S v De Marco Lawyers [2004] VLPT 2 (18 May 2004)

Last Updated: 15 May 2006

Tribunal reference: T0025 of 2004


Name of client: Ms. S


Name of legal practitioner: De Marco Lawyers


RPA and its reference: Law Institute of Victoria Limited

Ref: CP:JK:VLR/03/747


CONCERNING A DISPUTE between Ms. S (the “client”) and De Marco Lawyers (the “legal practitioner”).

REASONS OF LEGAL PROFESSION TRIBUNAL FOR DECISION GIVEN ON 18 MAY 2004
(Section 409 Legal Practice Act)

The legal practitioner acted for Ms. S in responding to an application brought by her former husband concerning contact with their two children. The application was heard by the Magistrates’ Court at Bendigo, a court established by legislation enacted by the Parliament of Victoria. However, in hearing the application the Magistrates’ Court was exercising federal jurisdiction conferred upon it by legislation enacted by the Commonwealth Parliament, namely the Family Law Act 1975.

Ms. S disputes various items in the account rendered to her by the legal practitioner, and claims generally that the account is excessive. Ms. S sought the assistance of the Law Institute of Victoria in an attempt to resolve the dispute, but its involvement did not lead to resolution of the dispute. Ms. S then referred the dispute to this Tribunal for hearing and determination.

It is necessary for me to determine a jurisdictional issue that arises because of section 109 of the Australian Constitution which provides as follows:

“When a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall, to the extent of the inconsistency, be invalid.”

So far as the legislation of Victoria is concerned, Ms. S was entitled to seek the assistance of the Law Institute of Victoria in an attempt to resolve her dispute with the legal practitioner: see sections 123 to 126 of the Legal Practice Act 1996. The dispute not having been resolved with the assistance of the Law Institute, Ms. S was entitled to refer the dispute to this Tribunal for hearing and determination: section 128 of the same Act.

This Tribunal clearly has jurisdiction unless there is Commonwealth legislation that prevails over the State legislation. Consequently, it is necessary for me to ascertain whether there is Commonwealth legislation that provides for the resolution of disputes about costs charged by a legal practitioner to its client in proceedings concerning contact with a child, conducted in the Magistrates Court of Victoria exercising federal jurisdiction.

The starting point in section 69J of the Family Law Act 1975, which invests federal jurisdiction in summary courts of each State to hear and determine matters arising under Part VII of the Act, which Part deals with matters concerning children.

Judges of the Family Court have power to make rules concerning practices and procedures in both the Family Court and in any courts exercising federal jurisdiction granted by the Family Law Act: section123(1) Family Law Act 1975. That power includes “prescribing matters relating to the costs of proceedings (including solicitor and client costs and party and party costs) and the assessment or taxation of those costs”: section 123(1)(g).

The Family Law Rules 2004, made by the judges of the Family Court, provide for payment of costs by clients to lawyers: rule 19.01. The rules extend to the costs of a lawyer conducting a case in a court of summary jurisdiction: rule 19.40. Most importantly of all for present purposes, rule 19.23 provides as follows:

“Rule 19.23 Disputing itemised costs account
A person served with an itemised costs account may dispute it by serving on the person entitled to the costs a Notice Disputing Costs Account (Form 15) within 28 days after the account was served.”

The rules then proceed to set out detailed procedures for the resolution of disputes about costs, starting with attempts to settle, moving to a settlement conference, then to the making of a preliminary assessment, and then to an assessment hearing before a Registrar. These procedures are quite different to the procedures set out in the Legal Practice Act 1996 for the resolution of disputes about costs, with the result that the provisions in the Family Law Rules 2004, being Commonwealth legislation, must prevail over the provisions in the Legal Practice Act 1996, being State legislation.

This leads me to find that the Legal Profession Tribunal does not have jurisdiction to hear and determine the costs dispute between Ms. S and the legal practitioner. My finding is based, of course, upon section 109 of the Australian Constitution, but there are many decisions that support the finding that I have made, including Silver v The Consumer Claims Tribunal and Budziszewski (1978) FLC 90-514 and Re P’s Bill of Costs (1982) 8 Fam LR 489. The two decisions to which I have just referred were relied upon by the Full Tribunal of this Tribunal to reach a similar conclusion in B v Home Wilkinson & Lowry (Tribunal reference T0136 of 1999).


Order:

I will sign an order to record my finding that the Legal Profession Tribunal does not have jurisdiction to hear and determine this dispute.

[Signed: Malcolm Howell]
..............................................................................................
Registrar and Member of the Legal Profession Tribunal

NOTE:

Copies of this document will be provided by the Tribunal to the client, the legal practitioner, the Legal Ombudsman, the recognised professional association that originally handled the dispute, and the conciliator.