R v ACT Registrar; Ex Parte Ryan t/as Ryans Barristers & Solicitors [2003] ACTSC 72 (9 September 2003)

Last Updated: 14 October 2003

THE QUEEN v THE REGISTRAR OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY; Ex Parte EUNICE CATHERINE MARY RYAN t/as RYANS BARRISTERS AND SOLICITORS

[2003] ACTSC 72 (9 September 2003)

LEGAL PRACTITIONERS - costs - costs dispute arising from proceedings in Federal Magistrates Court - determination under Legal Practitioners Act 1970.

JUDICIAL REVIEW - certiorari - Registrar exercises limited jurisdiction to tax bills of costs - Registrar hears application and makes consequential costs order - costs order not beyond jurisdiction because Registrar would not have power to make final order - Registrar entitled to enquire as to existence of jurisdictional facts.

Family Law Act 1975 (Cth), s 123(1), s 123(1)(g)

Federal Magistrates Act 1999 (Cth), s 81

Legal Practitioners Act 1970, ss 180, 181, 190, 191

Supreme Court Act 1933, s 10

Family Law Rules, (Cth) O 38

Supreme Court Rules, r 6(d)

Federal Magistrates Court Rules, (Cth) r 21.09(3)

M Aronson & B Dyer: Judicial Review of Administrative Action (LBC, 2^nd ed, 2000)

No SC 452 of 2003

Judge: Connolly J

Supreme Court of the ACT

Date: 9 September 2003

IN THE SUPREME COURT OF THE )

) No SC 452 of 2003

AUSTRALIAN CAPITAL TERRITORY )

THE QUEEN

Against

THE REGISTRAR OF THE SUPREME

COURT OF THE AUSTRALIAN CAPITAL

TERRITORY

Respondent

Ex Parte: EUNICE CATHERINE MARY RYAN

t/as RYANS BARRISTERS AND SOLICITORS

Prosecutor

ORDER

Judge: Connolly J

Date: 9 September 2003

Place: Canberra

THE COURT ORDERS THAT:

1. The application be dismissed with costs.

1. This is an application to make absolute an order nisi granted by Gray J on 8 August 2003 for a writ of certiorari to quash an order made by the Registrar of the Supreme Court of the Australian Capital Territory on 17 June 2003 in matter No SC 192 of 2003 where the Registrar made certain costs orders against the firm of Ryans Barristers and Solicitors in the course of an application to tax a bill of costs. The application is based on the assertion that the Registrar would have lacked jurisdiction to make final orders on the costs application, and so lacked jurisdiction to make the costs order. Where the jurisdiction of the Registrar is questioned, the use of the prerogative writ of certiorari is the appropriate process to call into question the order. It would not be appropriate in these circumstances to have brought an appeal from the order, because the applicant's contention is that the order is a nullity.

2. The matter arises from a family law dispute. As disputes in the Family Court, and disputes under the Family Law Act 1975 (Cth) (the Family Law Act) that are heard and determined in the Federal Magistrates Court protect the identity of the parties, it is appropriate for me in these reasons to simply refer to the litigant as Mr B. Mr B engaged the firm of Ryans Barristers and Solicitors to act for him in respect of certain family law matters which were being contested in the Federal Magistrates Court, and the principal of that firm, Ms Eunice Ryan, swore in her affidavit of 30 July 2003 that she acted for Mr B in respect of family law matters between 17 April 2001 and 22 May 2003, when she filed a notice of ceasing to act. She says that she entered into a costs agreement with Mr B, and this is annexed to the affidavit, bearing the date of 17 April 2002. It is common ground that Mr B first consulted Ryans Barristers and Solicitors in April 2002, and the reference in Ms Ryan's affidavit to 17 April 2001 is an error.

3. After the firm ceased to act for Mr B, it sought to recover what it claims to be the costs due to it for the legal services performed on behalf of Mr B, and it is this dispute that is the basis of the costs order made by the Registrar of this Court.

4. An obvious preliminary question is why would a family law costs dispute end up in this Court? The Family Law Act provides in s 123(1)(g) that the Judges of the Family Court may make rules relating, inter alia, to the assessment or taxation of costs in family law proceedings. The Judges have made such rules under O 38 of the Family Law Rules.

