Dibb v Hopgood Ganim [2001] QDC 153

DISTRICT COURT OF QUEENSLAND CITATION: Dibb v. Hopgood Ganim [2001] QDC 153 PARTIES: RAYMOND JOSEPH DIBB (Appellant) v. HOPGOOD GANIM (Respondent) FILE NO/S: Appeal D486/2001 M 22273/99 DIVISION: PROCEEDING: Appeal ORIGINATING COURT: Magistrates Court Brisbane DELIVERED ON: 9 March 2001 DELIVERED AT: Brisbane HEARING DATE: 20 February 2001 JUDGE: McGill D.C.J. ORDER: Appeal allowed with costs; judgment of 31 January 2001 set aside; order that there be a new trial of the claim and counterclaim before a different magistrate; respondent to have indemnity certificate CATCHWORDS: LEGAL PRACTITIONERS – solicitor and client – action to recover fees – significance of certificate of assessor – Queensland Law Society Act 1952, ss.48K, 48L INFERIOR COURTS – Magistrates Court – whether appropriate to dispense with record at trial – whether summary judgment appropriate – whether matters raised going to defence of claim – Uniform Civil Procedure Rules r.519 Australian Coal and Shale Employees Federation v. The Commonwealth (1953) 94 CLR 621 - cited Re: Bain Gasteen & Co’s Bill of Costs [1990] 1 Qd.R. 412 – cited Re: Morris Fletcher & Cross’Bill of Costs [1997] 2 Qd.R. 228 – cited Re: Feez Ruthning’s Bill of Costs [1989] 1 Qd.R. 55 – cited Re: Baker Johnson’s Bill of Costs [1995] 2 Qd.R. 234 – followed Re: Hallett’s Bill of Costs [1997] 1 Qd.R. 164 – followed Australian National Industries Ltd v. Spedley Securities Ltd (1992) 26 NSWLR 411 - distinguished -- 1 of 16 -- 2 R v. Masters (1992) 26 NSWLR 450 – cited Quadra Pacific (Aust) Co. Pty Ltd v. Mercantile Credits Ltd [2000] QCA 284 – cited COUNSEL: Appellant in person C.F.C. Wilson for the respondent SOLICITORS: Hopgood Ganim for the respondent [1] This is an appeal from a decision in the Magistrates Court on 31 January 2001 by which it was ordered that there be judgment on the claim for the plaintiff against the defendant in the sum of $4,792.10 plus interest of $638.05 and costs of $3,810.00, a total of $9,240.15, and that the defendant’s counterclaim be dismissed. One of the grounds of the appeal was that the Magistrate who made this order erred by failing to disqualify himself from proceeding with the matter when the defendant had applied to him to do so. In order to understand why this application was made, and provide some context for what occurred on 31 January, it is necessary to say something about the history of the action. History Of The Action [2] The action was commenced by a claim filed on 30 November 1999 seeking the sum of $7,210.05 for breach of contract, together with interest and costs. The attached statement of claim alleged that the plaintiff was a firm of solicitors suing on a client agreement made, in accordance with s.48 of the Queensland Law Society Act 1952, with the defendant on or about 11 September 1998. It alleged that the plaintiff performed professional services for the defendant who incurred costs and disbursements in accordance with the client agreement, and the amount claimed was owing after making allowance for counsel’s fee paid directly by the defendant. [3] The defendant filed a notice of intention to defend and defence and counterclaim on 7 January 2000. In the defence the defendant admitted the allegations in paragraphs 1, 2 and 3 which involved an admission of the making and relevant terms of the client agreement. However, the performance of professional services in accordance with the agreement was not admitted. A large number of other matters were raised in that document. A reply and answer was filed on 19 January 2000, and on 2 February 2000 the plaintiff replied for an order that the defence and counterclaim be struck out pursuant to rule 171, that judgment be entered against the defendant, or in the alternative, that the defence and counterclaim be struck out pursuant to rule 371, because the defendant had failed to provide full and proper particulars as required by the rules, and in the further alternative that the court appointed a costs assessor under s.48K of the Queensland Law Society Act at the cost of the defendant, and orders as to the cost of the application. [4] On 18 February 2000 the application came before a Magistrate. According to the endorsement sheet the outcome was as follows:- -- 2 of 16 -- 3 “Application is adjourned sine die. Either party is at liberty to apply. Ordered that the plaintiff’s bill of costs be remitted to the Solicitors Complaint Tribunal by filing a form 8 for assessment of those costs within twenty-eight days from today, failing which the plaintiff is at liberty to enter judgment. Further ordered that within fourteen days of that assessment the defendant file and serve a properly prepared entry of appearance and defence and counterclaim. Costs reserved.” [5] Reference to the form 8 is a reference to the form required for an application to the Solicitors Complaint Tribunal under s.6ZA of the Queensland Law Society Act 1952 for the appointment of a costs assessor to assess the solicitors’ account. In view of the terms of s.6ZB, a client who asked for an appointment is taken to dispute only the amount payable under the client agreement, so that the client may not subsequently challenge the validity or enforceability of the client agreement. It is not at all clear on what basis there was jurisdiction on the part of the Magistrate to order that a form 8 be filed with the Solicitors Complaint Tribunal, or to give leave