Symonds v Vass - [2009] NSWCA 139

No judgment structure available for this case.

Appeal Outcome: Special leave dismissed with costs by the High Court, 11 December 2009 s186/2009

New South Wales

Court of Appeal

CITATION: Symonds v Vass [2009] NSWCA 139

HEARING DATE(S): 16 March 2009, 17 March 2009

JUDGMENT DATE:
10 July 2009

JUDGMENT OF: Beazley JA at 1; Giles JA at 10; Ipp JA at 47

DECISION: 1. Appeal and cross-appeal allowed.
2. Set aside orders 1 to 8 made by Patten AJ on 13 December 2007.
3. Remit the proceedings to the Common Law Division for a new trial on all issues.
4. Costs of the trial before patten AJ to be in the disposal of the judge conducting the new trial.
5. Respondent pay 70 per cent of the appellants' costs on appeal.

CATCHWORDS: CAUSATION - whether respondent’s breaches of duties caused the appellants to suffer damage by losing the opportunity of a better outcome - where appellant clients entered into compromise of their claim following breaches of duties by the respondent solicitor. - PROCEDURE - courts and judges generally - judges - adequacy of reasons for judgment - whether trial judge made express findings of primary fact that exposed a specific chain of reasoning - where trial judge recounted in detail large extracts from the evidence and the transcript. - LEGAL PRACTITIONERS - lawyers - duties and liabilities - whether respondent solicitors breached duties owed to the appellant clients in contract and in tort in preparing the appellants' case for trial. - LEGAL PRACTITIONERS - lawyers - other matters - advocate's immunity - application of the test in D’Orta-Ekenaike v Victoria Legal Aid - where appellant clients entered into compromise of their claim following breaches of duties by the respondent solicitor - finality of litigation principle.

LEGISLATION CITED: Fair Trading Act 1987
Trade Practices Act 1974 (Cth)

CATEGORY: Principal judgment

CASES CITED: Alpine Holdings Pty Ltd v Feinauer [2008] WASCA 85
Batard v Hawes (1853) 2 E & B 287
Beale v Government Insurance Office of NSW (1997) 48 NSWLR 430
Boland v Yates Property Corporation Pty Ltd [1999] HCA 64; (1999) 74 ALJR 209
Brittain v Lloyd (1845) 14 M & W 762
Calin v Greater Union Organisation Pty Ltd [1991] HCA 23; (1991) 173 CLR 33
Chamberlain v Ormsby [2005] NSWCA 454
Chapman v Hearse [1961] HCA 46; (1961) 106 CLR 112
Coshott v Barry [2009] NSWCA 34
Customs and Excise Commissioners v A [2002] EWCA Civ 1039; [2003] 2 All ER 736
Dansar Pty Ltd v Pagotto [2008] NSWSC 112
D’Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1
Digi-Tech (Australia) Ltd v Brand [2004] NSWCA 58; (2004) 62 IPR 184
Donellan v Watson (1990) 21 NSWLR 335
Francis v Bunnett [2007] VSC 527; (2007) 18 VR 98
General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125
Giannarelli v Wraith (1989) 156 CLR 543
Gould v Vaggelas [1985] HCA 85; (1985) 157 CLR 215
In re A Debtor [1937] 1 Ch 156
Keefe v Marks (1989)16 NSWLR 713
Kelley v Carston [1998] QB 686
Kuru v State of New South Wales [2008] HCA 26; (2008) 236 CLR
Lampleigh v Brathwait (1688) 1 S & M LC 13
MacRae v Stevens (1996) Aust Torts Rep 81-405
Mallik v McGeown [2008] NSWCA 230
March v E & MH Stramare Pty Ltd [1991] HCA 12; (1991) 171 CLR 506
Mastronardi v State of New South Wales [2007] NSWCA 54
Mifsud v Campbell (1991) 21 NSWLR 725
Mt Isa Mines Ltd v Pusey [1970] HCA 60; (1970) 125 CLR 383
Munnings v Australian Government Solicitor [1994] HCA 65; (1994) 68 ALJR 169
National Insurance Company of New Zealand Ltd v Espagne [1961] HCA 15; (1961) 105 CLR 569
Philip Walton trading as Pitcher Walton & Co v Efato Pty Ltd [2008] NSWCA 86
Rees v Sinclair [1974] 1 NZLR 180
Saif Ali v Sydney Mitchell & Co [1980] AC 198
Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247
Sourlos v Luv A Coffee Lismore Pty Ltd [2007] NSWCA 203
Stead v State Government Insurance Commission [1986] HCA 54 (1986) 161 CLR 141
Walton v Efato Pty Ltd [2008] NSWCA 86
Wardley Australia Ltd v Western Australia [1992] HCA 55; (1992) 175 CLR 514
Waterways Authority v Fitzgibbon [2005] HCA 57; (2005) 221 ALR 402
Yates Property Corporation Pty Ltd v Boland (1997) 145 ALR 169
Zhang v Andrew Pine Furniture Pty Ltd [2004] NSWCA 250

TEXTS CITED: P Cane, "The new face of advocate's immunity" (2005) 13 Torts Law Journal 93.

PARTIES:
Monica Frances Symonds (First Appellant)
Gerald Henry Symonds (Second Appellant)
Cedric Bohrsmann Vass and the other 24 persons named in Schedule "A" to the Notice of Appeal (Respondents)

FILE NUMBER(S): CA 40860/07

COUNSEL: D M J Bennett QC; V R W Gray (Appellants/Cross Respondents)
R J Weber SC; T M Faulkner (Respondents/Cross Appellants)

SOLICITORS:
George Mallos Lawyer (Appellants/First & Second Cross Respondents)
Mallesons Stephen Jaques (Respondents/Cross Appellants)
Kemp Strang Lawyers (Third Cross Respondent)

LOWER COURT JURISDICTION: Supreme Court

LOWER COURT FILE NUMBER(S): SC 20994/01

LOWER COURT JUDICIAL OFFICER: Patten AJ

LOWER COURT DATE OF DECISION: 14 November 2007

LOWER COURT MEDIUM NEUTRAL CITATION: Monica Frances Symonds and Gerald Symonds v Cedric Borsmann Vass and 24 ors [2007] NSWSC 1274

CA 40860/07
SC 20994/01

BEAZLEY JA
GILES JA
IPP JA
10 JULY 2009

Monica Frances Symonds & Anor v Cedric Bohrsmann Vass & Ors

Headnote

FACTS

In March 1994 the appellants commenced proceedings in the Supreme Court of NSW against Mr Frank Egan and his company, Egan National Valuers (NSW) Pty Ltd, claiming damages for the losses they had suffered in relation the development of a property, Paradis Sur Mer. The appellants had retained Egan and his company as valuer and professional advisor in connection with the development.

The appellants were represented in their case against Egan and his company by the respondent, a firm of solicitors. The hearing commenced before Dowd J on 29 January 1996, and lasted nearly five weeks, after which time the appellants entered into a compromise of their claim. By that compromise the appellants received nothing in respect of their claim and agreed to pay their own costs.

The appellants then sued the respondent, alleging that, in the preparation of the case against Egan and his company, the respondent breached contractual and tortious duties it owed the appellants. These breaches, according to the appellants, resulted in them entering into the compromise and suffering damage falling under two heads: the loss of an opportunity to recover a large sum of damages from Egan and his company, and the loss resulting from delay and disruption in the proceedings.

The trial judge, Patten AJ, found that the respondent had committed breaches of duties as the appellants alleged. He dismissed the claim for loss of an opportunity, however, on two bases. First, his Honour held that the appellants had not proved that the breaches caused the appellants to lose the chance of succeeding in their proceedings against Egan and his company. Secondly, his Honour held that, in any event, the respondent was protected by advocate’s immunity because it prevented the appellants from relying on the compromise of the Egan proceedings as a component of their damages.

His Honour upheld the claim for damages for delay and disruption and awarded the appellants $140,000. His Honour held that the defence of advocate’s immunity did not apply to those breaches, as they were not intimately connected with the conduct of a case in court.

On appeal, the appellants challenged the dismissal of their claim for damages for loss of the chance of succeeding in the proceedings against Egan and his company. They contended that his Honour erred in holding that advocate’s immunity applied to their claim for loss of a chance damages, and erred in holding that they had failed to prove that the breaches of duty caused such damage. On cross appeal, the respondents challenged the finding that it committed breaches of duty and the finding that it was liable to the appellants for damages of $140,000.

HELD (Ipp JA dissenting) allowing the appeal and the cross appeal, and ordering a retrial

Breach of duty and causation

Per Ipp JA (Beazley and Giles JJA agreeing)

Digi-Tech (Australia) Ltd v Brand

Mastronardi v State of New South Wales

Soulemezis v Dudley (Holdings) Pty Ltd

Sourlos v Luv A Coffee Lismore Pty Ltd

Waterways Authority v Fitzgibbon

(ii) There was ample evidence before the trial judge capable of proving that the respondent had committed breaches of the duties it owed the appellants. The cross appeal should be upheld, however, to the extent that it seeks a retrial of the breaches of duty issues on the ground of inadequate reasons.

Beale v Government Insurance Office of NSW

Mifsud v Campbell

Mastronardi v State of New South Wales

Mallik v McGeown

Stead v State Government Insurance Commission

Advocate’s immunity

Per Beazley and Giles JJA

The finality principle, upon which advocate’s immunity is based, has not always been given full effect in the case law. The question whether advocate’s immunity applies cannot be determined without proper findings of negligence. Whether advocate’s immunity applies depends on a clear understanding of what occurred and of the respect or respects in which there was negligence and cannot be determined on a hypothetical basis. Accordingly, a new trial should be ordered.

Alpine Holdings Pty Ltd v Feinauer [2007] WASCA 85 referred to
Chamberlain v Ormsby [2005] NSWCA 454 referred to
Coshott v Barry [2009] NSWCA 34 referred to
Dansar Pty Ltd v Pagotto [2008] NSWSC 112 referred to
D'Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1 referred to
Francis v Bunnett [2007] VSC 527 referred to
Giannarelli v Wraith [1988] HCA 52; (1988) 165 CLR 543 referred to
Keefe v Marks (1989) 16 NSWLR 713 referred to
Walton v Efato Pty Ltd [2008] NSWCA 86 referred to

Per Ipp JA

(i) The appeal fails by reason of advocate’s immunity.