5. The Federal Magistrates Court was established in 1999, pursuant to the Federal Magistrates Act 1999 (Cth) (the Federal Magistrates Act). One of the purposes of establishing the Federal Magistrates Court was said to be to facilitate easier access to justice for less complex family law disputes. The Family Law Act rule-making power referred to above under which rules have been made for the taxation of costs in family law proceedings can extend to proceedings in the Federal Magistrates Court, because s 123(1) of the Family Law Act extends the application of Family Law Rules to "the practice and procedure to be followed in the Family Court and any other courts exercising jurisdiction under this Act". On its face then, the Family Law Rules could be said to have application to family law proceedings in the Federal Magistrates Court.

6. The Federal Magistrates Act, however, provides in s 81 that the Federal Magistrates may make rules -

Making provision for or in relation to the practice and procedure to be followed in the Federal Magistrates Court or...in relation to all matters and things incidental to any such practice or procedure.

The Federal Magistrates have made rules pursuant to the power. It must follow that the express rule-making power granted by the Parliament to the Federal Magistrates supersedes any extended application of the Family Law Rules to the Federal Magistrates Court, at least where the two conflict.

7. Rule 21.09(3) of the Federal Magistrates Court Rules provides that -

... these Rules do not regulate the fees to be charged by lawyers as between lawyer and client in relation to proceedings in the Court.

A notation to the Rule states that -

In each case the lawyer is governed by the Legal Professional Conduct Rules applying in the state or territory where the lawyer is practicing.

8. The effect of this, and this is common ground between the parties in this application, is that whereas costs disputes arising from family law matters dealt with in the Family Court may be dealt with under the Family Law Rules, costs disputes arising from family law matters dealt with in the Federal Magistrates Court cannot be dealt with under the Family Law Rules, and must fall for determination under the general law relating to the resolution of costs disputes in the state or territory where the lawyer is practicing.

9. This is a surprising result, and indeed it seems contrary to the intention of the Commonwealth Parliament in creating what has been intended to be a simple and more accessible form of justice. It will compel persons with family law costs disputes arising from a Federal Magistrates Court proceeding to resolve that dispute in proceedings such as this, at significant potential cost. As the Federal Magistrates Court in Canberra serves a broad geographic region, it has the consequence that a New South Wales resident who engages a Canberra practitioner to appear for them in a family law matter may have their costs dispute determined under Australian Capital Territory law, whereas if they engaged a New South Wales practitioner, a different regime would apply under New South Wales law. This is a matter that should be brought to the attention of the Commonwealth Attorney-General, and I will provide him with a copy of these reasons for his consideration.

10. Both Mr Thomas and Mr Farrar were in agreement that the effect of the Federal Magistrates Court Rules is that a costs dispute between a client and a practitioner in Canberra is not governed by the provisions of O 38 of the Family Law Rules, but is governed by the provisions of the Legal Practitioners Act 1970 (the Legal Practitioners Act) and the common law as it applies in the Australian Capital Territory. The relevant law is Part 15 - Costs - of the Legal Practitioners Act, being ss 177-191.

11. These provisions set up two regimes in relation to disputes over legal costs. Where there is no written agreement between a solicitor and a client, ss 178-185 of the Legal Practitioners Act set out a procedure whereby a solicitor will deliver a detailed statement of their costs to the client, and this may then lead to a procedure before the Registrar of this Court whereby the costs may be taxed, and a certificate issued, which can result in an action to recover the amount of the certified costs as a debt. The client may, on receipt of a bill in taxable form, request the Registrar to tax the bill. In this case, there was a written agreement between the firm and Mr B in relation to costs, and so the relevant provisions are ss 190 and 191 of the Legal Practitioners Act. Section 190 states that the preceding sections relating to taxation do not apply where there is a costs agreement. Section 191 provides a regime whereby a person dissatisfied with the costs may make an application to this Court to vary the claimed costs if this Court is satisfied that the agreement is not "fair and reasonable".

12. Ms Ryan annexed to her affidavit a document described as a "statement of account" which was sent by her firm to Mr B on 5 March 2003. This asserted a debt of $24,675.75. Accompanying this was an itemised time billing document, which appears to indicate that the client was being billed for the time of the legal practitioner at a rate of $23.34 per minute (for example, item 12 June 2002 - attendance on client, 12 minutes at $23.24, billed amount $280.08). The costs agreement asserted that the rate at which the client would be charged was $220 per hour plus GST. The client, perhaps not surprisingly, did not pay this account, which seems to itemise billing by a legal practitioner at a rate that amounts to $1,400.40 per hour.

13. On 27 March 2003 the firm sent a letter to Mr B, which is annexed to Ms Ryan's affidavit and states -

We confirm the advice of ...and yourself that you will not be attending to the payment of our account for professional costs and disbursements.

As a consequence of that advice we have prepared a bill in taxable [sic] to commence the process for recovery of our costs.

