Seymour v WJ Markwell & Associates
[2023] QDC 112
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- Unreported Judgment
- Seymour v WJ Markwell & Associates[2023] QDC 112
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Seymour v WJ Markwell & Associates[2023] QDC 112
Seymour v WJ Markwell & Associates[2023] QDC 112
DISTRICT COURT OF QUEENSLAND
CITATION: | Seymour & Anor v WJ Markwell & Associates [2023] QDC 112 |
PARTIES: | ANNE LENIA SEYMOUR and MICHAEL SEYMOUR (applicants) v WJ MARKWELL & ASSOCIATES PTY LTD ACN 131 977 761 (first respondent) |
FILE NO/S: | BD929/23 |
DIVISION: | Civil |
PROCEEDING: | Originating Application |
ORIGINATING COURT: | Brisbane |
DELIVERED ON: | 21 June 2023 |
DELIVERED AT: | Townsville |
HEARING DATE: | 2 June 2023 |
JUDGES: | Jarro DCJ |
ORDER: |
|
CATCHWORDS: | PROFESSIONS AND TRADES – LAWYERS – REMUNERATION – TAXATION AND ASSESSMENT OF COSTS – APPLICATIONS – where the applicants applied pursuant to s 335(1) of the Legal Profession Act 2007 for an assessment of costs charged in a number of bills delivered to them by the first respondent for proceedings – where s 335(5) of the Act requires that an application for assessment of costs be made within 12 months after the final bill was given to the client – where the first respondent contends that the applicant is out of time to seek an assessment of those costs – whether, if the applicant is out of time, the court should exercise the discretion conferred on it by s 335(6) of the Act in deciding to deal with the application for assessment of costs. Legal Profession Act 2007 (Qld) s 333, s 335, Part 3.4 Challen v Golder Associates Pty Ltd [2012] QCA 307 Cupo & Anor v Anderssen Lawyers [2015] QSC 202 Lessbrook Pty Ltd (in liq) v Whap [2014] QCA 63 Mishrea v Bennett & Philp Pty Ltd (2021) 8 QR 306 Stevens v HopgoodGanim Lawyers (a Firm) [2023] QDC 96 |
COUNSEL: | M Campbell for the respondent |
SOLICITORS: | Creevey Horrell Lawyers for the applicants Maven Lawyers for the respondent. Walt Allan for barrister Grant Allan. |
- [1]The applicants seek an assessment of all legal costs charged by the first respondent in accordance with Division 7, Part 3.4 of the Legal Profession Act 2007 (“the Act”). They also seek the appointment of Glenn Walter as cost assessor for the assessment.
- [2]One of the primary issues for determination relates to whether the application has been brought within the necessary 12 month time period prescribed by the legislation, otherwise leave would need to be granted to extend time. It is therefore necessary to consider whether the bills issued by the first respondent (which includes the disbursements) were “interim bills” or “final bills”.
Background Facts
- [3]What follows is largely uncontested between the parties. Relevantly, the applicants instructed the respondent to act on their behalf as defendants in District Court proceedings for an unpaid debt concerning a bore the applicants alleged had not been drilled correctly on their property by the plaintiff in those proceedings. Those proceedings required the respondent to issue its cost agreement terms to the applicants. The respondent did so on 14 May 2020. It is also issued three “disclosure notices” and “item schedules” on or around 14 May 2020, 26 July 2021 and 16 December 2021. The costs agreements terms were accepted by the applicants on 15 May 2020. Each of the three costs disclosures described the work that the respondent agreed to perform in a number of “stages”. Relevantly, the work to be performed under the first and third cost disclosures included preparation for, and attendance at, the trial. The second cost disclosure concerned work to be performed in respect of a summary judgment application brought by the applicants.
- [4]It was a term of the retainer that the applicants pay the respondent in respect of barrister’s fees. The barrister involved in the proceedings was Mr Grant Allan.[1] Mr Allan, through his solicitor, appeared at the hearing of this application, given he has an interest in the matter as it is possible for him to be subject to any orders made by a costs assessor appointed in this matter.[2]
- [5]The respondent engaged Mr Allan in or around May 2020. Mr Allan issued invoices to the respondent on an almost monthly basis from June 2020 to March 2022. Each of Mr Allan’s invoices were:
- (a)sent by email by the respondent to the applicants;
- (b)not referenced in the respondent’s invoices; and,
- (c)paid by the respondent using funds deposited into its trust account by the applicants.
