Taylor v Wilson

[2014] VCC 1660

IN THE COUNTY COURT OF VICTORIA Revised
(Not) Restricted

AT MELBOURNE

COMMERCIAL LIST

EXPEDITED CASES DIVISION

Case No. CI-14-00017

ROBERT TAYLOR & ANOR	Plaintiffs
v.
WILLIAM WILSON & ANOR	Defendants

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JUDGE:	His Honour Judge Anderson
WHERE HELD:	Melbourne
DATE OF HEARING:	6 October 2014
DATE OF JUDGMENT:	6 October 2014
CASE MAY BE CITED AS:	Taylor & Anor v. Wilson & Anor
MEDIUM NEUTRAL CITATION:	[2014] VCC 1660

REASONS FOR JUDGMENT

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Catchwords:             Practice and procedure – Application for a stay of proceedings – Claim for recovery of legal fees, costs and disbursements – Concurrent proceedings in the Costs Court for a review of the solicitor’s bills of costs – Likelihood of duplication and/or inconsistent determinations – Proceeding stayed until review by Costs Court completed.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr A. Bristow	Robert D Taylor
For the Defendants	Mr S. Pitt	Mills Oakley

HIS HONOUR:

1The proceeding is by a solicitor and barrister, as plaintiffs, seeking the recovery of costs, fees and disbursements from former clients in relation to earlier proceedings in the Supreme Court. By summons dated 29 August 2014, the defendants sought an order staying the proceeding until the costs were reviewed by the Costs Court.

2The application was argued before me on 18 September 2014. The basis for the application was as follows:

a.the defendants had on 13 August 2014, sought a review of the costs claimed by the plaintiffs in the present proceeding;

b.the plaintiffs had not made proper disclosure to the defendants as required by Part 3.4 of the Legal Profession Act 2004 (Vic) (“the Act”).

3Whilst the defendants’ summons relied upon s.3.4.41 of the Act, that provision appeared to have no application because the plaintiffs had already commenced this proceeding for the recovery of costs. Defendants’ counsel, Mr Pitt, sought to amend the summons to rely upon s.3.4.17(2) which prevents lawyers maintaining proceedings against a client for the recovery of costs, if there has not been proper disclosure under the Act, unless the costs have previously been reviewed by the Costs Court under Division 7 of the Act.

4As I was of the view that there had not been a proper articulation of these issues in the pleadings, I adjourned the hearing of the application for a stay of proceedings to the trial judge and gave the parties the opportunity to file amended pleadings.

5Since the hearing on 18 September 2014:

a.the plaintiffs filed an amended statement of claim better particularising the disclosure relied upon;

b.the defendants filed an amended defence better particularising the lack of disclosure alleged;

c.the plaintiffs sought leave this morning to file a reply. The drafted reply does not raise an issue relied upon by plaintiffs’ counsel, Mr Bristow, at the earlier hearing, that certain forms of disclosure may not be required because the defendants were “sophisticated” clients, as that term is used in the Act;

d.the plaintiffs prepared a court book of 10 volumes containing the solicitor’s file in relation to one proceeding (the Annesley matter), but no documents relating to the Waigani or Darley matters;

e.the first plaintiff by email yesterday notified the defendants’ solicitors that, “The Waigani documents are not included in the Court Books, as I have reallocated the payments to dispose of the Waigani and Darley files, but those that pertain to the Annesley matters are included”.

6On 25 September 2014, the plaintiffs and the defendants consented to orders being made by the Costs Court in relation to the application to review. The orders included obligations on the plaintiffs, as respondents, to:

a.file and serve all costs agreements and disclosure statements upon which they will rely;

b.file and serve itemised bills of costs in a form capable of review in relation to each of the Annesley, Waigani and Darley matters;

c.make available the relevant first plaintiff’s files for inspection by the defendants.

7The first plaintiff has engaged a costs consultant to draw the itemised bills. Mr Bristow informed me that it is likely the review will be conducted in the second half of 2015.

8There appears to be no issue that the defendants are entitled to have all the relevant bills reviewed under Division 7 of the Act by the Costs Court, as the proceeding for review in the Costs Court was commenced within 12 months after the last bill was provided.

9Mr Bristow submitted that:

a.the present recovery action should proceed to judgment;

b.if the plaintiffs were successful in obtaining judgment, the defendants would be required to pay the judgment;

c.subsequently, the review in the Costs Court of the bills would proceed;

d.depending upon the result of the review, the defendants may be entitled to a refund or may have to pay a further sum to the plaintiffs.

10Mr Bristow would not acknowledge, during the course of argument, that:

a.the Costs Court may be constrained by the decision of this Court on issues including whether proper disclosure had been made under the Act by the plaintiffs, or the proper quantification of the plaintiffs’ fees, costs and disbursements; and/or

b.there was likely to be some overlap in the consideration of matters by this Court and by the Costs Court.

11After being invited by the Court to state the precise causes of action the plaintiffs relied upon, Mr Bristow stated that each plaintiff relied upon;

a.work and labour done;

b.account stated;

c.breach of agreement;

d.estoppel.

12The claim for work and labour done is basically the claim for the legal work performed by each of the plaintiffs at the defendants’ request. This would require the plaintiff to establish:

a.a request for the work to be performed;

b.compliance with the requirements of the Act;

c.that the work was carried out;

d.the reasonable cost, or agreed cost, of the work;

e.that this sum remains unpaid.

13The other claims rely upon discussions between the parties after the legal costs had been charged for but remained unpaid. It is alleged that promises of payment were made and not met and that, in reliance upon the promises, further work was performed.

14It is clear from the pleadings, and from the submissions made by Mr Pitt, that there are disputes as to:

a.the quantum of the legal costs charged;

b.the “reallocation” of payments by the first plaintiff to the Waigani and Darley matters rather than to the Annesley matter. In relation to the Waigani and Darley matters, the defendants allege that no disclosure was made at all. In relation to the Annesley matter, they allege that the disclosure was inadequate;

c.the subsequent “agreements”, which the plaintiffs allege give rise to separate causes of action.

15In the circumstances, the Court must decide whether it is appropriate to proceed with the present trial with the likelihood that a review by the Costs Court would proceed at a later time.

16In my view, the present action should be stayed until the Costs Court has conducted the review under the Act. It will be more efficient for the specialist Costs Court to determine:

a.all matters relating to the sufficiency of the Costs Agreements and the relevant disclosures to the defendants required by the Act;

b.the appropriate quantum of the fees, costs and disbursements. This may include, in the Costs Court’s consideration of “what is a fair and reasonable amount of legal costs…, any disclosures made…under Division 3” of the Act (s.3.4.44(2)(b)).

17The proceeding is stayed until the determination by the Costs Court of proceeding SCI-2014-04202, or further order.

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Certificate

I certify that the preceding 4 pages are a true copy of the reasons for decision of His Honour Judge Anderson delivered on 6 October 2014.

Dated: 6 October 2014

Catherine Kusiak    

Associate to His Honour Judge Anderson