Summary dismissal in a solicitors’ negligence claim at VCAT

Skinner’s Case [2007] VCAT 917, a claim against a leading labour law firm, was for some reason heard in VCAT’s Civil List. A more likely list would have been the Legal Practice List, given that it was a professional negligence claim, albeit one pleaded under the Fair Trading Act, 1999 and the Trade Practices Act, 1974. But Mr Skinner, a self-represented litigant with an enthusiasm for internet research and a copy of Pizer’s Annotated VCAT Act under his arm, came up against the Acting President, Judge Bowman, who turfed his $400,000+ claim out as doomed to fail and as an abuse of process. Yet another failed regretted settlement claim bites the dust. The only pity is that this proceeding was allowed to wallow for 2 years, while repeated directions of the Tribunal requiring witness statements and an intelligible statement of claims against the solicitors were ignored. The solicitors did not claim advocates’ immunity in respect of the suit, despite the availability of such a plea: Biggar v McLeod [1978] 2 NZLR 9; O’Connor-Sraj v Lawrence [2005] VCC 1093.

Mr Skinner had had a dispute with the vendor and financier of a refrigerated truck. He had paid $14,000 and had another $50,000 or so to go. The vendor agreed to take the truck back, waive the remaining payments owing under the contract, and pay him $4,000, but it kept the $14,000 he had already paid. That settlement occurred at a mediation in October 2003 before a December trial. One wonders whether the presumably confidential settlement was disclosed with the consent of the vendor of the truck, and I suspect not. As a result, he said, he lost a job and two rental properties. So he had sued his solicitors in the Legal Profession Tribunal. It had dismissed his suit. When that Tribunal was abolished and VCAT’s Legal Practice List was established, he decided to have another go there.

The solicitors applied for dismissal pursuant to s. 75 of the VCAT Act, which provides:

‘Summary dismissal of unjustified proceedings

(1) At any time, the Tribunal may make an order summarily dismissing or striking out all, or any part, of a proceeding that, in its opinion- (a) is frivolous, vexatious, misconceived or lacking in substance; or (b) is otherwise an abuse of process.’

and s. 78, which provides:

‘Conduct of proceeding causing disadvantage

(1) This section applies if the Tribunal believes that a party to a proceeding is conducting the proceeding in a way that unnecessarily disadvantages another party to the proceeding …

(2) If this section applies, the Tribunal may- (a) order that the proceeding be dismissed or struck out …’.

The solicitors submitted that:

‘Mr Skinner settled his case, and settled it following discussion of the costs of the proposed litigation, and in private session with the mediator. He cannot now say that he should not have settled it because at the time he did not have certain material, and now pursue [the solicitors] because of this. What he should have done was simply instruct his solicitors and barrister either to adjourn the mediation, or to leave with the matter not settled. If necessary, he could have sacked his solicitors, as he did with [his previous solicitors]. In this case, it is an inescapable conclusion that he settled the matter on his own terms. It was his decision. The one allegation that is not made is that Mr Skinner was stood over or coerced to settle, against his better judgment, by either [his solicitors] or by counsel.’

Acting President Bowman held that the appropriate test was stated by Deputy President McKenzie in Norman v Australian Red Cross Society (1998) 14 VAR 243: for a dismissal or strike out to succeed, the proceeding must be:

  • obviously hopeless or bound to fail,
  • obviously unsustainable in fact or in law,
  • unable to justify relief on any reasonable view.

His Honour held that Skinner’s application was ‘totally misconceived and lacking in substance’. At [27], he accepted the solicitors’ arguments:

‘Mr Skinner’s application fails to disclose any reasonable cause of action and is bound to fail. On no reasonable view can the proceeding justify relief. His application, which has been on foot for some time, simply fails to identify what [the solicitors] have done wrong [or] which failing or error has been productive of a resultant defined loss. Counsel was briefed, appropriate material obtained, no improper pressure was applied to Mr Skinner, and he settled the matter on his own terms and of his own volition. If [the solicitors] did do something that was erroneous, negligent or non-professional, and I struggle to see that there was any such behaviour, it would then seem to have available to it virtually a complete defence based upon the circumstances of the settlement. Mr Skinner does not suggest that he sought to adjourn the mediation or that he asked for more time. He did not walk away with the matter unsettled. He did not sack his solicitors or his counsel. He settled the matter privately and on terms known to him. There is no suggestion that the terms were of such a nature that he could not understand them. As stated, I accept that he settled his case of his own volition and with there being no suggestion of improper pressure being placed upon him.’

Furthermore, it was an abuse of process, even though the solicitors for did not assert that there was a res judicata flowing out of the Legal Profession Tribunal’s earlier decision in relation to overlapping allegations of negligence in relation to the same settlement, albeit pleaded as a different cause of action. Acting President Bowman held, correctly, and with appropriate fortitude that:

’31 There should be an end to litigation. A proceeding is an abuse of process if it could be characterised as seeking to re-agitate issues that had, as a matter of substance, already been determined in prior decisions – see, for example, [Julian] Knight v CORE (2003) 20 VAR 89. That approach seems to me to be applicable in the present case. Mr Skinner is seeking to re-agitate issues that have already been determined as a matter of substance. The applications do not overlap entirely, but they seem to me to overlap substantially and to the extent that the present application represents an abuse of process.’

