Thanks to Overlawyered I bring you the story of the US plaintiffs’ lawyer who has advertised for personal injury work arising out of car accidents on a 15% contingency fee basis instead of the normal 33%. The mischievous quirk of behaviour has not been particularly warmly accepted by his peers. This post looks at that story and at the euqivalent laws in Victoria where lawyers working no-win no-fee are not allowed to charge a percentage of the client’s winnings, but are allowed to jack up their normal rates by up to 25% in no-win no-fee cases which are “successful”. Continue reading “US lawyer castigated for accepting less than 1/3 contingency fee”
How not to bill; how not to deal with a fee dispute; the story of a Yank lawyer
Courtesy of Justinian, I bring you the story of the overcharging New Jersey lawyer who charged like this:
“With regard to the fee, he purportedly spent entire days, sometimes eight or nine hours per day, for several days in a row, apparently in ‘lockdown’ — researching, reviewing and negotiating issues that had little or no bearing on the substance of the transaction. Further, respondent presented nothing to substantiate the time charges underlying the bill. Nothing in the record refuted Ferwerda’s compelling testimony that respondent’s services should have been limited to review of the SBA loan documents, an unalterable lease agreement, and the franchise agreement, itself a non-negotiable contract.”
Then, when the client hesitated before paying the $50,000 bill, he:
“threatened her with criminal prosecution for “theft of services” and he didn’t stop there: He also warned that she might lose her business, her home and her professional license.”
She went to another lawyer, who instituted a fee arbitration. The first lawyer settled by waiving his fee, all the time contending he was perfectly entitled to it. When he was charged with gross overcharging and intimidatory conduct, he failed to appear at the hearing, earning himself a break for 6 months.
Solicitor refers costs dispute to VCAT’s legal practice list
In Robert J Lawyers v Kirby [2006] VCAT 2609 A client complained about his solicitor’s fees. The Legal Services Commissioner was unable to settle the costs dispute. The solicitor exercised his right to refer the matter to the Legal Practice List of VCAT. Unusual, but sensible, since the Legal Practice Act, 1996 empowers VCAT to give judgment, effectively, for outstanding fees, and that is what he got, after having 15% knocked off for what I would characterise as a rather technical breach of the Legal Practice Act, 1996’s costs disclosure rules. Continue reading “Solicitor refers costs dispute to VCAT’s legal practice list”
Tidy little fruits of litigation lien judgment
In Khoury v Gonvales [2006] NSWSC 1290, Mr Khoury, a solicitor, got from Justice Barrett of the NSW Supreme Court a declaration that he was entitled to a fruits of litigation lien. He had acted for Mr Sef Gonzales in a suit against the executrix of the will of Teddy Gonzales, and won. Sef got an order for costs too, and the Court ordered the executrix to pay the costs out of the estate. There was a taxation and that resulted in a judgment against the executrix in favour of the client for the sum of $107,032 in costs. The solicitor wrote to the executrix and asked for the money, but she said she needed the consent of the judgment creditor — Sef Gonzales — before she would pay it to anyone other than him, and that consent was not forthcoming. So the solicitor did the sensible thing and applied to the Supreme Court for a declaration that he was entitled to an equitable lien over the estate to the extent of the judgment debt since it was only through his exertions on behalf of Sef Gonzales that Sef had got the judgment at all. The Court obliged, and provided some neat summaries of the relevant law along the way. Continue reading “Tidy little fruits of litigation lien judgment”
Litigant’s right to recover fees of interstate lawyer under costs order
Update: now reported at (2007) 237 ALR 802
This little problem gives rise to ridiculous complexities. In Cannon Street Pty Ltd v Karedis [2006] QCA 541, the Queensland Court of Appeal upheld Justice White’s decision to allow, as party party costs, work done for the successful party by Clayton Utz Sydney in relation to trial of the matter in the Supreme Court of Queensland, despite a parochial provision in the local Supreme Court Act, 1995 (s. 209) which said “A person who is not a barrister or solicitor of the Supreme Court shall not be entitled to claim or recover or receive directly or indirectly a sum of money or other remuneration for appearing or acting on behalf of another person in the Supreme Court”. That the Court had been exercising federal jurisdiction seems to have been significant. I have only glanced at the decision. Another recent case to consider similar issues is Santos Ltd v Delhi Petroleum Pty Ltd [2005] SASC 242.
Can the taxing master decide professional negligence claims?
Update, 10 March 2009: See also these posts about Macteldir Pty Limited v Roskov [2007] FCAFC 49, and King v Stiefel [2023] EWHC 453, case note here.
Update, 3 April 2009: It’s still going: Winn v GHB [2009] VSC 93.