for the plaintiff to enter judgment unless that step is taken. Section 48J(2)(b) of the Act contemplates that a client may apply to the Tribunal for the appointment of a costs assessor between the time when the solicitor sends an account and the time when the solicitor starts proceeding in the court to recover these costs, but if that is not done there does not seem to me to be any power in the court to refer the matter to the Tribunal, or to require the client to do so. Perhaps it was in substance a judgment subject to a condition (under s.80 of the Supreme Court Act 1991) that the Form 8 not be filed within that time. [6] It is not necessary however for me to consider in any further detail the appropriateness or otherwise of the orders made on that occasion. An attempt was made to file a form 8 modified in such a way as would prevent s.6ZB from operating, but that was rejected by the clerk at the Tribunal and there was therefore no assessment prepared in that way. The defendant on 17 March 2000 filed an amended notice of intention to defend with an attached amended defence and counterclaim, and subsequently filed an application seeking summary judgment for the defendant, or in the alternative that the plaintiff’s claim be dismissed for want of prosecution and because the plaintiff failed to file and serve an answer to the amended counterclaim within 14 days. This application and the plaintiff’s adjourned application came on before a different Magistrate on 19 April 2000, where the decision was reserved until 28 April. That Magistrate dismissed the defendant’s application with costs, for reasons that I need not go into as no appeal has been brought from that order. [7] On the plaintiff’s application that Magistrate determined after hearing the parties further that there had been sufficient compliance with the order of 18 February, and that what was done did not prevent the defendant from disputing the validity of the client agreement. Judgment for the plaintiff upon that application was refused, but an order was made under s.48K for the appointment of a Tribunal costs assessor. Under s.49L, in the proceeding to recover the fees or costs the court may receive in evidence a written costs assessment by an assessor appointed under the Act, and have regard to a matter contained in the assessment. The Magistrate also ordered -- 3 of 16 -- 4 that each party pay one half of the costs of the assessment, with each party being at liberty to recover the costs paid by a party from the other party if successful in the overall proceedings. The costs of the application were reserved and each party was granted leave to apply. There was a further direction that the plaintiff file an amended answer to the amended counterclaim within fourteen days. There was no appeal from any part of this order, and the required answer of the defence and counterclaim was filed on 12 May 2000. A further pleading on behalf of the defendant in response (also called a reply) was filed on 24 May 2000. [8] On 8 June 2000 the legal costs assessor filed a statement advising that he had assessed the solicitor’s proper and reasonable cost, on the basis of the costs detailed in the agreement between the parties executed on 11 September 1998, at $5,292.10, and in the alternative, by applying the Supreme Court scale of costs relevant to both of these instructions, at a sum of $4,465.50. Subsequently an amended claim and amended statement of claim were filed on 4 July 2000 substituting for the original amount claimed claims in the alternative of the two amounts in the costs assessment. A second amended notice of intention to defend and amended defence and counterclaim in response were filed on 11 July 2000. [9] Subsequently a request for trial date signed by both the parties was filed. After a Magistrate considered whether it was appropriate to refer the matter to ADR, it was listed for trial and came on for trial on 31 January 2000; it was listed before the same Magistrate who had heard the plaintiff’s application on 18 February 2000. There is a transcript of the beginning of what happened on that day, but most of what occurred was not transcribed; an affidavit of Mr. Barry provided on behalf of the respondent sets out further details of what occurred. The Magistrate ascertained that the amount now claimed (after allowing $500 payment of which had been admitted in the reply) was in the sum of $4,792.10 plus interest to which the Magistrate responded: “That being the case, there would be no record kept of the proceedings.” Was A Record of the Proceeding Required? [10] Whether a record of the evidence was to be kept was formerly governed by r.293(2) of the Magistrates Court Rules 1960, which required that the evidence of the witnesses be taken down in writing (including typewriting) or in shorthand in: “any action or matter in which the sum sued for amounts to $50 or upwards, or on the trial of any action in respect of which an appeal lies without leave… ” 1 1. Under the Recording of Evidence Act 1962 s.5 it was permissible for this record to be kept by the proceedings being recorded by a mechanical device; which was done for that part of the transcript which is available. -- 4 of 16 -- 5 Under s.45 of the Magistrates Court Act 1921, an appeal lies without leave when the amount involved is more than $5,000. However, the Magistrates Court Rules 1960 were repealed by the Civil Justice Reform Act 1998, s.19. The