DISTRICT COURT OF QUEENSLAND

Introduction

1. [1]
   By application filed in this court on the 5^th May 2006, Francis Edward Carroll (‘the plaintiff’) asked the court to make certain orders pursuant to the Uniform Civil Procedure Rules (‘UCPR’)

2. [2]
   That application was heard by His Honour Judge Forno on the 19^th May 2006 in chambers.

3. [3]
   At that point, His Honour ordered that Nerida Jane Nunis (‘the defendant’) provide further and better particulars in respect of paragraph 13 of her defence.

4. [4]
   His Honour also ordered, pursuant to Rule 483 of the UCPR, that the following question be determined (subsequently) as a preliminary issue:

“Whether the plaintiff’s claim is governed by (1) the Queensland Law Society Act 1952; (2) the Family Law Rules 1984; or (3) the Family Law Rules 2004”.

5. [5]
   The determination of that question however, was then adjourned for hearing to a date to be fixed subsequently before another chamber judge.

6. [6]
   The matter then came on before me as the Chamber Judge on the 13^th June 2006 for that purpose notwithstanding that this was a matter that ought to have been placed on the general civil list for hearing..

7. [7]
   The matter was heard and I subsequently reserved my decision.

8. [8]
   Correspondence from the plaintiff was however then received by me on the 4^th July 2006.

9. [9]
   The plaintiff informed me that he intended to advise each of the relevant Attorney-Generals of the matter in order to see if any of the Attorney-Generals wished to intervene and be heard in the matter.

10. [10]
    That step was taken notwithstanding that the matter had already been heard on the 13^th June 2006 before me in chambers.

11. [11]
    As a consequence, this matter was then delayed for more than some 4 months while the Attorney-Generals determined whether they wished to intervene or not.

12. [12]
    On the 2^nd August and 6^th November 2006 respectively, notification was received that the state or federal Attorney-General did not wish to intervene at this juncture.

Background

13. [13]
    On the 24^th November 2005, the plaintiff had filed in this court, a claim for debt with associated declaratory relief.

14. [14]
    That claim related to accounts which had been rendered by the plaintiff as solicitor to the defendant as his client for services provided by him to her under an oral retainer which had been entered into by the parties in January 2003.

15. [15]
    The twenty (20) accounts which had been issued were dated from the 28^th January 2003 up to and including 26^th April 2005.

16. [16]
    Some of those accounts had been paid by the defendant during that period.

17. [17]
    On the 11^th January 2006, the defendant filed a Defence and Counter-Claim which included, amongst other things, an assertion that the plaintiff was not entitled to maintain his proceedings as he had not complied with the requirements of section 48J(1)(b) of the Queensland Law Society Act 1952.

18. [18]
    In the Reply and Answer filed on the 14^th March 2006, the plaintiff stated that the defendant’s assertion was not correct insofar as the relevant Family Law Rules 1984 (the Rules in force at the time the oral retainer was entered into) applied, rather than the Queensland Law Society Act 1952.

Regulation of a Solicitor’s claim for fees under the State Act and the Federal Rules.

19. [19]
    The ‘prerequisites’ which must been satisfied before a solicitor may start or commence a proceedings in a court of competent jurisdiction to recover payment for work performed, under the State Act or the Family Law Rules are quite different, thus the need to set out those steps in some detail.

s.48J of the Queensland Law Society Act (which commenced on the 1 July 1998)

20. [20]
    A concise and helpful statement in respect of the regulation of a solicitor’s claim for fees under this Act is found in paragraph [13] of Dibb v Hopgood Ganim [2001] QDC 153 where His Honour Judge McGill said:

‘Under the scheme of the Queensland Law Society Act, a solicitor, before suing for fees owed, must first give a client an account that complies with s.48J of the Act and wait for one month…..’

21. [21]
    For an account to comply with that section, the account must clearly set out all items of work done for the client and the amount charged (whether by ways of fees or costs) for each item unless the parties had entered into a client agreement (which is not the case here).

22. [22]
    In other words, the account provided must in ‘itemised form’.

O 38 of the Family Law Rules 1984 (now repealed).

23. [23]
    Under the scheme which existed in the Family Law Rules 1984, O 38 r 37(2) provided:

A lawyer must not commence or continue a proceeding to recover costs from a person unless:

1. (a)
   the lawyer has served on the person an account and, if applicable, a notice of rights, and no request for a bill has been made in accordance with rule 38 or 39; or
2. (b)
   if a bill has been served on the person:

(i) no notice disputing the bill has been served in accordance with rule 42; or

(ii)a notice disputing the bill has been determined or withdrawn.

