Theden v Nominal Defendant[2008] QCA 71

SUPREME COURT OF QUEENSLAND

[1]  KEANE JA:  The plaintiff succeeded at trial in an action against the defendants for damages for negligence arising out of a motor vehicle accident which occurred in North Queensland on 9 August 1996.  Orders were made in favour of the plaintiff for the recovery of his costs of the proceedings from the defendants.  This appeal is concerned with the assessment of those costs.

[2] The plaintiff presented three Costs Statements:  the first related to the fees of the solicitor originally retained by him; the second related to fees charged by the Queensland solicitors who acted as agents for a New South Wales solicitor, Mr Goudkamp, who was retained directly by the plaintiff; and the third related to the costs charged by Mr Goudkamp himself. 

[3] In the third costs statement, the plaintiff sought to recover costs in respect of work Mr Goudkamp did in anticipation of, and for the purposes of, the plaintiff's action.  This work was all done by him in New South Wales.  At all material times after proceedings were commenced in Queensland, a firm of Queensland solicitors was on the record as the plaintiff's solicitors.

[4] Mr Goudkamp was admitted to practise as a solicitor and barrister in New South Wales.  He was also admitted to practise as a solicitor in Queensland, but he did not hold the practising certificate required by s 38 of the Queensland Law Society Act 1952 (Qld) ("the Law Society Act").  It was common ground that he was not registered in Queensland under the Mutual Recognition (Queensland) Act 1992 (Qld).

[5] On the assessment of the third costs statement referred to above, an amount of $13,883.80 was allowed by the Registrar.  At the instigation of the defendants, on a reconsideration pursuant to r 741 of the Uniform Civil Procedure Rules 1999 (Qld) ("the UCPR"), the Registrar disallowed entirely the claim for any costs for the work done by Mr Goudkamp. 

[6] Pursuant to r 742 of the UCPR, the plaintiff sought a review by a judge of the Supreme Court of the Registrar's reconsidered decision.  On that review, the learned primary judge set aside the disallowance of the items referable to the work performed by Mr Goudkamp, and remitted the assessment of costs to the Registrar for further consideration in accordance with his Honour's reasons.

[7] The defendants appeal to this Court against the learned primary judge's decision contending that the legislation which was in force in Queensland when the work the subject of the disputed claim for costs was performed precluded any entitlement in the plaintiff to recover fees for this work from the defendants. 

[8] It is convenient to set out the terms of the relevant legislation before moving to a consideration of the reasons of the learned primary judge and then to a discussion of the arguments agitated on appeal.

The legislation

[9] The relevant legislative provisions were contained in s 38, s 39 and s 44 of the Law Society Act, and s 209 of the Supreme Court Act 1995 (Qld).

[10]  The relevant provisions of the Law Society Act were in the following terms:

"Prohibition on practising without practising certificate

38(1)  No solicitor shall on or after 1 July 1931, act or practise as a solicitor unless–

(a)the solicitor has obtained from the secretary on application in proper form a certificate which is then in force to the effect that the solicitor is on the roll of the court as a solicitor thereof and entitled to practise as a solicitor, and

(b)in the case where the certificate aforesaid obtained by the solicitor is subject to a condition prescribed by this Act or a condition prescribed by or imposed pursuant to the rules – the solicitor acts or practises as a solicitor in accordance in all respects with that condition.

…

Persons practising without certificates

39(1) Every person who directly or indirectly acts or practises as a  solicitor or conveyancer–

(a) without having at the time a certificate then in force issued to the person by the secretary, being a certificate referred to in section 38; or

(b) otherwise than in accordance in all respects with the conditions to which a certificate then in force issued to the person by the secretary, being a certificate referred to in section 38, is subject as prescribed by this Act;

shall be guilty of an offence, and shall be liable on summary conviction to a penalty not exceeding 10 penalty units and in addition shall be guilty of a contempt of the court and shall be liable to be punished accordingly.

(3)  Where a person, being a body corporate, is guilty of an offence against this section, any director, manager, secretary or other officer of the body corporate who was knowingly a party to the offence shall also be guilty of that offence.

(4)  This section does not apply in relation to a barrister-at-law, solicitor or conveyancer in any department of the Government of the Commonwealth or State in the course of his or her official duties.

…

Solicitor may not act or recover fees whilst uncertificated

44. No person acting as a solicitor for a client shall sue, prosecute, defend, or carry on any proceedings in any court without having previously obtained a practising certificate which shall be then in force, or shall be capable of maintaining any action or suit for the recovery of any fee, reward, or disbursement for or in respect of any business, matter, or thing done by the person as a solicitor whilst the person shall have been without such practising certificate."