relevant provisions are now in the Uniform Civil Procedure Rules. Rule 514 provides that various simplified procedures apply to minor debt claims, including in r.514(1)(f)(v) that the court “is not required to make a record of the evidence given but must record the reasons for its decision.” [11] This however, was not a minor debt claim. That term is defined in the Magistrates Court Act 1921 as a claim for an amount including interest of not more than $7,500 claimed against the defendant as a debt or liquidated demand, where the plaintiff elects in the claim to have it heard and decided in the Magistrates Court under the simplified procedure in the rules. Indeed, there is a special approved form for a minor debt claim, Form 3, which was not used in the present case, and neither the claim nor the amended claim contained an election as required in the definition of “minor debt claim” in the Act. It was therefore not a minor debt claim, so r.514 did not apply. It was however a minor claim, as the amount of the claim was not more than $7,500, and therefore r.519 applied. Rule 519(5) provides that r.514(1)(f) applies to all minor claims, subject to an exception not presently relevant. [12] Accordingly the fact that the plaintiff’s claim was a minor claim meant that, as far as it was concerned, the court was not required to make a record of the evidence given, although it "must record the reasons for its decision”. However, there was also a counterclaim. In a minor debt claim there cannot be a counterclaim (r.520) but there is no obstacle to the defence including a counterclaim with the defence in response to a minor claim, as r.177 permitting a counterclaim to be brought applies. Rule 181 provides that “these rules apply to the conduct of a counterclaim with necessary changes as if the plaintiff on the counterclaim were the plaintiff in an original proceeding, and the defendant to the counterclaim were the defendant to an original proceeding”, and, by sub-rule (3), that subject to r.182 a counterclaim must be tried at the trial of the plaintiff’s claim. If therefore a defendant in the Magistrates Court claims an amount including interest of not more than $7,500, that counterclaim can be treated as a minor claim for the purposes of applying r.519. But if a claim if of $7,500 or more, it is not a minor claim, so r.519(2)(v) will not apply. [13] The amount sought in the amended counterclaim was put at $7,550.00 together with interest in accordance with s.47 of the Supreme Court Act 1995 from 7 June 1999 to the date of judgment. There was some argument as to whether some of those amount claimed were properly amounts by way of costs of the current proceedings, rather than a claim as such. When the counterclaim was pointed out to the Magistrate, (p.3 of the transcript) he examined it and went through the details of how the claim was made up, and after asking about them he considered some of the items claimed, and expressed the view that the amounts of $1,200 and $500, claimed as “out of pocket expense incurred in providing the plaintiff with material as requested” and “out of pocket expense incurred in corresponding with the -- 5 of 16 -- 6 plaintiff and return travel in meeting with the plaintiff” respectively, were costs in the proceedings rather than matters of counterclaim; p.5. [14] In my opinion that was clearly wrong. The defendant’s case was that during the course of the retainer he was asked by the plaintiff to copy a large volume of material, which he did at a cost of $1,200, but that he should not have been required to copy that material, and that the plaintiff was in breach of its obligations towards him in requiring him to do so, and he was therefore entitled to damages in that amount being the cost to which he was put in copying that material. If there was some action or conduct on behalf of the plaintiff which was negligent or in breach of contract and as a result of which the defendant was put inappropriately to that expense, then it seems to me that that amount was properly recoverable as damages and will not be part of the costs. With regard to the $500, what was claimed there in effect was the cost to which the plaintiff was put in connection with his seeing the plaintiff as a solicitor in the course of a retainer which it then was alleged was conducted improperly by the solicitor. If as a result of some breach on the part of the solicitor the plaintiff was put to an expense to which he ought not to have been put, that expense would properly be recoverable as damages, subject to the usual requirements of such a claim being made out. Whether or not such claims are sustainable is irrelevant for present purposes; what mattered is simply that that is what the defendant was claiming in the counterclaim. [15] In my opinion it is quite clear that neither is a matter of costs, and in my opinion the Magistrate was wrong in law in that conclusion. In my opinion, the only part of the claim which was arguably a matter of costs, rather than a matter of claim, was that part which sought reimbursement of $350.00 paid by the defendant as his share of the fee charged for the costs assessment ordered under s.48K. The rest of the claim is all properly characterised as claim rather than costs, and comes to $7,200 which when interest at the rate of 9% per annum from 7 June 1999 to 31 January 2001 is added, a claim of interest in excess of $1,000, comes to more than $8,200. Since the