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Baik v Minister for Immigration & Anor [2008] FMCA 61 (18 April 2008)

Last Updated: 13 May 2008

FEDERAL MAGISTRATES COURT OF AUSTRALIA

BAIK v MINISTER FOR IMMIGRATION & ANOR

MIGRATION – Costs – application for review of decision of Migration Review Tribunal – whether order should be made against barrister under r.21.07 of the Federal Magistrates Court Rules.


Baik & Hankuk Grocery Pty Ltd v Minister for Immigration [2004] FMCA 543
Baik v Minister for Immigration [2007] FMCA 352
Bent v Gough and Another [1992] FCA 267; (1992) 36 FCR 204
D'Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1
De Sousa v Minister for Immigration, Local Government & Ethnic Affairs [1993] FCA 146; (1993) 41 FCR 544
Ex Christmas Islanders Association Inc v The Attorney-General for the Commonwealth (No 2) [2006] FCA 671; (2006) 233 ALR 97
Giannarelli and Others v Wraith and Others (1988) 165 CLR 543
Glenhill Enterprises Pty Ltd v BHP Australia Ltd (unreported, Federal Court of Australia, Whitlam J, VG 112 of 1991, 1 June 1993)
Hankuk Grocery Pty Limited v Minister for Immigration [2007] FMCA 353
Harley v McDonald [2001] UKPC 18; [2001] 2 AC 678
Harley v McDonald [1999] 3 NZLR 545
KM & A Chadwick Pty Ltd v Yeung (unreported, Federal Court of Australia, Tamberlin J, NG3187 of 1994, 2 June 1995)
Lemoto v Able Technical Pty Ltd [2005] NSWCA 153
Macteldir Pty Ltd v Roskov [2007] FCAFC 49
NAFG v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 389
Nguyen v Pascoe [2006] FCA 719
Re Bendiech [1994] FCA 1504; (1994) 53 FCR 422
Shocked v Goldschmidt [1998] 1 ALL ER 372
Steindl Nominees Pty Ltd v Laghaifar [2003] QCA 157
SZFLH v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCA 1287
Taylor v CGU Insurance Limited [2006] FCA 548
Taylor v CGU Insurance Ltd [2005] FMCA 1073; (2005) 193 FLR 120
Theo v Official Trustee in Bankruptcy (unreported, Federal Court of Australia, Black CJ, Sackville and Finn JJ, QG 160 of 1996, QG 16 of 1998, 23 July 1998)
White Industries (Qld) Pty Ltd v Flower & Hart (a Firm) [1998] FCA 806; (1998) 156 ALR 169

Applicant:
KYUNG SOO BAIK

First Respondent:
MINISTER FOR IMMIGRATION & CITIZENSHIP

Second Respondent:
MIGRATION REVIEW TRIBUNAL

File Number:
SYG 2062 of 2005

Judgment of:
Barnes FM

Hearing date:
12 November 2007

Date of Last Submission:
15 November 2007

Delivered at:
Sydney

Delivered on:
18 April 2008

REPRESENTATION

Counsel for the Applicant:
Ms G. Wright

Solicitors for the Applicant:
PSK Legal Lawyers

Counsel for the Respondents:
Mr D. Jarrett

Solicitors for the Respondents:
Lou Baker & Associates

ORDERS

(1) That the application be dismissed.
FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG 2062 of 2005

KYUNG SOO BAIK

Applicant


And


MINISTER FOR IMMIGRATION & CITIZENSHIP

First Respondent

MIGRATION REVIEW TRIBUNAL

Second Respondent


REASONS FOR JUDGMENT

The applications

  1. By applications filed on 4 August 2005 Kyung Soo Baik and Hankuk Grocery Pty Ltd (Hankuk) (the applicants) sought review in separate proceedings in this Court of associated decisions of the Migration Review Tribunal. The applications were both dismissed pursuant to r.13.03A(c) of the Federal Magistrates Court Rules on 12 March 2007. The applicants were each ordered to pay the costs of the first respondent (the Minister for Immigration) in the sum of $5,000. The applicants now seek orders under r.21.07 of the Federal Magistrates Court Rules against their former barrister Victor Kit Wan (the barrister).
  2. Initially, by application filed on 23 March 2007, the applicants sought orders under r.16.05 of the Federal Magistrates Court Rules setting aside the orders made in their absence on 12 March 2007 and orders under r.21.07 that their “former solicitor on the record Frank Ngo and / or [their] counsel Victor Kit Wan” pay the costs or part of the costs the applicants had been ordered to pay the respondent Minister.
  3. However by amended applications filed on 30 July 2007 they each seek orders pursuant to r.21.07 that the barrister pay the first respondent such costs. Hankuk also seeks an order that the barrister pay its costs of $4,000 said to have been incurred by it in engaging the barrister to prepare for and appear at the hearing of 12 March 2007. The applicants no longer seek orders under r.16.05 or orders against Mr Ngo.
  4. The Court has power under s.79 of the Federal Magistrates Act 1999 (Cth) to award costs in proceedings before the Court. Except as provided by the Rules of Court, or any other Act, the award of costs is in the discretion of the Federal Magistrates Court or Federal Magistrate (s.79(3)).
  5. The applicants seek orders pursuant to r.21.07 of the Federal Magistrates Court Rules which deals with applications for orders for costs against a lawyer. It is as follows:
  6. Under r.21.07(5) the lawyer and any other person who may be affected by the decision must be given a reasonable opportunity to be heard. It is not disputed that the barrister (who was represented) has had such an opportunity. Notice of the applications was also sent by the Court to Mr Ngo of Goh Lawyers, who was the solicitor on the record for the applicants prior to 12 March 2007 as discussed below (see r.21.07(5)). There is no appearance by or evidence before the Court from Mr Ngo.
  7. As a preliminary point I note that the issue before the Court is not whether the orders of 12 March 2007 dismissing the judicial review applications should be set aside under r.16.05 as having been made in the absence of the applicants. The question of whether or not the applicants had an adequate explanation for their non-appearance on 12 March 2007, which would be relevant to such an application, would not require proof of default, negligence, improper conduct or other misconduct on the part of the lawyer such as required under r.21.07. Rather what would be in issue would be whether the applicants could show that by accident and without fault on their part the orders were made without them being heard (Theo v Official Trustee in Bankruptcy (unreported, Federal Court of Australia, Black CJ, Sackville and Finn JJ, QG 160 of 1996, QG 16 of 1998, 23 July 1998)). Any such application under r.16.05 would have to be considered in light of the whole of the relevant circumstances (Glenhill Enterprises Pty Ltd v BHP Australia Ltd, (unreported, Federal Court of Australia, Whitlam J, VG 112 of 1991, 1 June 1993)) including whether there was an arguable case or a realistic or reasonable prospect of successfully establishing the existence of jurisdictional error on the part of the Tribunal (see KM & A Chadwick Pty Ltd v Yeung, (unreported, Federal Court of Australia, Tamberlin J, NG3187 of 1994, 2 June 1995); NAFG v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 389; Shocked v Goldschmidt [1998] 1 ALL ER 372 at 381 per Legatt CJ; Nguyen v Pascoe [2006] FCA 719; and SZFLH v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCA 1287 at [18] per Conti J).
  8. Had the applicants successfully pursued such an application the orders made on 12 March 2007 (including that the applicants pay the costs of the first respondent) could have been set aside and the judicial review applications considered on their merits. However as the applicants, who are legally represented, no longer seek orders under r.16.05 the Tribunal decisions must stand, as do the orders for payment of the first respondent’s costs of $5,000 in each matter.