- (a)
- [6]The proceedings involving the applicants as defendants and the plaintiff were heard by Porter KC DCJ over four days in March 2022. On 16 June 2022, judgment was delivered in favour of the plaintiff to the extent of $335,896, together with interest and costs. An appeal has been heard with respect to the primary decision, but judgment has not been delivered.
- [7]Relevantly, between 15 June 2020 and 1 August 2022, the respondent issued 14 invoices to the applicants totalling $241,835.38 (inclusive of GST). Between 9 June 2020 and 31 March 2022, barrister Mr Grant Allan issued 22 invoices to the applicants totalling $443,732.05 (inclusive of GST). Therefore, the total professional fees charged to the applicants was $685,567.63.
Were the respondent’s invoices interim or final bills?
- [8]Of the respondent’s 14 invoices issued to the applicants, the first 12 were provided more than 12 months before the filing of the present application. Consideration needs to be given as to whether each of those invoices are “interim bills” or “final bills”. If they are found to be the former, then an assessment is permissible. If they are found to be the latter, an assessment is not permissible unless otherwise ordered.[3]
- [9]The applicants submit that the invoices (numbered 1 to 12 inclusive) are interim bills. The respondent contends otherwise, namely that each of its invoices is a final bill and in doing so relies upon its costs agreement that was accepted by the applicants on 15 May 2020. Relevantly, the costs agreement provides:
“Each invoice we issue is a final invoice, not an interim invoice, and the right to an itemisation and assessment arises on receipt of each separate invoice. This means each invoice is final for the work covered by it. If you want to request an itemisation in relation to an invoice, you must do so within 30 days of receipt of the invoice.”
- [10]The retainer/disclosure notice provides as follows:
“If you wish to make an application to have the costs assessed, the application must be made within 12 months after:
- a)the bill of costs was given or a request for payment was made; or
- b)the costs were paid, if neither a bill of costs was given, nor a request made.”
- [11]The Act requires applications for assessment to be brought within 12 months from the time the final bill was issued. As for interim bills, interim bills may be assessed either at the time of the bill or at the time of the final bill, whether or not the interim bill has previously been paid or assessed.
- [12]Sections 333 and 335(5) of the Act provides as follows:
“333 Interim bills
- (1)A law practice may give a person an interim bill covering part only of the legal services the law practice was retained to provide.
- (2)Legal costs that are the subject of an interim bill may be assessed under division 7, either at the time of the interim bill or at the time of the final bill, whether or not the interim bill has previously been assessed or paid.
…
335 Application by clients or third party payers for costs assessment
…
- (5)A costs application by a client or a third party payer must be made within 12 months after—
- (a)the bill was given, or the request for payment was made, to the client or third party payer; or
- (b)the costs were paid if neither a bill was given nor a request was made.”
- [13]In the course of submissions, I was referred to a number of decisions regarding the approach to be taken to resolve the primary issue. Those cases include the decision of his Honour Judge McGill SC in Turner v Mitchells Solicitors [2011] QDC 61, the Court of Appeal authority in Challen v Golder Associates Pty Ltd [2012] QCA 307 and the decision of Holmes CJ in Mishra v Bennett & Philp Pty Ltd (2021) 8 QR 306. After the close of argument, the parties also referred me to the recent decision by Rosengren DCJ in Stevens v HopgoodGanim Lawyers (a Firm) [2023] QDC 96.
- [14]I was also usefully referred by Mr Campbell of counsel, who appeared for the respondent, to the ‘Law of Costs’ by Professor Dal Pont.[4]
- [15]There are at least two interpretations with respect to the timeframe permitted with respect to assessment. One interpretation permits all interim bills to be assessed at the time of the final bill, so that, provided the application for an assessment is within the time limit by reference to the final bill, the legal costs covered by interim bills could also be assessed. The other approach is that the time limit applies likewise to interim bills, as from when the interim bill was delivered. The applicants contend the former approach be adopted; whereas the respondent contends the latter approach.
- [16]In the recent decision of Stevens v HopgoodGanim Lawyers (a Firm), Rosengren DCJ usefully summarised a number of relevant cases. Her Honour said:[5]
“[24] In Re Lynch and Co Bill of Costs, Chesterman J was concerned with the question of whether certain bills were several separate bills or were part of the one bill when applying s 9 of the Legal Practitioners Act 1995 (Qld). His Honour stated at [13] that:
‘Equity therefore developed the principle that distinctly identifiable parts of the retainer would constitute a separate retainer for the purposes of billing and if a ‘natural break’ occurred in the conduct of the litigation a bill could be delivered up to the time of the break.’