definition of a “minor claim” requires that interest be included in determining whether the claim is for an amount of not more than $7,500, it follows that this counterclaim is clearly not one which can be treated as a minor claim for the purposes of the rules. [16] Neither r.519(2) which permitted the court to apply r.514(1)(f)(v) if it considered that it would help decide the claim or sub-rule (5) which applied r.514(1)(f) to all minor claims, applied to the counterclaim. In circumstances where there is a counterclaim to this type of a claim, in my opinion if the counterclaim is not a minor claim, the fact that the claim is, is not a sufficient reason for not making a record of the evidence given. Rule 514(1)(f)(v) does not prohibit the making of a record, it merely provides that in the appropriate circumstances one is not required; if the nature of the claim does not require a record of the trial, but that is not the case with the counterclaim, then a record for the trial is required.2 It follows that in 2 Although there is not an express equivalent in the Uniform Civil Procedure Rules to the requirement in r.293(2) of the former Magistrates Court Rules that the evidence of the witnesses be recorded, I think it is implicit from the provisions that in some circumstances the court is not required to make a record of the evidence given that in other circumstances the court is so required. -- 6 of 16 -- 7 my opinion the Magistrate was required to make a record of the evidence unless the parties agreed in writing to the application to the trial of r.514(1)(f)(v). There is no suggestion that they have done so in this case. Therefore, the magistrate was wrong in concluding that it was unnecessary for any record to be kept. As soon as he reached that conclusion the recording stopped. [17] It does not appear from the transcript that at any point the plaintiff sought that a record not be taken, much less argued in favour of the position adopted by the Magistrate. No doubt in a case where the rules do permit a record not to be taken it is appropriate for Magistrates to take the initiative on that point and not to wait for an application from one party or the other, but if one of the parties does wish to argue the point the Magistrate ought at least to hear what that party has to say. [18] It appears from the endorsement sheet that the Magistrate understood that the defendant was requesting the proceedings be recorded and that he had refused that application. No reasons for that decision are recorded there or anywhere, notwithstanding the concluding provision in r.514(1)(f)(v) that the court “must record the reasons for its decision”. Since the singular includes the plural3, this requires, where there is more than one decision that reasons be recorded for each of them. In the present case, however, it was evidently not that the Magistrate thought that it was sufficient for him to record the reasons for his ultimate decision, since he did not record any reasons for that either. Indeed, so far as I can locate, there are no reasons recorded anywhere for any of the decisions he made that day. Was The Plaintiff Entitled To Appear By Counsel? [19] Prior to the consideration of the counterclaim, there was an exchange in relation to the question as to whether the plaintiff was entitled to be represented. The position in relation to that was governed by r.514(1)(e) in the case of a minor debt claim; in such a case the party must not appear by a lawyer unless the parties otherwise agree or the court gives leave. There is a discretion in the Magistrates Court under r.519(2) in the case of a minor claim to apply that simplified procedure in deciding the claim if the Magistrate considered that it would help to decide the claim, but that only applied in the present action to the claim, it did not apply to the counterclaim. In view of the requirement in r.181 that the counterclaim be tried at the trial of the claim, it would not be possible to exclude lawyers at the trial. The Magistrate was therefore correct in concluding that it was not inappropriate for the plaintiff to be appearing by a barrister, although the explanation he offered at the top of page 3 was that the plaintiff was entitled to be represented because it was a matter brought in the Magistrates Court rather than being a small claim or a small debt. [20] If a small claim were brought before a Magistrate acting as a referee constituting a Small Claims Tribunal under the Small Claims Tribunal Act 1973, the parties to the proceedings are not entitled to appear by a person with legal qualifications unless 3 Acs Interpretation Act 1954 s.32C(a) -- 7 of 16 -- 8 all parties to the proceedings agree or the Tribunal is satisfied that any party not agreeing should not be thereby unfairly disadvantaged: s.32(3). This was not a small claim brought before the Tribunal. Nor was it a “small debt”; this is a reference to an action for a small debt which was formerly permissible under the Magistrates Courts Act, a concept similar to a minor debt claim except that it was for a sum not exceeding $5,000, and again required the plaintiff to elect to have the matter determined as an action for a small debt; which this plaintiff had not done. But the defendant was in a sense correct in saying that it depended on the amount of the claim, because when a claim was brought in the Magistrates Court which is properly characterised as a minor claim, there