The Queen, On the Application of John Patrick Davey v Ronald David Silverstein & Ors (according to the attached Schedule) [No 2]

[2020] VSCA 251

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S EAPCI 2019 0134

THE QUEEN, ON THE APPLICATION OF JOHN PATRICK DAVEY	Applicant
v
RONALD DAVID SILVERSTEIN & ORS (according to the attached Schedule) [No 2]	Respondents

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JUDGES:	KYROU, KAYE and McLEISH JJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	On the papers
DATE OF JUDGMENT:	25 September 2020
MEDIUM NEUTRAL CITATION:	[2020] VSCA 251
JUDGMENT APPEALED FROM:	[2019] VSC 724 (Richards J)

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COSTS – Contempt of Court – Leave to appeal refused – Applicant and first respondent both legal practitioners – First respondent acted on own behalf and on behalf of second and third respondents on appeal – Right of first respondent to recover costs of second and third respondents – No order as to costs.

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WRITTEN SUBMISSIONS:	Counsel	Solicitors
For the Applicant	In person
For the Respondents	Mr R D Silverstein, in person and on behalf of the second and third respondents

KYROU JA
KAYE JA
McLEISH JA:

1. On 10 September 2020, this Court delivered judgment and made orders dismissing the application for leave to appeal from a decision of a trial judge of the Court.[1]  Application is now made that the applicant pay the costs of the second respondent and the third respondent of the application for leave to appeal.

   [1]The Queen v Silverstein [2020] VSCA 233 (‘Reasons’).

1. In the proceeding before the trial judge, the applicant, by originating motion, sought orders that each of the three respondents be found guilty of seven charges of contempt of the Magistrates’ Court.  The judge, who heard the application, dismissed the proceeding (‘the contempt proceeding’).[2]  The applicant and first respondent are both legal practitioners.  The first respondent acted as the solicitor for the second and third respondents in the Magistrates’ Court proceedings in which it was alleged that each contempt of court was committed (‘the debt recovery proceeding’).  At the hearing of the contempt proceeding before the trial judge, the first respondent acted for himself, and he also acted, on a pro bono basis, for the second and third respondents.  The judge, having dismissed the contempt proceeding, made orders that the applicant pay the costs of the second and third respondents. 

   [2]Davey v Silverstein [2019] VSC 724 (‘Trial Judge Reasons’).

1. On the application for leave to appeal, the first respondent again acted for himself, and for the second and third respondents.  After the Court delivered judgment, it sought submissions from the parties as to the question of costs.  In the email that accompanied the delivery of the judgment, it was noted that the Court required the parties to address whether it would be appropriate for the Court to order that they each bear their own costs, on the basis that the submissions of the first respondent to this Court, made on behalf of each of the respondents, were, in effect, defending his own conduct. 

1. In response, the first respondent has filed submissions, attached to which was a conditional costs agreement, signed by the second respondent and on behalf of the third respondent, and bearing the date of 17 July 2020.  The first respondent has accepted that he is not entitled to seek legal costs in respect of acting for the second and third respondents before that date.  He has also accepted, in accordance with the decision of the High Court in Bell Lawyers Pty Ltd v Pentelow,[3] that he is not entitled to recover legal costs for representing himself.  He has submitted that, as the second and third respondents were successful on the application for leave to appeal, they should be entitled to an order for costs in their favour.  Accordingly, he submitted that this Court should make an order that the applicant pay two-thirds of the costs of the second and third respondents from 17 July 2020.

   [3][2019] HCA 29.

1. In response, the applicant, who represented himself, has submitted that the Court should not make any order for costs.  First, he contended that the first respondent acted in breach of the Legal Profession Uniform Law Application Act 2014 in acting on behalf of the second and third respondents, up to and including 16 July 2020, without having first entered into a costs agreement with them.  Further, he submitted, there was conduct by the first respondent which disentitled him from an order for costs.  The applicant also submitted that as the matter was one of ‘considerable general importance and difficulty’ no order for costs should be made.

1. We have come to the conclusion, albeit not for the reasons advanced by the applicant, that there should not be any order for costs. 

1. The first respondent had a direct personal interest in resisting each ground of the application for leave to appeal.  If the applicant had succeeded on any of those grounds, that would have adversely affected the position of the first respondent to the same extent as, if not more than, it would have affected the position of the second and third respondents.  If the first respondent, on the application for leave to appeal, had only represented himself, and not the second and third respondents, he would have presented the same arguments on his own behalf that were presented on behalf of each of the respondents.  He did not make, nor was he required to make, any additional argument on behalf of the second and third respondents which was not relevant to his own position.

1. It is also relevant that each of grounds 1 to 5 of the application for leave to appeal concerned, and was directed to, the conduct of the first respondent in the debt recovery proceeding, which had given rise to the allegations in the charges in the contempt proceeding.  Any liability of the second and third respondents, for the alleged contempts of court, was based on, and derived entirely from, the conduct of the first respondent.  That is, the second and third respondents would only have been liable for any of the contempts of court, that were alleged in the proceeding, if the first respondent himself was also liable for them. 

1. That consideration is reinforced by the circumstance that the trial judge, and this Court, have been critical of some aspects of the conduct of the first respondent which were relevant to the grounds of appeal.  The contempt of court, that was alleged in count 2 (and which was the subject of ground 3 of the application for leave to appeal), concerned the filing by the first respondent of the affidavit of Thomas Davey in the debt recovery proceeding.  This Court endorsed the description, given by the trial judge to that affidavit, as a ‘spiteful document’, and agreed with the judge’s observation that it was entirely irrelevant to any issue in the debt recovery proceeding.  As this Court noted, the filing of the affidavit was a plain breach of the basic rules of evidence.[4]  Ground 5 of the application for leave to appeal was based on the fact that, in the contempt proceeding, the first respondent acted for the second and third respondents in circumstances in which he was a material witness in the proceeding.  This Court observed that it was ‘quite unsatisfactory’ that the first respondent was an important witness on behalf of the defence of each of the respondents, while at the same time acting for them, and appearing on their behalf, in the trial of the contempt proceeding.[5]

   [4]Trial Judge Reasons [39]–[40]; Reasons [107].

   [5]Reasons [119].

1. In summary, the first respondent had a direct personal interest in resisting the appeal.  The arguments that he presented to the Court may have enured also to the benefit of the second and third respondents, but they were necessary to protect his own position.  Further, five of the seven grounds of the application for leave to appeal were concerned with the conduct of the first respondent which was the basis of the contempt proceeding.  Any liability of the second and third respondents, for those contempts, would have derived directly from the liability of the first respondent for the same contempts.

1. For those reasons, it would be quite inappropriate for the first respondent to seek fees from the second and third respondents for representing them on the application for leave to appeal.  In effect, by doing so, he would be asking his clients to pay to him a fee for defending himself and for protecting his own position.  We would therefore expect that the first respondent would not claim such fees from his clients.

1. In those circumstances, we reject the submission by the first respondent that the applicant should pay the costs of the second and third respondents.  It follows that there shall be no order made as to the costs of the application for leave to appeal.  We would, however, make an order that the applicant pay the costs of the transcript of the application for leave to appeal.

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SCHEDULE OF PARTIES

THE QUEEN, ON THE APPLICATION OF JOHN PATRICK DAVEY	Applicant
and
RONALD DAVID SILVERSTEIN	First Respondent
PETER PATRICK DESSMANN	Second Respondent
DESSCO PTY LTD (ACN 072 755 590)	Third Respondent