We enclose by way of service upon you our account for professional costs and disbursements which has now been prepared in taxable form. The bill in taxable for [sic] is for the sum of $58,728.76.

14. The letter clearly contains typographical errors. It asserts that it is a "bill in taxable", and then a "bill in taxable for", but I read this to be intended to mean a bill in taxable form, and indeed it states that the account "has now been prepared in taxable form". The letter goes on to assert that it gives notice that "we will commence proceedings in the Supreme Court for the recovery of our costs after the expiration of 30 days from the date of this letter. We will also seek interest and the full costs of recovery action".

15. This letter appears to be invoking the procedure for recovery of solicitors' costs set down in the Legal Practitioners Act under ss 180 and 181 for taxation of a solicitor/client bill of costs. This is clearly the inappropriate procedure here, because it is common ground that there was a costs agreement, and s 190 provides that those provisions do not apply where there is a costs agreement. Nevertheless, Ryans Barristers and Solicitors asserted that that was what it was doing. Mr B, upon receipt of this letter, obtained legal advice from the firm of Farrar Gesini and Dunn. Mr Farrer wrote to Ms Ryan on 9 April 2003, indicating that he would request the Registrar to proceed to tax the itemised account. Both Ryans Barristers and Solicitors and Farrar Gesini and Dunn appear from the documents to be proceeding towards a taxation.

16. On 6 May 2003 Mr Farrer wrote to the Registrar noting that a date had been set for taxation, requesting a directions hearing -

... because we wish to clarify whether or not there will be an issue as to your powers to tax bills of cost drawn under client costs agreements. Arguably the Legal Practitioners Act does not vest power in the Court to tax bills of cost drawn under costs agreements.

17. On 7 May 2003 Ms Ryan wrote to Mr Farrar indicating that her firm was withdrawing the account, and stating that it would be redrawn and served upon Mr B upon completion. Ms Ryan stated in her letter to the Registrar dated 7 May 2003, a copy of which she sent to Farrar Gisini and Dunn, that -

The Court is not at liberty to tax a Bill rendered in accordance with a Cost Agreement and we are instructed to object to the Court doing so.

18. It appears from Ms Ryan's affidavit that this letter may not have reached the court file, and on 14 May 2003 Ms Ryan wrote again to the Registrar, copying the letter of 7 May and stating -

We confirm that we have now withdrawn the Bill in Taxable Form and we request that the Court vacate the hearing dates ...

19. Mr Farrar wrote to Ms Ryan on 29 May 2003 noting that the bill had been withdrawn, and stating -

Obviously our client incurred costs in consulting us in relation to the bill. There was also correspondence with your firm and the Court, perusal of the account and discussions with you.

We note that the taxation was set down for 17 June. Whilst the taxation of the bill cannot proceed our client is entitled to orders of costs in relation to the matter as you have submitted an account, he has sought taxation, and then you have withdrawn it.

Mr Farrer offered to settle these costs at $750.

20. On 17 June 2003 the Registrar made an order, on the application of Mr Farrar, that -

Ryans Barristers and Solicitors pay the costs of and incidental to the solicitor/client bill filed in relation to Mr B on 15 April 2003 pursuant to s 180 of the Legal Practitioners Act.

There was no appearance by Ryans Barristers and Solicitors at this hearing, and Mr Farrar wrote to Ms Ryan on 19 June 2003 enclosing a copy of the Registrar's order, and advising that he would accept costs in the sum of $1,500, or would proceed to an itemised scale costing, which he anticipated would be higher.

21. On 1 July 2003 Ms Ryan wrote to Mr Farrar advising that these proceedings would be launched on the basis that the Registrar had no power to tax the bill. Ms Ryan stated -

The fact that you requested a taxation under the misapprehension that the Supreme Court had jurisdiction to tax the Bill, does not ground an entitlement for costs against us, nor does it enliven the jurisdiction of the Supreme Court in respect of the matter. The error was entirely of your own making and is a matter between you and your client.

22. It seems to me that Ryans Barristers and Solicitors in their letter of 27 March 2003 asserted to Mr B that he was being presented with a bill "in taxable form". Ryans Barristers and Solicitors asserted that unless the bill was paid they would proceed to recover, and would commence proceedings in the Supreme Court for the recovery of those costs. Mr B, understandably, took this letter to a legal adviser, and Mr Farrar, presented with an assertion by Ryans Barristers and Solicitors that they had a bill in taxable form, made the appropriate application to have the matter resolved by the Registrar. Upon becoming aware of the costs agreement, he very properly wrote to Ryans Barristers and Solicitors and to the Registrar requesting the matter be set down for directions to determine the question as to whether the Registrar had jurisdiction to determine the matter. Following this, Ryans Barristers and Solicitors withdrew the bill.

