See Well Law Practice Pty Ltd v Barclay
[2021] QDC 114
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- Unreported Judgment
- See Well Law Practice Pty Ltd v Barclay[2021] QDC 114
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See Well Law Practice Pty Ltd v Barclay[2021] QDC 114
See Well Law Practice Pty Ltd v Barclay[2021] QDC 114
DISTRICT COURT OF QUEENSLAND
CITATION: | See Well Law Practice Pty Ltd v Barclay [2021] QDC 114 |
PARTIES: | SEE WELL LAW PRACTICE PTY LTD as trustee for THE SEE WELL LAW TRUST trading as SEE WELL LAW (applicant) |
v | |
SUSAN BEVERLY BARCLAY AS PERSONAL REPRESENTATIVE IN THE ESTATE OF OLIVE ELMS, DECEASED (respondent) | |
FILE NO: | 144/2020 |
PROCEEDING: | Application for costs |
ORIGINATING COURT: | Magistrates Court Maroochydore |
DELIVERED ON: | 18 June 2021 |
DELIVERED AT: | Maroochydore |
HEARING DATE: | Determined on the papers without oral hearing |
JUDGE: | Cash QC DCJ |
ORDERS: | The applicant and Donna Maree Sewell are to pay the respondent’s costs of the proceeding in the District Court fixed in the amount of $35,000. |
LEGISLATION: | District Court of Queensland Act 1967 (Qld), s 113 Magistrates Court Act 1921 (Qld), s 45, s 47 Uniform Civil Procedure Rules 1999 (Qld), r 5, 367, r 681, r 687, r 702, r 703, r 766, r 785 |
CASES: | Arundel Chiropractic Centre Pty Ltd v Deputy Commission for Taxation (2001) 179 ALR 406 ASIC v Atlantic 3 Financial (Aust) Pty Ltd [2008] QSC 9; [2008] 2 Qd R 298, [32] Colgate Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225, 232-234 Collins v The Queen (1975) 133 CLR 120, 122-123 North Ganalanja Aboriginal Corporation v Qld (1996) 185 CLR 595, 643 Knight v F.P. Special Assets Ltd (1992) 174 CLR 178 Smith v Ash [2011] 1 Qd R 175, [51] Steindl Nominees Pty Ltd v Laghaifar [2003] 2 Qd R 683 Symphony Group PLC v Hodgson [1994] QB 179 Warren v Body Corporate for Buon Vista CTS 14325 [2007] QCA 160, [19] |
COUNSEL: | No appearance for the applicant S Hartwell for the respondent |
SOLICITORS: | No appearance for the applicant Donald Portbury & Co for the respondent |
Introduction and necessary background
- [1]This decision concerns the costs of an unsuccessful application for leave to appeal a decision of a Magistrate. Before coming to the issues to be decided, it is necessary to set out some background. The applicant is a law practice. The respondent engaged the law practice to do work and in due course the applicant rendered bills. One bill was for $4,613.20 and was said to be in relation to the registration of an enduring power of attorney. The other bill was for $4,393.65 and was said to be in relation to a conveyance. The respondent was unhappy with the bills. She sought their assessment pursuant to the Legal Profession Act 2007 (Qld). A costs assessor reviewed the matter and decided that the appropriate fee for the power of attorney work was $89.51 and for the conveyance $1,183.71. The applicant was unhappy with this decision and applied to a Magistrate to review the costs assessment. A Magistrate heard, and dismissed, the applicant’s application for review. He ordered the applicant pay the respondent’s costs of the application on the standard basis, those costs to be fixed if the parties agreed or otherwise to be assessed.