Background

  1. In 1997 Mr Baik was granted a Temporary Business Entry (Class UC) (Subclass 457) visa to work for Campsie Asian Groceries. Hankuk Grocery Pty Ltd subsequently acquired that business. Mr Baik is a director of Hankuk. In 2001 Hankuk applied to the Department of Immigration for approval of the nomination of a business activity and a standard business sponsorship. Mr Baik sought a further subclass 457 visa on the basis that he would be employed by Hankuk. The Minister approved the sponsorship, but refused to approve the nomination of a business activity and hence the visa application. Both applicants sought review by the Migration Review Tribunal.
  2. Mr Baik’s affidavit evidence, which I accept in this respect, is that in or about early 2003 he orally retained Mr Wan to act for him as his (and Hankuk’s) migration agent in relation to the Tribunal reviews. Mr Wan is a registered migration agent as well as a barrister. Mr Baik paid ASC International Immi Edu Company Law Office (which he said was Mr Wan’s “Migration Agent Company”) fees in relation to Mr Wan’s assistance in connection with the applications to the Tribunal. It is not in dispute that when Mr Wan acted as immigration agent for the applicants in relation to Tribunal reviews he was retained directly by Mr Baik.
  3. Mr Baik gave evidence that his “understanding” at the time he retained Mr Wan (in relation to the Tribunal reviews) was that he would be “dealing with my matter entirely by himself” and that as he was a barrister as well as a migration agent he was “capable” of making a visa application as well as representing Mr Baik in court if necessary. Mr Baik’s evidence was that he was “never informed that I would be required to engage an instructing solicitor upon short notice should such need arise”.
  4. I accept that this was Mr Baik’s initial “understanding”. However he does not suggest that Mr Wan told him that he would deal with any possible judicial review application “by himself” or, indeed, that the issue of possible future representation in judicial review proceedings was discussed at the time Mr Wan was retained as a migration agent. I also note in relation to evidence from Mr Baik about the content of his conversations with Mr Wan, that in his affidavit of 25 July 2007 he stated in relation to a telephone conversation with Mr Wan of 12 March 2007 “I cannot recollect exact nature of the conversation as I cannot remember conversations conducted in English”. I accept this evidence.
  5. The Tribunal affirmed the decisions on 19 May 2003. I accept Mr Baik’s evidence that Mr Wan advised him to appeal the Tribunal decisions. According to Mr Baik in June 2003 he instructed Mr Wan to lodge an application for judicial review in this Court. The applicants sought review of those Tribunal decisions in separate applications filed in this Court on 16 June 2003 (the first judicial review proceedings). The present applications under r.21.07 do not relate to costs incurred in relation to those proceedings, but aspects of what occurred at that time form part of the background to the applications now before the Court.
  6. In each of the applications of 16 June 2003 the applicants were said to be represented by a named solicitor (other than Mr Ngo) (see Baik & Hankuk Grocery Pty Ltd v Minister for Immigration [2004] FMCA 543 (Baik [2004])). On 29 July 2003 that solicitor filed a notice of ceasing to act in each matter. There is no evidence before the Court in relation to the circumstances of that solicitor’s involvement as solicitor on the record.
  7. On 5 August 2003 notices of appearance were filed by Mr Ngo advising that the solicitors for the applicants in the first judicial review proceedings were Goh Lawyers. The matters were dealt with together as associated proceedings.
  8. It is not disputed that Mr Wan appeared as counsel for each applicant in those proceedings. Mr Wan’s affidavit evidence in these proceedings is that he was “briefed” by Mr Ngo from Goh Lawyers & Co to act for Mr Baik for a “number of years”, but he did not explain when this involvement began.
  9. When the barrister was given the opportunity to give oral evidence in chief (in light of objections to the form of part of his affidavit evidence), in response to a question “On what basis do you say you were briefed by Mr Ngo?” Mr Wan replied:

Mr Wan also said that this position “never changed” and that there were “a lot of documents”. There is no documentation before the Court of the relationship between Mr Ngo and Mr Wan.

  1. Relevantly, after an adjournment of the originally scheduled hearing date of 5 July 2004, orders were made by consent on 13 August 2004 setting aside each decision of the Tribunal and remitting the matters to the Tribunal for reconsideration. Subsequently the Minister sought an order under r.21.07 that Mr Ngo, as solicitor for the applicants, pay costs of $2,000 incurred by the Minister in relation to the adjournment of the hearing. Mr Wan appeared for Mr Ngo in relation to the r.21.07 application.
  2. On 30 November 2004 orders were made pursuant to r.21.07 of the Federal Magistrates Court Rules that Mr Ngo pay costs of $2,000 incurred by the Minister in the first judicial review proceedings in relation to the adjournment of the hearing. Otherwise the parties were to bear their own costs (see Baik [2004] at [22] – [23] and [49] – [52]).
  3. Prior to the making of that personal costs order against Mr Ngo, Mr Baik received a letter dated 11 November 2004 from Mr Ngo addressed to Mr Baik and Hankuk enclosing a tax invoice from the court in relation to a setting down fee and a memorandum of costs and disbursements from Mr Ngo’s firm, Goh Lawyers. The letter sought payment of $4,787.20 in relation to Goh Lawyers’ professional costs of and incidental to acting for Mr Baik and Hankuk in “Baik v DIMIA” and “Hankuk v DIMIA” (the first judicial review proceedings) as particularised on an attached timesheet on which the first item listed was “receipt and review email from V Wan” on 26 July 2003. The timesheet also referred to 2 conferences between “F Ngo, V Wan (counsel) and client” (the first of which was said to be on 12 August 2004, the day before the consent orders were made).
  4. Mr Baik’s evidence was that he was “surprised” by this letter as he had never retained Mr Ngo as his lawyer or authorised anyone to retain him. He claimed he was never advised by Mr Wan of the need to engage Mr Ngo. Mr Baik denied that he ever met Mr Ngo (except possibly when he paid the account) or that he attended conferences with Mr Ngo and Mr Wan as listed on the timesheet. He paid the amount sought by Mr Ngo by attending at the office of Goh Lawyers. His evidence in his affidavit of 23 March 2007 is that a few weeks after 10 November 2004 he received a phone call from Mr Wan, who said words to the effect: “You will need to pay Frank Ngo $4,787.20. I engaged him as my instructing solicitor, and he already sent you a bill for the work he has done for you. I won’t act for you further unless you pay Frank Ngo immediately.”
  5. Mr Baik’s affidavit evidence is that he said words to the effect: “You should have told me earlier. You told me I don’t need to pay more than what I have already paid you for your professional fees. Asking me to pay to Frank Ngo when I have never even authorised him to take any part in my case is so unfair. I am sure there is a rule prohibiting you from doing that. I am going to pay this time but please don’t do this again. $4,787.20 is not a small amount of money.”
  6. While the accuracy of Mr Baik’s recollection of conversations in English has to be seen in light of his concessions in his later affidavit of 25 July 2007, it is clear that, at least by this time, on his own account Mr Baik was aware of the fact that there was a distinction between a solicitor and a barrister – as he acknowledged in cross-examination. It is also clear that however the involvement of Mr Ngo as solicitor on the record came about, Mr Baik paid his account. I note in passing that while counsel for the applicants took issue with aspects of this account (for example the fee for a conference on 19 August 2004 and charges for other items incurred after the consent orders were made) this is not the forum to resolve any such issue between the applicants and Mr Ngo.
  7. In cross-examination Mr Baik confirmed that he had asked Mr Wan about Goh Lawyer’s invoice. He claimed that he did not know what Mr Ngo was doing for his case “but because I was asked to pay the money and the importance was to go on the case, I paid him”. Mr Wan’s evidence did not address the first judicial review proceedings, except insofar as he referred very generally to a long-standing brief from Mr Ngo.
  8. Mr Wan subsequently acted as migration agent for each applicant in connection with the reviews by the Tribunal as reconstituted. By decisions of 29 June 2005 the Tribunal affirmed the Department’s decisions in relation to the rejection of Hankuk’s nomination application and Mr Baik’s visa application.