D'Orta-Ekenaike v Victoria Legal Aid

Rees v Sinclair

Saif Ali v Sydney Mitchell & Co

Giannarelli v Wraith

D'Orta-Ekenaike v Victoria Legal Aid

Keefe v Marks (1989) 16 NSWLR 713 referred to

CA 40860/07
SC 20994/01

BEAZLEY JA
GILES JA
IPP JA

10 JULY 2009

Monica Frances SYMONDS and Anor v Cedric Bohrsmann VASS and 24 Ors

Judgment

1 BEAZLEY JA: I have had the opportunity to read in draft the reasons of Giles JA and Ipp JA. I agree with the reasons of Giles JA and wish only to add the following short remarks.

2 As the reasons of each of Giles JA and Ipp JA demonstrate, the content and extent of the principle of advocate’s immunity and its application in a particular case is both problematic and troubling. This is particularly so if the immunity extends to the case of an omission, such as a failure to prepare the evidence necessary for trial, or the failure to give consideration to the correct parties to a claim.

3 In determining the outer limits of the immunity, the language of Mason CJ in Giannarelli v Wraith [1988] HCA 52; (1988) 165 CLR 543 may be significant. His Honour said at [21], 559-560:

“… where does one draw the dividing line? Is the immunity to end at the courtroom door so that the protection does not extend to preparatory activities such as the drawing and settling of pleadings and the giving of advice on evidence? To limit the immunity in this way would be to confine it to conduct and management of the case in the courtroom, thereby protecting the advocate in respect of his tactical handling of the proceedings. However, it would be artificial in the extreme to draw the line at the courtroom door. Preparation of a case out of court cannot be divorced from presentation in court. The two are inextricably interwoven so that the immunity must extend to work done out of court which leads to a decision affecting the conduct of the case in court.”

4 Mason CJ then accepted as correct the statement of McCarthy P in Rees v Sinclair [1974] 1 NZLR 180 at 187:

“... the protection exists only where the particular work is so intimately connected with the conduct of the cause in Court that it can fairly be said to be a preliminary decision affecting the way that cause is to be conducted when it comes to a hearing.”

5 Those statements bear the notion of some active decision making being involved. If that is correct, it may be that the immunity does not extend to an omission that occurs because the legal practitioner failed to turn her or his mind to the matter that is alleged to be negligent. An omission can arise as much from an active decision not to do something, as it can from a failure to turn one’s mind to a particular matter.

6 However, there are statements, in both Giannarelli and D'Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1 that might tend against that view. There is certainly extensive reference in both cases to the immunity extending to omission. The principle has also been applied in cases that might be seen as involving a failure by the practitioner to turn her or his mind to a particular matter: see, in particular Keefe v Marks (1989) 16 NSWLR 713 at 718.

7 In D'Orta-Ekenaike, Gleeson CJ, Gummow, Hayne and Heydon JJ made the following comments in the plurality judgment at [87], 31:

Giannarelli

8 These comments do not necessarily capture the distinction I have made above, nor do they necessarily extend the immunity as far as Ipp JA considers has been done. If that is so, it is apparent that the question whether advocate’s immunity applies in this case cannot be determined without proper findings of negligence.

9 Accordingly, I agree with Giles JA that the appeal should be allowed and the matter remitted for a new trial.

10 GILES JA: I gratefully draw upon the reasons of Ipp JA, which I have had the advantage of reading in draft, and assume familiarity with them in what follows. I respectfully differ from his Honour only to the extent that, not being persuaded that the appeal fails by reasons of advocate’s immunity, I consider that there should be a new trial.

11 As explained by Ipp JA, the trial judge’s findings of negligent conduct suffered from inadequacy in his Honour’s reasons. The trial judge’s basis for holding that the breaches of duty did not cause loss of the opportunity to recover damages from Egan was also erroneous. It was, however, open on the evidence to find negligence and causation of loss in that respect. I do not think that this Court could make findings on those matters, not having experienced first hand the evidence of Mr Klotz and the appellants. It would also not be appropriate to do so when the trial judge did not meaningfully assess the value of the lost opportunity. If the respondent be held liable, there will have to be a further hearing in which evidence of the appellants will come into the determination of that value. Accordingly, subject to the question of advocate’s immunity there should be a new trial in which negligence, causation and loss can be properly decided.

12 I go then to the question of advocate’s immunity.

13 The trial judge’s application of advocate’s immunity is difficult to understand. His Honour said at [153] that it applied to “everything which occurred after the commencement of the proceedings before Dowd J”, it seems meaning the commencement of the hearing, and prevented “any attack upon anything done by counsel or Mr Klotz in that period including the advice which led to the compromise of the action”. He said at [171] that, because advocate’s immunity prevented the appellants from relying on the compromise of the earlier proceedings as a component of their damages, he would “exclude from their damages an assessment of the value of their lost chance of success in the proceedings against Egan”. But he also said at [162], under the heading “causation”, that the appellants were not precluded by advocate’s immunity from recovery of damages representing the loss flowing from delay and disruption in the conduct of the trial, because the respondent’s breaches were not intimately connected with the conduct of the case in court, and referred at [167]-[168] to Mr Klotz’s “failure to apply his mind to the many difficulties inherent in the case” and failure to provide proper particulars, acceptance of a trial date for a case unready for trial and failure to seek a hearing date. As also explained by Ipp JA, the application of advocate’s immunity in relation to loss of the opportunity to recover damages from Egan was flawed.

14 Ipp JA has considered in detail the extent and application of the immunity, and I do not unnecessarily repeat the valuable discussion in his Honour’s reasons. On the law as expounded in the High Court the immunity extends to the work of a solicitor, not acting as an advocate, done out of court which is intimately connected with work in court, or on another statement of the test the work which leads to a decision affecting the conduct of the case in court. Its central justification is the finality principle, that a controversy once quelled should not be re-litigated in demonstrating that the lawyer’s negligence in the conduct of litigation caused damage to the client. Re-litigation in which it is asserted that, had the case been prepared and presented properly, a different result would have been reached is regarded as offending the finality principle.

15 Ordinarily the correct application of advocate’s immunity would be left for the new trial, to be determined upon the findings of negligence. The question in the new trial would be whether, having regard to the rationale for the immunity, the negligence of the respondent, if found, fell within the statement(s) of the test.

16 Can it be said that, assuming negligence in the respects alleged by the appellants, advocate’s immunity would necessarily apply? If it can, the appeal should be dismissed. It is not clear whether the cross-appeal should also be dismissed. While the respondent does not seek a new trial as to the wasted costs unless the appeal is upheld, that could leave reliance on advocate’s immunity as an answer to liability in damages for the wasted costs. If there is immunity from suit or no actionable duty of care, can any loss at all be recovered? It is not necessary to decide, since for the reasons which follow I do not think it can be said that advocate’s immunity would necessarily apply.

17 I go first to the respects in which negligence is alleged by the appellants. While recognising the inadequacy of the trial judge’s reasons, the appellants relied on findings of Patten AJ. They also provided a “summary of what [they submitted] Mr Klotz should have done in relation to the damages claim”.

18 Patten AJ found that the appellants proved the breaches alleged in sub-paras (a) to (i) and (k) of para 27 of the statement of claim. The appellants did not rely on sub-paras (c) or (g). The other sub-paragraphs were -

“(a) Failed to obtain a written opinion from counsel as to the Plaintiff’s prospects of success in the proposed proceedings against Egan prior to proceedings being commenced or at all.

(b) Failed to include in the Summons and Statement of Claim causes of action based on Mr F K Egan’s letter addressed to Mr G Symonds dated 30 August, 1990, letter dated 5 April 1991 addressed to Barclay’s Bank, the letters addressed to Mr G Symonds dated 6 February, 1992 and 28 February, 1992 and the Certificate of Valuation dated 18 December, 1991.

…

(d) Failed to advise with respect to the proper parties to be named in the Summons and the Statement of Claim; and either failed to advise that Senneh Pty Limited and/or Tisete Pty Limited and/or Tabard (Jersey) Limited should have been Plaintiffs in the action or wrongly applied for their joinder as Plaintiffs after the hearing had commenced.

(e) Failed to identify and plead to particularise the nature of the losses suffered by the Plaintiffs.

(f) Failed to respond to Egans Solicitors’ request for particulars (letter dated 19 December 1995) in relation to the Barclays Bank deed until ordered by the Court to do so. When they did respond, they failed to contend that the Barclays Bank Deeds were irrelevant.

…

(h) Taking a date for a five week hearing without having sought or obtained an advice on evidence when the Plaintiffs’ case was not ready for hearing.

(i) Failed to advise the Plaintiffs that the case was not property prepared ready for hearing and that an application could be made to vacate the hearing date, or once the hearing had commenced to apply for an adjournment of the hearing;

…

19 His Honour added more generally -

“157 Obviously some of the breaches were more significant than others. I am satisfied, in particular, on the probabilities that Mr Klotz failed to apply his mind to the significance to the case of the companies Senneh Pty Ltd, Tisete Pty Ltd, Tabard (Jersey) Limited and Gowrise Pty Ltd, and as to how the involvement of those companies could impact upon the pleading of the Plaintiffs causes of action. He also failed to give adequate or any consideration to the proper quantification of the Plaintiffs damages, including as to the impact upon those damages of the deeds of release. As a consequence, Dunhill Madden also failed to provide proper particulars to Egan’s solicitors.

20 It may be that not all the breaches found by Patten AJ would have causal significance. Some may go beyond work during and as part of the conduct of the case in court.