- [2]Still dissatisfied with the reduction of the fees, the applicant sought leave to appeal to the District Court against the decision of the Magistrate. The appeal required leave pursuant to section 45(2) of the Magistrates Court Act 1921 (Qld). Notice was filed in early September 2020 but did not proceed with alacrity. By early March 2021 the respondent applied to strike out the appeal on the basis that the applicant had not complied with consent orders as to the filing of material. On 5 March 2021 the matter came on for hearing before me. The applicant was represented by counsel. I did not strike out the appeal and instead gave further directions for the filing of material. The applicant did not comply with those orders and on 13 April 2021 the matter was back before the court. On that occasion the applicant was represented by Ms Sewell who is, as I understand it, a legal practitioner and principal of the applicant. I decided that day to determine the issue of leave and, after hearing the submissions of the parties, refused leave to appeal. I also gave directions concerning the filing of submissions as to the costs of the application for leave to appeal and listed the matter for hearing on the afternoon of 4 June 2021 to hear argument.
- [3]Again, the applicant did not comply with the directions. On 2 June 2021 the applicant, through Ms Sewell, emailed to the court a document titled ‘submissions on costs’. This document was stamped by the registry on 3 June 2021. The respondent had by then filed submissions in accordance with my directions. At 10.00 am on 4 June 2021 an email was sent to the court by a ‘Legal and Administrative Assistant’ at See Well Law. It stated:
Re: See Well Law v Susan Barclay as Personal Representative in the Estate of Olive Elms
We refer to the above matter and confirm that Ms Donna Sewell is acting on behalf of See Well Law.
Unfortunately, Ms Sewell is unwell and has COVID-19 like symptoms, she will be unable to attend the Court today for the Mention at 2pm. Ms Sewell is in the process of acquiring a medical certificate. I will forward this once it has been received.
We apologise in advance and ask that an adjournment please be made today.
- [4]At my direction, the parties were advised that the court would hear any application for an adjournment at 2.00 pm and gave leave for the applicant’s representative to appear by telephone. Just after 1.00 pm a second email was received. It stated:
Dear Honourable Court,
Unfortunately, Ms Sewell is not well and unable to Attend today via physical or telephone appearance.
We do not currently have another Solicitor that can stand in for her, or Barrister.
The matter please will need to be adjourned based on medical evidence. Please see attached evidence.
We apologise for the inconvenience and please ask that the matter be adjourned until we have a legal representative that can appear.
- [5]Attached to the email was a document bearing the letterhead of the Tewantin Medical Centre. It was dated 4 June 2021 and stated, ‘Miss Donna Sewell has a medical condition and will be unfit for work from 04/06/2021 to 18/06/2021 inclusive’. No other detail was provided. When the matter was called for hearing at 2.00 pm there was no appearance for the applicant. Notwithstanding the objection of the respondent, I adjourned the matter to the registry. Costs were reserved. Because I had received submissions from the parties about costs it appeared to me to be a suitable matter for a decision on the papers to save further expense. The parties were advised by email that, absent an indication to the contrary, I would do so.
- [6]At 6.46 pm on 4 June 2021 Ms Sewell replied to the email:
Under COVID-19 Legislation it is illegal to go into public with suspected symptoms. The Court was supplied with a doctors certificate and I must abide by the legislation.
I seek to make oral submission and I will be in a better position to respond further when the doctor provides clearance.
Please respect the doctors certificate, and also please respect the COVID-19 Legislation. I trust you will not seek to impose further costs upon me for following the law. If this occurred this will be another issue I will raise with the Human Rights Commissioner.
- [7]As a result, I directed the matter be listed for a directions hearing on 10 June 2021. The parties were advised. This time an email was sent on behalf of Ms Sewell just before 2.00 pm on 9 June 2021. Relevantly, it stated that Ms Sewell was ‘still unwell and had been in a bad car accident’. It was said there was no one qualified to appear on behalf of the applicant and referred to the Doctor’s certificate of 4 June. I caused the applicant to be advised that the hearing would proceed on 10 June 2021 and that I intended to make directions whether or not the applicant appeared.
