Client wins professional negligence case against solicitors at VCAT

Such a result is a rare turn up for the books. It would be an interesting exercise to think when a client last won compensation after a hearing down there. What’s more, the American client didn’t bother with representation, didn’t come to Australia for the hearing, and still won based on a statutory declaration he presumably put in the post. The case is L. Scott Turner v DCL [2007] VCAT 1296. Essentially, Senior Member Howell found that the solicitors did nothing much that was useful, and seems to have ordered the refund of fees charged as damages according to the principle in Heywood v Wellers (a firm) [1976] QB 446. As Walmsley et. al put it in their excellent Professional Liability in Australia,where the professional’s breach of contract in respect of that part of the work for which fees are to be paid renders the professional’s services valueless or useless, he or she is not entitled to payment.’ This small case is exactly the kind of case the Legal Practice List is set up to deal with efficiently (which is not to say that it is unable to deal with much more complicated matters). It is a matter of continual surprise to me how rarely its jurisdiction is successfully invoked. Continue reading “Client wins professional negligence case against solicitors at VCAT”

Unconscionability and legal fee estimates, again

The law of unconscionable conduct has been rolled out again as a vehicle to adjust lawyers’ fees in the same way as they might be in a civil costs dispute under the Legal Profession Act, 2004, but in a case to which that Act’s regime did not apply. It has happened once before to my knowledge (see my previous post). In P&R v. Goodwin [2007] VCAT 1199, solicitors sued for their fees, but succeeded in obtaining an order only for the difference between the amount they estimated total legal fees to be at the start of the retainer, and the amount they had already been paid by the client. I do not think VCAT has jurisdiction in relation to disputes between lawyers and clients, because the jurisdiction is predicated on the engaging in of trade or commerce (VCAT has reserved on a test case in that regard). That aside, it is a relatively attractive forum in which to sue for fees. This decision may suggest that it is better to sue in a court, however, unless there is an unusual squeaky cleanliness in following the costs disclosure regime. Continue reading “Unconscionability and legal fee estimates, again”

Legal Services Commissioner publishes annual report

The Legal Services Commissioner’s website is growing some content. Her annual report for the part-financial year ending 2006 is published there. In summary:

  • For those who enjoy the suffering of others, commencing at p. 22 there is a list of all the adverse disciplinary findings made by VCAT’s Legal Practice List, and it names the practitioners involved;
  • The Commissioner’s office has 3 executives in addition to Victoria Marles: Janet Cohen (formerly the Deputy Legal Ombudsman), David Forbes, and Diana Gillespie; 9 legal staff 2 of whom are part time; (2 out of the 13 mentioned are blokes) and 19 administrative staff;
  • She received 1,218 complaints under the new Act (6 a day), of which 664 were only disciplinary (55%), 310 were only civil (25%), and 244 were both (20%) (all of the complaints figures below are only about the new Act complaints received, except where indicated);
  • Only 33 were against barristers (3%);
  • 238 involved a costs dispute (20%), a surprisingly low figure, especially given that 553 of the complaints were about costs or bills (45%);
  • Only 117 involved a pecuniary loss dispute (10%) which shows that two-thirds of the 322 complaints characterised as being about “Negligence — including bad case handling and advice” were dealt with as disciplinary complaints or costs disputes which is most surprising;
  • Only 719 were handled by the Commissioner (59%) — the rest were referred to the Law Institute and the Bar for investigation and recommendation as to ultimate decision to be made by the Commissioner;
  • 67% of those delegated to the Law Institute involved a disciplinary complaint;
  • 14% were about wills and estates, 14% about conveyancing, 18% about family law, and only 5% about crime;
  • 6% were about conflicts;
  • There were 3 complaints of sexual impropriety;
  • There were no ‘other genuine dispute’ within the definition civil disputes in s. 4.2.2(2) of the Legal Profession Act, 2004;
  • No prosecutions were brought;
  • Not a single finalised disciplinary complaint was successful (and only 1 out of the 100 old Act complaints succeeded — it resulted in a reprimand);
  • There were 3 FOI applications to the Commissioner; and
  • The going tariff for a breach of the obligation to deliver up documents within time pursuant to the Commissioner’s power of compulsion seems to be a $500 fine and costs of $1,000.

The Office had revenue of $3.4 million (almost all from the Legal Services Board) of which $1.3 million went on staff, including training (an annualised average of $73,300 per employee, some of whom are part-time, but it gets a little complicated because the Commissioner spent $205,000 on temps), $1.1 million went to the Law Institute for functions the Commissioner delegated to it (there is a list of all delegations on p. 20) and $150,000 to the Bar for the same thing.

Astonishingly, 89% of all disciplinary complaints finalised were summarily dismissed pursuant to s. 4.2.10 of the Legal Profession Act, 2004. Almost 1 in 6 was chucked within 30 days, and almost 9 in 10 within 60. To be fair, this may represent the dross which has been sifted out, since 60% of the complaints received during the reporting period were still open at the end of the financial year, and 60% of them had been open for 2 months or longer. I say ‘astonishingly’ because I perceive it to be a radical departure from the practice of the Commissioner’s predecessors. In general, though, it is a good thing if the Commissioner uses her office’s limited resources to deal doughtily with the complaints which suggest conduct conducive of condine condemnation, while giving the drossmongers and feewhiners the short shrift they often deserve.