21 The appellants’ summary of what Mr Klotz should have done was -

“a. Either delivered a brief to counsel to advise on what should be relied upon as the correct method of calculating damages or properly and carefully considered this issue himself in relation to the possible alternative methods. Note that the contractual obligation was to obtain, prior to the commencement of proceedings, advice on ‘prospects of success’ (Red 39F). The respondent has submitted that this would merely have involved saying ‘if you are believed on reliance and your valuation evidence is preferred to that of the defendants, you will win’. This was insufficient. In the context, as Mr Hammerschlag recognised ‘prospects’ clearly included damages which involved determining methodology. (See Black vol 3 95-D-Q). The contractual obligation should have been complied with prior to the commandment of proceedings. The general duty required it to be done early enough to avoid the trial being prejudiced by uncertainty and unpreparedness.

b. Acted on the resulting advice or conclusion by particularising the damages and preparing what ever evidence was consequentially required.

c. Either delivered a brief to counsel to advise whether (and, if so, how) that advice or conclusion was affected by the Barclays deed and what arguments should be put and evidence tendered in relation to it or properly and carefully considered that issue himself. (See Black Vol 3 1101K-O). this should have been done early enough after the date of the deed to avoid the trial being prejudiced by the necessity to deal with this issue ‘on the run’ and unprepared when the defendants (as was inevitable) raised it.

22 Some of this also may go beyond work during and as part of the conduct of the case in court.

23 I then say something more of the statement(s) of the test.

24 In D’Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1 at [86] the plurality said that they did not consider that the two statements of the test differed “in any significant way”. Intimate connection suggests a closer relationship than leading to a decision affecting the conduct of the case, but it seems that affecting the conduct of the case is to be regarded as intimate connection. On the other hand, intimate connection does not call for a decision, if by that is meant an overt decision like the pleading guilty in that case. If the negligence lies in omission, the intimate connection test may be more meaningful. If a decision is made to prove certain facts, but the lawyer negligently fails to obtain evidence to prove the facts, perhaps there is a decision in the sense of a decision to proceed with the case without evidence to prove the fact, but in Gianarelli v Wraith (1988) 165 CLR 543 at 586 Brennan J left aside “liability for failure to carry out preliminary decisions … when that failure impairs the conduct of the case in court in the way intended”.

25 Advice to the client may fall within the statement(s) of the test. In D’Orta-Ekenaike v Victoria Legal Aid McHugh J said of a “failure to warn” basis of negligence -

“157 … The issue is whether the relevant connection with the conduct of the litigation exists, not the form of the negligence. An integral part of the advocate's role is the giving of advice on the basis of which the client will give instructions that direct the course of proceedings. The advice is critical to and often determinative of the client's decision. There is no relevant distinction between instructions given on negligent advice and the negligent carrying out of instructions if both are intimately connected with the conduct of litigation.”

26 The rationale enunciated in D’Orta-Ekenaike v Victoria Legal Aid could bring a wide application of the immunity. Whether the work is negligently performed through act or through omission, and whether or not it leads to an overt decision, there cannot be re-litigation in which it is asserted that, but for the negligence, a different result would have been reached. According to the rationale, it does not matter that the client does not seek to overturn the prior result, but uses it as the basis for complaint. The re-litigation is regarded as challenging a lawful result and so as offending the finality principle, distinguished from challenge by appeal because it would be re-litigation “of a skewed and limited kind” (D’Orta-Ekenaike v Victoria Legal Aid at [45]).

27 The wide reach of the finality principle is evident from the outcome in D’Orta-Ekenaike v Victoria Legal Aid. The client was ultimately acquitted, and the impugned result was his initial conviction, overturned on appeal. The initial conviction was itself not a conviction on his guilty plea, but after the guilty plea was led in evidence at the trial.

28 The courts are of course bound to apply advocate’s immunity as the common law has been laid down by the High Court. But when the test(s) “describe the acts or omissions to which immunity attaches by reference to the conduct of the case” (D’Orta-Ekenaike v Victoria Legal Aid at [87]), the application depends on the acts or omissions and their part in the conduct of the case, and is likely to be fact-specific. How has it been applied?

29 In D’Orta-Ekenaike v Victoria Legal Aid at [154] – [156] McHugh J said -

Rees v Sinclair

]

Keefe v Marks

Munnings v Australian Government Solicitor

Giannarelli v Wraith

Biggar v McLeod

Keefe v Marks

Saif Ali v Sydney Mitchell & Co

MacRae v Stevens

Donellan v Watson

Heydon v NRMA Ltd

30 The plurality did not collect examples in the same way. McHugh J accepted a like test of work which “would require the impugning of a final decision of a court or the re-litigation of matters already finally determined by a court” (at [168]), and did not cast doubt on the examples he gave. Nor did the plurality suggest that cases which had been decided according to the “boundary for the operation of the immunity” (at [85]) laid down in Gianarelli v Wraith had been incorrectly decided.

31 McHugh J did not refer to Yates Property Corporation Pty Ltd v Boland (1997) 145 ALR 169 (Branson J) as approved for its “practical application of the immunity” in Boland v Yates Property Corporation Pty Ltd [1999] HCA 64; (1999) 74 ALJR 209 at [97] (Gleeson CJ); see also at [363] (Callinan J), perhaps because the various observations were obiter. Her Honour at 220 would have found that the immunity extended to a barrister’s failure to consider a matter or issue with consequential failure to advise with respect to it. As to the solicitors, her observations at 222 included that if the solicitors acted without due care skill and diligence it had not been shown that their failure affected the conduct of the case, it seems because the conduct of the case was in the hands of the barristers. This suggests a real causal question in the application of the test(s).

32 In MacRae v Stevens (1996) Aust Torts Rep 81-405 advising that proceedings had to be commenced in Queensland was regarded as not concerned with the management of the case. Beazley JA said at 63,690 that “it would be an artificial construct to say such advice ‘leads to a decision affecting the conduct of the case in court’, merely because it can be said to have a connection with the litigation”.

33 In Donellan v Watson (1990) 21 NSWLR 335 the parties compromised on the basis that an appeal should be withdrawn, but the solicitor mistakenly consented to an order that the appeal be upheld. Mahoney JA, with whose reasons Waddell AJA agreed, noted that there was no contested hearing and that the order as made was not collaterally attacked, and considered that the case did not fall within the rationale of advocate’s immunity. The rationale to which his Honour referred included (at 337) “the adverse consequences of the re-litigation of issues determined in a court proceeding”.

34 Non-exhaustive reference may be made to cases since D’Orta-Ekenaike v Victoria Legal Aid.

35 In Chamberlain v Ormsby [2005] NSWCA 454 it was held that negligence in advising in relation to a compromise of proceedings was within the immunity. But it has also been held, on strike-out applications, that it is arguable that advice in relation to compromise falls outside the immunity because there is no quelling of the controversy by the exercise of judicial power in the determination of the issues in the case: Francis v Bunnett [2007] VSC 527; (2007) 18 VR 98 (Lasry J); Alpine Holdings Pty Ltd v Feinauer [2008] WASCA 85 (Steytler P and Newnes AJA); see also Kelley v Carston [1998] QB 686. Whether for the finality principle it is sufficient that there be a result, although not a result through judicial determination, may not be definitively established, although Biggar v McLeod (1978) 2 NZLR 9 involved a negligently advised settlement.

36 In Walton v Efato Pty Ltd [2008] NSWCA 86 counsel advised that evidence of solvency should be obtained, but the solicitor failed to obtain it. On the basis that it was difficult to identify the decision to which that led affecting the conduct of the case in court, it was doubted whether advocate’s immunity applied. It was not necessary to come to a conclusion.

37 In Coshott v Barry [2009] NSWCA 34 failure to advise as to the extent of relief to be claimed in the proceedings was regarded as “too far removed from the actual conduct of the trial to be covered by the doctrine of advocate’s immunity” because not leading to a decision affecting the conduct of the case in court (at [62]). This may be compared with Keefe v Marks (1989) 16 NSWLR 713, where failure to plead or claim interest was held to be within the immunity.

38 In Dansar Pty Ltd v Pagotto [2008] NSWSC 112 Harrison J held that advocate’s immunity did not apply because, amongst other reasons -

“90. … the advice that it is alleged ought to have been given by the defendants was not connected with the conduct of the first proceedings but rather related to the question of whether or not they should have been brought to an end. That did not involve a forensic decision about how the case was to be conducted. In D'Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1 the High Court confirmed that the immunity (if it operates) extends to the instructing solicitor as well as to counsel: see [90] and [168]. However, the work must still be ‘work done out of Court which leads to a decision affecting the conduct of the case in Court’ or ‘work intimately connected with’ work in Court: D'Orta at [86].

conduct

D'Orta

Giannarelli

Rees v Sinclair

the way

39 I do not refer to these examples in approval or disapproval, but to make the point that the finality principle has not always been given full effect. There may be questions of pre-commencement work, of failure to carry out decisions, of advice as to prospects and of need for judicial determination. On ascertained facts, questions of that kind arising in the present case could be decided. But there should be ascertained facts.

40 It may not be easy to see a clear line between work done prior to the commencement of proceedings, such as advice on the prospects of success or on appropriate defendants and causes of action, and the conduct of the proceedings. It may not be easy, more particularly, to see a clear line between work done in the course of the proceedings and advice given in relation to compromise. Work done prior to commencement of proceedings can lead to decisions as to their conduct, and work done leading to decisions as to their conduct is likely to underpin advice in relation to compromise. More widely, work done leading to decisions as to the conduct of the proceedings is likely to govern whether the client is advised about preparedness for a hearing or about prospects as the hearing looms, and what advice is given. But there can not be excluded negligent failure in these respects which does not satisfy the statement(s) of the test. Deciding the application of the immunity requires a clear understanding of what occurred and clear findings of the respect or respects in which there was negligence on the part of the lawyer.

41 The negligence alleged by the appellants includes failure to obtain advice as to prospects of success prior to the commencement of the proceedings, and more particularly failure as part of obtaining that advice to consider the correct basis for damages. It includes failure to advise that the case was not properly prepared for a hearing and failure to reconsider and advise as to the merits prior to the hearing. No doubt the focus of the allegations is on failure to consider the proper basis for claiming damages having regard to the contingent, and later the actual, effect of the Barclay’s deed, and to prepare with evidence accordingly. It may be that any negligence in that central respect would attract advocate’s immunity. But I do not think that it can safely be concluded, on what amounts to an hypothetical basis, that negligence in all the respects alleged by the appellants falls within advocate’s immunity.