- [8]When the matter was called there was no appearance by the applicant. I proceeded with the directions hearing because the applicant had been given ample opportunity to engage a lawyer other than Ms Sewell to appear. After hearing the respondent, I gave directions to the effect that the costs issue was to be decided without oral hearing and on the submissions of the parties. I also gave leave to the parties to file further written submissions concerning the respondent’s request that I fix the costs of the proceeding before the Magistrate. I gave these directions because it appeared to me to be in the interests of justice.[1] Any further submissions were to be filed on or before 16 June 2021. The respondent filed short further submissions. The applicant did not.[2]
- [9]It is now for me to decide the question of costs in accordance with my directions.
The position of the parties as to costs
- [10]It is convenient to deal first with the applicant’s position as to costs. In the document emailed to the court on 2 June 2021 the applicant sought orders that:
- costs should come out of the estate of the late Mrs Olive Elmes1 (sic);
- in the alternative be paid by the Beneficiary of the Estate;
- in the alternative that each party for all matters wears their owns (sic) costs;
- in the alternative the solicitor for Susan Barclay wears the costs for providing advice which is contract (sic, semble ‘contrary’) to the Power of Attorney Act and also the Guardianship and Administration Act.
- [11]The only basis suggested by the applicant for these orders is a reference to some pages in Dal Pont’s Law of Costs. The photocopied pages are attached to the document. They deal with two topics. The first is concerned with litigation involving wills or deceased estates. The principles set out by Dal Pont, while correct, are irrelevant to the present proceedings which involve and attempt to appeal against the refusal by the Magistrate to review the costs assessment. While the respondent is styled as the ‘personal representative in the estate of Olive Elms, deceased’ – and the work for which the applicant billed had some connection to the estate – the present litigation is far removed from ordinary estate litigation.
- [12]The second topic addressed by Dal Pont in the pages supplied by the applicant is where a special costs order might be justified by the fraud or misconduct of a party. This appears to be a continuation of Ms Sewell’s frequent allegations of serious misconduct levelled against the respondent and her lawyers. There is no evidence, beyond Ms Sewell’s own assertions, to support these allegations. They appear to me to be baseless, and the principles cited in Dal Pont are not relevant.
- [13]The rest of the document is a series of unconnected reminiscences, complaints and allegations. The topics vary from the events giving rise to this litigation to Australia’s aged care system to Ms Sewell’s formative years as a solicitor. The document fails to acknowledge the real issue before the court: what costs orders should be made in relation to the unsuccessful application for leave to appeal? There is no basis for making any of the orders sought by the applicant.
- [14]The respondent submits she should have her costs of the proceedings in the District Court, fixed in accordance with the indemnity basis. It is submitted that exceptional circumstances exist such that Ms Sewell ought to be ordered to pay the costs personally. As well the respondent submits that I have the power to, and should, fix the costs that were awarded in the Magistrates Court.
- [15]Consideration of the respondent’s submissions
- [16]The Uniform Civil Procedure Rules 1999 (Qld) (‘UCPR’) apply to civil proceedings in the District Court. Chapter 17A provides for costs. Pursuant to rule 681 costs ‘are in the discretion of the court but follow the event, unless the court otherwise orders’. While in some cases identifying the ‘event’ may be difficult, in this case it is not. The event was my refusal of the application for leave to appeal. In that, the applicant was wholly unsuccessful. It follows that, as a starting point, the applicant should be ordered to pay the costs of the respondent of the proceeding in the District Court unsuccessfully pursued by the applicant. Of course, this is not an inflexible rule. In some cases circumstances might exist to disentitle a successful party to their costs. But no such circumstance exists in this case.
- [17]Costs are usually to be assessed on the standard basis.[3] But rule 703 permits the court to order assessment on the indemnity basis. The relevant principles governing the award of costs on the indemnity basis are not in doubt (see Colgate Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225, 232-234). Before an order for indemnity costs might be made, there must be some special or unusual feature to justify departure from the usual practice. Such features might include:
- Wilful disregard of known facts or established law;
- Unnecessary prolongation of the case; or
- Baseless or irrelevant allegations of fraud.