[25] Turner v Mitchells Solicitors concerned an application for assessment of legal costs under s 335 of the Act in relation to 44 tax invoices that were issued over a nearly eight year period. McGill DCJ distinguished between the use of the term ‘retainer’ in the broader sense of the relationship between the client and the legal practice, and a retainer to provide legal services for the purposes of s 333 of the Act. His Honour relevantly stated at [29]:
‘There can be a situation where a costs agreement can be entered into to cover particular legal work, and any other legal work which the solicitor is instructed to carry out. If the particular legal work is then completed, and there have been no further instructions, then the legal services the solicitor is retained to provide have been performed. If a bill is sent at that point it is a final bill, and it does not become an interim bill simply because at some later stage further instructions are given for additional legal services to be provided to which the earlier costs agreement also applies.’
[26] Applegarth J applied Turner in Tabtill No. 2 Pty Ltd & Ors v DLA Phillips Fox (a firm) & Anor . The applicants sought an assessment of costs pursuant to s 335 of the Act in relation to 115 tax invoices issued by the respondents on numerous separate files over a period of nearly four years. The first respondent had entered into a client agreement with the applicants and other related corporate entities. It was in the form of a letter which incorporated certain standard conditions. The respondents adopted the practice of opening and maintaining different files for different sets of instructions received from clients and these separate files were assigned different matter numbers. There were 11 different matter numbers. Relevantly, a large amount of the total costs in respect of which the assessment was sought, related to work undertaken by the first respondent in preparation for and attendance at a Supreme Court trial. The judgment in relation to that matter was delivered approximately nine months later and the respondent was retained to act in relation to arguments relevant to the issue of costs. Further invoices for this work were then issued and about nine months later the applicant made the costs application. Applegarth J considered that there was a natural break in the litigation at the conclusion of the trial. A bill sent at that point in relation to the conduct of the trial, was considered to be a final bill for the purposes of s 333 of the Act. The tax invoices subsequently issued for legal services performed pursuant to instructions that were received after the trial, were considered to be for separate and distinct legal services.
[27] The point arose in a different statutory context in Dart Mining NL v Foster Nicholson Jones and concerned the application of the Legal Profession Act 2004 (Vic). Wood As.J referred to Applegarth J’s statement in Tabtill No. 2 to the effect that within a broader retainer, there may be specific retainers the subject of specific instructions. His Honour found that there were separate retainers for discrete issues.
[28] In Mishra v Bennett and Philp Pty Ltd , the applicants applied pursuant to s 335(1) of the Act for an assessment of costs charged in 33 bills delivered to them by the respondent in respect of trial and appeal proceedings. The parties had entered into a costs agreement for the respondent to act in the Supreme Court proceedings. The respondent submitted that there were two distinct retainers. The first was the trial retainer, which ceased after the trial in April 2018. The final bill in relation to that retainer was rendered on 31 May 2018. Some months later, the applicants instructed the respondent to act on their behalf to make costs submissions in relation to the trial and subsequently to conduct an appeal in respect of the matter. Having considered the authorities, the Chief Justice concluded at [22]:
‘In the interests of comity, it seems to me that I should accept that instructions to prepare for and represent clients at trial may constitute a specific retainer within a larger retainer to act in the proceedings and that a bill given for that work at a natural break in the proceeding, in the absence of further instructions, should be regarded as final. Here, as at 31 May 2018, the specific retainer to prepare for and provide representation at the trial was complete and the respondent had no instructions to perform further work in that regard. Nothing more was required or done until 2 October 2018, when delivery of judgment was imminent. The bill rendered in May 2018 was a final bill.’”
- [17]In Challen v Golder Associates Pty Ltd, in considering the effect of s 333, the Court of Appeal stated at [44]:
“The conclusion of the primary judge that the final bill is merely the last in time rather than the ultimate bill would have the unsatisfactory consequence that over the course of the retainer the delivery of another bill would give rise to a new right of assessment of an interim bill under s 333(2). Although there is no definition in the LPA of ―final bill, the expression is used in contrast to ―interim bill‖ which is effectively defined in s 333(1) as a bill for part of the legal services that the law practice was retained to provide. That suggests that the final bill must be the last bill for the legal services that the law practice was retained to provide. Whether a bill is a final bill may not be apparent at the time that it is issued by the solicitor. By way of an example, a bill may be issued in anticipation that further work will be undertaken under the retainer, but that expectation is overtaken by the termination of the retainer immediately after the issue of the bill and before any further work is undertaken, resulting in the bill being the final bill.”
