspect of the proceeding which would need to be considered at a retrial would be the value of the lost opportunity to commence such a proceeding.

Desirable though it would be to limit the issues which must be agitated again, the proposed course is not practicable. I consider that the material adduced at trial was sufficient to show, on balance of probabilities, that a reasonably competent solicitor ought to have advised the plaintiff that she had sound prospects of succeeding in a serious injury application, and in a subsequent common law proceeding. But whether, probably, the plaintiff would have given instructions to proceed if given such advice by the defendant must depend upon on an evaluation of many circumstances best considered in the context of a trial. The plaintiff’s credibility (and perhaps the credibility of her husband) would likely influence the conclusion. The question of credibility would arise, for instance, if (self-serving) evidence was adduced that instructions to proceed would have been given if the plaintiff had been appropriately advised. This Court should not rely, I think, upon the learned trial judge’s assessment of the credibility of the plaintiff and her husband.

In the event, I consider that the entire subject-matter of the proceeding should be remitted for retrial before another judge of the Trial Division.

HANSEN AJA

I agree with Ashley JA.

---

[2008] VSCA 116

25 June 2008