- [18]As to the first, the applicant seemed entirely unaware of the relevant law concerning leave to appeal against the decision of the Magistrate. If the applicant had been aware of this requirement, and what the cases say about the test for leave, it would have appreciated the very difficult task it faced. Instead, the proposed appeal was pursued with reliance upon a large amount of irrelevant material and with serious allegations of fraud and other misconduct made without reference to admissible evidence. When Ms Sewell appeared, nothing was said on behalf of the applicant to properly engage with the question of leave to appeal. Of less significance, but still relevant, is the delay and other difficulties caused by the applicant’s continued failure to comply with requirements for the filing of material.
- [19]In these circumstances, where the respondent has had to defend unmeritorious proceedings, has faced unsubstantiated allegations of fraud and misconduct, and has confronted delay in the prosecution of the proceedings, it is entirely appropriate to exercise the discretion to order costs on the indemnity basis.
- [20]Rule 687(2)(c) allows the court to order a party pay an amount of costs fixed by the court, rather than assessed costs. There are benefits to fixing costs. Among them is that it spares the parties the costs of assessment.[4] A point has been reached in the proceeding where the parties’ costs far exceed what was in dispute. It is highly desirable to bring an end to the expenses. I also infer from the applicant’s intransigence in the pursuit of its claims that a process of assessment is likely to lead to further litigation. The circumstances favour fixing costs if that is otherwise appropriate. The respondent has filed affidavit material containing a detailed assessment of her costs.[5] This evidence provides me with a basis to reliably and with confidence fix the costs of the proceedings in the District Court. Assessed on the indemnity basis, the costs to the respondent of the proceeding in the District Court are $39,884.88. It is common when fixing costs that there be a degree of discounting to reflect that the process is not intended to be as rigorous as assessment.[6] Fixing costs can reflect a broad approach.[7] Adopting such an approach I intend in this case to fix the costs of the proceeding in the District Court at $35,000.
- [21]The next question to consider is who should be ordered to pay the costs? Ms Sewell is, of course, not a party to the proceedings. The respondent asks for an order that Ms Sewell pay the costs with the applicant. Such an order would be exceptional. The respondent advances two bases on which such an order should be made in this case. The first is that Ms Sewell, as a legal practitioner, unreasonably pursued the appeal in circumstances in which her conduct in doing so justified a costs order against her personally. Such a basis was recognised by the Court of Appeal in Steindl Nominees Pty Ltd v Laghaifar [2003] 2 Qd R 683. The pursuit of a plainly unarguable case may provide sufficient reason for a costs order against a legal practitioner engaged for a party. As noted in that case by Davies JA, it is important to distinguish between cases that are barely arguable and those that are plainly unarguable. My rejection of the application for leave does not itself mean the application was unarguable. As well, a case as finally presented may be hopeless without that being obvious beforehand. For these reasons, courts exercise considerable circumspection before ordering a legal practitioner to pay costs.
- [22]In this case, however, there are ample indications that the case presented by the applicant was unarguable and plainly so. Ms Sewell did not comply with directions to file an outline on behalf of the applicant in December 2020. When the matter was before the court on 5 March 2021 the applicant was represent by counsel, instructed by Ms Sewell. Counsel, whose submissions on that occasion were helpful, understood the need for leave pursuant to section 45(2) of the Magistrates Court Act 1921 (Qld). Further directions for filing were given, but after that the barrister took no further part in the proceedings. The applicant did not file an outline in accordance with the directions. Instead, Ms Sewell sent a long letter to the court on 22 March 2020. This letter was said to be submissions. The document was discursive, made serious allegations of fraud and misconduct without reference to evidence and completely failed to address the issue of leave to appeal. On 7 May 2021, before I refused leave to appeal, Ms Sewell made lengthy, and almost entirely irrelevant, oral submissions. It was plain to me, and admitted by Ms Sewell, that she had no idea how to run the appeal or what was involved in the question of leave. That is despite this issue being specifically identified at the hearing in March.