is a discretion to order that the party not be represented by a lawyer. Consistent with the Magistrate’s decision on the amount claimed in the counterclaim, he ought to have proceeded on the basis that he had discretion in the matter, although as I have just indicated in my opinion that decision was wrong and he therefore had no discretion in the matter and the plaintiff was entitled to appear by counsel. [21] I mention this aspect, however, not only because there is some indication of an error in the reasoning process by which this decision is arrived at, but because of the somewhat peremptory manner in which the Magistrate dealt with the argument when it was raised by the defendant. The defendant at page 2 pointed out that it was for an amount under $7,500 and the Magistrate responded: “Yes; but it is not a small claim or a small debt. It is a matter brought in the Magistrates Court. They are entitled to representation on it.” There was then the following exchange: “Defendant: My understanding, your Worship, is that the claim – Bench: Well, your understanding is wrong. Defendant: --- they have brought the claim in under – I think--- Bench: Well, your understanding is wrong. If the matter is brought in the Magistrates Court they are entitled to legal representation. Defendant: Your Worship, isn’t it driven by the amount? Bench: No.” Application For Disqualification [22] According to Mr Barry’s affidavit, the defendant then applied to have the Magistrate disqualify himself on the ground that he was biased. The appellant supported this on the basis that the Magistrate was the same Magistrate who had dealt with the interlocutory proceeding earlier and had made orders on that occasion -- 8 of 16 -- 9 which were either wrong or fairly harsh. The impression this gives is that the only basis for the application argued was that the Magistrate should disqualify himself because he had dealt with the interlocutory application in a way which was adverse to the defendant. Plainly that is not in itself a reason for disqualification. [23] I note however, that the application was not made initially, and my distinct impression was that it was in fact made in response to the way in which the Magistrate was conducting the proceedings on 31 January, by refusing to have the proceedings recorded and by his somewhat peremptory handling of the defendant, which would have lead the defendant to be concerned about the fairness of the hearing that he was receiving. I have already quoted one passage of the transcript showing the way in which the Magistrate was dealing with the defendant on this occasion; that is perhaps the worst single passage, but much of the rest of it is of a similar tone. I can understand that a litigant in person might well be put off. [24] It is important that a court, in seeking to deal efficiently with a matter before it, not give parties an impression that they are not getting a fair hearing. This is more likely to be a problem in the case of litigants in person than in a case where the parties are represented by lawyers, who might be expected to have a clearer understanding of the importance of getting things done efficiently, and who are better able to deal with the situation if the court does overlook something. Application For Summary Judgment [25] According to Mr Barry’s affidavit, Counsel for the plaintiff then applied for summary judgment. If that is correct, it was a course which was entirely inappropriate, and the Magistrate ought not to have entertained such an application. The Magistrate had before him the trial of an action, not an application for summary judgment under r.292. Apart from the fact that there had perhaps already been one application for summary judgment, if the earlier application for judgment was treated as one under r.292, so that leave was needed under r.292(5) to make a second application, the plaintiff had not complied with r.296, so the court could not have been satisfied that the plaintiff had complied with the rules. [26] If the situation was that the plaintiff was clearly entitled to succeed on its claim, it ought not to have had any difficulty in proving its claim, and indeed, in the circumstances it might not have needed to do much to prove its claim, assuming that it was entitled to split its case and not lead evidence in response to the counterclaim until after the defendant had closed his case. But in my opinion it was quite inappropriate for there to be an application for summary judgment and the Magistrate ought not to have entertained it. [27] According to Mr Barry’s affidavit the application was supported by an argument that the effect of s.6ZE of the Queensland Law Society Act was that the assessment made by the costs assessor was binding on the client. Plainly that section does not apply; it is concerned with an assessment made by a costs assessor appointed by the -- 9 of 16 -- 10 clerk of the Tribunal, that is appointed in response to an application by the client under s.6ZA. The only costs assessment which had been made in this case was one under s.48K; the effect of s.48L is that the court was entitled to have regard to that assessment, but it was not binding on the court or for that matter on the defendant. [28] The defendant however, did not argue against the application for judgment, merely indicating that he would appeal against the Magistrate’s decision to refuse to record what happened at the trial, and the