VCAT cancels bill and leaves solicitor wholly unremunerated for sloppy work

Praag v W & T Lawyers [2008] VCAT 307 was a rare thing: a case in VCAT’s Legal Practice List actually prosecuted pursuant to the Legal Profession Act, 2004. Mr Praag was his late mother’s executor. Before her death, she lived in Canberra. Her assets were a house in Canberra and $50,000 cash. Mr Praag went to the respondent solicitors who said they would get probate of the will for $2,800. The scale cost for doing so was $499. They did not otherwise comply with the costs disclosure regime in the Legal Profession Act, 2004. In fact it was unnecessary to get probate in Victoria, and it would have been better to have got it in the ACT. Though Mr Praag was able to withdraw the cash from the Bank with the Victorian parchment, he was unable to deal with the house unless he resealed the probate in ACT, which cost a bit extra on top of the cost of getting probate. Member Butcher mentioned several ‘concerns’ he had before concluding:

‘In all I am concerned that the legal practitioner has not done the right thing by Mr Praag on a variety of levels. Having regard to all of the above I am satisfied that it is appropriate to order that the account rendered by the respondent to the applicant dated 19 October 2006 is cancelled and the respondent is ordered to pay the sum of $2,800.00 to the applicant forthwith’

Sounds a bit harsh, really, until you notice that the solicitors did not appear at the hearing.  Had the solicitors turned up, they might have made an argument that they did what they agreed to do successfully for the amount the client was prepared to pay, though whether such an argument would have been available to them we can only guess at on the facts recorded in the brief reasons. If a client knows in advance exactly how much a job is going to cost, and agrees to that fee, all the other costs disclosures (like who within the firm is going to do the work, that itemised bills must be sought within 30 days, and that interest will accrue at a certain rate on unpaid bills) are subsidiary, and a failure to make them would not, in many cases, justify keeping the lawyer out of his fees altogether. Compare, for example, the Court of Appeal’s guidance on this issue in Equuscorp Pty Ltd v Wilmoth Field Warne (a firm) [2007] VSCA 280 (discussed by Legal Eagle here).

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6 Replies to “VCAT cancels bill and leaves solicitor wholly unremunerated for sloppy work”

  1. On the Hawkins v Clayton point above… following is a decision of the Supreme Court of New South Wales, where one point successfully argued at first instance was that the solicitor did not have a duty beyond the instructions to perform a specified task. (This took place in circumstances where two sets of firms undertook particular tasks, and the third was claimed to have an oversight/advisory role.)

    A I McLean Pty Ltd v Hayson [2008] NSWSC 927

  2. When I said that they were “too ashamed” to show their faces, I was not drawing any conclusions about the merits of the case, just saying that perhaps they were embarrassed to have allegations such as that laid against them. I would be mortified.

    I still think it’s contemptuous not to turn up at a hearing though (unless one has a good excuse…I leave that doorway open to the solicitors in question).

    I tend to think that a deliberate decision not to attend a hearing should be a professional offence.

  3. Legal Eagle,

    Of course it looks bad that no-one turned up and is not a smart legal strategy.

    My complaint about your post was not to disagree with the above observations, but your other comments made, as you say, as an “objective observer” (whatever that means). I agree we do not know what happened so best not to speculate.

    I am surprised, though, when solicitors do not show in the Tribunal to answer complaints of professional negligence or unethical conduct. It happens occassionally and it is not a good look either in the case or more generally. It puts the Tribunal and Counsel assistting in a difficult situation too.

    A question: could a solicitor’s decision to deliberately not attend a hearing in the Tribunal be in itself a professional offence?

  4. Fair comment, Rudi. I don’t know the solicitor at all. I certainly can’t comment on her competence or otherwise. I’m commenting as an objective observer who knows nothing about the firm or solicitor involved whatsoever.

    But I still think that it looks pretty bad that no one from the firm turned up, even if the individual solicitor involved was suffering from depression or illness. Surely they could even get someone else to represent them?

    It is true that research has shown that people who commit trust defalcations and other breaches are not incompetent, just depressed and struggling, so it may be that this solicitor had problems of that sort. Who knows what happened? That’s the point, we just don’t know.

    Avoiding the problem just makes the problem so much worse. The firm doesn’t get to put its side of the story, and looks like it doesn’t care about the problem. The member has to make a judgment with only one side of the story, and of course, that is the side which he came down upon. Whereas if someone from the firm had turned up and explained their side of the story, the firm’s actions may have been entirely understandable.

  5. I know the solicitor who was the subject of the charge. I have not discussed the case with her, but I am surprised she did not show up as I think her competent and professional. I caution Legal Eagle from stating, as she has, that the solicitor’s non-attendance was contemptuous of anyone or the Court, or a sign of shame. It is an easy remark to make but really you do not know. Solicitors do inexplicable things at time for more benign reasons, for example, out of ill mental health. In stating this, I do not know why the solicitor did not attend and make no comment about her mental health.

    The retainer in this case seems broader than simply to obtain probate in Victoria. Member Butcher says that “the applicant gave instructions concerning the assets of the estate and was told that the costs of obtaining probate in Victoria would be $2,800.00.” This would suggest a retainer to advise as well as obtain probate.

    Further, even if a client instructs a solicitor to perfom a specific task then his or her duty is probably broader that exercising reasonable care in performing the task. Justice Deane in Hawkins v Clayton (1988) 164 CLR 539 at 579 saw the duty as extending beyond the specifically agreed profesional task to include foreseeable risk of economic loss. This is in keeping with the general trend of finding a general duty of care rather than a duty to perform a speficic task.

    If a retainer was restricted to a specific task on a client’s instructions and an issue arose about whether the solicitors were negligent in not advising that a different task be undertaken there would be a strong argument that even if they had the client would not have relied on the advice. A client who wants only a specific task performed is a rare one and normally of a set mind or a repeat player in an area they know well.

  6. Not even turning up?! That’s terrible – shows contempt for the client’s concerns about the work and contempt for the court. Unless, of course, they were just too ashamed to show their faces?

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