Original post: In Winn v GHB [2006] VSC 476, Winn won, another victory for a pro se litigant against their former solicitors, though it seems this former teacher has recently joined the Queensland bar, which suggests she was at something of an advantage over your average punter in unravelling the arcane intricacies of the Supreme Court’s taxing court. Justice Kaye considered whether the Taxing Master was empowered to tax items off a bill of costs in taxable form on a solicitor-client taxation on the basis of professional negligence, and if so, when the process of doing so ought to stop in favour of a properly constituted professional negligence proceeding. His answers? Yes, and it’s a question of degree. Continue reading “Can the taxing master decide professional negligence claims?”
Lawyer claiming inexplicably high fees against other side restrained from acting
In the case of Brogue Tableau Pty Ltd v Tottle Partners [2006] WASC 273, Master Sanderson of the Supreme Court of Western Australia, exercised the Court’s inherent jurisdiction to restrain a firm from acting to protect the administration of justice. The fees they had charged their client, and which they were seeking against the other side on behalf of the client, seemed inexplicably high. The other side suggested they had overcharged, and the judge said the administration of justice could not tolerate them continuing to act in those circumstances. Continue reading “Lawyer claiming inexplicably high fees against other side restrained from acting”
Fees reduced for unconscionability where Legal Practice Act costs provisions did not apply
In Wilkins’s Case [2006] VCAT 2199, Mr Butcher was faced with an application under the Fair Trading Act, 1999 by a client who sought to avoid payment of two accounts in circumstances described in the previous post. The application was brought under the Fair Trading Act, 1999, though which provisions is not clear from the very brief reasons. The reasons are especially brief considering this is the first time to my knowledge that unconscionability provisions have been relied on to diminish legal fees payable by a solicitor because of a costs disclosure default. The solicitor sent a letter to the prospective client which set out the solicitor’s hourly rate but did not give an estimate of total fees. Mr Butcher found at [17]:
“The document … does not comply with s 86 of the Legal Practice Act 1996, which applied at the time. This dispute is not brought under that Act and the situation is that in relation to a dispute under that Act, I am empowered to reduce bills of costs where there has been a failure to comply with s 86 having regard to the seriousness of the failure to provide information. However, this dispute is brought under the Fair Trading Act 1999. I do, however, consider that an examination of whether the appropriate regulatory regime has been complied with is appropriate in deciding whether under the Fair Trading Act 1999 a determination should be made in favour of the applicant. There should have been more extensive advice given by [the solicitor] in relation to legal fees. It was practicable to do so . The failure to give this advice is unsonscionable.”
He knocked about 7.5% off the bill, rounding it down from $3,874 down to $3,000. The justification for this course is explained in the next post.
Roisin Annesley’s Victorian Barristers’ practice guide
The Bar has produced a practice guide. It is a great achievement and stands as a beacon for the Law Institute’s future efforts at promulgating knowledge of the practice rules. The Bar actually has something called the Professional Standards Education Committee. Written by Roisin Annesley, it was launched by Victoria Marles, the Legal Services Commissioner on 18 October 2006, and distributed free to every member of the Bar. Annesley has done a lot of work as Counsel Assisting the Legal Profession Tribunal (and continues to do occasional work assisting the Legal Practice List at VCAT). A doyen of professional discipline, Paul Lacava SC, and a judge who has excoriated Professional Standards, Justice Gillard, are credited with substantial involvement. It has chapters on: Continue reading “Roisin Annesley’s Victorian Barristers’ practice guide”
A complaint for every 6 solicitors last year in England
Here is an article from that most excellent of newspapers, England’s The Guardian, which notes that:
- the Law Society received 17,074 complaints, one for every six solicitors in England and Wales last year;
- that was up 14% on 2002;
- a third of people think they receive poor service from their solicitor;
- a quarter of those surveyed think their solicitor doesn’t listen to their opinion;
- a third don’t feel they are told enough about how much they will be charged;
- more than half the people surveyed said they received no pre-estimate of fees at all; and
- only about a quarter said they got one in writing.
Costs disputes in England apparently progress through firms’ internal dispute resolution mechanisms, to the Consumer Complaints Service at the Law Society, and then, if the punter is so minded, for review by the Legal Ombudsman. The complaint form used is interesting. It seeks the details of the complainant and the subject of the complaint and says “Please tell us the name and address of the solicitor you are complaining about and briefly state your complaint. (We will contact you later for more details.)” next to a box the size of a postage stamp. That is a sensible approach. I have seen hundreds of complaints. Though Victoria’s regulators were required until recently to give reasonable assistance to complainants in formulating complaints, I do not believe they ever did so. I have seen a case where a man requested assistance and it was flatly denied.
