I have never been quite clear about what you have to prove in a suit for fees. I was attracted to the proposition that if a client wants to go through a bill item by item, the place to do that is in a taxation, and if they do not go down that path, or they can’t because they’re out of time, then no challenge of the kind typical of a taxation ought to be allowed in the suit for fees, that is, that the bill may be sued on as a debt due and owing. But I was never entirely confident about it.
The Full Legal Profession Tribunal’s 16 June 2000 decision in B v Home Wilkinson Lowry [1999] VLPT 1 is authority for many things (principally that state tribunals like VCAT have no jurisdiction over the costs of Family Court proceedings), and seems to be authority too for the proposition which attracted me.B v Home Wilkinson Lowry [1999] VLPT 1 is discussed elsewhere on this blog, for example here. It is a decision of Justice Fullagar, a respected Supreme Court judge between 1975 and 1994, and thereafter Chairman of the Legal Profession Tribunal until his death. Those with an eye for these things look back on his tenure as Chairman with reverence.
The facts were that solicitors represented a wife in Family Court proceedings. They rendered a bill on 1 January 1997. They sued for outstanding fees on 19 January 1998. The Full Tribunal commented that at this stage, ‘the client was long out of time to dispute the bill,’ and ‘the client had lost all right to dispute in any way before the Family Court the liability to pay [the bill]’. The client lodged this defence:
‘The amount charged was about $21,000 for a job initially quoted at $2000.00, then to be capped at $4,000, there the solicitor offered to do amendments to documents for further (adjourned) hearing for free when total bill estimated at $6,000. Some work was not properly itemised despite my requests. Some work was done without my instructions and some I do not consider to be work done on my behalf, despite my requests information regarding my rights and process for disputing the bill was never sent to me. I am now making my own enquiries regarding making a complaint and disputing the costs.’
Two days before the Magistrates’ Court hearing, the client made 3 applications to the Family Court:
- for an order setting aside the costs agreement between herself and the practitioner;
- for an order requiring the practitioner to withdraw the Magistrates’ Court proceedings, and
- for an order that the practitioner deliver a bill of costs in taxable form, and then submit to taxation in the Family Court.
The Family Court’s Justice Carter heard and dismissed all 3. Fullagar J observed:
‘Carter J. held that the client’s application for a taxation was out of time, thus putting an end to (inter alia) any contention of the client that she did not receive a Notice of Rights with every single bill of costs. It is also clear in our opinion that the orders of Carter J. had the effect that there was thenceforth no power whatever in the client to dispute before any court or tribunal the fact that she owed to the practitioner a simple debt of $4276.40. No appeal was brought from the judgement and orders of Carter J.
10. On 16 September 1998 the proceedings in the Magistrates’ Court, having been adjourned because of the client’s eleventh hour proceedings in the Family Court, came on for hearing. It is to be observed that, in our opinion, the client was on 16 September 1998 faced with a res judicata that she owed the debt of $4276.40 to the practitioner which could simply enforce it as a debt. Any attempt to defend would be met by res judicata.
…
13 … the order of Carter J. of 3 August 1998 operates against the client as a res judicata not only for the proposition that the $4276.40 was a debt due and owing as at the date of the order of Carter J. but also for the proposition that it had been due and owing as soon as the time for disputing it in the Family Court had expired.’
I wasn’t sure that the case to which you refer is good authority for your proposition. First, as you say, the quantification of solicitor/client costs in respect of Family Court litigation is a matter exclusively for that Court. Second, the Family Court had rejected the attempt to have the solicitor’s costs taxed – hence the res judicata point. Given the question interested me, I have looked into it further …
Where the claim is brought in the Supreme Court, the fact that the time for seeking a taxation has passed will not prevent the Court, in the exercise of inherent jurisdiction, examining the quantum of the claim – at least where a prima facie case of unreasonableness is raised: see Turner & Co v A Palomo SA [1999] 4 All ER 353 (CA) – which was a dispute over time costed charges; Jones & Son v Whitehouse [1918] 2 KB 61 (to which Dixon J referred in Woolf v Snipe [1933] HCA 5; (1933) 48 CLR 677).
The position is not as clear where the court in which the claim is brought does not have the jurisdiction to tax solicitor/client costs (eg the Magistrates Court). The Full Court of the South Australian Supreme Court in in King William Law Chambers v Mobitel (International) Pty Ltd (1981) 29 SASR 316 decided such a court cannot examine the quantum of the claim – rather it should adjourn the proceeding to permit a taxation (and if that doesn’t happen it is evidence that the defendant accepts the charges as reasonable and proper). However the Full Court of the Federal Court suggested to the contrary in Re Jozef Titan v Romano and Co [1990] FCA 430 – saying that the ACT Magistrates Court could deal with quantum – even after the time for taxation had expired. However the Full Court relied upon legislation that invested the Magistrates Court with the same power as the Supreme Court in respect of proceedings before it – something akin to our (Victorian) Magistrates Rule 1.12, although that Rule gives the Magistrates Court a discretion to follow Supreme Court practice. What is clear is that the Magistrates Court can decide: if a retainer exists between the plaintiff solicitor and defendant client (Bar Chambers) ie the liability question as opposed to quantum. Also, putting aside the question of whether it can tax the solicitor’s costs, I can’t think of any reason why the Magistrates Court could not decide any counterclaim made or set-off pleaded by the client (eg for loss suffered through the solicitor’s negligence or failure to follow instructions).
I have been unable to find any Victorian authority of real assistance. Balmford J in Williamson v Macken (unreported, 21 May 1996 – available through the Supreme Court library web site) seems to accept that Bar Chambers is correct. In the earlier case of Delahunty v Howell (unreported, 12 May 1993) Gray J notes, without suggesting it was inappropriate, that a Magistrate had entertained a challenge to the quantum of solicitor’s costs.
In South Australia the Magistrates Court has power to require the solicitor to get the costs taxed: see Von Doussas Legal Pty Ltd v Nasr [2009] SASC 246 at para 68.