24. [24]
    Rule 1 of O 38 (Interpretation) states that unless the contrary intention appears, in this Order:

A Bill means a bill of costs in accordance with Rule 40.

25. [25]
    Rule 40 requires that the bill should be set out in ‘itemised form’.

Ch 19 Family Law Rules 2004 (which commenced 29^th March 2004).

26. [26]
    Under the scheme of the Family Law Rules 2004, Rule 19.13 provides:

A lawyer may start or continue a case to recover costs from a client only if:

1. (a)
   the lawyer has served on the client an account and a costs notice,  and no               request for an itemised costs account has been made under rule 19.20; or
2. (b)
   an itemised costs account has been served on the client and:

   1. a Notice Disputing Itemised Costs Account (Form 15) has not been served under rule 19.23;
   2. a Form 15 has been served under rule 19.23 and the dispute has been resolved by the agreement between the parties; or
   3. a Form 15 has been filed under subrule 19.24(3) and the dispute has been determined or the Form 15 has been withdrawn.

27. [27]
    Rule 19.20 confirms that an account should be set out in ‘itemised form’.

The relevant transitional provisions in respect of the federal Rules.

28. [28]
    At this juncture, it may be helpful to refer to the relevant Family Law Amendment Rules 2004 (No 2) SR 53 of 2004.

29. [29]
    By rule 3, the Family Law Rules 1984 were repealed and the Family Law Rules 2004 commenced on 29^th March 2004.

Family Law Amendment Rules 2004 (No 2) SR 53 of 2004

 The Family Law Rules 1984 were repealed by r 3 of the Family Law Amendment Rules 2004 (No 2) SR 53 of 2004, to commence on 29 March 2004. SR 53 of 2004 also contained the following rule:

Transitional

4 (1) If:

 (a) a case was commenced in accordance with the 1984 Rules; and

 (b) the case not finally determined before the repeal of those Rules;

the case must be continued in accordance with the 2004 Rules.

 (2) If:

 (a) an act or thing was done under the 1984 Rules before the repeal of those Rules; and

 (b) the act or thing is of a kind that could be done under the 2004 Rules;

the act of thing is taken to have been done under the 2004 Rules

 (3) If:

 (a) an obligation was incurred, or an undertaking was given, under the 1984 Rules

  before the repeal of those Rules; and

 (b) the obligation is of a kind that could be incurred, or the undertaking is of a kind that could be given, under the 2004 Rules.

the obligation is taken to have been incurred, or the undertaking is taken to have been given, under the 2004 Rules

 (4) If:

 (a) an act or thing was required to be done under the 1984 Rules before the repeal of                              those Rules; and

 (b) the act or thing was not done before the repeal of those Rules; and

 (c) the act or thing is of a kind that is required to be done under the 2004 Rules.

the act or thing is taken not to have be done for the purpose of the 2004 Rules

 (5) The 2004 Rules do not operate to revive any period of time for doing an act or thing                             that was required to be done under the 1984 Rules, if the period had expired before                                           the repeal of those Rules.

 (6) If:

 (a) a period of time was running in relation to a matter under the 1984 Rules before the                             repeal of those Rules; and

 (b) the period had not expired before the repeal of those Rules; and

 (c) the matter is of a kind to which the 2004 Rules apply;

the period continues to run as if the 194 Rules had not been repealed.

 (7) In this rule:

1984 Rules mean the Family Law Rules 1984, as in force immediately before the commencement of these Rules.

2004 Rules mean the Family Law Rules 2004.

case has the meaning given by the dictionary to the Family Law Rules 2004.

The parties’ respective arguments

30. [30]
    In short, the defendant argues that if the Queensland Law Society Act applies, then the plaintiff was required to serve an account in ‘itemised form’ (s.48J(1)(b)) prior to the commencement of any proceedings in this court to recover payment for work performed by him as a solicitor.

31. [31]
    The plaintiff, on the other hand, argues that the Family Law Rules 1984 apply, therefore the plaintiff was not required to serve a bill ‘itemised form’, prior to the commencement of any proceedings in this court to recover payment as no dispute had been taken in respect of the accounts which he had rendered.

32. [32]
    The situation in this case is that the plaintiff did not provide to the defendant a bill ‘in itemised form’ at any stage prior to the commencement of the proceedings in this court to recover  his costs and still has not done so, notwithstanding a request by the defendant on the 15^th March 2005 that he do so.

33. [33]
    The plaintiff’s own notation on the accounts rendered by him, confirm that those account were not bills in itemised form:

‘that should the amount of this account be disputed, we reserve the right to withdraw this account and substitute an amended Bill in form for taxation notwithstanding that it may exceed the amount of this bill’.