Magistrate thereupon gave judgment on the claim. In circumstances where the counterclaim had not been dealt with, that was also inappropriate, at least unless the Magistrate was prescient. In circumstances of the claim and counterclaim being tried together, which was required to be the situation here under r.181(3), the appropriate procedure was for the counterclaim to be tried so that, if the defendant established all or part of the counterclaim against the plaintiff, judgment could be given for the balance in favour of whichever party came out ahead under r.184. [29] The Magistrate then asked the appellant whether he wished to proceed with the counterclaim and the appellant refused to do so and so it was dismissed. [30] It was submitted on behalf of the respondent that, even if there were errors of law on the part of the magistrate, it was not appropriate to allow the appeal and send the matter back for a new trial because the outcome was inevitable. I was taken to a number of aspects of the amended defence and counterclaim with a view to showing that the matters sought to be raised there are necessarily bad in law, so the defendant could not succeed. I think it is sufficient for me to say that ultimately I was not persuaded that that is the situation in the present case. Apart from anything else, it is clearly alleged by the defendant that work was done negligently and in breach of the contractual obligation to take reasonable care, and that the work done by the plaintiff was of no value to the defendant, and these are matters which may, if made out, constitute a complete answer to the plaintiff’s claim. This is not a case where the outcome was inevitable so that there would be no point in having a new trial: Quadra Pacific (Aust) Co. Pty Ltd v. Mercantile Credits Ltd [2000] QCA 284 In saying this I am not intending to make any suggestion either way as to the prospect of success of the defendant in relation to any or all of the matters raised in the amended defence and counterclaim. Regulation of a Solicitor’s Claim For Fees [31] Under the scheme of the Queensland Law Society Act, a solicitor, before suing for fees owed, must first give the client an account that complies with s.48J of the Act and wait for one month. During that time, the client is entitled to apply to the Tribunal for appointment of a costs assessor under s.6ZA, and if this occurs, then the solicitor is prohibited from suing without the court’s leave until the assessment has concluded: s.48J(2). This is satisfactory where there is no dispute about the retainer, and where any dispute about the quantum of fees can be conveniently resolved by assessment. Where there is no application to the tribunal under s.6ZA, the practitioner may sue and the matter proceeds in the court, although there is the -- 10 of 16 -- 11 power in s.48K to appoint a costs assessor to assess the account. That assessment, however, is not conclusive, and difficulty arises in the present case because of the form of the assessment, which simply gives a final figure, or rather two final figures depending on the basis on which costs charged, without any details how either is made up. In some cases assessment at this stage will be appropriate, but where there is some issue as to the scope and proper interpretation of the retainer, or where there is issue as to whether particular work has been done at all, or ought to have been done, or where it is alleged that the solicitor has been negligent and this negligence has resulted in unnecessary work being done, or has resulted in the work that was done being of no value to the client, these issues ought to be resolved first so that an assessor will know the basis upon which the assessment is to proceed. [32] The idea that a solicitor’s right to remuneration should be the subject of some official regulation has long been a feature of statutory regulation of the profession: Re: Morris Fletcher & Cross’ Bill of Costs [1997] 2 Qd.R. 228. The current legislation replaces the regime in the Legal Practitioners Act 1995, formerly the Costs Act 1867, which in turn may be traced back to an English statute of 1729: Re: Feez Ruthning’s Bill of Costs [1989] 1 Qd.R. 55 at 90 per McPherson J (as His Honour then was); the judgments in this case provide a useful survey of the history of the jurisdiction in Queensland for the taxation of costs. Under the former legislation, when a solicitor sued to recover costs, it was open to the court, at an appropriate stage, to refer matters for taxation to the appropriate officer: Re: Feez Ruthning’s Bill of Costs [1989] 1 Qd.R. 55. Commonly that would be done if the matters in dispute in an action on the bill were matters which were appropriately the subject of determination or assessment by a taxing officer, or where the court had decided other matters which were appropriate for determination by the court, with the taxing officer essentially determining what amount was properly recoverable by way of costs in the light of the findings of the court. [33] Under the former legislative regime, a bill was required to be delivered prior to action by the solicitor to recover the fees, and that could be taxed on application of the party chargeable within one month: Legal Practitioners Act 1995 s.5, 7.4 Even if the application were not made within one month, there was a discretion in the Supreme Court to order taxation after the period of one month, but (except in specified