[11]  Section 209 of the Supreme Court Act 1995 was in the following terms:

"Appearance to be in person or by barrister or solicitor or person allowed by the judge

(1) In all matters and proceedings in the Supreme Court a party

may appear in person or by a barrister or solicitor or by any person allowed by special leave of the judge in any case.

(2) 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.

(3) In this section—

party includes a person served with notice of or attending a matter or proceeding although not named in the record."

The reasons of the primary judge

[12]  Before the learned primary judge, the defendants relied principally upon s 209(2) of the Supreme Court Act 1995 arguing that it operated to disentitle the New South Wales solicitor from claiming remuneration for acting on behalf of the plaintiff.  In this regard, his Honour concluded:

"In my view s 209(2) has no relevance to a non-Queensland solicitor’s entitlement to remuneration under a general retainer to commence and maintain proceedings in the Supreme Court at the relevant time. Consequently it seems to me that any objection founded upon s 209 of the Supreme Court Act is misplaced and provides no bar to the applicant’s recovery of costs associated with the solicitors’ work in the proceedings outside of Queensland …"[1]

[13]  In reaching this conclusion, the learned primary judge treated s 209(2) as concerned solely to deny the possibility of the recovery of fees by persons whose right to appear or act for a party to proceedings arose from a grant of leave under s 209(1).  His Honour was strongly influenced by the legislative history of s 209.  His Honour said:

"… Contextually, the provisions were enacted in the Supreme Court Act Amending Act 1973 to restore to solicitors the right of audience in the Supreme Court of Queensland, a right which had been taken away somewhat inadvertently by the Legal Practitioners Act 1881. So much appears from the excerpts of the speeches of the Minister for Justice when introducing the amending legislation. These were referred to by Wilson J in Maggbury Pty Ltd v Hafele Australia Pty Ltd (No.2) ([2001] QSC 78) and for convenience I repeat them here:-

'This amending Bill has one objective, namely, to enable solicitors to have a right of audience in the Supreme Court of Queensland.' Hansard 18 September 1973 p 580.

On the Second Reading of the Bill he said:

'This Bill will amend the Supreme Court Act 1867 by inserting a new section that will give a solicitor a statutory right of audience in the Supreme Court of Queensland… The Bill provides that any party appearing before the Supreme Court will, after the date of assent to the Bill, be able to appear either in person or by a barrister or a solicitor, or by any person allowed by special leave of the judge. Under the Bill, the only person able to claim or recover a fee for appearing or acting on behalf of a party to a matter or proceeding in the Supreme court will be a barrister or a solicitor.

…

The ideals of any judicial system a cheaper and speedier justice under the law, and I believe that by giving solicitors a right of audience in the Supreme Court, the Bill will go some way towards achieving these ideals.'

In essence the enactment was an enabling provision conferring rights of appearance in the Supreme Court. As an ancillary to this, subsection (2) was intended to prohibit the recovery of remuneration by persons whose right of appearance depends upon subsection (1), that is non-lawyers granted special leave to appear. Cannon Street Pty Ltd v Karedis ([2006] QCA 541) per Williams JA at [30] …"[2]

[14]  The defendants also argued that Mr Goudkamp acted contrary to s 38 of the Law Society Act as the plaintiff's principal solicitor in control of litigation in Queensland, and that s 39 of the Law Society Act rendered Mr Goudkamp's work for the plaintiff illegal so as to preclude the recovery of costs incurred by the plaintiff for that work.

[15]  The learned primary judge accepted the defendants' argument in relation to the effect of s 39 of the Law Society Act, but held that it was immaterial to the plaintiff's entitlement to recover the costs from the defendants. 

[16]  His Honour referred to the fact that, after proceedings had been commenced on the plaintiff's behalf, Mr Goudkamp had posted material directly to the court on behalf of the plaintiff, and went on to say:

"It seems to me to be beyond doubt from that very act and his conduct thereafter he was purporting to act as a solicitor. As it is admitted that he did not hold the required practising certificate, he was in breach of the provisions of the [Law Society Act]. At least from that point in the conduct of these proceedings he was not capable of taking action to recover any fees or disbursements in respect of the action. It is not possible for me by looking at the Costs Statement to make a judgment as to when circumstances so changed that I would have to conclude that Mr Goudkamp was acting or practising as a solicitor in Queensland at some earlier time. If not, I would adopt the approach of the Court of Appeal in the Northern Territory and hold that the solicitors on the record were responsible to the Court and to the Queensland Law Society for the proper conduct of the proceedings.