- [23]It also cannot go unnoticed that the applicant and Ms Sewell are, practically speaking, indivisible. Ms Sewell is the sole director and secretary of the applicant.[8] The inescapable conclusion is that the decision to pursue these proceedings is that of Ms Sewell personally. That is, the position is different to that of a legal practitioner who is instructed by a client with whom they are entirely unrelated to pursue actions of marginal merit. In my view this is probably enough to justify an order that Ms Sewell pay the respondent’s costs. But there is a second basis also advanced by the respondent. This depends upon Ms Sewell’s position as the director of the appellant. The High Court in Knight v F.P. Special Assets Ltd[9] recognised a power to order costs against a non-party in circumstances where:
- The party is insolvent or an entity of no substance;
- The non-party played an active role in the conduct of the litigation; and
- The non-party has an interest in the litigation.
- [24]In that case, Dawson J stated:[10]
The cases therefore establish a long asserted jurisdiction to award costs in appropriate cases against a person who is not a party to the proceedings where that person is the effective litigant standing behind the actual party.
- [25]It is the connection between the non-party and the litigation that justifies the extraordinary order to make them liable for the costs of the proceeding.[11] In this matter it is obvious that Ms Sewell has the closest of connections with the litigation. As the controlling mind of the applicant, she must be the person who decided to commence, and pursue, these proceedings. She has appeared, as a legal practitioner, to argue the case for the applicant. She cannot be separated from the applicant.
- [26]There is some indication that the applicant is not an entity of substance. Ms Sewell’s letter of 22 March describes the law practice as ‘barely holding on’. Of more significance is Ms Sewell’s repeated statements at the hearing of 7 May that, in the event the applicant was ordered to pay costs, she would immediately put the company into liquidation and cause it to be wound up. This was said to be because she refused to pay ‘murderers’ (the respondent and her lawyers) one cent. On this basis I conclude that Ms Sewell is the real litigant in the proceedings, that she has controlled the litigation, and that while the applicant may not be insolvent, any costs order made against it will go unsatisfied. In these circumstances I conclude that it is appropriate to make the admittedly unusual order that Ms Sewell share responsibility for the respondent’s costs of the proceedings in the District Court with the applicant.
- [27]The remaining matter for consideration is the submission of the respondent that I should make an order fixing the costs of the proceedings before the Magistrate. The order made by the Magistrate, on 6 August 2020, was:
- a.That the [applicant] pay the costs of and incidental to the application for review including reserved costs reviewed on the standard basis.
- b.That the costs be assessed or fixed in accordance with the scale of costs namely on the basis of Part 3 Schedule 2 of the schedule.
- [28]There followed further orders or directions to deal with the fixing of costs if the parties agreed that should occur. It seems the parties did not agree to the process of fixing costs proposed by the Magistrate. It follows that, unless some other order is made, the effect of the Magistrate’s order will be that the applicant is to pay the respondent’s costs of the proceedings in the Magistrates Court assessed on the standard basis.[12] The question arises: on what basis does this court have power to disturb the orders made by the Magistrate?
- [29]The respondent submits that by way of section 45 of the Magistrates Court Act 1921 (Qld), section 113 of the District Court of Queensland Act 1967 (Qld) and rule 766 of the UCPR, I have ‘all the powers and duties of the court that made the decision appealed from’. The respondent’s submission continues to the effect that an order fixing costs was one open to the Magistrate and is therefore open to this court.[13] The submissions of the respondent provide a correct analysis of the powers of the court hearing an appeal. Section 45 of the Magistrates Court Act 1921 (Qld) confers appellate jurisdiction on the District Court, but in circumstances such as the present only by leave. Section 113 of the District Court of Queensland Act 1967 (Qld) provides:
113 POWER OF DISTRICT COURT ON APPEAL FROM MAGISTRATES COURT
The District Court has, for an appeal from a Magistrates Court, the same powers as the Court of Appeal has to hear an appeal.
