Stephen Warne on professional negligence, regulation and discipline around the world

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The Lawchestra’s second ever concert

September 18th, 2014 · No Comments

The Lawchestra, about which I have troubled you before, is playing again this Sunday after we totally nailed the last concert (photos from the brilliant young photographer and law student Sean R. Ali here). It was thanks to the good work of Robert Dora, the conductor.  Man does he have a hard job.  Orchestras like the Melbourne Symphony Orchestra run themselves and the conductors just add an air of distinguished flamboyance.  But conducting a community orchestra, the conductor really has to work hard to cue people, explain to them without speaking or stopping wagging the baton that they came in a bar early, as well as drag some dynamic contrast out of players more worried about playing the right notes than where to diminuendo.  It’s a high-risk, high-stress job, and Dora the Conductor is great.  So is the gorgeous soloist, Natasha Lin.  You should definitely come: book here.  Even The Age says so. [Read more →]

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September 15th, 2014 · No Comments

Just when everyone finally stopped calling the Legal Profession Act 2004 the ‘new Act’, we’re set to have another one from early next year.  This is supposed to simplify things, just like the new Act was intended to simplify things. Sigh.  You can read about it here (and if you do, you will learn the surprising fact that the obligation on lawyers to charge no more than fair and reasonable costs is a ‘change’ in the law.)

And there are other developments which are more obviously changes too.  The functions traditionally carried out by the Law Institute, first as the regulator, and then as a delegate of the independent regulators created by statute — the issuing of practising certificates and the investigation of disciplinary complaints — are no longer being carried on by it.  Old names from this part of the Institute are gone — Joe Barravecchio, Jim Leach, Helen Hartsias.

Of course Steve Mark retired recently, and the hunt continues for a new Commissioner for NSW, and Robert Brittan replaced John Briton in Queensland.

One thing that’s not changing is Victoria’s Legal Services Commissioner, Michael McGarvie, who has just been reappointed for a further 5 year term in which he will preside over an expanded local regulatory empire with exciting new powers while liaising to an unprecedented extent with his NSW — and perhaps soon other states’ — Commissioners.

But there have recently been two key new appointments worthy of reportage: [Read more →]

→ No CommentsMore articles on: Legal Profession Uniform Law · Professional regulation

Jury verdict overturned by VSCA because of insinuation in cross-examination without adequate factual foundation

September 10th, 2014 · No Comments

In Green v Emergency Services Telecommunications Authority [2014] VSCA 207, the Victorian Court of Appeal today overturned a jury’s verdict following a nine-day trial. There had been a miscarriage of justice occasioned by the manner in which the plaintiff was cross-examined by the defendant’s trial counsel.  He had made an allegation of recent invention involving a conspiracy between her and her solicitors to concoct a story. [Read more →]

→ No CommentsMore articles on: Alleging fraud & misconduct · duties regarding witnesses · duty to court · Ethics · Evidence · litigation ethics

NZCA stomps on attempt to limit costs against disciplinary bodies

September 8th, 2014 · No Comments

In Roberts v A Professional Committee of the Nursing Council of New Zealand [2014] NZCA 141 a nurse had pleaded guilty to having sex with a vulnerable patient.  He had been suspended from nursing for three years.  The High Court upheld his appeal and reduced his period of suspension to 18 months, precisely as he had requested.  It dismissed the cross-appeal, which contended that he should have been deregistered.  He sought costs.  He got costs of the cross-appeal, fixed at 25% of the costs of the appeal because it had been doomed to fail and should never have been brought.  But he failed in his claim for costs of his own appeal though he had obtained in it precisely what he had sought.