     As it happens any breach of the provisions by Mr Goudkamp is of little moment since the applicant has already paid the fees to Mr Goudkamp for the work. In those circumstances, the authorities seem clear that the applicant is entitled to recover those fees paid on party and party taxation under the indemnity principle. See Elders (at p 33 l 10): Maggbury paras [19]-[22]. The defendants before me did not seek to argue otherwise."[3]

[17]  Finally, the learned primary judge also held that the plaintiff was not entitled to recover costs relating to work done in New South Wales on the basis of a costs agreement made in that State between the plaintiff and Mr Goudkamp.  The basis for that view was that the order for the assessment of costs invoked the fixed scales relating to proceedings in Queensland.[4]  This aspect of the decision below does not arise for consideration on the appeal to this Court.

The arguments on appeal

[18]  On the appeal, the defendants continue to rely upon s 209(2) of the Supreme Court Act 1995.  They argue that the plain words of this provision should not be read down by reference to the legislative history of the provision.  The defendants also argue that the reference to "barrister or solicitor" in s 209(2) must be understood as if qualified by words such as "authorised to practise as such in Queensland pursuant to a current practising certificate issued pursuant to the Law Society Act or otherwise."  This qualification is, they argue, necessarily implied by the collocation of s 209(2) and s 209(1), the latter provision being concerned only to recognise the rights of barristers and solicitors lawfully entitled to act as such to appear or act in proceedings in the Supreme Court of Queensland. 

[19]  The defendants also argue that each of the acts of Mr Goudkamp, in practising as a solicitor in New South Wales in relation to proceedings pending in Queensland, while not holding a practising certificate issued under the Law Society Act, was a breach of s 38 of that Act.  The defendants argue that each act by Mr Goudkamp in relation to the plaintiff's action was rendered illegal by s 39 of the Law Society Act so that Mr Goudkamp was not entitled either to receive payment or to retain it.  Consequently, so it is said, the plaintiff was under no liability to Mr Goudkamp for the latter's work on his behalf and was, therefore, not entitled to an indemnity from the defendants. 

[20]  Pursuant to a notice of contention filed on behalf of the plaintiff, it is argued that the learned primary judge erred in concluding that s 38 and s 39 of the Law Society Act had any relevant operation in relation to Mr Goudkamp's work in New South Wales.  On this basis, so it is said, s 38 and s 39 of the Law Society Act did not affect the recovery of costs for work performed by Mr Goudkamp on the plaintiff's behalf in relation to the action.

Discussion:  Section 209(2) of the Supreme Court Act 1995

[21]  Discussion of the arguments agitated by the parties must proceed on the clear understanding, asserted by the plaintiff and not contradicted by the defendants, that Mr Goudkamp's costs statement does not claim for any item of work performed in Queensland.  This understanding conforms with the evidence.  Mr Goudkamp may have posted documents to the court for filing, but Mr Goudkamp's activities all occurred in New South Wales.  As will be seen, this circumstance has important implications for the defendants' attempt to use this appeal as a vehicle to test the arguments they agitate in this Court.

[22]  If attention is given solely to the text of s 209(2) of the Supreme Court Act 1995, as the appellants urge, it can be seen to be a prohibition upon persons other than barristers or solicitors claiming, or recovering, or receiving remuneration for appearing on behalf of another person in the Supreme Court of Queensland or for acting on behalf of another person in the Supreme Court of Queensland.  It is apparent from the bare text of s 209(2) that the scope of the prohibition does not extend to remuneration for work that does not consist of "appearing or acting on behalf of another person in the Supreme Court".  Thus, even if one looks only at the words of s 209(2) of the Supreme Court Act 1995, one sees that the prohibition does not extend to a case where the person claiming remuneration does not appear in the Supreme Court or act in the Supreme Court. 

[23]  On no view of the words "appear in" can Mr Goudkamp be said to have appeared in the Supreme Court on behalf of the plaintiff, and the plaintiff does not seek to recover any costs in that regard. 