- [18]The applicants also relied upon the decision in Cupo & Anor v Anderssen Lawyers [2015] QSC 202 in support of the approach to be adopted. That involved an application related to 126 invoices issued by the law firm and other entities, including barrister Grant Allan. Justice Boddice said at [46]:
“In those circumstances, Mr Allan’s invoices are properly to be considered in any assessment of the invoices issued by the Respondents to the Applicants. It does not matter whether those costs were formally recorded as disbursements in a bill forwarded by the Respondent or were sent by the inclusion of accompanying invoices from Mr Allan. They constitute amounts the Respondents sought payment for from the Applicants.”
- [19]On behalf of Mr Allan on this occasion, it was submitted the approach given the express wording of costs agreement that each bill is a final bill, should be that the application is dismissed. In the alternative, it was submitted that the respondent’s costs agreements are properly to be considered as separating the scope of work into different and discrete elements of work (called “stages”), and that any order for assessment should relate only to the work items (specifically identified by the applicants) set out in stage 5 of the costs agreement of the respondent (as the final bill in relation to this work was issued within 12 months of the making of the application for assessment). Such an approach, it was submitted, would be consistent with what was stated in both Challan and Turner.[6]
- [20]Returning to the issue as to whether the respondent’s invoices are deemed interim or final. The terms of the retainer for the scope of works to be performed by the respondent on behalf of the applicants were broad. That is of no criticism to the respondent. The work the respondent was required to perform was to provide legal services to the applicants “in a matter where [they] are being sued” in the proceedings. The respondent issued detailed invoices. It also reduced its rate for the applicants. The retainer made it plain that each bill was considered to be a final bill.
- [21]The applicants submitted that the respondent did not complete the services (being retained by the applicants to appear at trial) that it was retained to provide until, at the earliest, the conclusion of the trial on 24 March 2022. It follows therefore that it could not have issued a “final invoice” prior to that date. The first invoice it delivered after the trial had concluded was issued on 12 April 2022. That was the earliest date that it could have issued a final bill. All invoices issued prior to that were interim bills, because they were bills which covered part only of the legal services that the respondent was retained to provide. It was highlighted that the legal costs which may be assessed under s 335(1) of the Act include:
“All of the legal costs subject to any interim bill which was part only of the legal services the law practice was retained to provide, even though those costs are not included in the final bill.”[7]
- [22]It was submitted that each of those earlier bills (the first 12 invoices) may be assessed if a costs application is filed within 12 months of the final bill, which was issued on 12 April 2022. This application was filed on 11 April 2023. For completeness, the applicants also submitted that it should be observed that the last of the respondent’s invoices issued in time was on 1 August 2022. The same result would follow if it was determined that that invoice was the final invoice for the purposes of the Act.
- [23]It was also submitted on behalf of the applicants that the invoices issued by Mr Allan related to the retainer entered into by Mr Allan with the respondent to act on the applicants’ behalf. In those circumstances, Mr Allan’s invoices are properly to be considered in any assessment of the invoices issued to the applicants. It does not matter that they were not recorded in the respondent’s invoices. They constitute amounts the respondent sought payment for from the applicants. I accept this submission, given the approach taken by Boddice J in Cupo & Anor v Anderssen Lawyers.[8] Mr Allan’s invoices ought to form part of any assessment if it is so ordered.
- [24]It was also highlighted on behalf of the applicants that the result contended by them is consistent with the observations of various courts of the “good reason” for conferring upon a client the opportunity to have the interim bills assessed after the retainer has ended. That is because it:
- (a)avoids prejudice to the relationship of the client and the solicitor during the course of the retainer;[9] and,
- (b)enables consideration of the reasonableness of the costs charged in the context of the completed work and costs claimed for the whole of the retainer.
- (a)
- [25]It was also highlighted that the respondent’s costs agreement (particularly clause 13.2)[10] is nothing more than an attempt to restrict the applicants rights by contracting out of consumer protection legislation. That clause, it was submitted, should not be given the effect contended for by the respondent because:
- (a)the Act only permits a contracting out of Division 7 (and the provision concerned here (s 333) is found in Division 6); and,
- (b)the applicants are not sophisticated clients in any event, so any attempt to contract out would be a breach of the Act.