circumstances) before the solicitor’s action had reached the stage of verdict, judgment or writ of enquiry: s.8. When a matter was referred to taxation on this basis, it was open to the taxing officer to conclude that the work done for which the solicitor had charged in the bill was useless to the client and therefore disallow any costs for it, notwithstanding it was also arguable that a reason for the work being useless was that the solicitor was negligent: Re: Baker Johnson’s Bill of Costs [1995] 2 Qd.R. 234. However, as the reasoning in that case indicates, the taxing officer did not have a general jurisdiction to consider any allegations of negligence on the part of the solicitor, and it was not necessarily appropriate for this matter to be determined by the taxing officer. If it were not decided by the taxing officer and remained the subject of a claim for negligence on the part of the client against the solicitor, it was inappropriate to enter judgment on the certificate under 4 The form of this legislation prior to the Civil Justice Reform Act 1998 appears in Reprint 1 of this Act, in force as at 8 December 1995. -- 11 of 16 -- 12 s.12(4) of the Act while claims of negligence against the solicitor remain outstanding: Re: Hallett’s Bill of Costs [1997] 1 Qd.R. 164. This decision supports the view that it was inappropriate in the present case for the magistrate to give judgment on the claim in circumstances where the counterclaim had not been determined. [34] It seems to me, however, that there is no equivalent to s.12(4) of the Legal Practitioners Act 1995 (which was derived from s.29 of the Costs Act 1867) in the Queensland Law Society Act 1972. The further mechanism of the latter Act does not suggest that in an action on the account by the solicitor to recover fees the assessment of the costs assessor is to be given the same significance as a certification of taxation was formally given. The change in the structure of the legislation means that the detail of the amounts properly charged (if any) may well have to be determined by the court during the trial of the action on the bill. [35] In the present case the defendant had in the defence and counter claim raised a large number of matters, but they include the proposition that the plaintiff is not entitled to recover costs because of negligence on the plaintiff’s part which has rendered the work useless to the defendant. It is established that in such circumstances the solicitor is not entitled to recover fees from the client, and it follows that that would be a defence to an action to recover fees, and indeed, any amount already paid towards fees would be recoverable in such circumstances, either as damages for negligence or as money paid for consideration which has wholly failed. [36] The important consideration for determination here is whether the solicitor acted negligently or in breach of a contractual duty of care; given the nature of what solicitors do, they will sometimes be in a position where their efforts on behalf of their clients are unavailing or essentially unproductive. That does not mean they were negligent, and does not mean that the client is entitled not to pay for them. At issue is always the question of whether the solicitor’s actions were negligent, or what probably amounts to the same thing, whether they were in breach of the contractual obligation to do the work with reasonable care and skill. It is only if that is the case, and if, as a result of that negligence or breach of contract, the work is worthless to the client, that fees will not be recoverable, and fees paid will be refundable. In these circumstances it is likely to be unhelpful to be looking at an assessment of the bill prior to the determination of these issues. Content of the Assessment [37] There is another difficulty with the assessment which was undertaken in the present case: it merely gives a total figure and it does not give any details as to how it was arrived at. The assessment is not conclusive so far as proceedings in the court are concerned, as is made clear by the terms of s.48L. Had the assessment been undertaken in response to a request for an appointment under s.6ZA, a party dissatisfied with the assessment may apply to the court to decide the reasonableness of the fees and costs charged, something which is then decided by the court, in effect on appeal from the assessor: s.6ZF(1), (3). In undertaking this task, it may -- 12 of 16 -- 13 however appoint a person to assess the account, and have regard to the assessment of that person, but again that assessment is not made binding: s.(4). Ultimately therefore in either case questions as to the reasonableness of fees are decided by the court. This is consistent with the traditional position where matters may be referred for assessment by taxing officers, but there is a right of appeal from the taxing officer ultimately back to the court. It would therefore be more useful if the assessment of the assessor has been presented in a form which would enable the court to ascertain how it had been arrived at, because the parties are, in principle, entitled to dispute the issue before the court and the court may have to arrive at its own conclusion in relation to such a matter. [38] It has always been recognised, of course, that taxing officers have a degree of special expertise in determining things such as whether it was reasonable to undertake particular work in particular