[24]  Insofar as s 209(2) of the Supreme Court Act 1995 prohibits claims by persons other than barristers or solicitors for remuneration for acting in the Supreme Court, on the plaintiff's behalf, it is emphasised that he has not sought to claim in respect of any costs for work performed by Mr Goudkamp other than work performed in New South Wales.  Although this was work in relation to proceedings in Queensland, it was not work which involved Mr Goudkamp actually acting in the Supreme Court.  On that basis, it is argued for the plaintiff that any entitlement in Mr Goudkamp to remuneration from the plaintiff for the work performed by him was not affected by the terms of s 209(2) of the Supreme Court Act 1995.

[25]  In my respectful opinion, the crucial point, so far as s 209(2) of the Supreme Court Act 1995 is concerned, is that Mr Goudkamp makes no claim for remuneration for work performed by him otherwise than in New South Wales.  Much of that work was performed before the plaintiff's action was commenced; it is impossible to see how the performance of this work involved acting in the Supreme Court.  As to work done after proceedings were commenced, the appellants say that Mr Goudkamp instructed Counsel during the course of the trial; and I note that the learned primary judge found that Mr Goudkamp "personally signed … documents filed [in the court] on behalf of the plaintiffs", and acted as "the principal solicitor who controlled the litigation".[5]  But s 209(2) of the Supreme Court Act 1995 is not concerned to prohibit anyone from acting as a solicitor: that is the function of s 38 of the Law Society Act.   Section 209(2) is relevantly concerned to impose a prohibition upon the recovery of remuneration by a person, who might otherwise be entitled to claim remuneration, for work involved in acting in the Supreme Court on behalf of another person.  That prohibition only applies to claims for remuneration for services which consist of acting in the Supreme Court.  Mr Goudkamp did not claim remuneration for instructing Counsel at the trial.  The other conduct for which he did claim remuneration, signing documents that were later filed and otherwise acting as the plaintiff's solicitor, was not "in the Supreme Court".  Mr Goudkamp simply did not claim remuneration for acting on the plaintiff's behalf in the Supreme Court.   

[26]  A statutory provision which is apt to defeat a right to remuneration for work done, where the right is not dependent on any provision of the statute, should not be given a wider operation than the language of the statute requires.  The court should not be astute to deny the reasonable expectation of honest people where the legislature does not clearly compel that course.  I respectfully agree with the approach of Wilson J in Maggbury Pty Ltd v Hafele Australia Pty Ltd (No 2),[6] whereby the work of Mr Goudkamp in New South Wales in connection with the litigation is properly characterised as work "'in relation to' proceedings in the Supreme Court rather than as work 'in the Supreme Court'." 

[27]  To conclude that s 209(2) does not reach as far as the defendants contend is not to take an unduly narrow or artificial view of the scope of s 209(2).  It is difficult to identify any interest, which s 209(2) could possibly be intended to protect, that would be sacrificed by this understanding of the scope of the provision.  A client, such as the plaintiff, would be able to hold the Queensland solicitors on the record accountable for their conduct of the case.  That Mr Goudkamp had been retained directly by the plaintiff in relation to his action would not absolve them from their responsibilities as solicitors duty-bound to conserve the plaintiff's interests. Mr Goudkamp may have had ultimate control of the litigation on behalf of the plaintiff, but the Queensland solicitors on the record were responsible for the conduct of the litigation for the plaintiff so far as the Court's interest in the supervision of its officers is concerned.  So far as the interests of the defendants as parties to the litigation were concerned, they were able to look to, and to hold to account, the Queensland solicitors on the record.

[28]  I am, therefore, in respectful agreement with the learned primary judge that s 209(2) of the Supreme Court Act 1995 had no relevant application in this case.

[29]  In these circumstances, there is no occasion to consider whether the legislative history of s 209(2) of the Supreme Court Act 1995 and the observations of Williams JA in Cannon Street Pty Ltd & Ors v Karedis & Ors,[7] referred to by the learned primary judge, also support the conclusion that s 209(2) does not apply in this case so as to disentitle Mr Goudkamp to remuneration for work performed by him in New South Wales on behalf of the plaintiff.   

Discussion:  Section 38 and s 39 of the Law Society Act

[30]  As to s 38 and s 39 of the Law Society Act, the defendants contend that these provisions strike at the work performed by Mr Goudkamp because it was work connected with legal proceedings in Queensland.  The defendants argue that s 39 of the Law Society Act renders the performance by Mr Goudkamp of his retainer as the plaintiff's solicitor illegal so that nothing is payable to Mr Goudkamp by the plaintiff for the work performed by him.  In this regard, it should be noted here that this argument is confronted by the substantial counter-argument that s 39 and s 44 constitute an exhaustive statement of the legal consequences of a contravention of s 38 of the Law Society Act.[8]  If this counter-argument were accepted, the fact that the plaintiff has already paid Mr Goudkamp would mean that this sum would not be recoverable by the plaintiff and there would be no reason to deny the plaintiff his indemnity against the defendants.

