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Taylor v CGU Insurance Limited

Taylor v CGU Insurance Limited

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Case Copied 2 August 2005 47 min read

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FEDERAL MAGISTRATES COURT OF AUSTRALIA

TAYLOR v CGU INSURANCE LTD

[2005] FMCA 1073

PRACTICE AND PROCEDURE – Whether unsuccessful party can recover costs ordered to be paid by own solicitor based on negligence – Rule 21.07 Federal Magistrates Court Rules 2001 – whether separate negligence claim part of the accrued jurisdiction of the Court.

Trade Practices Act 1974
Federal Magistrates Court Act 1999, s.79,
Federal Court of Australia Act 1976, s.43(2)
Fair Trading Act 1987 (WA), s.10, 79

Re Wilcox; ex parte Venture Industries Pty Ltd (No 2) (1996) 72 FCR 151
De Sousa v Minister for Immigration, Local Government and Ethnic Affairs (1993) FCR 544
White Industries (Qld) Pty Ltd v Flower and Hart (a firm) (1998) 156 ALR 169
Lemoto v Able Technical Pty Ltd & Ors [2005] NSWCA 153
Myers v Elman (1940) AC 282
Etna v Arif (1999) 2 VR 353
Abrahams v Wainwright Ryan (1999) VR 102
Harley v McDonald (2001) 2 AC 678
Dempsey v Johnstone (2003) EWCA Civ 1134
Knight v FP Special Assets Ltd (1992) 174 CLR 178
Orchard v South Eastern Electricity Board (1987) 1 QB 565
Taylor v CGU Insurance Ltd (No2) [2004] FMCA 1000
Moorgate Tobacco Co Ltd v Philip Morris Ltd (1980) 145 CLR 457

Applicant:

ROBERT FLYNN TAYLOR

Respondent:

CGU INSURANCE LTD

File Number:

PEG 46 of 2004

Judgment of:

McInnis FM

Hearing date:

18 May 2005

Delivered at:

Melbourne

Delivered on:

2 August 2005

REPRESENTATION

Counsel for the Applicant:

Mr Giles

Solicitors for the Applicant:

Solomon Brothers

Solicitors for the Respondent:

No appearance

Counsel for Talbot & Olivier:

Mr G Pynt

Solicitors for Talbot & Olivier:

Pynt & Partners

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
PERTH

PEG 46 of 2004

ROBERT FLYNN TAYLOR

Applicant

And

CGU INSURANCE LTD

Respondent

REASONS FOR JUDGMENT

In this matter the court conducted a hearing of a claim by the applicant against the respondent seeking damages for alleged breach of contract or, in the alternate, damages for breach of the provisions of the Trade Practices Act 1974 (the TPA). The hearing on 8 December 2004 resulted in a judgment being delivered on 22 December 2004 dismissing the application with costs. A counterclaim not pursued by the respondent was likewise dismissed. After hearing further submissions an order was made on 9 February 2005 in the following terms:-
“The applicant shall pay the respondent's costs including reserved costs in accordance with Schedule 1 of the Federal Magistrates Court Rules to be taxed pursuant to Order 62 of the Federal Court Rules.”
On 10 March 2005 the applicant filed an application seeking what is described as, "consequential orders concerning costs and other matters between the applicant and his former solicitors specified in annexure A." Annexure A provides:-

“AND THE APPLICANT CLAIMS:
(1)An order pursuant to rule 21.07 of the Federal Magistrates Court Rules 2001 that the applicant's former solicitors, Talbot & Olivier, pay to the respondent the costs that the applicant has been ordered to pay to the respondent;
(2)

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2005] FMCA 1073
Decision Date: 2 August 2005

CaseChat Overview and Summary

The Federal Magistrates Court was required to determine the jurisdiction and power to make a costs order against a party's former solicitor under Rule 21.07 of the Federal Magistrates Court Rules 2001, as well as the court's jurisdiction to award damages for negligence, mistake of law, and contravention of the Fair Trading Act 1987 (WA). The court considered the principles set out in Lemoto v Able Technical Pty Ltd & Ors [2005] NSWCA 153 and found that the applicant's claim against his former solicitor was not a clear case of dereliction of duty and did not warrant a costs order against the solicitor under Rule 21.07 or the general power of the court to award costs. The court also found that the additional claims for damages for negligence, mistake of law, and contravention of the Fair Trading Act 1987 (WA) did not fall within the accrued or associated jurisdiction of the court and should be pursued in a court of competent jurisdiction. The court concluded that the power to award costs under Rule 21.07 and s.79 of the Federal Magistrates Court Act 1999 should not be regarded as a substitute for a party's rights to pursue a claim in negligence and/or contract against a solicitor.

Orders