Why? Because there were no ‘compelling reasons’ justifying such an order.  The High Court noted that unlike disciplinary cases against lawyers, where first instance decision makers were empowered to make orders for and against the legal regulator, costs orders could be made only in favour of the nurses’ disciplinarian.  The first-instance immunity to costs of nurses, and the important public function of the maintenance of standards in the provision of healthcare caused the High Court to carve out of quite a prescriptive costs regime in the High Court rules, one of the policies of which is apparently to make costs decisions predictable, a ‘compelling reasons’ threshold.  So he did not get costs of his own appeal.  He appealed again, on costs. The Court of Appeal allowed his appeal, and found there was no ‘compelling reasons’ threshold to be overcome before costs could be awarded against disciplinary regulators.  The judges unanimously said: [Read more →]

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R v Milat: A Case Study in Cross-Examination

September 6th, 2014 · No Comments

British backpacker Paul Onions got away from Ivan Milat on 25 January 1990, after Milat pulled a gun on him after giving him a lift.  He ran off, zigzagging to avoid being shot to death and managed to hail a passing motorist as Milat’s shot missed him.  The police did not do anything much in response to his report and, tragically, Mr Milat was more successful with at least seven others who were in 1992 found murdered in the Belangolo State Forest.  One had been decapitated. [Read more →]

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VCAT’s Legal Practice List and the Privilege Against Penalties

July 30th, 2014 · 1 Comment

I have been banging on about the privilege against penalties for a long time.  VCAT used routinely to require respondents in disciplinary proceedings to submit witness statements prior to the final hearing.  Then the Court of Appeal admonished it for doing so in Towie v Medical Practitioners Board of Victoria [2008] VSCA 157.  (That case stands for the proposition, incidentally, still not perfectly understood by people who probably should understand it, that even expert evidence of a respondent need not be filed prior to the close of the prosecution’s case: see the Court at [10], apparently approving ASIC v Plymin (2002) 4 VR 168 at [10].)

All this did not stop certain regulators inviting respondents to consent to orders to that effect without bringing the privilege against penalties or Towie’s Case to their attention and serving ‘Notices to Admit’.  Some of my clients, keen to save an appearance fee of a few hundred dollars, consented to such orders. [Read more →]

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Director ordered to pay company’s £35M and counting costs liability

July 25th, 2014 · No Comments

Deutsche Bank AG v Sebastian Holdings Incorporated [2014] EWHC 2073 (Comm) is big.  Deutsche Bank sued a company in the English High Court and got a quarter of a billion American dollars judgment.  Justice Cooke also ordered the company to pay costs and ordered  an interim payment towards the company’s costs liability of about £35 million within a fortnight.  The company, a special purpose shell company incorporated in the Turks & Caicos (a British territory in the Bahamas and offshore financial centre), didn’t pay.  The plaintiff successfully applied ex parte to join the company’s sole shareholder and director and effect substituted service in the US.  He is the Norwegian born, Swedish raised, Harvard educated, Monaco domiciled Alexander Vik, said to have been miraculously lucky in his path to billionnairedom.  Until now…

The plaintiff then succeeded in its non-party costs order against the director for the reasons set out below.  It seems all the rage over in England; consider also Xhosa Office Rentals Ltd v Multi High Tech PCB Ltd [2014] EWHC 1286 (QB).  (And see also this post about a similar decision in Victoria, Lillas and Loel Lawyers Pty Ltd v Celona [2014] VSCA 70.  Even more recently, see JJES Pty Ltd v Sayan (No 2) [2014] NSWSC 475 in which the director of a corporate plaintiff which sued its solicitors for professional negligence was ordered to pay the solicitors’ costs personally on an indemnity basis.  It refers to two more authorities directly on point: FPM Constructions v Council of City of Blue Mountains [2005] NSWCA 340, and May v Christodoulou [2011] NSWCA 75; (2011) 80 NSWLR 462) [Read more →]

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Costs of a solicitor’s negligence claim which bombed only on causation; costs of the successful solicitor’s unsuccessful proportionate liability defence

July 23rd, 2014 · No Comments

In King v Benecke [2014] NSWSC 957, Mr King alleged that his solicitor was negligent.  The solicitor denied everything and lost on all but one issue, namely causation, with the result that the solicitor got judgment and Mr King only Pyrrhic victories.