- [30]Rule 766 of the UCPR confers upon the Court of Appeal, and via section 113[14] on the District Court hearing an appeal from the Magistrates Court, ‘all the powers and duties of the court that made the decision appealed from’. One might add to the sections cited by the respondent section 47 of the Magistrates Court Act 1921 (Qld). Subsection (d) confers upon the District Court, when hearing an appeal against a decision of a Magistrate, the power to ‘make any other order, on such terms as it thinks proper, to ensure the determination on the merits of the real questions in controversy between the parties’. The difficulty, however, with the respondent’s submission is that it treats the present proceedings, wrongly in my view, as an appeal.
- [31]The proceedings before me were for leave to appeal. They were, in effect, an application to the District Court to commence proceedings in the court. In refusing leave to appeal I was not hearing an appeal or exercising appellate jurisdiction. An analogy may be drawn with applications for special leave to appeal in the High Court, where it has been said ‘until the grant of leave or special leave, there are no proceedings inter partes before the Court’.[15] Where an appeal lies by way of leave, the court does not exercise appellate jurisdiction unless and until leave is granted.[16] The result of purporting to hear and determine an appeal where leave is necessary, but has not be given, is to render the orders made a nullity. That is because the court is acting without jurisdiction.[17] Each of the powers relied upon by the respondent are predicated upon there being an appeal, properly constituted, or the exercise of appellate jurisdiction. In the absence of such there is no power to make the order sought by the respondent to fix the costs of the proceedings before the Magistrate.
- [32]If I am wrong about that, and it is within my power to fix the costs of the proceedings before the Magistrate, I would in any event decline to do so. The respondent had the opportunity to ask the Magistrate to fix the costs. His order contemplated a procedure by which that might occur. The respondent has at no point until now sought to challenge to vary the order of the Magistrate. Even if there were power, there is no sufficient reason to alter the order of the Magistrate.
Orders
- [33]For these reasons I order the applicant and Donna Maree Sewell to pay the respondent’s costs of the proceeding in the District Court fixed in the amount of $35,000.
Footnotes
[1] Uniform Civil Procedure Rules 1999 (Qld), rules 5 and 367.
[2] I understand more emails have been sent to the court by Ms Sewell, but none resemble a submission addressing the issue for which leave to file further submissions was granted.
[3] UCPR, rule 702.
[4]ASIC v Atlantic 3 Financial (Aust) Pty Ltd [2008] QSC 9; [2008] 2 Qd R 298, [32].
[5] Affidavit of Donald Portbury filed 14 May 2021 (court document 14).
[6]ASIC v Atlantic 3 Financial (Aust) Pty Ltd [2008] QSC 9; [2008] 2 Qd R 298, [32].
[7]Warren v Body Corporate for Buon Vista CTS 14325 [2007] QCA 160, [19].
[8] Affidavit of Donald Portbury filed 14 May 2021 (court document 14) at paragraph 15 and exhibit ‘E’.
[9] (1992) 174 CLR 178.
[10] Ibid at 202.
[11] See also Symphony Group PLC v Hodgson [1994] QB 179 and Arundel Chiropractic Centre Pty Ltd v Deputy Commissioner for Taxation (2001) 179 ALR 406.
[12] Order ‘b’ does not explicitly state that the applicant is to pay the respondent’s costs, but this is the obvious inference.
[13] I note the respondent’s submission (supplementary submissions filed 14 June 2021 at paragraph 1) that the Magistrate ‘did not determine whether to fix [the] costs or order that they be assessed’ does not seem consistent with the order he made as set out above.
[14] Rule 785 of the UCPR would also have the effect of applying rule 766 to the District Court hearing an appeal.
[15]Collins v The Queen (1975) 133 CLR 120 at 122-123.
[16]North Ganalanja Aboriginal Corporation v Qld (1996) 185 CLR 595 per McHugh J at 643.
[17]Smith v Ash [2011] 1 Qd R 175 at [51].