The second judicial review proceedings

  1. On 4 August 2005 Hankuk and Mr Baik sought review of the 2005 Tribunal decisions by separate applications filed in this Court (the second judicial review proceedings). The applications were each filed in the name of the applicant. There was no reference to any legal representation in either application, despite the fact that under r.9.04 of the Federal Magistrates Court Rules a corporation may not start or carry on a proceeding otherwise than by a lawyer without the leave of the Court. However directions were made by consent at a directions hearing conducted by a Registrar on 1 September 2005 which were marked as signed by each applicant’s solicitor “Goh Lawyers”.
  2. On 6 September 2005 a notice of appearance in the matter of Baik v Minister for Immigration was filed by Mr Ngo of Goh Lawyers. On 19 October 2005 a notice of appearance was filed in the matter of Hankuk v Minister for Immigration stating that Mr Baik appeared for Hankuk and that the solicitor was Mr Ngo of Goh Lawyers. On 26 October 2005 both matters were listed for hearing before me on 1 February 2007.
  3. Despite orders of 1 September 2005 that each applicant file and serve written legal submissions and a list of authorities five days before the hearing, written submissions for the applicants were not filed until 1 February 2007, the day of the hearing. On that day Mr Wan appeared as counsel for the applicants. The hearing was adjourned until 12 March 2007 at 2.15pm. Counsel for the first respondent foreshadowed a possible costs application in relation to costs occasioned by the adjournment.
  4. At the start of the hearing on 12 March 2007 Mr Ngo informed the Court that he had filed by facsimile and post a notice of ceasing to act on 8 March 2007 and had notified Hankuk and Mr Baik by letter that day. Copies of the letter and a notice (incorrectly referring to the Federal Court of Australia) were tendered by Mr Ngo. The letter advised that Goh Lawyers had ceased to act on behalf of Mr Baik and Hankuk, notified them of the adjourned date and advised Mr Baik to make sure that “either you or your new legal representative attended Court.”
  5. Under r.9.03(2) of the Federal Magistrates Court Rules Mr Ngo required leave of the Court to file a notice of ceasing to act in the absence of evidence that a notice of intention to withdraw had been served on the applicants in the manner required under the Rules. The first respondent did not oppose the grant of leave. As counsel for the first respondent observed, if leave was granted and the applications subsequently dismissed under r.13.03A(c), the applicants could seek an order to set aside such dismissals (under r.16.05) should it be shown that there was some injustice because of Mr Ngo’s conduct. Mr Ngo told the Court that Mr Wan (who had not been present at the start of the hearing) was present to act for the applicants. Leave was granted to Mr Ngo under r.9.03.
  6. However when Mr Wan was asked if he was acting for the applicants on a direct brief basis, he stated no. Somewhat confusingly he initially told the Court that he understood “that the client has accepted the consent order and we will pay for the costs”. It was possible that this related to the first respondent’s foreshadowed costs application in relation to the adjournment, but in cross-examination in these proceedings Mr Wan’s explanation for this statement was that he “had a mental block”.
  7. Mr Wan told the Court that he was just back from overseas and understood that he was still briefed by Mr Ngo. The Court adjourned for a short time to enable Mr Wan to clarify whether he was appearing for the applicants. After the adjournment he advised. “Because this is the first time that I heard that my instructing solicitor has withdrawn, I haven’t got any instructions from the client whether to proceed or not”. Mr Wan confirmed that he could not address the Court as he had no instructions to act “one way or the other”.
  8. In those circumstances the matters were called outside the Court. There was no appearance for either applicant. Mr Wan suggested that Mr Baik be contacted by the court in case he was not aware that Mr Ngo had withdrawn. However as indicated in my judgments (see Baik v Minister for Immigration [2007] FMCA 352 and Hankuk Grocery Pty Limited v Minister for Immigration [2007] FMCA 353) I considered it appropriate in all the circumstances to make the orders sought by the first respondent dismissing the applications for judicial review under r.13.03A(c), bearing in mind the provisions of r.16.05. Each applicant was ordered to pay the costs of the first respondent in the sum of $5,000 (see r.44.15(1)).
  9. On 23 March 2007 Mr Baik and Hankuk each filed an application seeking orders under r.16.05 setting aside the judgments of 12 March 2007, orders that the applications for judicial review be heard again and orders under r.21.07 that Mr Ngo and/or Mr Wan pay the costs, or part of the costs that each applicant had been ordered to pay to the first respondent and the costs of the r.21.07 application.
  10. The matters were listed for 26 July 2007. On 3 May 2007 the lawyer for the applicants named on the applications advised the Court in writing that he no longer appeared as the applicants’ counsel. On 24 July 2007 notices of appearance for each applicant were filed by their present solicitors.
  11. On 26 July 2007 Ms Wright of counsel appeared for the applicants. There was also an appearance for the first respondent. There was, however, no appearance for Mr Wan or for Mr Ngo.
  12. Ms Wright told the Court that the applicants no longer sought orders under r.16.05. She confirmed that Mr Baik understood that this meant that there would be no further review of the Tribunal decisions. Ms Wright indicated that the applicants’ complaint was against Mr Wan.
  13. The applicants were each ordered to file and serve an amended application to clarify precisely what orders were sought. On 30 July 2007 Mr Baik and Hankuk Grocery Pty Limited each filed an amended application in a case seeking orders pursuant to r.21.07 of the Federal Magistrates Court Rules against Mr Wan as described above. On 7 August 2007 the Court made orders by consent that each of Mr Baik and Hankuk pay the Minister’s costs of the applications under r.16.05 which were no longer pursued. The first respondent was excused from further participation in the proceedings.
  14. The Court notified Mr Wan (and also Mr Ngo) of the orders sought in the amended applications and of the date, time and place for a subsequent directions hearing, which was attended by a legal representative for Mr Wan but not by Mr Wan. Directions were made for the filing of affidavit evidence and the matters were listed for hearing. The applicants’ applications in relation to Mr Wan were heard together on 12 November 2007. Both Mr Baik and Mr Wan relied on affidavits on which they were cross-examined. The parties were also given the opportunity to file written submissions both before and after the hearing.
  15. The essence of the applicants’ contention is that Mr Baik orally retained Mr Wan to act as migration agent and lawyer for himself and Hankuk Grocery in relation to the applications to the Tribunal and in relation to the applications for judicial review by this Court, that he never engaged Mr Ngo of Goh Lawyers to be the applicants’ solicitor, that at all times he believed Mr Wan was going to represent them at the hearing on 12 March 2007 and that Mr Wan had instructions to represent them. It was contended that Mr Wan’s failure to do so on 12 March 2007 amounted to negligence, improper conduct, other misconduct or default that was unreasonable conduct that resulted in the hearing of 12 March 2007 being unable to proceed conveniently and that this caused costs to be incurred by and/or ordered to be paid by the applicants such that the barrister should meet such costs under r.21.07.
  16. The barrister disputed that he was retained on a direct access basis in relation to the second judicial review proceedings in this Court. He claimed that he appeared at Court on 12 March 2007 being ready and willing to present the applicants’ case, but that he had no instructions to do so after the withdrawal of his instructing solicitor. He claimed that, as he informed the Court on 12 March 2007, he did not have instructions to act on a direct access basis.