I saw the other day a set of circumstances which was unfortunate, and which I hope is not too often replicated. The Commissioner characterised a complaint as a pecuniary loss dispute (one of the species of civil dispute) and a conduct complaint. The particulars of the complaint read, in substance — “See the attached Family Court affidavit”. Rather hastily after the receipt of the complaint, the Commissioner exercised her discretion to bypass the dispute resolution procedures with which she is tasked in relation to civil disputes by giving the client a ticket to go off and agitate her professional negligence claim in VCAT. She referred to s. 4.3.6 of the Legal Profession Act, 2004 which says she can do so if she considers the dispute unsuitable for her to attempt to settle. The matter was referred to VCAT’s Legal Practice List. Then, the Commissioner realised that because the exact subject matter of the complaint was before the Family Court she had no power to deal with the complaint, which she dismissed pursuant to the power in s. 4.2.10(1)(e) of the Legal Profession Act, 2004, which says ‘The Commissioner may dismiss a complaint if— (e) the complaint is not one that the Commissioner has power to deal with’. Yet she did not withdraw the ticket she had mistakenly given to the c lient to refer the purported complaint to VCAT insofar as it amounted to a civil dispute in the belief that she did have power to deal with the complaint.

The Commissioner settled 10% of civil disputes. She let 5% through to VCAT’s pecuniary loss dispute jurisdiction, which would explain why it’s been quiet down in the Legal Practice List. That means 85% never went anywhere for various reasons. She summarily dismissed 53%. She refused to extend time 18 times.

Of the complaints summarily dismissed, 41% were dismissed for being frivolous, vexatious, misconceived or lacking in substance. 9% were dismissed because the Commissioner formed the view the complaint required no further investigation. One-third were dismissed on the basis the Commissioner did not have jurisdiction.

Doctor’s opinion not given in trade or commerce so VCAT had no jurisdiction

In a landmark decision with profound implications for VCAT’s Fair Trading Act, 1958 jurisdiction over lawyer-client disputes about professional negligence and fees, a Deputy President of VCAT has recognised that it did not have jurisdiction to hear a former client’s misleading and deceptive conduct claim brought against ‘a professional’ in the traditional sense of the word, in relation to professional advice. The claim was brought under s. 9 of the Fair Trading Act, 1958 (the state analogue of s. 52 of the Trade Practices Act, 1974), which says:

“(1) A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive”.

The case is Stagliano v Duke [2007] VCAT 1070. The applicant was injured at work, and made a Workcover claim. His employer’s Workcover insurers had him examined. The doctor wrote a report and sent it to the insurer. That professional opinion was not given in trade or commerce, even though it was given pursuant to a contract with the insurer, and for a fee, Deputy President Steel held, for the following reasons: Continue reading “Doctor’s opinion not given in trade or commerce so VCAT had no jurisdiction”

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. Continue reading “Summary dismissal in a solicitors’ negligence claim at VCAT”

Judge Bowman explains Murray’s Case

VCAT’s Acting President Judge Bowman today handed down a long and important decision in relation to the relationship between alleged failures to follow the procedures for investigating complaints against professionals laid down by legislation and the jurisdiction of the disciplinary tribunal to hear charges laid as a result of such investigations. After eight months’ thought, his Honour decided that VCAT did have jurisdiction in the matter of Law Institute of Victoria Ltd v IAB [2007] VCAT 808, and that anything which could have been done better by the Law Institute were not productive of such unfairness as to invalidate the charge laid in the tribunal. In the course of doing so, he provided this summary of the leading case on point, Murray v Legal Services Commissioner (1999) 46 NSWR 224:

Continue reading “Judge Bowman explains Murray’s Case”

The new contract law: a Fair Trading Act claim against Kennard’s Self-Storage

In Kimitsis v Kennards Self Storage [2007] VCAT 668, a man put some things into a Kennard’s self-storage facility. He paid the licence fees for a while, but then fell into arrears, and was uncontactable for two months from the time he put the things into the stroage unit. A written warning went unheeded, but there was a bit of a mix-up with the post. Kennard’s forcibly entered the storage unit and sold the stored things, as it was entitled to do under the contract. But it did so unbeknownst to the man, at what he considered to be an obscene undervalue. The contract said Kennard’s did not take possession of the goods and was not a bailee of them. It did not have a key to the storage unit, and did not know what was inside. Neither warehousemen’s legislation — which required sale of the goods at public auction — nor the law of bailment was accordingly found to apply. Kennard’s was found to have breached an implied contractual duty to sell the goods as well as possible. The result was that Kennard’s was ordered to pay damages. It just so happened that those damages were precisely equivalent to the arrears of licence fees owed by the man. Continue reading “The new contract law: a Fair Trading Act claim against Kennard’s Self-Storage”

VCAT’s Civil List engenders “a sea of misunderstanding”

Coggin’s Case [2007] VCAT 266 is an illustration that the merger of the former Legal Profession Tribunal with VCAT is still being worked out. Senior Member Howell described what had been engendered as ‘a sea of misunderstanding’. Unless you are interested in the procedures of VCAT’s Legal Practice List, you will find this post very boring. Continue reading “VCAT’s Civil List engenders “a sea of misunderstanding””