42 Courts are ordinarily, and properly, astute to come to decisions upon facts as found, and not upon assumed facts. The old procedure of demurrer operated, not always satisfactorily, on precisely pleaded allegations, but a notional demurrer cannot resolve the appeal. On a notional strike-out the high standard of unarguability for which General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125 is conventionally cited is not achieved. As Ipp JA has pointed out, with reference to Keefe v Marks, fine distinctions should not be drawn and the immunity cannot be circumvented by the construction of allegations of damage. Fully appreciating that, in my opinion it cannot properly be determined on appeal that advocate’s immunity applies so as to provide a complete defence to the appellants’ claim against the respondent.

43 As I have said, it may be that not all the breaches on which the appellants rely would have causal significance. The respondents sought to categorise them in such a way that, in their submission, the breaches would not have caused loss of the opportunity to recover damages from Egan. That too depends, in my view, on a clear understanding of what occurred and of the respect or respects in which there was negligence, and causation also cannot properly be determined on appeal on what amounts to an hypothetical basis.

44 It may be that in the end it will be held that the appellants’ claim is defeated by advocate’s immunity. They no doubt will take advice. However, for the reasons above a new trial should be ordered.

45 The costs of the trial before Patten AJ should be left for disposal by the judge conducting the new trial in the light, amongst other things, of its conduct and result. The costs on appeal are difficult. The appellants and the respondents each had valid complaints. A result come to on appeal can aid in the disposition of costs, but not in the present case. A complex assessment of costs of the appeal and costs of the cross-appeal should be avoided if possible. On a necessarily broad-brush approach, the appellants have had greater success on the substantive matters debated than the respondents, and the respondents should pay 70 per cent of the appellants’ costs on appeal.

46 I propose the orders -

1. Appeal and cross-appeal allowed.

2. Set aside orders 1 to 8 made by Patten AJ on 13 December 2007.

3. Remit the proceedings to the Common Law Division for a new trial on all issues.

4. Costs of the trial before Patten AJ to be in the disposal of the judge conducting the new trial.

:

The appeal and cross-appeal

48 This appeal and cross-appeal arise out of a claim for damages for professional negligence brought by the appellants against the respondent, a firm of solicitors. The appellants’ claim against the respondent concerns the respondent’s conduct, on the appellants’ behalf, of an action brought by the appellants for damages against Mr Frank Egan and his company, Egan National Valuers (NSW) Pty Ltd. I shall refer to Mr Egan and his company as “Egan”.

49 Dowd J presided over the trial of the appellants’ claim against Egan. After a hearing lasting nearly five weeks, the appellants entered into a compromise of their claim. By that compromise the appellants received nothing in respect of their claim and agreed to pay their own costs. The sole benefit they received from the compromise was that they escaped any liability to pay Egan’s costs (for which they would probably have been held liable if, at the end of the trial, judgment had been given in favour of Egan).

50 The appellants then sued the respondent. In broad terms they alleged that, in the preparation of the case against Egan, the respondent breached contractual and tortious duties it owed the appellants. These breaches, according to the appellants, resulted in them entering into the compromise and suffering damage. The appellants alleged that the damage so caused fell under two heads. The first was the loss of an opportunity to recover a large sum of damages from Egan. The second was loss resulting from delay and disruption in the proceedings.

51 Patten AJ found that the respondent had committed breaches of duties as the appellants alleged. He dismissed the claim for loss of an opportunity in the Egan proceedings, but upheld the claim for damages for delay and disruption. He awarded the appellants $140,000 under the latter head.

52 The appeal concerns the claim for loss of the opportunity of a better outcome in the Egan proceedings. The cross-appeal, as originally framed, challenges the award of $140,000 for delay and disruption and also asserts grounds on which it was contended this Court should uphold his Honour’s dismissal of the claim for loss of opportunity. The latter arguments should more properly have been the subject of a notice of contention but the appellants accepted that matters raised in the cross-appeal could be relied on to resist the appeal, and nothing turns on the way in which the issues were brought before this Court.

53 The cross-appeal challenges the findings Patten AJ made to the effect that the respondent had breached the duty it owed the appellants. Determination of the appeal raises issues concerning advocate’s immunity and causation. These issues would ordinarily require precise findings of how the respondent breached its duty. The respects, if any, in which the respondent breached its duty, was an issue raised by both the cross appeal and the appeal. Nevertheless, the appeal was argued before the cross-appeal.

The appellants’ claim against Egan

54 The appellants’ claim against Egan concerned the development of a property known as Paradis Sur Mer, 7 Wolseley Crescent, Point Piper. The appellants were the developers of Paradis Sur Mer and retained Egan as a valuer and professional advisor in connection with the development.

55 The development was a failure and, in consequence, the appellants sustained a loss of several millions of dollars. The appellants asserted that, in proceeding with the unsuccessful development, they relied on incorrect valuations by Egan. They brought proceedings against Egan, claiming damages for the loss they had suffered.

56 The appellants based their case against Egan on four alternative causes of action, namely, breach of contract, negligence, and misleading or deceptive conduct under the Trade Practices Act 1974 (Cth) or the Fair Trading Act 1987.

57 On 29 January 1996 the Egan trial commenced. Mr Hammerschlag, then of counsel, appeared (at first, alone) for the appellants, instructed by the respondent. Mr Stephen Klotz, a solicitor then in the employ of the respondent, had carriage of the appellants’ case on behalf of the respondent. On 1 February 1996, Mr Klotz retained Mr Spender QC to lead Mr Hammerschlag. Mr Stitt QC with Mr J Simkins represented Egan.

58 The trial continued until 28 February 1996, on which date the appellants and Egan entered into the compromise agreement. In consequence of the compromise, Dowd J made orders by consent. These orders included judgment for Egan against the appellants. As I have mentioned, the effect of the compromise (and the orders) was that the appellants failed to recover any part of the damages that they had claimed.

59 Opening the appellants’ case proved to be a difficult task. Counsel for the appellants was frequently interrupted by objections from Mr Stitt, most of which Dowd J upheld. As the opening proceeded, his Honour began to display a degree of acerbity and hostility towards the appellants’ case.

60 Mr Stitt’s objections led to attempts by the appellants to amend their statement of claim. Eventually the statement of claim was amended and additional parties, two companies controlled by the appellants, were joined as plaintiffs. These new plaintiffs were pleaded as having claims only in the event of the appellants failing in their claim (the joinder of these new plaintiffs was described by Mr Weber SC, who together with Mr Faulkner appeared in the appeal for the respondent, as a “fall-back position”).

61 The joinder led to further interlocutory applications, including an application by Egan for security for costs. The atmosphere in the court deteriorated to the extent that the appellants made two applications for Dowd J to disqualify himself. One of these applications was withdrawn and the other was unsuccessful. The opening was adjourned to enable the appellants to apply to this Court for leave to appeal against certain interlocutory orders made by Dowd J. That application for leave was unsuccessful.

62 The appellants’ counsel spent the entire period from 29 January 1996 (when the trial commenced) until 28 February 1996 (when the compromise was arrived at and Dowd J ordered judgment for Egan) opening the appellants’ case. No oral evidence was adduced.

The appellants bring proceedings against the respondent

63 Nearly six years later, on 13 December 2001, the appellants commenced proceedings against the respondent. Their claim was based on allegations that the respondent had breached its retainer agreement and, alternatively, a duty of care it owed at common law to the appellants “with respect to the bringing of the proceedings [against Egan] and the conduct and preparation of [that] case for hearing”. Patten AJ presided over this trial.

64 His Honour found, principally, as follows:

(a) The appellants had proved ten breaches of duty (in contract and in negligence) by the respondent. In these reasons, I use “breaches of duty” as a compendious term to describe the breaches both in contract and in negligence that his Honour found.

(b) The appellants had proved that the breaches caused “delay and disruption in the conduct of the trial”.

(c) The defence of advocate’s immunity did not apply to the breaches that caused delay and disruption as those breaches were not “intimately connected with the conduct of a case in court”.

(d) The damages caused by disruption and delay amounted to $140,000 (in which sum the appellants were entitled to judgment); this sum represented part of the fees that the appellants had paid the respondent and which, according to his Honour, were wasted by reason of the respondent’s breaches.

(e) The appellants had not proved that the breaches caused the appellants to lose the chance of succeeding in their proceedings against Egan.

(f) In any event, advocate’s immunity prevented the appellants “from relying on the compromise of the earlier proceedings as a component of their damages”.

(g) Therefore, the appellants failed in proving that they were entitled to damages for the loss of the chance of succeeding in their proceedings against Egan.

The relief sought and the issues raised in the appeal and cross-appeal

65 In their appeal to this Court, the appellants challenged his Honour’s dismissal of their claim for damages for loss of the chance of succeeding in the Egan proceedings. Essentially, the appellants contended that his Honour erred in holding that advocate’s immunity applied to their claim for loss of a chance damages, and erred in holding that they had failed to prove that the breaches of duty caused such damage.

66 As I have mentioned, the respondent’s cross-appeal challenged the finding that it committed breaches of duty and the finding that it was liable to the appellants for damages of $140,000.

67 During the course of the hearing of the appeal, Mr Bennett QC, who together with Mr Gray appeared for the appellants, limited the relief the appellants sought to a retrial of their claim for damages for loss of the chance of succeeding in the Egan proceedings.

68 On the second day of the appeal, Mr Weber also limited the relief sought by the respondent in the cross-appeal. What Mr Weber intended to convey in this regard is not entirely clear. There are two factors that complicate the question. Firstly, the appeal transcript on this issue may not be entirely accurate. Secondly, the parties’ submissions did not always take account of the way in which the issues on the appeal and the cross-appeal were interdependent. While the relief that Mr Weber was seeking in the cross-appeal (in the event of the appeal succeeding) is plain enough, it is not entirely clear to what extent, should the appeal fail, he limited the relief sought in relation to the order for damages of $140,000. I shall explain how this uncertainty arises.