The law

  1. Rule 21.07 is set out above. It is not disputed that the Court’s power to award costs is not limited to orders against parties on the record (see s.79(2)). However, as counsel for the applicants acknowledged, the jurisdiction to order costs against a lawyer must be exercised “with care and discretion and only in clear cases” (see Bent v Gough and Another [1992] FCA 267; (1992) 36 FCR 204 cited in De Sousa v Minister for Immigration, Local Government & Ethnic Affairs [1993] FCA 146; (1993) 41 FCR 544 at 547). As French J stated in De Sousa (at 548): “The mere fact that litigation fails is plainly no ground for its exercise. There has to be something which amounts to a serious dereliction of duty.”
  2. As the applications in this instance are made under r.21.07 it is not necessary to consider any wider power to award costs under s.79, although statements made by other courts about the nature of the jurisdiction to order costs against a lawyer are of assistance in relation to the scope of r.21.07.
  3. Counsel for the applicants sought to rely on Harley v McDonald [1999] 3 NZLR 545 (a decision of the New Zealand Court of Appeal) which was said to have been referred to by McColl JA in Lemoto v Able Technical Pty Ltd [2005] NSWCA 153, albeit Lemoto concerned the operation of s.198M of the Legal Profession Act 1987 (NSW) and the rather different issue of whether a costs order should be made against a lawyer who had provided legal services “without reasonable prospects of success” in the context of proceedings on a claim for damages. In fact McColl JA referred to the discussion of the Privy Council on appeal from the New Zealand Court of Appeal in relation to whether a costs order was compensatory or punitive (see Harley v McDonald [2001] UKPC 18; [2001] 2 AC 678 at [49]) in the course of expressing the view that the particular jurisdiction to make wasted costs orders against a legal practitioner in Division 5C of the Legal Profession Act was intended to involve an exercise of disciplinary power (or a power ancillary to disciplinary power) rather than being “merely an aspect of the court’s costs jurisdiction” (Lemoto at [116] – [126]).
  4. More direct assistance in relation to r.21.07 may be found in decisions of the Federal Court addressing the principles applicable to applications for personal costs orders against legal practitioners under s.42 of the Federal Court of Australia Act 1976 (Cth) and O.62 r.9 of the Federal Court Rules. Section 79 of the Federal Magistrates Act is similar, although not identical, to s.43 of the Federal Court of Australia Act. Order 62 rule 9 deals with costs orders against lawyers, although it refers to both solicitors and barristers (not simply to “lawyers” as does r.21.07).
  5. In Ex Christmas Islanders Association Inc v The Attorney-General for the Commonwealth (No 2) [2006] FCA 671; (2006) 233 ALR 97 French J referred to the approach of the Privy Council in Harley v McDonald in considering the power of the Federal Court to award costs against legal practitioners under s.43 of the Federal Court of Australia Act 1976 and O.62 r.9. However what was in issue in Ex Christmas Islanders Association Inc was whether a lawyer had proceeded without any prospects of success. His Honour found that the preparation and presentation of an application for judicial review “was done at such a poor level of competence as to amount to a significant breach of duty of the practitioner” (at [1] – [2]) to the client and the Court and warranted the making of an order for costs against the lawyer personally. There was said to be a failure to discharge a legal practitioner’s “basic duty” to give proper consideration to the legal issues that should have been considered before the application was filed and argument presented (at [21]). The Privy Council was said to have adopted a “careful and discriminating approach” to the circumstances in which a costs order should be made in that context.
  6. While the context of the present case can be distinguished, it is relevant to have regard to the fact that, as French J stated at [24], in Harley v McDonald the Privy Council: “did not think it appropriate, when considering whether or not to make it a costs order, for the Court to rule upon whether there had been any breach of professional conduct. Nor was it appropriate for the Court in exercising its summary jurisdiction to make such an order, to say whether the client would have a cause of action against the practitioner for negligence. That was a matter which, in their Lordships’ opinion, fell to be dealt with in separate proceedings in which issues of fact and law between client and practitioner were focused and the practitioner was given a full and fair opportunity to respond to the client’s claim”.
  7. Such caution is of particular relevance in this case. It is not appropriate in proceedings of the present nature under r.21.07 to rule upon whether there has been any breach of professional conduct by the legal practitioner or for the Court to say whether the applicants would have any cause of action against the legal practitioner for negligence. Such matters are properly the subject of separate proceedings in the appropriate jurisdiction.
  8. Nevertheless, as French J accepted at [25], consistent with the view of the New Zealand Court of Appeal and the Privy Council in Harley v McDonald:
  9. Rule 21.07 refers to costs orders against a “lawyer”. An issue arose in these proceedings as to whether a costs order could be made under r.21.07 against a barrister. Counsel for Mr Wan contended generally that principles of advocates’ immunity were applicable (see Giannarelli and Others v Wraith and Others (1988) 165 CLR 543 and D'Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1) at least to require that any claim against a barrister be “clearly proven” (Steindl Nominees Pty Ltd v Laghaifar [2003] QCA 157 at [42] per Williams JA).
  10. However in the context of an application under r.21.07, as French J stated in Ex Christmas Islanders Association Inc (at [23]) in relation to the equivalent provisions of the Federal Court of Australia Act and Rules, the distinction between a solicitor and a barrister “appears to have no relevance in terms of principle in the exercise of the Court’s power to award costs against practitioners personally ...” although “their distinctive roles may give rise to different applications of the general principles informing the exercise of the Court’s powers”. On this basis, while the different roles of barrister and solicitor may be relevant to a determination of what is misconduct, negligence or default, a costs order could be made against a barrister under r.21.07.
  11. The circumstances in which liability for costs should be imposed on a legal practitioner (whether barrister or solicitor) were considered recently by the Full Court of the Federal Court in Macteldir Pty Limited v Roskov [2007] FCAFC 49. Macteldir involved a claim against both a barrister and a solicitor by a client dissatisfied with the way proceedings were conducted.
  12. Spender, Kiefel, Emmett JJ stated in relation to Order 62 r. 9 (at [56] – [57]):
  13. While r.21.07 refers to “an order for costs against a lawyer” I am satisfied that, as under the Federal Court Rules, costs orders may be made by this Court under r.21.07 against a barrister as well as a solicitor. However I am mindful that this should occur only after the exercise of great caution “and upon the Court being satisfied that the relevant default of the legal practitioner was sufficiently serious to amount to be a breach of duty, not only to the relevant client, but also to the Court” (Macteldir at [55]). As their Honours stated in Macteldir at [73] – [74]:
  14. I consider that such an approach is equally applicable to a claim under r.21.07. Contrary to what seems to have been submitted by counsel for the barrister in post-hearing submissions, the suggestion in Macteldir that an order under O.62 r.9 (the Federal Court equivalent of r.21.07) should not circumvent advocates’ immunity does not mean that a claim cannot be brought against a barrister under r.21.07. Rather it indicates that while such an action is possible, there is a distinction between the nature of such proceedings and proceedings such as a claim for damages in negligence or for breach of a term of a retainer. The distinction their Honours made (at [73]) is that to succeed in a claim under O.62 r.9 (and the same can be said in relation to r.21.07) “much more must be established” than a failure on the part of a barrister to fulfil or perform his instructions and retainer “carefully and competently”. This emphasises that it is necessary to have regard to the specific requirements of the rule in issue, bearing in mind that what is required is conduct “much more serious than would give rise to a claim for damages” which involves a serious dereliction or failure to fulfil a duty to the Court. (Also see the discussion of the jurisdiction to make an order for costs against a lawyer in Taylor v CGU Insurance Limited [2005] FMCA 1073; (2005) 193 FLR 120 at 130 per McInnis FM and of a barrister’s duty to the Court in Giannarelli and Others v Wraith and Others (1988) 165 CLR 543 at 556 per Mason CJ).
  15. Hankuk seeks to recover costs incurred in engaging the barrister to prepare for and appear at the hearing on 12 March 2007. In Taylor McInnis FM proceeded on the basis that orders could be made under r.21.07 that a lawyer pay both the costs or part of the costs that his or her client had been ordered to pay to another party and also costs that the client incurred by engaging his or her own lawyers (and see r.21.07(4)). Notably, his Honour also observed (at [40]) that a costs application “should not be regarded as analogous to a claim in negligence” and expressed the view that broader issues concerning such a claim, including negligent advice, were more properly determined by a court vested with the appropriate jurisdiction to determine such claims (at [41]).
  16. Notwithstanding the reference to negligence in r.21.07(1), McInnis FM stated in Taylor at [42] that: “The power of the court to award costs under s 79 of the FMC Act and/or r 21.07 of the Rules should not be regarded as a substitute for a party’s rights to pursue a claim in negligence and/or contract against a solicitor” and that the sort of claims to be raised in such a matter constituted substantive issues to be tried in the normal manner in a court of competent jurisdiction rather than such as should be relied upon to support an application for costs under the Federal Magistrates Court Rules.
  17. While Nicholson J upheld an appeal from this decision (see Taylor v CGU Insurance Limited [2006] FCA 548) on the basis that the court had failed to accord the applicant or his solicitor procedural fairness (in purporting to determine the substantial merits without giving the parties an opportunity to be heard on such an issue), his Honour made it clear (at [21] – [29]) that the Federal Magistrates Court has jurisdiction to consider an application for costs against solicitors acting for a party “by its character as an application for costs in the proceeding” even though the solicitors were not parties to the proceeding. Such reasoning would also apply to proceedings against a barrister. Nicholson J did not take issue with the statement of general principles referred to above.
  18. As contended by counsel for the applicants, these authorities support the view, which I accept, that the court has jurisdiction under r.21.07 to order a legal practitioner (whether barrister or solicitor) to pay costs being either or both “the costs, or part of the costs as between the lawyer and the party” (sub-r.21.07(4)(a)) and the “costs or part of the costs incurred by the other person” to the proceeding (sub-r.21.07(4)(b)).
  19. However, the question of whether the barrister should pay the costs that the applicants have been ordered to pay the first respondent and/or the costs or part of the costs Hankuk incurred in relation to the judicial review proceedings is to be determined by a consideration of whether the barrister “caused” costs to be incurred by the first respondent or the applicants or thrown away because of the barristers “negligence, improper conduct or other misconduct or default” within the language of r.21.07(1) such as to constitute a serious dereliction or failure to fulfil his duty to the court (Macteldir at [55]).
  20. In these proceedings it was submitted first that there was default by the barrister within r.21.07(2)(d). Rule 21.07(2) provides that a lawyer may be in default if a hearing does not proceed conveniently because the lawyer has “unreasonably” failed to do one of a number of things including “any other act” necessary for the hearing to proceed. It was submitted that the failure of the barrister to proceed to argue the applicants’ case on 12 March 2007 was within this provision. It was also submitted generally that the circumstances involved negligence, improper conduct or misconduct within r.21.07(1) because Mr Wan had “blurred the lines” between his roles as a migration agent and barrister. There is no claim of “undue delay” or that Mr Wan conducted a proceeding without proper consideration of the prospects of success.
  21. The applicants’ case related to Mr Wan’s failure to present their case on 12 March 2007, not to whether he was personally responsible for any of the costs incurred by reason of the adjournment of the hearing from 1 February 2007 to 12 March 2007. However they seek recovery of the full amount of the costs ordered to be paid to the Minister.
  22. Insofar as it is contended that there was “default” by the barrister r.21.07 (or other misconduct within 21.07) it is important to note that even if misconduct or default is made out, it is also necessary to establish that the lawyer has “caused” costs to be incurred or thrown away because of such misconduct or default.
  23. In that respect counsel for the applicants contended that the fact that the hearing did not proceed on 12 March 2007 was directly the consequence of the default of Mr Wan and that as a result of this the applicant in each proceeding was ordered to pay the first respondent’s costs in the amount of $5,000. It was contended that Mr Wan should meet these costs on the basis that while Mr Baik was aware that the matter was before the Court that day, his reason for non-attendance was that he had engaged Mr Wan to represent him, that Mr Wan had been the applicants’ representative before the Tribunal and in relation to the prior proceedings and that Mr Baik did not attend as he believed his lawyer (who he believed at all material times to be Mr Wan) would attend in his place. Hankuk also seeks fees of $4,000 said to have been paid to Mr Wan to prepare for and appear at the hearing on 12 March 2007.
  24. In essence, the applicants contend that as Goldberg J stated in White Industries (Qld) Pty Ltd v Flower and Hart (a Firm) [1998] FCA 806; (1998) 156 ALR 169 at 231 (albeit in the context of considering whether proceedings had been instituted or maintained that had no prospects of success):
  25. The crux of the applicants’ case is that Mr Wan’s failure to present their case on 12 March 2007 was “unreasonable” because Mr Wan knew the matter was listed for hearing and that Mr Baik was not able to attend and because Mr Baik had given Mr Wan instructions to represent him (and Hankuk) on a direct access basis Mr Wan had an obligation both to the Court and to the applicants to appear on their behalf and make submissions.