34. [34]
    The main thrust of the plaintiff’s argument is that because the oral retainer was entered into between the parties in January 2003, then the Family Law Rules in force at that time (the ‘1984 rules’) apply, notwithstanding that some of the accounts which were send in respect of the work performed by him under the retainer were issued subsequent to the repeal of those Rules on the 29^th March 2004 when the Family Law Rules 2004 (the ‘2004 rules’) came into force.

35. [35]
    In support of that argument, the plaintiff relies on Section 123(1)(g) Family Law Act 1975 which allows the Family Court to make rules prescribing:

1. (a)
   matters relating to the costs of proceedings including ‘solicitor’ and client costs and party and party costs); and
2. (b)
   the assessment or taxation of those costs.

36. [36]
    In further support of his argument, the plaintiff relies on the affidavit filed on the 9^th June 2006 which he says demonstrates that the work done by him under the relevant retainer was clearly in relation to a ‘matrimonial cause’ (within the definition of the Family Law Act 1975).

37. [37]
    The plaintiff however also concedes in that affidavit that some of the work performed by him involved 3 appearances in the Magistrates Court (relating to alleged domestic violence issues between the defendant and plaintiff during their period of cohabitation).

38. [38]
    The plaintiff also relies on the fact that under the 2004 Rules, when a solicitor first receives instructions to act in a case, certain information must be provided and certain advice must given to the client at that point (an obligation more onerous than what was required under the 1984 Rules).

39. [39]
    The plaintiff therefore argues that because he only first received instructions in January 2003 to act for the defendant in the case, it follows that the 1984 Rules should apply notwithstanding the subsequent repeal of them on the 29^th March 2004.

40. [40]
    The plaintiff also relied on case authorities set out in the text of the 2005 CCH Australia Limited edition of the Australian Family Law & Practice Reporter (a copy of the relevant pages of that text containing those cases being annexed to the written submissions tendered) in support of his submissions that the Family Law Rules 1984 applied to his claim as opposed to the Queensland Law Society Act 1952.

41. [41]
    The counter argument raised by the defendant was that the Family Law Rules (whether it be the 1984 or 2004 Rules) have no application whatsoever with respect to any of the prerequisite steps that need to be taken by a solicitor before legal proceedings can be instituted by him or her to recover payment for work from a client.

42. [42]
    The defendant says that the only relevance those Rules may have in respect of the plaintiff’s claim before this court is in reference to the applicable scale of costs set out in those Rules which the plaintiff may charge for the services rendered by him.

43. [43]
    The defendant argues that because the plaintiff has not complied with s.48J(1)(b) of the Queensland Law Society Act before commencing proceedings in this court, it follows that his action is barred.

Evidence received by the court during the hearing

44. [44]
    During the course of submissions, the defendant tendered a letter which had been sent to the plaintiff dated 15^th March 2005. Copies of the twenty (20) accounts which had been sent by the plaintiff to the defendant were also provided to this court for its consideration.

45. [45]
    Those documents were then marked as Exhibits (1) and (2) respectively.

46. [46]
    It was submitted by the defendant that the letter dated 15^th March 2005 (which the plaintiff accepted during the course of the hearing that he had received) had requested that a bill of costs in taxable form be delivered to the defendant.

47. [47]
    While it is true that the letter does make such a request, it does appear however that the bill was only required to be delivered by the plaintiff at the conclusion of his work for the defendant (who also expressed an interest in continuing to retain the plaintiff as her solicitor at that stage in the same correspondence).

48. [48]
    That retainer remained on foot, as I understand it, until it was terminated by the defendant at a time (date unknown) shortly after the correspondence of the 15^th March 2005.

49. [49]
    However, it does seem that the account dated 26^th April 2005 indicates that work was still being performed by the plaintiff until at least April at which time the retainer came to an end.

Which Act or Rules therefore govern the plaintiff’s claim?

50. [50]
    There does appear to be some case authority which supports the proposition that the Family Law Act and its Rules are a complete code relating to disputed (my emphasis added) solicitor-client costs (Re P’s Bill of Costs (1982) 8 Fam LR 489 at p 494)

51. [51]
    It is also true however that the Family Law Act and Rules do not create the substantive right for lawyers to commence proceedings to recover their costs, but rather the Rules set out the necessary steps to be taken before such recovery proceedings may be instigated.