69 Shortly before the luncheon adjournment on the second day of the appeal, the presiding judge, Beazley JA, asked Mr Weber (at Appeal Transcript 39) whether the respondent sought a retrial of the $140,000 claim should the court consider that the cross-appeal succeeds to the extent that the breaches of duty issues should be retried, but not be prepared to find, affirmatively, that there were no breaches of duty on the part of the respondent. Mr Weber replied, “Only if the appeal was successful”. In other words, Mr Weber was saying that he only sought a retrial of the $140,000 claim in the event of the appeal succeeding. He clarified this as follows:

“In other words we would live with the court not feeling like it was in a position to overturn the trial judge on the findings of negligence and not go back for a retrial, but in the event that the appeal was successful then we think there should be a complete retrial … .”

70 I understood this statement to mean that, should the court dismiss the appeal and also hold that the findings as to breaches of duty by the respondent should stand, the respondent did not want a retrial on the claim for damages of $140,000. On the other hand, should the appeal be upheld, the respondent sought a retrial on all issues, including the damages claim of $140,000. I intend to proceed on this basis.

71 I accept, however, that I may have misunderstood Mr Weber. I would therefore give liberty to the respondent to apply if it wishes to argue that my understanding is incorrect.

72 In his opening argument in the appeal, Mr Bennett made two main submissions. The first was that his Honour erred in finding that advocate’s immunity was a defence to the appellants’ claim. Mr Bennett submitted that his Honour had incorrectly applied the doctrine of advocate’s immunity to the issue of causation, whereas it was only capable of applying to the issue of breach. The second was that his Honour erred in finding that the appellants had not proved causation. He submitted that his Honour should have held that the respondent’s breaches of duty caused the appellants to lose the chance of succeeding in their proceedings against Egan. Mr Bennett further submitted that his Honour failed to give adequate reasons for all his decisions adverse to the appellants. He sought a retrial of the causation issue.

73 Mr Weber supported his Honour’s ultimate findings as to causation (although he did not argue, in opposition to Mr Bennett, that his Honour had given adequate reasons for those findings). He submitted, further, that advocate’s immunity protected the respondent from liability, including liability for the loss of a chance.

74 Mr Weber also submitted, in the cross-appeal, that Patten AJ had erred in finding breaches of duty on the part of the respondent. He submitted that the judge had failed to make findings of primary facts from which breaches of duty could be inferred and had given inadequate reasons for his conclusions in this regard. Mr Weber submitted that it was open to this Court to make the necessary findings of fact itself and that, should it do so, those findings would lead to the conclusion that the respondent had not breached any duty. Mr Weber submitted, in the alternative, that there should be a retrial of the breaches of duty issue. Mr Bennett did not argue that his Honour’s reasons for his findings on the breaches of duty issue were adequate. Mr Gray, who argued this part of the case on the appellants’ behalf, submitted that there was ample evidence capable of supporting findings of breaches of duty.

The resolution of the appeal and the approach to the remaining issues

75 In my opinion, the appeal fails by reason of advocate’s immunity. In accordance with my understanding of the relief sought by the respondents (as set out above), in these circumstances they do not seek a re-trial of the claim for damages for delay and disruption.

76 I shall proceed to deal with the issues raised by the cross-appeal and the causation issue raised by the appeal. I shall do so, not only because of what is stated in Kuru v State of New South Wales [2008] HCA 26; (2008) 236 CLR 1 about the duty of intermediate courts of appeal to deal with all grounds of appeal, but also because I think that the appellants, in light of the unfortunate history of the proceedings so far, are entitled to have their arguments fully addressed.

77 As appears from what follows, I would uphold the appellants’ arguments on the issues other than advocate’s immunity and consider that the cross-appeal should succeed to the extent that the breaches of duty issues should be re-tried. These views, however, are predicated on my conclusion that advocate’s immunity applies and the appeal fails.

Advocate’s immunity

78 Patten AJ held that, by reason of advocate’s immunity, the respondent was not liable to the appellants for the loss of the chance of succeeding in the Egan action. His Honour’s reasoning was based on the proposition that advocate’s immunity applied to everything done by the respondent (and Mr Klotz on its behalf) after the commencement of the trial and, in particular, in connection with the compromise of the action. His Honour said (at [153]-[154]):

“In my opinion, advocate (sic) immunity clearly applied to everything which occurred after the commencement of the proceedings before Dowd J. The immunity … prevents any attack upon anything done by counsel or by Mr Klotz in that period including the advice which led to a compromise of the action.

That decision [to terminate the proceedings by the compromise], its implementation and the discussions and advice which preceded it were, in my opinion, protected by advocate (sic) immunity.”

79 The appellants, however, did not contend that Mr Klotz (and through him, the respondent) negligently caused the compromise to be entered into. The compromise, on the appellants’ case, was merely a link in the causal chain connecting alleged earlier breaches of duty by Mr Klotz to the damages they claimed. On this basis, advocate’s immunity had no application to the compromise. Furthermore, the appellants’ case alleged breaches of duty on an ongoing basis for more than a year before the trial commenced. The appellants’ case did not allege breaches of duty after the trial commenced. Accordingly, his Honour’s reasoning in regard to the application of advocate’s immunity, as set out in [153] of his reasons, cannot be sustained.

80 Mr Weber did not seek to support his Honour’s reasoning. Rather he submitted that advocate’s immunity applied to those breaches of duty actually relied on by the appellants (that is, acts and omissions by the respondent that occurred prior to the commencement of the trial and the entry of the compromise). This submission focuses attention upon the true issue of advocate’s immunity in this appeal.

81 In dealing with that issue, it is first necessary to define the breaches of duty said to have caused the damage. This exercise involves issues raised by the cross appeal. For the purposes of this part of my reasons I shall, however, assume that the breaches of duty submitted by Mr Bennett and found by Patten AJ are correct.

82 Mr Bennett submitted that “the main negligence” on the part of the respondent was a “failure to analyse and prepare the case properly”. He said, “It was simply going to court totally unprepared as to what was being claimed [and] how it was being claimed.” Later, he expanded on this submission, saying, “It was a failure to have organised, to have worked out the precise basis [of the damages claimed], worked out the problems and worked out the way they were going to be dealt with.” In subsequent, written submissions filed by Mr Bennett and Mr Gray on behalf of the appellants, it was contended, in effect, that the respondent was negligent in failing, in good time (and prior to the trial):

(a) to brief counsel to advise on the most appropriate method of calculating and proving damages (having regard to the different possible factual scenarios that might obtain), and properly and carefully to examine and consider these issues itself;

(b) to brief counsel to advise as to how the appellants’ damages could be affected by two documents referred to at the trial as the “Barclay Deeds” (and, in particular, how those damages would be affected by the first Barclay Deed becoming unconditional) and properly and carefully to consider these issues itself; and

83 The particulars of negligence as formulated in the previous paragraph are not in precisely the same terms as those pleaded in paras 27 (a), (b), (c), (d), (e), (f), (g) (h), (i), and (k) (being the breaches of duty found by Patten AJ to have been established). Nevertheless, having regard to the width of the pleaded particulars and the way in which the case was run at trial, including the evidence that was led, I am satisfied that it is open to the appellants, on appeal, to put their case in the way set out in the previous paragraph.

84 Patten AJ made findings as to particular negligent conduct on the part of the respondent (through Mr Klotz) that fall squarely within the formulation of the breaches of duty articulated by the appellants. These findings (to which I refer below) reinforce the conclusion that the breaches of duty as so formulated are in accord with the way in which the appellants presented their case at trial.

85 The first set of the findings concerned three companies (the “Corporate Guarantors”) who - to facilitate the financing of the development of Paradis Sur Mer - guaranteed the appellants’ liabilities to the Bank and mortgaged properties owned by them as security for those liabilities. The first finding was that Mr Klotz, in preparing the case for trial, failed to apply his mind to the significance of the involvement of the Corporate Guarantors in the development of Paradis Sur Mer and “to how the involvement of those companies could impact upon the pleading of the [appellants’] causes of action” (at [157]).

86 The second finding (at [157]) was that Mr Klotz “failed to give adequate or any consideration to the proper quantification of the [appellants’] damages, including as to the impact upon those damages [of the Barclay Deeds]”.

87 Other relevant findings that fall within the formulation articulated on appeal are:

(a) “[The respondent] … failed to provide proper particulars to Egan’s solicitors” (at [157]);

(b) “The case against Egan was not ready for hearing and [the respondent] was negligent and in breach of [its] contractual obligations when [it] accepted a date for hearing and thereafter failed to apply for vacation of the hearing date” (at [158]);

(c) “[Mr Klotz failed] to apply his mind to the many difficulties inherent in the case” (at [167]), and;

88 The respondent, by its cross-appeal, challenges these findings. I mention the findings at this point, however, as they support the conclusion that the breaches of duty as formulated by the appellants on appeal are within the way the case was presented at trial.

89 The question that arises is whether advocate’s immunity applies to the breaches of duty so formulated. In considering this question it is necessary to bear in mind that the breaches of duty on which the appellants rely are not breaches by the respondent acting as an advocate, either in the court or outside it. They are breaches that are alleged to have been committed before the trial commenced (and not in court) by the respondent acting purely as a solicitor. It is not alleged that the barristers who represented the appellants were negligent in any respect.

90 There is a linguistic anomaly in applying the doctrine of advocate’s immunity to a person who did not purport to act as an advocate. This anomaly focuses the mind on the problem, namely, what is the boundary of the immunity; that is, to adopt the language now in fashion concerning duty of care, what is the “scope” of the immunity? In particular, does it apply to solicitors doing work in connection with court proceedings but other than as an advocate?

91 The current position in Australia relating to advocate’s immunity stems from what was said by McCarthy P in Rees v Sinclair [1974] 1 NZLR 180 at 187:

Each piece of before-trial work should, however, be tested against the one rule; that the protection exists only where the particular work is so intimately connected with the conduct of the cause in Court that it can fairly be said to be a preliminary decision affecting the way that cause is to be conducted when it comes to a hearing.

92 Kirby J, in D’Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1 (at [291], 92), pointed out that McCarthy P’s dictum expanded the immunity to out-of-court advice. Not until Rees v Sinclair was the notion propounded that advocate’s immunity extended to pre-trial work.