Resolution

  1. It was submitted that Mr Wan was in dereliction of his duty as a barrister and that this was relevant to the exercise of the Court’s discretion under r.21.07. However as the Full Court stated in Macteldir, the question under a rule such as r.21.07 is not whether there was a failure on the part of the barrister to fulfil or perform his instructions and retainer carefully and completely.
  2. It is appropriate to reiterate that the Court is not determining whether there has been any breach of professional rules of conduct or whether the applicants would have a cause of action against Mr Wan or any other person, but rather whether by his conduct within r.21.07 the barrister caused costs to be incurred or thrown away and if so whether a personal costs order should be made against him.
  3. On the limited evidence before the Court it has not been established that the barrister’s failure to present the applicants’ case on 12 March 2007, despite Mr Ngo’s withdrawal as solicitor on the record, constituted default in r.21.07(2) or other conduct within r.21.07 that caused costs to be incurred or thrown away.
  4. There are aspects of the evidence about the circumstances in which legal representation was provided to the applicants which raise concern about, at the least, Mr Baik’s understanding of the process and the circumstances in which costs were incurred. Whether there are matters which reflect adversely on Mr Wan (or Mr Ngo) is not of itself a matter for determination by this Court, except insofar as such issues are relevant to the limited question of whether I am persuaded on the evidence before the Court that a personal costs orders should be made against Mr Wan under r.21.07 on the basis that he caused costs to be incurred or thrown away because of undue delay, negligence, improper conduct or other misconduct or default.
  5. However the applicants incurred liability for the costs of the first respondent because they were unsuccessful in their judicial review proceedings. While there is no suggestion for the applicants that Mr Wan encouraged them to initiate or continue judicial review proceedings which had no reasonable prospect of success (as to which now see Part 8B of the Migration Act 1958), there is also no claim or evidence that they would have, or even that they arguably could have, succeeded in their judicial review applications had the hearing proceeded.
  6. As set out above, in dismissing the applications on the basis of the applicants’ non-appearance on 12 March 2007 I referred to r.16.05 of the Federal Magistrates Court Rules. Had there been confusion or uncertainty about precisely what would occur on 12 March 2007 and whether the case would proceed (a rather different thing from the very serious dereliction of duty and the causal nexus between misconduct and incurring costs required for a costs order to be made under r.21.07) it was open to the applicants to seek to have the dismissals for non-appearance set aside on the basis that a reasonable explanation was provided for their non-appearance and that they had an arguable case in relation to jurisdictional error on the part of the Tribunal.
  7. Initially the applicants sought to proceed on that basis in their applications of 23 March 2007. However that aspect of the applications was not pursued. Had it been the confusion that I am satisfied existed in the mind of Mr Baik could have been taken into account in determining whether the applicants had a reasonable explanation for their failure to appear on 12 March 2007 and the applicants could have had the opportunity to have their applications for judicial review considered by the Court. They chose not to do so. That is, of course, a matter for Mr Baik. It is however relevant to the issue of causation and the appropriateness of the exercise of the discretion to make an order under r.21.07.
  8. It has not been established that the applicants incurred costs that would not otherwise have been incurred (see Re Bendiech [1994] FCA 1504; (1994) 53 FCR 422). Nothing has been put before the Court in relation to any prospects of success they might have had in relation to the judicial review proceedings. Hence, even if the barrister was at fault in the manner contended, it has not been established that liability for costs of the first respondent was incurred because of Mr Wan’s conduct, beyond what would have been incurred by the applicants as unsuccessful applicants for judicial review (see r.44.15). It might have been otherwise, had fault on part of the barrister been established in circumstances where the orders dismissing the judicial review applications were set aside necessitating a further hearing and hence additional costs to be incurred. However that is not the case. As discussed further below, I am not satisfied that the circumstances are within r.21.07 such as to enliven the discretion to make a costs order against the barrister under r.21.07.
  9. It was acknowledged for the applicants that an inference could be drawn from the existence of a solicitor on the record that a solicitor/client relationship between the applicants and Mr Ngo was in existence. However it was submitted that such an inference was negated by the evidence before the Court.
  10. In support of the proposition that Mr Wan was retained on a direct access basis, reference was made to a number of matters. Mr Baik’s evidence was that he had no knowledge of Mr Ngo’s involvement as solicitor in the second judicial review proceedings until receiving a letter from him on 9 March 2007 enclosing the notice of intention of ceasing to act. Mr Ngo was not on the record at the time when the applications for judicial review were filed on 4 August 2005. It was contended that Mr Baik had instructed Mr Wan to make those applications. He made payments directly to Mr Wan at or about that time and during the time when the matter was before the Court prior to the hearing date. Documents were sent to Mr Baik by Mr Wan for signature on 12 March 2007. On the basis of this evidence it was said that the inference of a solicitor/client relationship was negated and it was established that Mr Wan was retained by the applicants on a direct access basis, so that his failure to represent them at the hearing on 12 March 2007 constituted an unreasonable failure which meant that the hearing could not proceed conveniently and hence was default in r.21.07(2)).
  11. Determination of this issue in proceedings of this nature was complicated by the limited nature of the evidence before the Court. There is no evidence of any written agreement or documentation in relation to legal representation of the applicants in either judicial review proceedings (apart from the 2004 letter and account of Goh Lawyers and evidence of receipts for payments to Mr Wan by Mr Baik at various times).
  12. There were gaps and some vagueness in the evidence of both Mr Baik and Mr Wan. Both were cross-examined. Neither was an entirely satisfactory witness in that each of them had difficulty remembering certain events. Mr Wan did not provide dates or specific details in relation to his claimed involvement such as might have been expected to have been available to him. Mr Baik acknowledged that he could not remember conversations conducted in English – yet on his account his arrangements with Mr Wan were oral.
  13. Counsel for the applicants submitted that an adverse inference could be drawn from the fact that Mr Wan did not produce any “costs agreement” appropriate in the circumstances of an indirect retainer (whether between himself and the solicitor or the applicants and the solicitor). However, while the absence of documentation such as evidence of any costs agreement (or, for that matter, of costs disclosure) may be critical if what was in issue was compliance by a legal practitioner with the Legal Profession Act 2004 (NSW), the present proceedings are not of that nature and I am not persuaded that the absence of any documentation before the court establish that there was a direct access brief between the applicants and the barrister. The absence of documentation (and I accept Mr Baik’s evidence that the “arrangement” he reached with Mr Wan at the time of the first Tribunal review was oral), means that the question of whether I am satisfied that Mr Wan was briefed on a direct access basis in relation to the hearing on 12 March 2007 has to be determined on the evidence before the court.
  14. Part of the difficulty in this case is the time that has elapsed since Mr Baik and Hankuk first became involved with Mr Wan who was their migration agent in relation to the first and the second Tribunal reviews. Also, while the applications were before the Migration Review Tribunal Mr Wan was acting as a migration agent (see s.280 Migration Act 1958 (Cth)) rather than as a barrister. There is no suggestion that the applicants had a solicitor acting for them in relation to either Tribunal review.
  15. The matter is further complicated by the fact that there have been two applications for judicial review by the applicants. While Mr Baik says that he understood Mr Wan was his “lawyer” in relation to the first judicial review proceedings, there was a solicitor on the record at all times in those proceedings (see Baik [2004] at [2]). Mr Ngo was the second solicitor on the record (filing a notice of appearance on 5 August 2003). As indicated he was the subject of a personal costs order under r.21.07 in the first judicial review proceedings (see Baik v Minister for Immigration [2007] FMCA 352 and Hankuk Grocery Pty Limited v Minister for Immigration [2007] FMCA 353) that was imposed on him on the basis that he was the applicants’ solicitor in those proceedings.
  16. There is no evidence that Mr Baik attended court on any of the occasions when proceedings were before the court. I accept that Mr Baik’s initial contact in relation to the first judicial review proceedings was with Mr Wan, rather than with Mr Ngo. Mr Wan was already his migration agent and Mr Ngo was not the first solicitor on the record. I can make no findings in relation to circumstances in which the first solicitor appeared on the record. However a solicitor was on the record at all times in the first proceedings. Mr Ngo’s initial involvement as solicitor for the applicant in the first judicial review proceedings may have been at the instigation of Mr Wan (consistent with Mr Baik’s evidence and with the invoice from Goh Lawyers). There is no evidence before the Court from Mr Ngo (a matter which highlights the limited nature of a r.21.07 costs application as discussed in Ex Christmas Islanders Association Inc at [24] and Harley v McDonald).
  17. The letter to Mr Baik enclosing the invoice from Goh Lawyers (dated 11 November 2004 and annexed to the affidavit of Mr Baik sworn on 23 March 2007) specified both in the memorandum of costs and disbursements and in the letter that it related to the proceedings between Mr Baik and Hankuk Grocery and the Department of Immigration (and enclosed a tax invoice from the Court in relation to a setting down fee). The correspondence also included a timesheet which indicated that the first involvement of Mr Ngo was on 26 July 2003. This was described as “receipt and review email from V. Wan”, followed on 5 August 2003 by preparation of a notice of appearance in each matter. The timesheet also referred to Mr Ngo’s correspondence with the solicitors for the first respondent and two conferences (on 12 August 2004 and 19 August 2004) said to be between Mr Ngo, Mr Wan as counsel and the client.
