Super 1000 Pty Ltd v Pacific General Securities Ltd

[2007] NSWSC 171

CITATION:	Super 1000 Pty Ltd v Pacific General Securities Ltd [2007] NSWSC 171
HEARING DATE(S):	26/02/07
JUDGMENT OF:	Gzell J
EX TEMPORE JUDGMENT DATE:	26 February 2007
DECISION:	Leave to file notice of ceasing to act granted.
CATCHWORDS:	PROCEDURE - Ceasing to act - Leave to file a notice of ceasing to act - No notice of intention - Application shortly before hearing date - Failure of client to put solicitor in funds - Opposed as causing prejudice by adjournment - Representative of defendant in Court - Whether application distinct from adjournment application
LEGISLATION CITED:	Uniform Civil Procedure Rules 2005 Ritchie's Uniform Civil Procedure New South Wales
CASES CITED:	Wadsworth v Marshall (1832) 2 Cr & J 665 (149 ER 279) Robins v Goldingham (1872) LR 13 Eq 440 Warmingtons v McMurray [1937] 1 All ER 562) Underwood Son & Piper v Lewis (1894) 2 QB 306
PARTIES:	Super 1000 Pty Ltd - Plaintiff Pacific General Securities Ltd - Defendant
FILE NUMBER(S):	SC 3410/06
COUNSEL:	Mr S Burchett/ Ms MGerace - Plaintiff
SOLICITORS:	Crisps Solicitors (Mr DNeggo - First Defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

GZELL J

MONDAY 26 FEBRUARY 2007

3410/06 SUPER 1000 PTY LTD v PACIFIC GENERAL SECURITIES LTD & ORS

EX TEMPORE JUDGMENT

1 The matter before the court was set down for hearing before Windeyer J at noon today. An application is made by the solicitors for the first defendant for leave to withdraw. The application is opposed.

2 The affidavit in support of the application indicates that on 23 November 2006 a director of the first defendant was informed that it would need to pay the solicitors $15,000 by three instalments of $5,000 and the cost of the hearing would probably be $20,000 or more. Of the three weekly instalments, only one was paid.

3 On 31 January 2007, following the transfer of the proceedings to the Equity Division in November 2006, the director was contacted and the funds were sought. The matter came before Windeyer J on 16 February 2007. His Honour set the matter down for hearing before him as Expedition List judge at noon today.

4 On 14 February 2007, the solicitors attended a meeting with the director. A conversation took place indicating that the minimum amount that would be required for the purpose of the hearing was $25,000. The director indicated that he would attempt to have a cheque for that amount by Friday 16 February 2007.

5 On 16 February 2007, the solicitors sent an e-mail to the director. He sent an e-mail to his co-director that day. A further e-mail was sent by the solicitors on 19 February 2007 on which date the director replied to the earlier e-mail. On 20 February 2007, a further e-mail was sent to the director and on 21 February 2007, a telephone conversation was had with him in which he said that the solicitors would need to speak to his co-director. The director said they had a verbal agreement for a loan but no written approval and that they would not be able to pay for a few more days.

6 The co-director was contacted and said that he was expecting a second acceptance the following morning. An e-mail was then sent to the co-director. He did not telephone the solicitor before lunch on 22 February 2007, and a further e-mail was sent. At around 5.00 pm on that day, a telephone conference was had with the director and the co-director in the course of which the solicitor was informed that the co-director thought that the first defendant would be in a position to pay that day, but it could not.

7 On 23 February 2007, during a telephone conference the solicitors informed the co-director that they could not proceed to act for the first defendant.

8 An attempt was made to have the matter heard before Windeyer J on Friday 23 February 2007, but that was stood over until today. The solicitors for the plaintiff were put on notice that the solicitors for the first defendant intended to seek leave to cease acting.

9 The Uniform Civil Procedure Rules 2005, r 7.29 provides that except by leave of the court, a solicitor may not file or serve notice of ceasing to act for a party unless there has been served on the client and the Registrar a notice of intention to file the notice of change within a specified time.

10 A notice of intention not having been served, the application is made for leave for the solicitor for the first defendant to file a notice of ceasing to act for the first defendant.

11 It was submitted that the considerations of the due administration of the court should be taken into account and the application refused because it was made at the eleventh hour and because the matter cannot proceed before Windeyer J until noon on Wednesday 28 February 2007 which is a time that does not suit either senior or junior counsel for the plaintiff.

12 It was submitted that there is a difficulty if, as a result of granting leave to file the notice of ceasing to act, the matter does not proceed today in that the plaintiff submits that there is every likelihood that the first defendant has insufficient funds to discharge what is owed, allegedly, to the plaintiff or to discharge an order for costs, if one be made. It was submitted that prejudice will be suffered thereby.

13 On the other hand, it is submitted, in my view correctly, that leave to file the notice does not bear upon the question of an adjournment. A representative of the first defendant is in court and the proceedings may continue against the first defendant. It may have a difficulty because it may seek to be represented by a director who does not have that entitlement, but that is a matter that the first defendant has brought upon itself by its actions.

14 In Ritchie’s Uniform Civil Procedure New South Wales, at 5696 authority is cited for the proposition that a failure by a client to provide funds to cover disbursements is good cause for termination of a retainer (Wadsworth v Marshall (1832) 2 Cr & J 665 (149 ER 279), Robins v Goldingham (1872) LR 13 Eq 440, Warmingtons v McMurray [1937] 1 All ER 562). It is also stated in that work that where a solicitor is prevented by the client from properly carrying out the duties required by the retainer good cause for termination is established (Underwood Son & Piper v Lewis (1894) 2 QB 306 at 314).

15 In my view, notwithstanding the late time of the application with respect to the hearing, the solicitor for the first defendant, I think, is justified in ceasing to act. While the attempts to obtain those funds were not put into high gear until very late in the piece, the solicitors certainly were not dilatory in seeking to extract the necessary funds from their client. The client having failed to do so, in my view the solicitor’s application should be granted, and I give leave to file in court a notice of ceasing to act for the first defendant. I stand the matter over before Windeyer J at noon on Wednesday 28 February 2007 or such other date as may be arranged with Justice Windeyer’s Associate.

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