- (a)
- [26]My view is that the respondent’s bills were interim bills. They are to be assessed, therefore, at the time of the final bill. They then fall within the 12 months of the issuing of the final bill. Accordingly they should therefore be assessed. There is a consistent line of cases demonstrating the approach which I have adopted in this instance. Those cases have been referred to above. I am particularly guided by the authority in Challen, where the Court of Appeal observed a number of principles including:
- (a)The final bill must be the last bill for the legal services that the law practice was retained to provide.[11]
- (b)A law practice’s final invoice is determined by the scope of its retainer, not the terms of its costs agreement. The costs agreement is relevant to determining what is the final bill because it specifies the extent of the retainer.[12]
- (a)
- [27]I am not satisfied there was a natural break which occurred in the conduct of the litigation such that any of the bills could be deemed to be characterised as a final bill at the time of issue.[13]
- [28]Consistent with the approach I have taken in classifying the bills as interim bills, it is appropriate that the applicants ought to be conferred with the opportunity to have the interim bills assessed after the retainer has ended and the final bill has been issued, because it avoids prejudice to the relationship of the client and the solicitor during the course of the retainer.[14] It also enables consideration of the reasonableness of the work that is the subject of the interim bill, the way in which that work was carried out and the costs for that work to be undertaken in the context of the completed work and the costs claimed by the solicitor for the whole retainer.[15] I do not accept the alternative proposition advanced on behalf of Mr Allan (that is that any assessment should only relate to stage 5 of the costs agreement of the respondent) because I do not consider there has been a natural break in the conduct of the work performed by the respondent and it is only appropriate that the applicants be conferred with the opportunity now to have the bills assessed.
- [29]Therefore, it is ordered that the legal costs charged by the respondent set out in the tax invoices (including third party disbursements) be assessed in accordance with Division 7, Part 3.4 of the Act.
Cost Assessor
- [30]Initially, the position of the respondent was to seek to have the appointment of Glenn Walter as cost assessor. However, at the hearing of the application, its position changed, such that it supported the position of Mr Allan that the cost assessor be Mr Paul William Cameron.
- [31]I agree that Mr Cameron is the preferable appointment because consistent with the approach in Lessbrook Pty Ltd (in liq) v Whap [2014] QCA 63:
- (a)his hourly rate is cheaper than that of Mr Walter;
- (b)he is available to commence the assessment procedure immediately upon his appointment and to attend to the assessment in a timely manner; and,
- (c)he has the necessary skill and experience to conduct the assessment.
- (a)
- [32]It is appropriate that Mr Cameron be appointed as assessor and there is no good reason why, where the respondent and Mr Allan agree to his appointment, that he should not be appointed.
Conclusion and Orders
- [33]The orders are as follows:
- (a)All of the legal costs and disbursements that were charged by the respondent be assessed in accordance with Division 7, Part 3.4 of the Legal Profession Act 2007.
- (b)Mr Paul William Cameron, costs assessor, be appointed to conduct the assessment.
- (a)
- [34]At the hearing of the application, I heard submissions regarding costs be sought subject to the outcome. The applicants sought, if successful, indemnity costs. I am not satisfied indemnity costs are justified because there was, in my view, nothing untoward or unreasonable in the conduct of the respondent in opposing the application so as to justify indemnity costs. The arguments ventilated by the respondent were entirely reasonable. I therefore propose that, subject to any contrary submissions, costs follow the events such that the respondent be ordered to pay the applicants costs on the standard basis. In the event contrary submissions are not received within 14 days of these reasons, that will be the costs order.
Footnotes
[1] Mr Grant Allan was initially a party to the originating application. He was named as the second respondent. However a previous order was made by consent such that the application against him was dismissed.
[2] See ss 339(2)(c) and 342(3) of the Act.
[3] See s 335(6) of the Act.
[4] Law of Costs, 4th Edition by GE Dal Pont, LexisNexis Butterworths, 2018, pages 116-117.
[5] Footnotes omitted.
[6] Challan at [45] and Turner at [28]-[29].
[7] Turner at [27].
[8] At [44]-[46].
[9] Challen at [41], Turner at [21], Retemu Pty Ltd v Ryan (New South Wales District Court, Coorey DCJ, 16 April 2010, unreported).
[10] The clause effectively states that every bill is a final bill.
[11] [44].
[12] [45].
[13] See generally Mishra.
[14] See Challan at [41].
[15] Challan at [41] citing Retemu and Turner.