  18. However, while the applicant claims that he did not engage Mr Ngo to be his solicitor, and even if Mr Ngo’s initial involvement as solicitor on the record in the first judicial review proceedings was initiated by a referral by Mr Wan (which would be consistent with the need for a corporation to be represented), Mr Baik admitted in his affidavits of 23 March 2007 and 10 October 2007 that on or around 10 November 2004 he received the invoice from Goh Lawyers for professional costs and disbursements. Despite his claim that he had never authorised Mr Ngo to take part in his case, he nonetheless paid this amount by attending at the Goh Lawyers office. Whatever his understanding prior to this date, I am satisfied that while he may have believed that Mr Wan was his lawyer he was also aware of and acknowledged the involvement of Mr Ngo as solicitor in relation to the first judicial review proceedings and, at least thereafter, had some understanding of the role of a solicitor as distinct from that of a barrister.
  19. Mr Baik denies that the conferences referred to in the timesheet from Goh Lawyers occurred. While that claim may have implications in other contexts, in this instance what is relevant as part of the background to the present claim of a direct access brief in the second judicial review proceedings is that however it came about and whatever it involved, Mr Baik paid Mr Ngo (the solicitor on the record) for the services of a solicitor in relation to the first judicial review proceedings.
  20. After the first judicial review proceedings Mr Wan again acted as migration agent for the applicants during the Tribunal reconsideration. There is no evidence from Mr Wan as to how the effect of changes in the capacity in which he represented the applicants was communicated to them. I accept that the nature of this representation may have led Mr Baik to believe (or reinforced an earlier belief) that his legal representative was Mr Wan. I also accept that he may have failed to understand clearly the distinction between retaining Mr Wan as his migration agent and his role in relation to any judicial review proceedings. This may partly be a consequence of the provisions of the Migration Act 1958 (Cth) in relation to the giving of migration assistance which exclude the provision of immigration assistance by legal practitioners unless they are registered migration agents (see Part 3 of the Act and s.280). I accept that the waters were “muddied” as to the nature of the applicants’ relationship with Mr Wan at different times by the fact that Mr Wan had acted as migration agent for the applicants in proceedings before the Tribunal on two occasions. It may well be that Mr Baik, a visa applicant for whom English is not his first language, was confused as to the precise nature of the representation provided to him and to Hankuk by Mr Wan at different times. Mr Wan’s practice (which he admitted to in cross-examination) of direct billing Mr Baik and Hankuk may have added to any such confusion on the part of Mr Baik. I am satisfied that such payments were made direct to Mr Wan as evidenced by receipts before the Court. Mr Wan may bear some responsibility for any such belief or misunderstanding. However, that would not of itself establish default or misconduct on the part of Mr Wan that caused costs to be incurred within r.21.07.
  21. The second judicial review proceedings were commenced in the names of the applicants. No legal practitioner was referred to in either application or affidavit, despite one applicant being a corporation. Mr Ngo came on the record as solicitor in September and October 2005, although the consent orders made at the initial directions hearing of 1 September 2005 were signed on behalf of his firm, Goh Lawyers.
  22. Mr Wan provided somewhat vague and unsatisfactory evidence in relation to whether he had a direct brief at that time. When asked if at the time of the August 2005 application he was in a direct access arrangement with the applicants he replied: “I was in indirect access, because there was a notice of appearance by Frank Ngo some time after the first mention. So it was an indirect access, not a direct access.”
  23. He claimed that he advised Mr Baik about the possibility of applying for judicial review. In cross-examination he could not recall whether he drafted the application, as the case was “a very big case” and he did not “recall exactly what was done on the file without looking at the file” (which he did not have with him in court). He agreed that Mr Baik did not speak sufficient English to draft an application for judicial review. Mr Baik paid him $1,000 on 4 August 2005 but Mr Wan did not “recall” whether he drafted the application.
  24. However Mr Wan conceded that: “We do have a number of clients, when they apply for the first mention, (sic) they simply engage someone to draft a template application and I do not recall whether it was a standard template drafted by someone else, or by myself”. In all the circumstances I am satisfied that the second judicial review application was prepared by Mr Wan (or an employee of Mr Wan’s migration agent business).
  25. There is no evidence from Mr Ngo as to the circumstances in which he became the solicitor on the record for the applicants (one of whom is a corporation in relation to which no leave had been sought for it to carry on the proceeding otherwise than by lawyer). However Mr Ngo told the Court he was the solicitor for the applicants when he sought leave to file a notice of withdrawal on 12 March 2007.
  26. Even if Mr Ngo’s involvement came about at the instigation of Mr Wan (through a “reverse brief” as submitted for the applicants) in all the circumstances I am not satisfied that it has been established that as at 12 March 2007 there was a direct access brief of the barrister by the applicants as contended.
  27. Nor am I satisfied that Mr Baik had no knowledge of Mr Ngo’s involvement as at 12 March 2007 or that the circumstances were such that Mr Wan’s conduct in failing to argue the applicant’s case on that day after Mr Ngo was given leave withdraw “caused” costs to be incurred because of Mr Wan’s negligence, improper conduct or other misconduct or default within r.21.07.
  28. While there is no documentary evidence of any relationship between Mr Baik and any solicitor or barrister or as between Mr Ngo and Mr Wan, that does not lead to an inference that, contrary to the position on the record, there was a direct access brief, given what occurred shortly before the hearing date of 12 March 2007. I cannot be satisfied on the evidence before me in these proceedings as to precisely what Mr Wan told Mr Baik about Mr Ngo’s involvement at any time, given the limited evidence from Mr Wan and Mr Baik’s admitted lack of English. However what is clear is that even if Mr Baik did not initially understand or know of Mr Ngo’s involvement in the second judicial review proceedings (and I note that Mr Baik did not claim to have attended on any of the occasions on which the second judicial review proceedings were before the Court) the nature of Mr Ngo’s purported involvement as solicitor was made clear to him at the latest by the letter of 8 March 2007 which he received on 9 March 2007. Mr Ngo informed Mr Baik by this letter and the accompanying notice of his intention to cease to act as solicitor and that Mr Baik or his new legal representative would have to attend court on 12 March 2007.
  29. In these circumstances, and given what had occurred in relation to the first judicial review proceedings (when Mr Baik paid Mr Ngo’s account), if Mr Baik disputed Mr Ngo’s involvement as solicitor in the second judicial review proceedings it is difficult to understand why he signed a promissory note to pay Mr Ngo’s costs and disbursements on 12 March 2007. I am not persuaded that by that date that Mr Baik did not know that Mr Ngo had been acting as his solicitor on the record, even if that involvement was in some way initiated by Mr Wan.
  30. Thus, although I accept that Mr Baik’s initial understanding was that Mr Wan was “his lawyer”, and that he first dealt with Mr Wan, Mr Baik’s payment to Goh Lawyers in 2004 and his promise to pay Mr Ngo in March 2007 reveal some understanding and acknowledgement of the involvement of Mr Ngo as his solicitor in relation to both judicial review proceedings (however that was initiated).
  31. Despite the lack of evidence before the Court in relation to any costs agreement or documents establishing the relationship between the applicant and either Mr Ngo or Mr Wan, there was a solicitor on the record and the “client” agreed on the day of the hearing to make a payment to that solicitor after he had indicated an intention to withdraw for “costs and disbursements” (albeit that this was done by direct negotiation with the barrister).
  32. What is in issue is not whether there was compliance with any applicable professional rules or practices but whether Mr Wan’s failure to present the applicants’ case on 12 March 2007 where the solicitor on the record withdrew constituted negligence, improper conduct, default, or other misconduct which caused costs to be incurred.
  33. Mr Baik attested that he received the letter and two notices of ceasing to act from Mr Ngo on 9 March 2007. He stated: “I did not understand the meaning of the letter at the time I received it because my understanding was Victor Kit Wan was my lawyer acting for me in this matter. But I understood from the letter that 12 March 2007 was my new hearing date.”
  34. In that letter Mr Ngo stated that Goh Lawyers had “ceased to act” on behalf of Mr Baik and Hankuk. He enclosed a copy of a notice of intention to cease to act and advised of the adjourned date and time. The letter concluded by suggesting that the applicants should “make sure that either you or your new legal representative attend court” on that date. In cross-examination Mr Baik stated that he “ignored” that letter because the only person he employed was Mr Wan. He subsequently clarified that he ignored it “because I did not know the content of it and because I only communicated with [Mr Wan], that is what I did”.
  35. However Mr Baik’s claimed decision to “ignore” this letter contributed to some extent to what occurred on 12 March 2007, at a time when there was no appearance by him personally or for Hankuk, the company of which he was director.
  36. In fact, contrary to his claim that he “ignored” this letter, Mr Baik also gave affidavit evidence that late on 9 March 2007 he went to see Mr Wan at his office “to find out what was happening”. However he put no evidence before the Court as to what, if anything, was the result of such visit.