Another unrepresented lawyer bites the dust in WA
The lessons against self-representation in discipline cases are coming almost too thick and fast for me to digest them. Here is The West Australian‘s short article on the striking off recently of Vijitha De Alwis, a solicitor who played a part in a legal saga involving an attempt to deport a non-citizen Briton convicted of crimes, Mr Taylor. The Full Bench of the Supreme Court of Western Australia struck De Alwis off the roll of practitioners on 29 September 2006 in Legal Practitioners Complaints Committee v De Alwis [2006] WASCA 198 following a report by the Legal Practitioners Disciplinary Tribunal. It is a case about receiving trust monies without holding a trust account, like the Victorian case in this post, but it is as much a case about a self-represented person shooting himself in the foot by:
- serial non-compliance with rules and orders;
- repeated bias applications (he said the Legal Practitioners Discipline Tribunal “descended to the dust of the Arena and blinded itself”); and
- repeated ill-got-up adjournment applications on health grounds (one was based on a medical certificate in the following terms: “This gentleman suffers from numerous medical problems and is currently unfit to stand trial or an inquiry”; on another occasion “He said that he had medical advice to the effect that, if he continued to handle his case he ‘might end up having a severe Heart Attack or a massive Stroke that will be fatal’).
One of his problems was that there was ample evidence of him appearing in courts as advocate (or attempting to) at around the same times as he said he was unable to face trial in the proceedings against him. Another was that his written submissions as to why he was too ill to make written submissions disproved what they sought to argue (see [100]). The Full Court said:
“111 … the practitioner’s unfitness for practice is amply demonstrated, in addition, by the manner in which he has conducted himself in these proceedings. His affidavits have been replete with argumentative material, often including allegations of gross misconduct against judicial officers, practitioners and court staff, none of which appear to have any foundation. Moreover, as will be apparent, he has repeatedly failed to comply with time limits and directions imposed by the Court.” Continue reading “Another unrepresented lawyer bites the dust in WA”
No problems with right to costs contingent on recovery from other side on costs order?
Update: 9 February 2008: A good wrap up of the American debate here at Legal Blog Watch.
Original post: In Wentworth v Rogers [2006] NSWCA 145, the NSW Court of Appeal seemed to pave the way for a future declaration as to the efficacity of a costs agreement that says the solicitor will get paid only if the client recovers costs from the other side, and only to the extent of that recovery, so long as there is some lip service paid to a residual obligation in the client to pay the lawyer regardless. Until I read this learned judgment I thought perhaps I was the only doubting Thomas in the world who thought that these agreements, increasingly de rigeur amongst the more switched on pro bono set, had their problems. So I was glad to see that the problems were recognised, and even more glad that such costs agreements seem likely in the future to be certified kosher. Continue reading “No problems with right to costs contingent on recovery from other side on costs order?”
A little case about costs against lawyers personally in NSW
I posted a few days ago about the differences between the Victorian and NSW regimes for ordering costs against solicitors personally.
In Deputy Commissioner of Taxation v Rollason [2006] NSWSC 1032, the defendant consented to judgment with costs at trial having advised the Commissioner’s solicitors more than a month beforehand, confirmed 3 days beforehand, that the matter was unlikely to be defended. There was accordingly non-compliance with the pre-trial directions. The Court was in the dark about what was going on. Justice Gzell said the proper course in the circumstances would have been to apply to vary the pre-trial directions or seek the stay of the proceedings. The Court was inconvenienced in arranging its business. Justice Gzell required the defendant’s barrister and solicitor to show cause why they should not pay the costs thrown away by virtue of their non-compliance with the orders personally. Continue reading “A little case about costs against lawyers personally in NSW”
Latest fruits of litigation lien decision: SA
Scammell & Co v Workcover Corporation [2006] SASC 258, a decision of the Full Court of the Supreme Court of South Australia dealing with how the lien survives in cases under the Workers Rehabilitation and Compensation Act 1986 (SA). Is this a record for the smallest amount ever in dispute in a state Court of Appeal ($350)? Austlii’s headnote says: Continue reading “Latest fruits of litigation lien decision: SA”
Unrepresented woman jumps off Legal Practice Act conveyor belt into Fair Trading Act jurisdiction
It has to be said that De Sarro’s Case [2006] VCAT 1924 is about as boring as they come, a costs dispute about whether a quote of $400 plus GST was for the whole conveyance or only for preparation of the vendor’s statement. Apart, that is, from the unusual feature that Ms De Sarro apparently went through the Professional Standards costs dispute process, got her permission to refer the matter to VCAT, but then decided to proceed to VCAT not on the basis set out in her permission letter under s. 128 of the Legal Practice Act, 1996 (or its correlate in the Legal Profession Act, 2004) but by instituting a proceeding in VCAT’s civil jurisdiction under the Fair Trading Act, 1999.
