Personal injury law shop Brydens having trouble producing an itemised bill of costs … A continuing difficulty … Lost file … Strange interpretation of the Legal Profession Act … Daniel Ahern reports
While findings of unsatisfactory conduct or professional misconduct have been made against solicitors for refusing to give their clients itemised bills, in this instance there was nothing so drastic for Brydens’ principal Lee Hagipantelis.
The firm’s motto is “protecting your future” with that claim that …
“time after time, case after case, Brydens Lawyers have proven that when it comes to protecting the rights and interests of our clients that no stone is left unturned.”
The law shop markets itself tirelessly, including events such as the recent “free legal consultation” Q&A on The Daily Telegraph website – all part of its constant image buffing.
Brydens’ former client Tan Thanh Le was seriously injured at work when he was struck by a forklift and in May 2013, Judge Len Levy awarded him damages in excess of $1 million.
The employer filed a notice of intention to appeal judgment and it was then ordered that Le be paid $650,000 and the employer continue to pay him weekly workers compensation, until the outcome of the appeal.
Of the $650,000 in interim damages, Brydens charged $304,677.72 – almost half – in costs and disbursements. The firm also transferred $221,379.03 from its trust account to its office account.
Le switched law firms after receiving this bill, and requested an itemised bill of costs from Brydens through his new firm, Gajic Lawyers. In response, Brydens asked Gajic Lawyers to provide them with Mr Le’s file, which by then had been transferred to Gajic.
After the file had been send back, Brydens promptly lost it. The firm relied on the evidence of Ms Villar, at the time a paralegal assisting the solicitor with carriage of Mr Le’s matters. She said the file cannot be found, explaining that the LEAP software used by Brydens did not store client files. Rather, Mr Le’s file was kept as a single physical copy, and that it had been lost.
Schmidt said that Brydens not only had a statutory obligation to retain the files, but a contractual one.
Brydens insisted upon an obscure construction of s 332A the Legal Profession Act 2004 (NSW) that would see a 12 month limitation read into it, such that a request for an itemised bill of costs could only be made within a 12 month period from when the solicitor provided their initial bill of costs to the client. No such limitation period is included in the provision.
Brydens attempted to analogise s.332A with other provisions in the Legal Profession Act that deal with independent costs assessments (such as s.350), and argued that because these provisions included a 12 month limitation period, the same limitation should also be read into s.332A.
“It is a strong thing to read into an Act of Parliament words which are not there, and in the absence of clear necessity it is the wrong thing to do.”
Justice Schmidt accepted Garling J’s finding in Mackowiack – a strikingly similar case in which Hagipantelis was also a party – that the right for a client to request an itemised bill of costs from a solicitor is a “general right in relation to billing”.
Schmidt J also accepted Justice Lucy McCallum’s statement in Dale v Firth that this right “exists even if that information would not give rise to any remedy”.
It was fallacious for Brydens to claim a 12 month limitation period in s.332A on the basis of an analogy to provisions relating to independent costs assessment, as s.332A does not exist for the purpose of facilitating independent costs assessments. Justice Peter Garling observed in Mackowiack:
“a client may use an itemised bill of costs for entirely proper and legitimate reasons other than to engage in the assessment process.”
For instance, s.332A could also be used by:
“a client who wishes to consider or pursue proceedings for breach of contract or of a fiduciary obligation; or one who wishes to be assured that the solicitor has included all relevant items in the lump sum bill, so that financial decisions with respect to the proceeds of litigation can be made.”
Because Brydens’ Lee Hagipantelis was a party to the 2015 Mackowiack judgement, which made the status of s.332A crystal clear, Schmidt took a particularly dim view of the firm’s continued refusal to provide Mr Le with an itemised bill of costs.
Brydens was required by the Legal Profession Act to provide Mr Le and itemised bill of costs.
Section 498(1)(a) of the Act specifies that conduct capable of being unsatisfactory professional conduct or professional misconduct, as defined in ss.496 and 497 includes, “conduct consisting of a contravention of this Act, the regulations or the legal profession rules”.
In cases such as Council of the Law Society of NSW v Pizzinga [2012] NSWADT 211 and Legal Services Commissioner v King [2013] QCAT 260, failures to provide an itemised bill when requested has led to findings of such misconduct, but fortunately for Hagipantelis this was not the finding here.
Schmidt J also allowed allowed Mr Le to apply for an assessment of Brydens’ legal costs, despite the expiration of the 12 month limitation period in s.350(5) of the Legal Profession Act:
“… when the nature of Mr Le’s command of English and the difficulties that posed for him are considered together with … Brydens’ persistent refusal, in breach of its statutory obligation, to provide Mr Le an itemised bill even after judgment was given in Mackowiak, I am satisfied that the order sought to permit an out of time costs assessment must be made.”
Brydens was ordered to pay Le’s costs, subject to the parties approaching the court within 14 days.