  37. While Mr Baik’s initial suggestion that he ignored the letter of 7 March 2007 may have reflected his understanding that Mr Wan was still his lawyer and an assumption that he would therefore still have representation on 12 March 2007 in the absence of an instructing solicitor, this understanding does not establish that Mr Wan’s withdrawal on 12 March 2007 constituted an unreasonable default or other misconduct that caused costs to be incurred or thrown away such as to warrant a personal costs order against him within r.21.07.
  38. On 12 March 2007 Mr Baik received by facsimile three documents (Mr Wan agreed in cross-examination that such documents were sent from “our office”) which he signed: an undertaking to pay any costs ordered by the court; a promissory note promising to pay Sparke Helmore (the solicitors for the Minister) $1,600 for “delay costs” on 12 March 2007 plus interest and; a promissory note promising to pay “Frank Ngo in favour of Goh Lawyers the amount of $1,000 for costs and disbursements on 12 March 2007” (and interest).
  39. I accept Mr Baik’s evidence that he had a telephone conversation with Mr Wan about the documents. However I also accept that, despite a detailed account of a conversation of 12 March 2007 with Mr Wan in his original affidavit of 23 March 2007, as he stated in his subsequent affidavit of 25 July 2007 he “cannot recall exact nature of the conversation as [he] cannot remember conversations conducted in English but we had some arguments as to why I needed to sign these documents”. Similarly in cross-examination he admitted that because a telephone conversation with Mr Wan after the hearing on 12 March 2007 was in English he “couldn’t understand fully”.
  40. There was some contact between Mr Wan and Mr Baik on 12 March 2007 in relation to the three documents faxed to Mr Baik. I accept that when Mr Wan said that the documents came from his “office” that must have been in connection with the conduct of the judicial review proceedings. Mr Wan denies that he had instructions to appear on a direct access basis. Given Mr Baik’s evidence about his English language ability and difficulties in communicating in English with Mr Wan and recalling the conversation, I am not satisfied that Mr Baik’s understanding of what was said is such as to establish that on that day Mr Wan undertook to appear for him and for Mr Hankuk on a direct access basis. Indeed a contrary indicator is that Mr Baik was asked to and did sign a promissory note to pay $1,000 to Mr Ngo on account of costs and disbursements. Even if at some time Mr Baik had thought that his “only” lawyer was Mr Wan, such promise of payment is only consistent with Mr Baik acknowledging that Mr Ngo had an involvement as solicitor in the judicial review proceedings. I accept that Mr Baik may not have understood precisely what this meant and may even have assumed that Mr Wan would be “appearing” for him, but this is not such as to establish negligence, improper conduct, or other misconduct or default by Mr Wan that caused costs to be incurred within r.21.07.
  41. As set out above, if there was some confusion at that time or misunderstanding on Mr Baik’s part, that may have reflected the fact that Mr Wan had appeared for him as a migration agent as well as representing him as a barrister. It may also have reflected the manner in which Mr Wan communicated with him and billed and was paid directly by Mr Baik and/or Hankuk and the manner in which the applications of 8 August 2005 were initiated. But that does not establish that Mr Wan’s conduct caused costs to be incurred or thrown away with r.21.07.
  42. Hence while I accept that Mr Baik’s understanding was that Mr Wan said that he would attend court on 12 March 2007 if Mr Baik faxed through the signed documents and on the basis of his understanding of this “verbal assurance” did not attend the court himself, this does not establish that Mr Wan had agreed to represent Mr Baik and Hankuk on a direct access basis or that his failure to act on such a basis constituted default or other conduct that caused costs to be incurred within r.21.07.
  43. It is notable that Mr Baik agreed to pay Mr Ngo $1,000 for costs and disbursements. He gave no evidence that he disputed with Mr Wan the involvement and reimbursement of Mr Ngo on this basis. Nor did he claim that Mr Wan told him he would appear on a “direct access basis” or whether or not Mr Ngo was involved, albeit Mr Baik may have assumed that this was the effect of the conversation. Further, the absence of evidence from Mr Baik of any discussion with Mr Wan about Mr Ngo’s letter and notice of ceasing to act is consistent with Mr Wan’s evidence that he did not know of Mr Ngo’s intention to seek leave of the Court to cease to act until the hearing on 12 March 2007.
  44. While Mr Baik may not have been aware of the precise distinction between a barrister and solicitor, his promise of payment to Mr Ngo on the day of the hearing is not such as to support his claim that Mr Wan had led him to believe that there was no solicitor in the second judicial review proceedings – at least not by that time. Insofar as Mr Baik’s claim is that there was a “reverse” brief initiated by Mr Wan without his knowledge, that does not establish default by Mr Wan that caused costs to be incurred within r.21.07. Whether there are any other ramifications is not a matter to be determined in these proceedings. The applicants do not seek recovery of money paid to Mr Ngo and these proceedings do not relate to the promissory note signed by Mr Baik in relation to Mr Ngo’s costs.
  45. Even if Mr Baik understood he had an oral arrangement from the time Mr Wan first acted for him as a migration agent that Mr Wan would represent him in all migration matters (and accepting that initially he did not understand the different roles of a barrister and a solicitor) any such understanding (and any assumption on that basis that Mr Ngo’s ceasing to act in March 2007 did not mean that Mr Baik and Hankuk were without legal representation) would not suffice to bring r.21.07 into play unless the absence of representation on 12 March 2007 and the fact that costs were incurred or thrown away could be shown to be attributable to default, negligence or misconduct of Mr Wan.
  46. Mr Baik did not suggest that he had told Mr Wan of Mr Ngo’s intention to cease to act – just that he went to see Mr Wan on 9 March 2007 “to find out what was happening”. It is not disputed that Mr Wan came to the hearing on 12 March 2007, albeit he was late. He informed the Court that this was the first time he had heard that his instructing solicitor had withdrawn and that he did not have any instructions from the client as to whether to proceed or not.
  47. Mr Wan raised with the Court the possibility of Mr Baik being contacted directly by the Court. That approach was not adopted. The matter was called and in the absence of Mr Baik or any legal representation for Hankuk the application for judicial review was dismissed pursuant to r.13.03A(c) of the Federal Magistrates Court Rules.
  48. While the manner in which Mr Wan became involved with Mr Baik as migration agent and the history of Tribunal and Court proceedings did, from the perspective of Mr Baik, a client with little English “blur the lines”, I am not satisfied that personal liability should be imposed on the barrister for costs under r.21.07 because of Mr Baik’s understanding as to the nature of his representation. Under r.21.07(2) a lawyer is in default if he has “unreasonably” failed to do any other act necessary for the hearing to proceed. I am not persuaded that the failure to present a case on a direct brief basis given the position on the record at the time of the hearing and what occurred prior to the hearing is such as to constitute an “unreasonable” failure within r.21.07 or that it has been established that negligence, improper conduct or other misconduct or default of the barrister has caused costs to have been incurred by the applicants or another party such as to warrant a personal costs order being made under this provision. I accept that Mr Baik thought that Mr Wan would appear for him, but that does not suffice under r.21.07, even taking into account all the circumstances in this case.
  49. Hence while I accept that Mr Baik thought that (one way another) after he faxed three documents to Mr Wan he would have representation on 12 March 2007 and that this confusion may well provide a reasonable explanation for his failure to appear personally (as would be relevant under r.16.05), it does not on the evidence before me establish default, negligence or misconduct on the part of the barrister that caused costs to be incurred within r.21.07.
  50. I note in this respect that if the barrister had proceeded to argue the case in the absence of a solicitor and in the absence of a direct brief, that in itself would have raised significant issues. However it is difficult to see why the barrister would not have argued the case if in fact he had a direct access brief from the applicants as at 12 March 2007.
  51. The fact that Mr Baik thought that Mr Wan would argue his case (despite the fact that leave was granted to Mr Ngo to withdraw) is not such as to establish that it is appropriate to make an order for costs against Mr Wan under r.21.07. I note again that it was not claimed by Mr Baik that Mr Wan told him that he would appear on that day with or without Mr Ngo and that Mr Baik’s understanding of his conversations with Mr Ngo must be seen in light of his concession about his lack of English and his poor recollection.
  52. Insofar as the Hankuk claim also relates to fees paid to Mr Wan to prepare for and appear at the hearing the evidence is limited – consisting of a number of receipts made out to Mr Baik for “legal services”. In any event, as discussed above, it has not been established that the conduct of Mr Wan caused costs to be incurred or thrown away such that an order under r.21.07 should be made. Any broader dispute in relation to the quantification of these costs is not a matter for determination in these proceedings (see French J in Ex Christmas Islanders Association Inc and Harley v McDonald).
  53. As I am not persuaded that Mr Wan’s failure to proceed on 12 March 2007 to make submissions on behalf of the applicants after Mr Ngo withdrew, constituted negligence, improper conduct or other misconduct or default that caused costs to be incurred or thrown away such that an order for costs under r.21.07 should be made, the applications should be dismissed.
  54. However, in all the circumstances it may not necessarily be appropriate that costs should follow the event. I am presently minded that each party should bear his or its own costs so that no order as to costs would be made. The parties should however have an opportunity to be heard on costs if they seek some other order and should inform my associate within seven days if they wish the matter to be listed again or to make written submissions on costs.

I certify that the preceding one hundred and twenty (120) paragraphs are a true copy of the reasons for judgment of Barnes FM


Associate:


Date: 18 April 2008

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