[31]  In Re D,[9] Gibbs J, as his Honour then was, held that the precursor of this provision served to create an offence only where a person lacking the required qualification is acting as a solicitor in Queensland:  the section has no application to render unlawful conduct in New South Wales which is lawful under the laws of that State.  In Re D, Gibbs J said:

"Section 39 reads:  'Every person who directly or indirectly acts or practises as a solicitor or conveyancer without having at the time a certificate then in force issued by the secretary shall be guilty of an offence, and shall be liable on summary conviction to a penalty not exceeding fifty pounds and in addition thereto shall be guilty of a contempt of the Supreme Court and shall be liable to be punished accordingly.'  If the words in this section are read without any limitation, they are, of course, perfectly general in their application.  So read, the section could apply to any person who acts anywhere as a solicitor if he has not a certificate in force issued by the secretary of the Queensland Law Society.  It is therefore necessary, applying the well-known rule of construction which was illustrated by the decision of the Judicial Committee in MacLeod v A-G for NSW ([1891] AC 455), 'to search for limitations, to see what would be the reasonable limitation to apply to words so general'.  See page 457 of the report in MacLeod's case …

     However, it seems to me that there is one simple and obvious way in which the words of the section may be limited to give effect to the presumed intention of the Queensland legislature.  The obvious limitation is that the section applies only to persons who act within the territorial boundaries of the State of Queensland.  That this is the proper limitation to be implied seems to me to follow, firstly, from the fact that it is the most obvious and reasonable limitation that may be suggested, secondly from the fact that the effect of a certificate issued by the secretary under s 38 of the Acts is obviously intended to have only local and not extraterritorial operation, and thirdly, because the section provides that the offending acts shall in effect amount to a contempt of this court and it is unlikely that the legislature intended that acts of this kind, done within the jurisdiction of another court, should amount to a contempt of this court.

     In my opinion, therefore, the section should be construed to apply only to persons who act in the forbidden way within Queensland."[10] 

[32]  The defendants accept that Re D was correctly decided, but argue that it is distinguishable because the "acts" of the solicitor in that case did not involve any acts as a solicitor in Queensland.  The defendants' observation upon the facts of the case is correct, but there can be no doubt that Gibbs J adopted a territorial nexus between the statutory prohibition and the conduct in question to determine the true scope of the statutory prohibition.  His Honour said that the territorial location of the acts in question was the "obvious limitation" of the section.  The limitation adopted by Gibbs J does not support a less "obvious" limitation, such as "in relation to proceedings in Queensland".  A limitation referable to the purposes of the acts in question would be distinctly less certain in its practical application, a most undesirable feature of any statutory provision and especially of a provision intended to have a penal operation.  For example, would the limitation apply only where the person to be charged was purporting to act as the principal solicitor in relation to the litigation pending in Queensland, or would it extend to preventing any level of participation?  One should also bear in mind that, if the territorial test propounded by Gibbs J was not regarded as an accurate and satisfactory statement of the intention of the legislature, the legislature has had ample opportunity to remedy the position. 

[33]  On the basis that the scope of the prohibition in s 38 and the penal provision in s 39 do not apply to acts done in New South Wales, the defendants' argument that Mr Goudkamp's activities on behalf of the plaintiff were illegal must be rejected. 

[34]  For these reasons, I respectfully disagree with the conclusion of the learned primary judge on this point, and conclude that the argument advanced by the plaintiff pursuant to its notice of contention must be upheld.  It should be noted that the decision of Gibbs J in Re D was not drawn to his Honour's attention by either party.

[35]  The conclusion which I have reached also makes it unnecessary to consider whether s 39 and s 44 of the Law Society Act were intended by the legislature as an exhaustive statement of the legal consequences of a contravention of s 38 of the Law Society Act.

Conclusion and orders

[36]  For the reasons given above I consider that the decision of the learned primary judge was correct. 

[37]  The appeal should be dismissed.

[38]  The defendants should pay the plaintiff's costs of the appeal to be assessed on the standard basis.

[39]  HOLMES JA:  I agree with the reasons of Keane JA and the orders he proposes.

[40]  FRASER JA:  I agree with the reasons of Keane JA and the orders proposed by his Honour.