93 McCarthy P’s dictum was adopted in Saif Ali v Sydney Mitchell & Co [1980] AC 198 by Lord Wilberforce (at 215), Lord Diplock (at 224), and Lord Salmon (at 232). Lord Wilberforce (at 215) said that the immunity attached to “a solicitor acting as an advocate in court” but “only in the area in which it extends” (presumably, his Lordship had in mind the limitations contained in the words of McCarthy P underlined above). Lord Diplock (at 224) regarded Rees v Sinclair as a “limited extension” of the immunity. These views coincided with the opinion of McCarthy P that “[t]he protection should not be given any wider application than is absolutely necessary in the interests of the administration of justice”.

94 In Giannarelli v Wraith [1988] HCA 52; (1988) 165 CLR 543 Mason CJ (at 559) agreed with the views expressed by Lord Wilberforce, Lord Diplock and Lord Salmon in Saif Ali that: “[T]he same immunity attaches to a solicitor acting as an advocate in court as attaches to a barrister”. This statement suggests that a solicitor would only be able to rely on the immunity if he or she was “acting as an advocate” (albeit that his Honour agreed with McCarthy P that the protection existed if the work out of court was “intimately connected with the conduct of a cause in court”).

95 In Giannarelli Mason CJ (at 560) said that “the immunity must extend to work done out of court which leads to a decision affecting the conduct of the case in court”. His Honour did not in this sentence mention the qualification that the work involved must be “intimately connected with the conduct of the cause in court”. Nevertheless, Mason CJ expressly approved McCarthy P’s dictum in Rees v Sinclair and warned, “to take the immunity any further would entail a risk of taking the protection beyond the boundaries of the public policy considerations which sustain the immunity”. Wilson J was of similar mind when saying (at 577) that: “It is the function of advocacy that attracts the immunity”. See also Dawson J at 596.

96 D’Orta-Ekenaike involved a claim by the appellant (Mr D’Orta-Ekenaike) against the Victorian Legal Aid Commission (VLA). VLA, acting as instructing solicitor, had advised the appellant to plead guilty to a criminal charge against him. In later proceedings the appellant alleged that that advice had been negligently given and he had, in consequence, suffered damage. VLA relied on advocate’s immunity.

97 Gleeson CJ, Gummow, Hayne and Heydon JJ (the “plurality”) dealt (at [90], 32) with the position of VLA as a solicitor as follows:

“No relevant distinction could be drawn between the junior of two counsel retained to appear for an accused tendering advice of the kind of which the applicant complains and the instructing solicitor tendering that advice … The duties which each owes the client are identical. The content of the advice is identical. It cannot be said that the advice of one is more closely related to the court proceedings than the other, let alone one being intrinsically superior to or more effective than the other (if such a distinction were possible or relevant).”

98 The appellant in D’Orta-Ekenaike was represented in the criminal proceedings by a barrister instructed by a solicitor (on behalf of VLA). The plurality said (at [90], 32) that considerations of finality that underpinned the maintenance of advocate’s immunity required that the immunity extend to advice given by the solicitor as well as that given by the barrister.

99 Their Honours expressly dispelled any notion that the immunity does not extend to a solicitor not acting as an advocate (see at [91], 32). The majority (Gleeson CJ, McHugh, Gummow, Hayne, Callinan and Heydon JJ) held that the instructing solicitor, who was not acting as an advocate, was entitled to the immunity.

100 In dealing with the test for advocate’s immunity, the plurality stated (at [86], 31):

“[T]here is no reason to depart from the test described in Giannarelli as work done in court or ‘work done out of court which leads to a decision affecting the conduct of the case in court’ or, as the latter class of case was described in the Explanatory Memorandum for the Bill that became the Practice Act, ‘work intimately connected with’ work in a court. (We do not consider the two statements of the test differ in any significant way).”

101 Their Honours went on (at [87], 31) to say:

Gianarelli

102 Their Honours concluded (at [91], 32):

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

103 As a matter of language, there is a difference between “work done out of court which is intimately connected with the conduct of a case in court” and “work done out of court which leads to a decision affecting the conduct of the case in court”. The omission of the qualification that the work be “intimately connected with the conduct of a case in court” is capable of extending the scope of the immunity. In light of D’Orta-Ekenaike, what weight, if any, must now be attributed to that qualification?

104 In my opinion, a significant pointer to this question is to be found in the rationale for the immunity as expressed in D’Orta-Ekenaike. As Professor Cane has said, “one would expect the scope of advocate’s immunity to reflect its rationale” (See P Cane, “The new face of advocate’s immunity” (2005) 13 Torts Law Journal 93).

105 Put shortly, the principal rationale of the majority in D’Orta-Ekenaike is the finality of litigation principle. It is thus difficult to resist the proposition that advocate’s immunity applies to any claim that requires the re-litigation of a decided case on the alleged ground that any work done out of court (leading to a decision affecting the conduct of the decided case in court) was negligently done by a solicitor or barrister. On this basis, “work done out of court which leads to a decision affecting the conduct of the case in court” is work that is “intimately connected with the conduct of a case in court”. This explains the statement by the plurality in D’Orta-Ekenaike that the two expressions of the test do not differ in any significant way.

106 The plurality (at [31], 16 and [35], 17-18) stressed that the administration of justice would suffer adverse consequences from the re-litigation, in collateral proceedings for negligence, of issues determined in the principal proceedings. They said (at [45], 20-21):

“[T]he central justification for the advocate’s immunity is the principle that controversies, once resolved, are not to be reopened except in a few narrowly defined circumstances. This is a fundamental and pervading tenet of the judicial system, reflecting the role played by the judicial process in the government of society. If an exception to that tenet were to be created by abolishing that immunity, a peculiar type of re-litigation would arise. There would be re-litigation of a controversy (already determined) as a result of what had happened during, or in preparation for, the hearing that had been designed to quell that controversy. Moreover, it would be re-litigation of a skewed and limited kind.”

107 Their Honours went on (at [66], 26) to state:

“In every case the complaint must be that a consequence has befallen the client which has not been, and cannot be, sufficiently corrected within the litigation in which the client was engaged. That consequence may take a number of forms. For the moment, it will suffice to identify what may appear to be the three chief consequences: (a) a wrong final result; (b) a wrong intermediate result; and (c) wasted costs.”

108 Their Honours proceeded to give examples of complaints of the kind referred to at [66] and then said (at [70], 27):

In particular, leaving cases of wasted costs aside, the client wishes to assert that, if the case had been prepared and presented properly, a different final, or intermediate, result would have been reached.

lawful

lawfully

109 McHugh J’s reasoning is similar to that of Gleeson CJ, Gummow, Hayne and Heydon JJ. It is encapsulated by the following paragraph ([168], 56):

Accordingly, the immunity should extend to any work, which, if the subject of a claim of negligence, would require the impugning of a final decision of a court or the re-litigation of matters already finally determined by a court

110 I draw attention to the statement of the plurality at [70] that I have underlined at [108] above, namely:

“In particular, leaving cases of wasted costs aside, the client wishes to assert that, if the case had been prepared and presented properly, a different final, or intermediate, result would have been reached.”

111 The assertion that their Honours so identified constitutes the basis of arguments by clients that:

(a) prior to trial, their solicitors made negligent decisions and negligently failed to prepare the case properly;

(b) the negligence in question led to decisions affecting the presentation of the case in court by a barrister;

(c) as a result of that negligent conduct, the trial judge granted judgment in favour of the opposing side;

(d) but for that negligent conduct, the trial judge would have granted judgment in the clients’ favour, and;

(e) hence, the clients suffered the loss of an opportunity of obtaining a successful outcome in the litigation.

112 As the plurality noted, the failure to obtain a different and more favourable result (by reason of the solicitors’ failure to prepare and present the case properly) is a “consequence” that may befall clients but which cannot be corrected within the litigation in which they were engaged (see at [69] and [70]). Their Honours observed (at [71], 27) that the premise for the proposition that a client should have an action against a person who negligently caused such a consequence is that “there should be no wrong without remedy”. Their Honours, in effect, rejected this proposition. They stated (at [84], 30-31):

“To remove the advocate’s immunity would make a significant inroad upon what we have earlier described as a fundamental and pervading tenet of the judicial system. That inroad should not be created. … But the legal principle which underpins the Court’s conclusion is fundamental. Of course, there is always a risk that the determination of a legal controversy is imperfect. And it may be imperfect because of what a party’s advocate does or does not do. The law aims at providing the best and safest system of determination that is compatible with human fallibility. But underpinning the system is the need for certainty and finality of decision. The immunity of advocates is a necessary consequence of that need.” (Citation omitted.)

113 I would observe that their Honours referred to a “party’s advocate”. But, the application of the broad test for advocate’s immunity, and the powerful focus given to the rationale for the immunity (the finality principle), protects conduct by persons not acting as advocates at all (as occurred, in fact, in D’Orta-Ekenaike).

114 Take for example the situation where a solicitor briefs a barrister to advise on the preparation of a case for trial. Assume that the barrister gives negligent advice, goes on to act as advocate at the trial and the trial is lost because of the negligent advice. There can be no doubt, according to D’Orta-Ekenaike, that the barrister would be entitled to rely on advocate’s immunity. As a second scenario, assume that the solicitor does not retain a barrister, but does all the preparation and advocacy work at the trial on his or her own and with the same result. According to the principles laid down in D’Orta-Ekenaike, advocate’s immunity would apply to the solicitor. Assume, as a third scenario, that the solicitor prepares for trial without retaining a barrister, thereafter retains a barrister on trial, and the trial is lost without negligence on the barrister’s part but rather by reason of negligence in the preparation by the solicitor. As I later explain, on the evidence this case is equivalent to this last scenario. In my view, it is self-evident according to the principles laid down in D’Orta-Ekenaike that advocate’s immunity would apply to the solicitor.