Sounds awfully like a res judicata, issue estoppel, Anshun estoppel, or a combination of them to me. Same parties, same case, differently dressed up. If Skinner had alternative concurrent remedies, he must have been taken, in the Legal Profession Tribunal, to have elected to pursue one of them, so that each other such remedy would also be the subject of the litigation estoppel which applied to the one he elected to puruse.

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3 Replies to “Summary dismissal in a solicitors’ negligence claim at VCAT”

  1. I didn’t mean to sound like I was “blaming” litigants in person.

    The ones who have conspiracies of masonic domination and try to bring up the Bill of Rights are very difficult to deal with. Having worked in a court, I have seen them consume hours of court time in fruitless battles – a waste of time for everyone involved, and tragic for them on a personal level.

    I agree that the system creates these people by the way in which it operates and could be seen as a major contributor towards the problem. One of my initial posts was on the difficulty of obtaining legal advice if you are a layperson with no idea of where to turn. I know that I could not have afforded to hire myself (at the rates my firm used to charge).

    I think your idea of an Idiot’s Guide to Litigation is a great one. Certainly, the kind of problems one sees at community legal centres crop up over and over again.

    It used to frustrate me a great deal when I acted for banks and had to sue mortgage defaulters. The defendants had no idea of how to respond or where to turn.

    The responses one could take were actually very simple:
    1. Sell the house yourself and use the proceeds to pay off the loan.
    2. Refinance (but think about the fact that if you are in arrears now, can you afford the higher interest of a second- or third-string mortgage company?)
    3. Pay the arrears.
    4. Defend the action (but be aware that if the Bank wins you’ll have to pay their costs).
    5. Give up possession to the Bank.
    6. Sit there and do nothing, in which case the Bank will take your house. (Many people were in denial about this).

    All people needed was some very simple advice, but usually if they went to see lawyers, they got knuckle-headed advice to defend the action, by denying that they signed the mortgage or something like that. Usually, there was no basis for these defences, and they ended up going down in a summary judgment application or settling the day before the application. But they could have saved themselves the money by being sensible and helping themselves at the outset.

    Whew! That was a bit longer than I thought it was going to be. But as you can see, it’s something I feel strongly about.

  2. lri.lsc.gov

    Madam Eagle, you refer to unrepresented litigants as “the problem” whilst recognising that there may be some pearls amongst the dross, and cite Gambotto, a pro se success I had not noticed. Despite the thrust of my post, I am interested in legal systems where an educated person could take advice from a lawyer and then prosecute their case themselves. Daming He is an example of an unrepresented man whose doggedness appears to have revealed the pearl, eventually, in the Court of Appeal. Type “Daming” into the search box on the blog and you will find the story. I am interested because until recently I was Middletons’ Pro Bono Coordinator, and had discussions with PILCH, the Public Interest Law Clearing House, about an Unrepresented Persons Legal Clinic. Now the Victorian Bar is forging ahead with plans for a duty barrister scheme which is exciting. And I am also interested because I have been opposed to unrepresented people suing their lawyers in the Legal Profession Tribunal and VCAT scores of times.

    But another way of looking at things is that “the problem” is a legal system structured around lawyers whose prices for an adjudicated outcome — and let’s face it, despite all the win-win rhetoric of an alternative dispute resolution industry which is the child of the high prices of adjudicated outcomes, your average punter does like a nice adjudicated outcome — start at $10,000. That’s why VCAT is an interesting experiment, where in small cases, leave to be represented is sparingly granted. Lots of cases get dealt with there without lawyers successfully enough, but we only hear about the mad and obsessed unrepresented litigants.

    The most important thing to remember when considering “the problem” is that “All unrepresented litigants are pains” does not necessarily mean that “All persons who would choose to litigate appropriate matters without lawyers given half a chance are pains”. Or, put another way, it does not follow from the proposition “Anyone who would represent themselves in our system would have to be mad” that you would have to be mad to represent yourself in a slightly modified legal system, especially with the benefit of an Idiot’s Guide to Litigation. Two questions are worthy of further discussion:

    1. Could an Idiot’s Guide to Litigation be compiled by legal bloggers as a wiki easily enough? (Yes, I say)

    and

    2. How slightly modified would the legal system have to be successfully to accommodate litigation without full lawyer representation? More detailed procedural rules, with in-built commentary, strictly observed would be a good start. If AAMI can revolutionise the insurance industry with insurance policies which punters can actually understand, the writers they employ must be able to come up with a similar product for the courts. There should be a rule, for example, entitled “What to do if you’re sick”.

    The most interesting thing I have read on the subject is Richard Zorza’s “The Self Help Friendly Court”. His is a really far-reaching and imaginative vision: http://www.lri.lsc.gov/abstrac.....tID=030111.

  3. It’s so hard dealing with litigants in person.

    On the one hand, you want to give them a chance. What if there is a speck of gold amongst all the dross?

    On the other hand, if the proceeding has already been determined elsewhere…such a claim should be given short shrift. But I think some judges/members suspect that if they just strike out the claim, it will increase the litigant in person’s sense of grievance and confirm their view that “all lawyers are against me”.

    Have written more on the topic on my own blog here and here.

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