Worrell v Bain Gasteen Solicitors

[1998] QCA 25

[1998] QCA 025

COURT OF APPEAL

McPHERSON JA
PINCUS JA

MOYNIHAN J

Appeal No 154 of 1998

IVOR WORRELL	Appellant (Plaintiff)
and
BAIN GASTEEN SOLICITORS (A FIRM)	Respondent (Defendant)

BRISBANE
..DATE 04/02/98
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McPHERSON JA: This is an application under section 118 of
the District Courts Act 1967 for leave to appeal against a
decision in the District Court which in turn affirmed a
judgment given in the Magistrates Court. The action in the
Magistrates Court was one in which a liquidator to sue to
recover a preference, as he asserted it to be, given by a
company that subsequently went into liquidation.

The question, as I see it, that is now before us is essentially whether a firm of solicitors had at a particular date an equitable charge over or in respect of money deposited by the solicitor's client and a purchaser from it in the trust account of the firm of solicitors. The matter so far as concerns that question seems to me to raise essentially factual questions with respect to which Her Honour found on the facts that at the relevant date there was an equitable assignment.

Mr Dutney QC, who appears to support and move the application for leave to appeal, has submitted two arguments to support his application. The first is that there was really no evidence on which the learned Judge could have made the finding that there was an equitable assignment. I am not satisfied that that view of the evidence is correct.

Equitable assignments or the circumstances in which they arise are enormously open to variation and a study of the decisions on the subject suggests that it is not at all easy to identify in the many cases on the matter a single principle to which the learned Judge in this case could be said not to have given effect.

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The other point to which Mr Dutney referred with particular emphasis was the provision in section 8 of the Trust Accounts Act 1973 which in effect inhibits a solicitor from paying him or herself his remuneration in respect of a particular transaction or transactions by appropriating money from a trust account until he receives a written authority from the client to take that course. In this case it may be that the written authority came so late that the solicitor at that date did have some reasonable grounds for suspecting insolvency.

It is, however, in my view, not necessary to reach a final conclusion on this point beyond saying that my opinion expressed in a tentative fashion is that the giving of that authority is not a matter that determines whether there was before it is given an equitable charge or mortgage over the money in question. I would be inclined to view the giving of the authority by the client to the solicitor to pay the money out of the trust account as a step which gave effect to the pre-existing equitable charge if there was one by discharging it and carrying it into effect by payment.

It is, of course, well settled that if there is an existing legal or equitable mortgage in support of the indebtedness at a time before the preference provisions come into effect a subsequent payment does not amount to a preference because it does not disturb the order of priorities in the winding up.

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In my view the principal points raised and relied upon by
Mr Dutney are not such as to invite the intervention of this
Court to permit an appeal to proceed in a matter in which it
is by no means easy to determine whether any clear point of
law is at stake or any question of fact exists that raises a
point of justice which should encourage our intervention. I
would therefore refuse the application for leave to appeal

in this case.

PINCUS JA: I agree that the application should be refused.

As to the Trust Accounts Act 1973 point which Mr Dutney QC raised, it seems to me that in general this Court would not grant leave with respect to a point of law which was not taken below and I understand Mr Dutney to convey that in his view it was not taken there. Therefore, I would not propose for myself to attempt to deal with that point. As I have said, I agree with the learned presiding Judge that leave should be refused.

MOYNIHAN J: I agree.

McPHERSON JA: The order is that the application is dismissed.

MR MURPHY: I ask for costs of the application, Your Honour.
McPHERSON JA: You cannot dispute that.
MR DUTNEY: No, Your Honour.
McPHERSON JA: I will add with costs.
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McPHERSON JA: The order is application dismissed with costs.

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