52. [52]
    As Lindenmayer J stated in Strudwick v Baker Johnson (1996) 20 Fam LR 789 at page 797 line 20:

“The Family Court is not the exclusive court for recovery of debts between solicitor and client arising out of family law proceedings. But, it is only after the requirements of the Rules have been satisfied that the solicitor may sue upon the account in the appropriate court of jurisdiction: (see Re P’s Bill of Costs (1982) FLC) For these reasons, the Rules do not create a substantive right in the solicitor to commence an action for the recovery of his or her costs. It merely prescribes the procedures which must be followed before recovery of costs may be sought, albeit in another court.”

53. [53]
    As Lindenmayer J further observed, at lines 10 to 15, O 38, r 38(9), (10) and (11) the Rules merely establish the procedural requirements a solicitor must overcome before he or she can commence an action to recover their costs. Once a solicitor has complied with those requirements, the Rules are silent with respect to the method by which the solicitor may then seek to recover his or her costs and provide no rights in solicitor with respect to taking action in the Family Court, except as provided by O 38 r 42(4) following a taxation of a disputed bill.

54. [54]
    Those case authorities do however lend some support to the submission made by the plaintiff that the Family Law Rules have some application to the situation which has arisen here.

55. [55]
    The situation here being that because the defendant did not take any issue within the time prescribed under those Rules in respect of the accounts which had been rendered by the plaintiff and delivered to her, it follows that he was entitled to seek recovery of his costs in the appropriate (state) court of jurisdiction if he so chose without any reference to the requirements set out in s 48J of the Queensland Law Society Act 1952.

56. [56]
    It is true, as observed by His Honour Judge McGill in Dibb v Hopgood Ganim [2001] QDC 153 at paras [32] and [33], that a solicitor’s right to remuneration for work performed has long been the subject of statutory regulation of the profession under  the various State Acts.

57. [57]
    Under a former legislative regime, His Honour noted that a bill was required to be delivered prior to action by the solicitor to recover the fees, and that could be taxed on application of the party chargeable within one month. (Legal Practitioners Act 1995 s.5 and 7).

58. [58]
    A somewhat similar regime also existed under the Costs Act 1867, s.22 and 24 which was repealed on the 8^th December 1995 by the Legal Practitioners Act 1995.

59. [59]
    While it is true that Strudwick v Baker Johnson was decided prior to the commencement of s.48J of the Queensland Law Society Act, it is also true that the respective ‘regimes,’ under the various relevant state and federal Acts which have regulated the steps that a solicitor must undertake before the commencement of any court proceedings to recover his or her fees, have ‘co-existed’ together.

60. [60]
    Therefore it is difficult to accept the submission which has been made on behalf of the defendant, that the Family Law Rules have no application whatsoever at all in respect of the prerequisite steps which the plaintiff must take before he may even commence proceedings in this court to recover his costs in respect of work performed by him in respect of a ‘matrimonial cause’.

61. [61]
    To do otherwise, would in my view, create the situation that a client, who takes no issue with an account or a bill sent (as the case may be) during the time allowed under those Rules, may then, upon the solicitor commencing proceedings to recover payment for those fees in a (state) court of competent jurisdiction subsequently, argue that the solicitor must first provide him or her a bill in itemised form before he or she can continue on with those proceedings.

62. [62]
    In other words, a solicitor’s client could easily circumvent, as it were, the application of the Family Law Rules altogether by simply waiting until the solicitor has instituted recovery proceedings in a state court for recovery of fees and only then request that a bill be provided in itemised form at that time.

63. [63]
    In this case, it is important to remember however, that the defendant did request that a bill in itemised form be delivered to her until the 15^th March 2005.

64. [64]
    At that point however, nineteen (19) out of the twenty (20) accounts had already been rendered by the plaintiff with no issue having been taken by the defendant regarding those accounts within the time provided for under the applicable Family Law Rules in force at the material time.

65. [65]
    Accordingly, I am satisfied that in the circumstances, the Family Law Rules cannot be ignored.

66. [66]
    However, that is not the end of the matter.

67. [67]
    This matter has been further complicated by the fact that the defendant, when seeking an itemised bill of costs in the correspondence of the 15^th March 2005 appears to be seeking it in respect of all of the work which the plaintiff had performed prior to that request being made.

68. [68]
    In other words, in respect of all of the work which the plaintiff says he had performed under the oral retainer since 2003.

69. [69]
    This matter is further complicated by the fact that the plaintiff has included in the account of 25^th February 2005 (and also in others), an amount/s which was or were still owing on the previous accounts which had been previously rendered. ($80,399.13)

70. [70]
    Even if one was to accept that the request was made by the defendant in March 2005 for an itemised bill of costs within the 28 days allowed under the Rules in respect of the 25^th February 2005 account, it does not follow, in my view, that any itemised bill of costs provided now must also include an itemised bill of costs in respect of all of the work performed by him prior to that time, where no issue or dispute was ever raised by the defendant upon delivery of those accounts to her at the relevant times.