(c) Without having taken statements from all necessary witnesses, including the appellants, so as to be in a position to prove the appellants’ damages claim in the most advantageous way;

(d) Without having taken taking statements from all necessary witnesses so as to be in a position to prove reliance on the part of the Corporate Guarantors (the witnesses concerned would be one or more of the directors of each of the Corporate Guarantors);

(e) Without having taken taking statements from all necessary witnesses and without having obtained the necessary documents so as to be in a position to prove the diminution of the value of the appellants’ shareholding in each of the Corporate Guarantors and any claim for damages that might have to be advanced on behalf of the Corporate Guarantors;

(f) Without having amended the appellants’ pleadings to clarify the fact that Gowrise had no interest in the proceedings;

(g) Without having evidence available by way of statements of witnesses or otherwise to prove that Gowrise had no interest in the proceedings;

(h) Without having taken reasonable steps to ensure that full discovery had been or could quickly be made of all documents that had or might become discoverable by reason of any change in the way the appellants might put their damages claim, and by reason of any potential involvement of the Corporate Guarantors, and;

(i) Without having taken reasonable steps to ensure that appropriate particulars of the way in which the appellants were advancing their damages claim were provided to Egan’s solicitors.

257 Mr Klotz did not in good time, after accepting the trial date, attend to all the matters referred to in the preceding paragraph and did not brief counsel with the information and material that would have become available to him had he in fact attended to those matters.

258 The evidence is capable of establishing that the respondent committed other breaches of its duty to the appellants in regard to the way in which the appellants’ case was prepared for trial. I shall briefly mention these.

259 The particulars as to damages were provided only on the third day of the trial. The valuations for the lost properties were as at 1989 and 1990, six years before the trial. It would have been desirable to have current valuations for the lost properties. Mr Weber drew attention to the fact that, save for Airways House, there was evidence of the price the properties had fetched when sold by the Bank. But those sales were mortgagee sales and might well not have represented market value on the basis of sales that were not forced. As regards Airways House, it is true that the appellants acknowledged that they should proceed with the trial without evidence of value, but that acknowledgement was made after the trial had commenced when the appellants had little choice other than to proceed with what evidence they had.

260 Mr Klotz stated that the appellants had instructed him that the Corporate Guarantors held no assets other than the secured properties. This is a matter that had to be proved and prudence required that that proof should include production of the latest financial statements of the companies concerned. The material before this Court does not indicate that documentary evidence of that kind was available.

261 On the material before this Court, there does not appear to have been any documentary evidence to prove that Senneh owned 1/56 Wolseley Road, that Tisete owned the Elizabeth Bay properties, that Tabard owned Airways House, that the appellants were the beneficial owner of each of these properties and that the appellants controlled these companies.

262 There is no documentary material before this Court that establishes how the appellants were able to pay the Bank $465,000 to discharge the Bank’s mortgage over the 13/39 Elizabeth Bay property owned by Tisete.

263 The matters I have listed above demonstrate, amply, that the evidence before Patten AJ was capable of proving that the respondent committed breaches of the duties it owed the appellants. Had I not dismissed the appeal on the grounds that advocate’s immunity applies to the appellants’ claim (and had this Court been required to deal with the cross-appeal), I would have dismissed the cross-appeal to the extent that the respondent thereby sought a finding that it did not commit breaches of its duties as his Honour found. I would, however, have upheld the cross-appeal to the extent that it seeks a retrial of the breaches of duty issues on the ground of inadequate reasons.

Causation

264 In dealing with causation Patten AJ first found that the respondent’s breaches of duty were capable of causing delay and disruption in the conduct of the trial, and this, his Honour said, was “the very situation which came about” (at [161]). For this reason his Honour held that the appellants were entitled to damages representing the loss flowing from the delay and disruption. These damages, as I have said, he assessed at $140,000.

265 In dealing with the damages relating to the loss of a chance of succeeding in the case against Egan, Patten AJ said (at [169]-[171]):

novus actus interveniens

…

March v E & MH Stramare Pty Ltd

;

266 Thus, his Honour held that the respondent’s breaches of duties he had found did not cause the appellants to suffer damage by losing the opportunity of a better outcome in their case against Egan.

267 As regards the value of that loss of opportunity, his Honour firstly, held (at [30]) that “[t]he project resulted, on any basis, in very considerable financial loss [to the appellants]”. His Honour, however, later observed that he would have assessed the appellants’ prospects of success in the litigation against Egan “at very much less [than] 50%” (at [173]).

268 In their appeal, the appellants challenged Patten AJ’s decision that they had not proved causation.

269 The appellants submitted, firstly, that his Honour erred in holding that, because entering into the compromise was an act of the appellants’ free will, it must be regarded as a novus actus interveniens.

270 In March v E & MH Stramare Pty Ltd Mason CJ explained (at 517-518):

“The fact that the intervening action is deliberate or voluntary does not necessarily mean that the plaintiff’s injuries are not a consequence of the defendant’s negligent conduct. In some situations a defendant may come under a duty of care not to expose the plaintiff to a risk of injury arising from deliberate or voluntary conduct or even to guard against that risk … . To deny recovery in these situations because the intervening action is deliberate or voluntary would be to deprive the duty of any content.” (Citations omitted.)

271 The respondent, as the appellants’ solicitor, owed the appellants a duty to take reasonable care in the preparation of the case against Egan. The content of that duty involved taking reasonable care not to expose the appellants, by reason of inadequate preparation of the case, to the risk of having to compromise their claim on adverse terms (that is, on terms less favourable to those that might reasonably have been agreed upon had the case not been inadequately prepared, or to the terms of a judgment that the court might otherwise have handed down in the appellants’ favour). In these circumstances, to paraphrase Mason CJ, to deny recovery because the appellants entered into the compromise of their own free will deprived the duty of any content. It was an erroneous approach.

272 The appellants then submitted that his Honour had erred in holding that “the compromise of the action in the way it occurred was not a reasonably foreseeable consequence of the respondent’s breaches, nor was it, in the ordinary course of things, something likely to happen.”

273 His Honour’s phrase, “the compromise of the action in the way it occurred,” is enigmatic. What was the “way it occurred”? His Honour made no express findings in this regard.

274 Mr Weber submitted that his Honour was intending to imply that hostile conduct by Dowd J, including the various statements reflecting on the appellants’ credibility, made during the course of the appellants’ opening and in extempore judgments, caused the appellants to decide (in the light of advice they had received from their counsel) to compromise as they did. Mr Weber submitted that Patten AJ used “a deliberately opaque expression to avoid being critical of the role that Dowd J played in the decision to settle”. Mr Weber submitted that the respondent did not cause Dowd J “to say what his Honour said”. He submitted that no one could possibly have foreseen that “a judge of this court would say the things [about the appellants] that he did without having even seen [them] in the witness box. That was rather extraordinary in anybody’s experience of this Court”.

275 In my opinion, Mr Weber was justified in submitting that Dowd J’s comments were unforeseeable and extraordinary. In view of the seriousness of the issue I think it desirable to recapitulate what occurred.

276 On the first day of his opening, Mr Hammerschlag submitted that the appellants had lost all their properties and that the Bank had sold all the properties. Both these statements were factually incorrect. The appellants were in court when Mr Hammerschlag made these statements. On the second day of the opening, Mr Hammerschlag corrected these errors. He explained that the appellants had discharged the mortgage over the restaurant property in Elizabeth Bay and still owned that property. He explained further that Tabard still owned Airways House.

277 The incorrect statements were obviously made through inadvertence and were very quickly corrected. They were, in any event, innocuous. As Mr Spender attempted to explain to Dowd J, the appellants had borrowed $465,000 to pay the mortgage debt owed to the Bank in respect of the restaurant property. This meant that, although they still technically owned the property, other lenders had replaced the Bank. Furthermore, although Tabard still owned Airways House, the Bank had taken possession of the property, it had been surrendered to the Bank pursuant to the First Barclays Deed, and the Bank was in the process of selling the property.

278 Mr Hammerschlag’s errors were trivial, made without any sinister motive whatever, and were rapidly corrected. In context, they carried no malignant imputation of any kind. They should have been ignored.

279 Dowd J, however, took a different view. As appears from his quoted remarks he appeared to have decided that the appellants were directly responsible for the misstatements of fact that had been made, that this demonstrated that the appellants had not been frank with the court, and that the conduct in question was tantamount to insulting to the court. Dowd J said that if he had been misled “as to matters of pecuniosity” that should have been corrected by counsel who had been as frank with the court “as his then instructions permitted him to be”. He said that he needed “to be a little more impressed by the appellants’ frankness to the court in a matter such as this”. He also made remarks suggesting that the appellants might order their affairs so as to thwart costs orders the court might make. These were very serious reflections on the integrity of the appellants, who were yet to give evidence in the case. They were quite unjustified and should not have been made.

280 It is true that on 13 February 1996, Dowd J, in giving judgment on the application that he disqualify himself, said:

“I also wish to make it abundantly clear that I have not formed a view unfavourable to the [appellants] in respect of the substantive issues that are to be tried in these proceedings, the issue of the credit of either the first or second appellants has not yet arisen at any stage in any matters that I have considered … .”

281 Despite these remarks, however, both counsel for the appellants - who were eminent and highly experienced barristers - advised the appellants that, by reason of the attitude the judge had manifested, he would find against them on credit and the appellants would lose.

282 I accept Mr Weber’s submission that, in the circumstances I have outlined, the attitude taken by Dowd J to the integrity of the appellants (manifested before they had given evidence) was extraordinary and unforeseeable. It is uncontroversial that that attitude materially contributed to the compromise. It does not, however, follow that it was the sole cause of the settlement. Nor does it follow that the fact that the judge’s attitude was unforeseeable means that the appellants failed to prove causation.

283 The appellants’ case was that there were other causes for their decision to compromise. These other causes included the argument that they entered into the compromise because of duress, the fact that by 28 February 1996 their funds were exhausted and they were unable to continue financing the action, and the fact that because of inadequate preparation Dowd J had taken an unfavourable view of their case (apart from their credibility) and, by reason of the lack of adequate preparation, the various amendments that had been made and the unavailability of necessary evidence, their case was in shambles.

284 Patten AJ rejected the appellants’ argument as to duress. His Honour did not, however, address the other factors that the appellants contended materially contributed to the entering into of the compromise.