Mr King argued he should not have to pay all of the solicitor’s costs.  Rather, he argued, he should have his costs of the issues on which he succeeded (duty, breach, the proportionate liability defence), which took up most of the case.

Harrison J only acceded to that argument in one respect.  The solicitor had alleged that Mr King’s solicitors in the professional negligence suit were themselves concurrent wrongdoers against whom some of any liability which might be established against him ought to be apportioned under the proportionate liability regime.  The consequence was that Mr King had to get new solicitors, the plea having put the old ones into a position of conflict between self-interest and duty to Mr King.

The solicitor never adduced any evidence in support of the proportionate liability defence.  His Honour found that Mr King should have his costs of and incidental to it, but otherwise pay the solicitor’s costs of the entire proceeding: [Read more →]

→ No CommentsMore articles on: "professional negligence" · Causation · Negligence · Party party costs

Solicitor’s creditors statutory demand set aside because of alleged non-compliance with costs disclosure obligations prior to settlement of client’s case

July 21st, 2014 · No Comments

In IMO Speedy Loans Pty Ltd [2014] VSC 273, a Victorian law firm delivered a creditors statutory demand to a company which was its former client.  The client convinced Gardiner AsJ to set it aside exclusively by reference to an argument that by virtue of s. 3.4.17(1) of the Legal Profession Act 2004, the client was not yet obliged to pay the fees, no taxation (‘costs review’) having yet occurred.  That was because there was an alleged failure to comply with the s. 3.4.16 requirement to provide costs estimates prior to the negotiation of the compromise of a litigious proceeding.

The lawyer involved swore that he had done so orally and the client swore that the lawyer had not. There was, accordingly, a genuine dispute as to the indebtedness of the company and the statutory demand had to be set aside. Lesson: give written disclosures even when writing is not specifically required.  And be very sure of perfect compliance before suing for fees or issuing a creditors’ statutory demand.  Otherwise, seek taxation of your own costs, following which the Costs Court will ordinarily make an order for payment of the taxed sum (or simply write off the fees as uncommercial to recover).

→ No CommentsMore articles on: Professional fees and disbursements · The suit for fees

Costs in settlements of claims by persons under disability

July 15th, 2014 · No Comments

Associate Justice Lansdowne has released for publication an edited transcript of reasons her Honour gave in Chan v Falls Creek Alpine Resort Management Board for not approving a proposed compromise of the claim of a person under a disability. The citation for the decision is  [2014] VSC 314.  ‘Disability’ in this sense is a term of art and extends to the disability of being a minor.

The plaintiff, through his litigation guardian, had proposed a compromise in terms which were expressed as an amount for the claim and an amount for his costs.  Her Honour pointed to Sztockman v Taylor [1979] VR 572 which suggests that such compromises are to be discouraged lest the plaintiff’s solicitors be attracted to an offer which is comparatively favourable in relation to costs but comparatively unfavourable in relation to the claim.  That raises a conflict between interest and duty which is inherent in any compromise structured this way, but which is comparatively impermissible because of the disability of the plaintiff and the important role played by the parties’ lawyers in assisting the Court to evaluate the reasonableness of the compromise, a judicial function which is not a feature of compromises of claims by people not under a disability.  Another reason for the discouragement of such compromises is that the judge approving the compromise is ill-equipped to assess the reasonableness of the proposed compromise in relation to costs.

Following the non-approval of the compromise, the deal was renegotiated such that the settlement sum was expressed on an all-in basis as the total of the separate sums originally proposed by way of compromise of the claim and of costs.  That sum was to be paid to the Senior Master and the plaintiff’s solicitors were to apply to the Senior Master for costs.  The renegotiated proposed compromise was approved by the Court.

→ No CommentsMore articles on: conflicts · duty and interest · Ethics · Party party costs