23. It may well have been the case that, upon a full hearing, the Registrar would have determined that there was no jurisdiction to proceed to tax the document, prepared by Ryans Barristers and Solicitors and served by them on Mr B with the assertion that it was a bill in taxable form. This question never fell for determination, because Ryans Barristers and Solicitors withdrew the bill. Mr B was, however, entitled to seek to have this matter determined, and Mr Farrar, presented with what was asserted to be a bill in taxable form, was entitled to protect his client's interests by proceeding to seek to have it taxed. Indeed, if there had not been a costs agreement and it had been a proper bill, and had he not sought to have had the matter set down before the Registrar within a month, he may have lost that right (Legal Practitioners Act, s 180).

24. It was entirely proper for this to be done, and it seems to me that the Registrar would clearly have had jurisdiction to hear and entertain this application, even if, had it proceeded, she would probably have concluded that, on the evidence that there was in place a costs agreement, she did not have jurisdiction to proceed to tax the costs. The question of whether or not there was a costs agreement is a jurisdictional fact, and a body expressing limited jurisdiction clearly may embark on an enquiry to determine the existence of such a jurisdictional fact (see discussion M Aronson & B Dyer: Judicial Review of Administrative Action (LBC, 2^nd ed, 2000) 194 ff. It seems to me to follow that the Registrar would have had jurisdiction to make consequential orders as to costs. The Registrar in undertaking a taxation has a specific power to tax the costs of the taxation (Schedule 3, Supreme Court Rules 6(d) in addition to the general power conferred on the Registrar in s 10 of the Supreme Court Act 1933 (the Supreme Court Act) (and in identical terms on the Master by s 9) by which the Registrar in exercising her jurisdiction exercises the jurisdiction of the Court. This general power is the source of the Registrar's (and the Master's) power to order costs on interlocutory applications, a power regularly exercised in this Court. The general power of the Court to order costs is that set out in s 23(1) of the Supreme Court Act -

The Court shall have jurisdiction to award costs in all matters brought before the court, including matters dismissed for want of jurisdiction.

The Registrar, when exercising the jurisdiction of the Court, exercises this power.

25. It is of course not the law that the fact that a court does not have jurisdiction to make a final order does not mean that it may not make orders as to costs. Indeed, a misconceived application seeking to invoke a jurisdiction that does not exist would, in the normal course of events, result in the application being dismissed with an adverse costs order. There would be no question that such a costs order is valid, and indeed s 23 makes this clear.

26. In this case the Registrar exercised her discretion in awarding costs against Ryans Barristers and Solicitors. She would have had before her the letter from Ryans Barristers and Solicitors asserting to contain a bill in taxable form, and warning Mr B that the firm would proceed to recover the claimed debt. She would have been aware that Mr Farrar, on receipt of this letter by his client, sought to protect his client's position by seeking taxation, and the letter from Mr Farrar raising, very properly, doubts about the ability to tax costs due to the existence of the costs agreement. She would have been aware that, following this letter, Ryans Barristers and Solicitors withdrew the bill. It seems to me that in all of these circumstances, the Registrar very properly exercised her discretion in favour of Mr B, who was forced to protect his position following the assertion by Ryans Barristers and Solicitors that they were serving him with a bill of costs in taxable form.

27. This is an application to make absolute a decree nisi for an order for certiorari to quash the Registrar's order, and it is not an exercise of review of her discretion. I am of the view that her discretion did not miscarry, but that is not the point. I am of the view that she had jurisdiction to determine whether she had jurisdiction to tax the document described as a bill of costs in taxable form and served by Ryans Barristers and Solicitors on Mr B on 27 March 2003. I do not make absolute the decree nisi, and I decline to issue a Writ of Certiorari. The Registrar had jurisdiction to exercise her discretion as to costs.

28. The application is dismissed, with costs.

I certify that the preceding twenty-eight (28) numbered paragraphs are a true copy of the Reasons for Judgment herein of his Honour, Justice Connolly.

Associate:

Date: 9 September 2003

Counsel for the Respondent: Mr D Farrar

Solicitor for the Respondent: Farrar Gesini & Dunn

Counsel for the Prosecutor: Mr R Thomas

Solicitor for the Prosecutor: Ryans Barristers & Solicitors

Date of hearing: 15 August 2003

Date of judgment: 9 September 2003