71. [71]
    I am satisfied however, that having received such a request as it relates to the account dated 25^th February 2005, that the plaintiff is obliged to provide an itemised bill in respect of that particular account.

72. [72]
    Accordingly, it would also seem appropriate that the plaintiff, in all the circumstances, should also provide a bill in itemised form in respect of the last account rendered (26^th April 2005) by him.

73. [73]
    As such, I am satisfied that the plaintiff cannot maintain his action in this court to recover his costs in respect of those two (2) accounts until he provides the itemised bill of costs as requested on the 15^th March 2005.

74. [74]
    I am also satisfied that the plaintiff must also provide a bill in itemised form in compliance with s 48J of the Queensland Law Society Act as it relates to the work he has performed regarding his appearances in the Magistrates Court matters.

75. [75]
    Another complicating feature of this matter is that the plaintiff also conceded during hearing that a variation of the original retainer which was made between the defendant and himself (by Mr Blond of Counsel who had authority to act on behalf of the plaintiff in respect of that variation) may have occurred around December 2004.

76. [76]
    The plaintiff argued however that any ‘variation’ was only in respect of counsel’s fees and was not in respect of the whole of the original retainer between the parties at that point.

77. [77]
    Whether it varied only part of that original retainer or it had the effect of creating a new retainer altogether between the parties from that point, is not of any real moment here, other than to dictate which of the two sets of Rules (1984 or 2004) may apply.

78. [78]
    I say this because it appears to me that even if it was accepted that the 2004 Rules may well apply from that date, the result for the plaintiff is the same.

79. [79]
    On any view of this case, the plaintiff cannot be said to have met his obligations under either the 1984 Rules or the 2004 Rules even if the latter were to apply from at least December 2004 and thereafter.

80. [80]
    O 38 r 36 of the 1984 Rules, requires that the plaintiff serve a ‘notice of rights’ on the client in the prescribed form with his initial account.

81. [81]
    It appears the plaintiff has done this by the endorsement on the first account (see account dated 28^th January 2003).

82. [82]
    However, O 38 r 36 (3) also states:

‘A lawyer is not required to serve more than 1 notice of rights if each account rendered in the course of the proceedings, after the notice of rights was served, includes an endorsement referring to the notice of rights’.

83. [83]
    A perusal of the relevant accounts (tendered as an Exhibit No 2) in this hearing, seems to me to reveal that the required endorsement which is to be made on each account rendered by the plaintiff subsequent to the delivery of his initial account, has not been made.

84. [84]
    In my view, the endorsements which have been made on the relevant accounts, (those which do not specifically include ‘an endorsement referring to the notice of rights’ as prescribed by O 38 r 36(3)), do not sufficiently set out those matters contained in the said notice which need to be drawn to the client’s attention by a solicitor.

85. [85]
    In fact, only the accounts dated 28^th January 2003, 2^nd April 2003, 24^th September 2003, 22^nd December 2003, 2^nd February 2004,  27^th February 2004,  29^th March 2004, 7^th May 2004, 30^th June 2004 seem to contain the requisite proper ‘endorsement’.

86. [86]
    Nor does it seem that any of the accounts rendered after December 2004 (the ‘variation of the retainer’ date) contain the necessary endorsement required.

87. [87]
    (See for example r 19.03 under the 2004 Rules which requires that when a solicitor receives instructions to act for a party in a case, he must provide at that time, ‘a costs notice’ and certain written advice and when sending any account subsequently must include in that account, a notice referring to the ‘initial costs notice’ given).

88. [88]
    Accordingly, I am of the view that the plaintiff has not satisfied the prerequisite steps required under the Family Law Rules.

89. [89]
    As such, the plaintiff cannot, in my view, continue with his recovery action in this court in respect of those accounts not properly endorsed, until the Rules which he seeks to rely upon now have been properly complied with.

90. [90]
    Undoubtedly, as one might expect in this case, it will not come as any great surprise that if, upon service of those properly endorsed accounts, the defendant chooses to avail herself of the Family Law Rules and request, within the time provided for after delivery of such endorsed accounts, a bill in itemised form in respect of the same.

91. [91]
    That step would be available to the defendant even notwithstanding that there has already been some payment made. See Re Walsh Halligan Douglas’ Bills of Costs (1990) 1 Qd R 288.

Costs

Order:

I reserve the question of costs and the parties shall have liberty to apply.