The solicitor won this contest on the facts, and it seems no one raised the question of whether the solicitor’s services were prepared in trade or commerce.
It seems from the catchphrases noted in Austlii, that the application was pursuant to s. 108 of the Fair Trading Act, 1999. That says VCAT may hear and determine a “consumer-trader dispute”, defined to include a claim in negligence arising between a purchaser (being the person to whom the services are supplied) and a supplier of services, including the performance in trade or commerce of work of a professional nature. VCAT’s powers include ordering in-house mediation, ordering compensation, exemplary damages and interest, ordering payments by way of restitution, rescinding, rewriting, rectifying, or declaring void contracts or terms of contracts, granting injunctions, and ordering specific performance. Continue reading “Unrepresented woman jumps off Legal Practice Act conveyor belt into Fair Trading Act jurisdiction”
Melbourne solicitor charged with contempt
As reported in the Sunday Age, a Melbourne solicitor successfully sued four policemen who bashed his client and broke her jaw (see the photo in the article, and, to balance the books, see the mobile phone footage of youths bashing police here). According to The Age, the story begins, like this:
“two police officers … stopped Ms Horvath, then 21, and her partner, Craig Love, and declared her car unroadworthy. Believing the couple were ignoring the roadworthy sticker, the next day the officers illegally entered their Somerville home. Knowing they did not have a warrant, Ms Horvath ordered them off her property. The officers called for reinforcements. When six others arrived a decision was made to raid the house, breaking down the door if necessary, and arrest Ms Horvath and Mr Love”. Continue reading “Melbourne solicitor charged with contempt”
Costs orders against solicitors
Russell Cocks, a man with a keen interest in legal ethics, and a penchant for cartoon ties, wrote an article in the Law Institute’s Litigation Section Newsletter on costs orders against solicitors in Victoria. It is always difficult to maintain an understanding in this area because the cases seem inconsistent, and are all based on different legislative regimes which themselves keep changing. So an up to the minute analysis is a handy thing. Continue reading “Costs orders against solicitors”
Supreme Court authority on setting aside costs agreements
Update, 21 April 2008: see the decision on appeal: McNamara Business and Property Law v Kasmeridis [2007] SASC 90.
Original post: Kesmeridis v McNamara Business and Property Law [2006] SASC 200 is a decision of a Master of the Supreme Court of South Australia. Decisions in such applications in Victoria are heard by the members of VCAT’s Legal Practice List. The decision, and several related decisions, (i) say that a costs agreement reduced in writing need not be signed by both parties to be a contract in writing as required by the relevant statute, (ii) say that whether a costs agreement is “fair and reasonable” is to be determined by reference to pre-contract conduct, (iii) say that a discretion to charge a premium over and above an hourly rate is easily severable from a costs agreement and does not require the whole agreement to be set aside, and (iv) demonstrate that the courts’ distrust of hourly rate costs agreements is not waning with time.
Though the clients had been defendants in 35 proceedings before the relevant retainer and so “were not as ignorant of the legal system as they might have claimed”, the costs agreement was set aside in part because the solicitors had not explained to their prospective clients that there were other solicitors in Adelaide who would have been willing to do the same work on scale. Continue reading “Supreme Court authority on setting aside costs agreements”
Litigation funding in the news
An article in The Age examines the financial viability of John Walker’s publicly listed litigation funder, IMF. Its share price has varied from 40c to $1.90 in recent times. It is funding 60 cases with a maximum claim value of $1 billion. Walker employs a “17-member team, which includes a clutch of lawyers, debt collectors and former investigators from the Australian Securities and Investments Commission and the fraud squad.”
An article in Lawyers’ Weekly provides a happily brief overview more or less accessible to the lay reader.
The High Court recently gave the thumbs up to litigation funding recently in Campbells Cash and Carry Pty Limited v Fostif Pty Limited [2006] HCA 41.
The transcript and audio for ABC Radio National’s Law Report on the decision begins with the aphorism “Justice is open to all, just like the Ritz Hotel”.
That goddam dictum of Denning about file notes and conflicts of evidence
Many a smug lawyer has grinned at me across a mediation table and trotted out some version received by Chinese whisper of Lord Denning’s typically over-reaching dictum in his dissenting judgment in Griffiths v Evans [1953] 1 WLR 1424 at 1428; [1953] 2 All ER 1364 at 1369 said to prove conclusively that the absence of a file note is a slam dunk for the plaintiff in any contest of evidence between solicitor and client. The dictum was confined to disputes as to retainers; it harks from a species of cases decided long ago on affidavit and not oral evidence; and it is at best a reflection of the public policy in favour of the formality of legal relationships than a principle of evidence. So say the judges in the cases extracted below. Continue reading “That goddam dictum of Denning about file notes and conflicts of evidence”