285 There was evidence that the appellants’ lack of funds contributed to their decision to compromise. Many of Dowd J’s remarks to which I have referred demonstrate that he was of the view that the appellants’ case had not been properly presented and that there was confusion on their part in several areas. This attitude on the part of his Honour was plainly justifiable. There were problems with Gowrise, with the basis on which damages were being sought, with the proof of damages, with the precise roles the Corporate Guarantors were playing as plaintiffs, with the claims in respect of losses in connection with the restaurant property and Airways House, with reliance on the part of the Corporate Guarantors, and with discovery.

286 It is against this background that I return to the phrase used by Patten AJ, namely, “the compromise of the action in the way it occurred” (my emphasis). His Honour gave no explanation of what he meant by “the way it occurred”. It is not possible to resolve, satisfactorily, what his Honour meant by this phrase. It is reasonably arguable that he had in mind not only Dowd J’s attitude to the appellants’ credit but also the appellants’ lack of funds and the breaches of duty that he had found in relation to the respondent’s preparation of the appellants’ case. It is also reasonably arguable that he meant only the remarks that Dowd J made about the appellants.

287 In my view, it was reasonably foreseeable that the case might come nowhere near finishing in the five weeks allocated to it if the respondent breached its duties in preparing the case for trial. It was also reasonably foreseeable that, in that event, the appellants might run out of funds and be forced to settle. It was also reasonable foreseeable that, should the respondent breach its duties in preparing the case for trial, the appellants would face incalculable problems in presenting their case and the judge might take a strongly adverse view as to its merits.

288 The evidence is capable of establishing that the appellants’ lack of funds and the respondent’s breaches of duty that his Honour found in relation to the respondent’s preparation of the appellants’ case materially contributed to the appellants’ loss of the opportunity of obtaining a better outcome in their case against Egan. Accordingly, had I not dismissed the appeal on the advocate’s immunity ground, I would have upheld it in regard to causation and ordered a retrial of that and all other issues.

289 I should also say that I accept Mr Bennett’s argument that it was reasonably foreseeable that the breaches of duty such as those found by Patten AJ might lead a judge, at an early stage in the trial, to form an adverse view of the appellants’ case. I accept further his submission that, for the appellants’ to succeed on causation, it was only necessary for them to prove that Dowd J’s expressed attitude to the credibility of the appellants (while not itself specifically foreseeable) was a consequence of the same general character as forming an adverse view of the appellants’ case: Chapman v Hearse [1961] HCA 46; (1961) 106 CLR 112 at 120 and 121. The test of foreseeability does not require precise events that caused the harm to be foreseeable. Rather, as Barwick CJ stated in Mt Isa Mines Ltd v Pusey [1970] HCA 60; (1970) 125 CLR 383 (at 390):

Chapman v Hearse

290 As the High Court said in Chapman v Hearse (at 121):

“[I]t would be quite artificial to make responsibility depend upon, or deny liability by reference to, the capacity of a reasonable man to foresee damage of a precise and particular character or upon his capacity to foresee the precise events leading to the damage complained of.”

291 Thus, in my opinion, Patten AJ erred in rejecting the appellants’ case on causation on the grounds that Dowd J’s reaction in relation to their credibility was not foreseeable. It was sufficient for the appellants to show, as they did, that the judge’s reaction fell within the general risk of harm to which they would be exposed should their case be inadequately prepared.

292 Whether it was foreseeable that breaches of duty on the respondent’s part might contribute materially (in the Chapman v Hearse sense) to a compromise of the kind that was in fact effected depends, to a material extent, on the precise breaches found to have occurred, the facts that gave rise to the breaches and the facts that gave rise to the compromise. The precise breaches could only be determined, reliably, at a retrial.

293 Likewise, a decision could only be made on causation once the precise breaches of duty, if any, were identified.

294 Thus, had I not considered that the appeal should be dismissed on the grounds of advocate’s immunity, I would have proposed that the appeal be upheld and the issue of causation, and all other issues, be remitted for retrial.

Conclusion

295 I would dismiss the appeal with costs. The cross-appeal, as I have said, is, in effect, conditional on the appeal succeeding. As I would dismiss the appeal, there is no need to make any orders on the cross-appeal. As the appellants’ arguments were largely successful on the cross-appeal, I would make no orders as to the costs of the cross-appeal. I would grant liberty to apply in regard to argument that the respondent may wish to raise in regard to the way in which the cross-appeal concerning the award of damages of $140,000 has been dealt with.

*********

Citations

Symonds v Vass [2009] NSWCA 139

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CITATION:	Symonds v Vass [2009] NSWCA 139
HEARING DATE(S):	16 March 2009, 17 March 2009
JUDGMENT DATE:	10 July 2009
JUDGMENT OF:	Beazley JA at 1; Giles JA at 10; Ipp JA at 47
DECISION:	1. Appeal and cross-appeal allowed. 2. Set aside orders 1 to 8 made by Patten AJ on 13 December 2007. 3. Remit the proceedings to the Common Law Division for a new trial on all issues. 4. Costs of the trial before patten AJ to be in the disposal of the judge conducting the new trial. 5. Respondent pay 70 per cent of the appellants' costs on appeal.
CATCHWORDS:	CAUSATION - whether respondent’s breaches of duties caused the appellants to suffer damage by losing the opportunity of a better outcome - where appellant clients entered into compromise of their claim following breaches of duties by the respondent solicitor. - PROCEDURE - courts and judges generally - judges - adequacy of reasons for judgment - whether trial judge made express findings of primary fact that exposed a specific chain of reasoning - where trial judge recounted in detail large extracts from the evidence and the transcript. - LEGAL PRACTITIONERS - lawyers - duties and liabilities - whether respondent solicitors breached duties owed to the appellant clients in contract and in tort in preparing the appellants' case for trial. - LEGAL PRACTITIONERS - lawyers - other matters - advocate's immunity - application of the test in D’Orta-Ekenaike v Victoria Legal Aid - where appellant clients entered into compromise of their claim following breaches of duties by the respondent solicitor - finality of litigation principle.
LEGISLATION CITED:	Fair Trading Act 1987 Trade Practices Act 1974 (Cth)
CATEGORY:	Principal judgment
CASES CITED:	Alpine Holdings Pty Ltd v Feinauer [2008] WASCA 85 Batard v Hawes (1853) 2 E & B 287 Beale v Government Insurance Office of NSW (1997) 48 NSWLR 430 Boland v Yates Property Corporation Pty Ltd [1999] HCA 64; (1999) 74 ALJR 209 Brittain v Lloyd (1845) 14 M & W 762 Calin v Greater Union Organisation Pty Ltd [1991] HCA 23; (1991) 173 CLR 33 Chamberlain v Ormsby [2005] NSWCA 454 Chapman v Hearse [1961] HCA 46; (1961) 106 CLR 112 Coshott v Barry [2009] NSWCA 34 Customs and Excise Commissioners v A [2002] EWCA Civ 1039; [2003] 2 All ER 736 Dansar Pty Ltd v Pagotto [2008] NSWSC 112 D’Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1 Digi-Tech (Australia) Ltd v Brand [2004] NSWCA 58; (2004) 62 IPR 184 Donellan v Watson (1990) 21 NSWLR 335 Francis v Bunnett [2007] VSC 527; (2007) 18 VR 98 General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125 Giannarelli v Wraith (1989) 156 CLR 543 Gould v Vaggelas [1985] HCA 85; (1985) 157 CLR 215 In re A Debtor [1937] 1 Ch 156 Keefe v Marks (1989)16 NSWLR 713 Kelley v Carston [1998] QB 686 Kuru v State of New South Wales [2008] HCA 26; (2008) 236 CLR Lampleigh v Brathwait (1688) 1 S & M LC 13 MacRae v Stevens (1996) Aust Torts Rep 81-405 Mallik v McGeown [2008] NSWCA 230 March v E & MH Stramare Pty Ltd [1991] HCA 12; (1991) 171 CLR 506 Mastronardi v State of New South Wales [2007] NSWCA 54 Mifsud v Campbell (1991) 21 NSWLR 725 Mt Isa Mines Ltd v Pusey [1970] HCA 60; (1970) 125 CLR 383 Munnings v Australian Government Solicitor [1994] HCA 65; (1994) 68 ALJR 169 National Insurance Company of New Zealand Ltd v Espagne [1961] HCA 15; (1961) 105 CLR 569 Philip Walton trading as Pitcher Walton & Co v Efato Pty Ltd [2008] NSWCA 86 Rees v Sinclair [1974] 1 NZLR 180 Saif Ali v Sydney Mitchell & Co [1980] AC 198 Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 Sourlos v Luv A Coffee Lismore Pty Ltd [2007] NSWCA 203 Stead v State Government Insurance Commission [1986] HCA 54 (1986) 161 CLR 141 Walton v Efato Pty Ltd [2008] NSWCA 86 Wardley Australia Ltd v Western Australia [1992] HCA 55; (1992) 175 CLR 514 Waterways Authority v Fitzgibbon [2005] HCA 57; (2005) 221 ALR 402 Yates Property Corporation Pty Ltd v Boland (1997) 145 ALR 169 Zhang v Andrew Pine Furniture Pty Ltd [2004] NSWCA 250
TEXTS CITED:	P Cane, "The new face of advocate's immunity" (2005) 13 Torts Law Journal 93.
PARTIES:	Monica Frances Symonds (First Appellant) Gerald Henry Symonds (Second Appellant) Cedric Bohrsmann Vass and the other 24 persons named in Schedule "A" to the Notice of Appeal (Respondents)
FILE NUMBER(S):	CA 40860/07
COUNSEL:	D M J Bennett QC; V R W Gray (Appellants/Cross Respondents) R J Weber SC; T M Faulkner (Respondents/Cross Appellants)
SOLICITORS:	George Mallos Lawyer (Appellants/First & Second Cross Respondents) Mallesons Stephen Jaques (Respondents/Cross Appellants) Kemp Strang Lawyers (Third Cross Respondent)

LOWER COURT JURISDICTION:	Supreme Court
LOWER COURT FILE NUMBER(S):	SC 20994/01
LOWER COURT JUDICIAL OFFICER:	Patten AJ
LOWER COURT DATE OF DECISION:	14 November 2007
LOWER COURT MEDIUM NEUTRAL CITATION:	Monica Frances Symonds and Gerald Symonds v Cedric Borsmann Vass and 24 ors [2007] NSWSC 1274