circumstances, and what is a reasonable amount to charge for a particular piece of work (in circumstance where the amount to be charged is not fixed by a scale) and accordingly courts limit their interference with such matters on appeal to consideration of whether there has been some error in principle in the taxation: Australian Coal and Shale Employees Federation v. The Commonwealth (1953) 94 CLR 621 at 627-8. Part of the justification for this approach lay in the circumstance that the taxing officer was an officer of the court, which is not the case with a costs assessor, but the terms of the legislation suggest that there was an intention that, to a significant extent, this approach should be transferred to litigation about costs under the Queensland Law Society Act. However, a court hearing an appeal from a decision of the taxing officer always has the benefit of the outcome of the detailed taxation item by item of the solicitor’s bill, and indeed, the benefit of reasons from the taxing officer on the review of the taxation in relation to particular objections directed to relevant items in the bill. It is impossible for a court to have any particular regard to any exercise of expertise on the part of the costs assessor as to the appropriate amount to be allowed as a reasonable amount for a particular task included within the solicitor’s account when provided merely with the certificate of assessment used in the present case. [39] There is also the consideration that it is by no means clear to what extent the costs assessor has purported to decide any questions of whether, for example, particular work was or was not included within the retainer. To some extent at least a taxing officer used to have (and therefore presumably a costs assessor now has) jurisdiction to decide questions as to the scope of the retainer in order to determine whether particular items in the account are matters in respect of which a solicitor may properly charge: Re: Bain Gasteen & Co’s Bill of Costs [1990] 1 Qd.R. 412. It was always recognised that it was appropriate for a taxing officer to determine whether a particular item of work for which the solicitor claims remuneration was work that was appropriate for the solicitor to do in the circumstances. But given what has occurred in the present case, and the form of the assessment certificate, it is difficult to see how that certificate can be of much assistance in the trial. [40] Accordingly, the magistrate erred in giving judgment on the claim without determining the counterclaim. Because of this error, and the procedural errors referred to earlier, the defendant was deprived of the opportunity to have his -- 13 of 16 -- 14 defence and counterclaim properly considered. In these circumstances it is not conclusive that he chose not to proceed with the counterclaim. This was not an election which prevents my setting aside the judgment on the counterclaim and ordering a new trial, since at worst he was electing to appeal, which he has done, successfully. Disqualification For Apparent Bias [41] It was submitted by the appellant that the Magistrate was displaying apparent bias and ought to have disqualified himself when the application to that end was made to him. The test to be applied in such circumstances is whether a fair-minded lay observer might reasonably apprehend that the magistrate might not bring an impartial or unprejudiced mind to the resolution of the question he was required to decide: Johnson v. Johnson (2000) 74 ALJR 1380 at 1382. The majority in that case went on to note that: “Modern judges, responding to a need for more active case management, intervene in the conduct of cases to an extent that may surprise a person who came to court expecting a judge to remain, until the moment of pronouncement of judgment, as inscrutable as the Sphinx.” (p.1382). [42] It is, in my opinion, clear that apparent bias is not made out simply because the magistrate had dealt with an interlocutory matter in a way which was adverse to the defendant. This is not a case where the magistrate had earlier dealt with an issue involving questions of credibility of the same persons, where there is a risk that his subsequent decision might be influenced by evidence heard earlier in another matter or by conclusions already arrived at: this is a very different case from Australian National Industries Ltd v. Spedley Securities Ltd (1992) 26 NSWLR 411. It is also recognised that the fact that a judge has decided an issue in a particular way, and is likely to decide it in the same way when it arises again, does not require him to disqualify himself for apparent bias: R v. Masters (1992) 26 NSWLR 450. [43] The fact the magistrate made orders adverse to the defendant on the earlier occasion, and indeed the fact that he made some orders adverse to the defendant when the proceedings started on 31 January, are not matters which would give rise to any reasonable apprehension of bias on the part of the hypothetical observer. What does concern me, however, is the manner in which matters were dealt with on 31 January, which may well have given rise to an apprehension by an impartial observer that the magistrate was not prepared to listen to submissions from the defendant. In these circumstances I think it was particularly unfortunate, and inappropriate, for the proceedings not to have been recorded. Even if, on the view the magistrate originally took of the quantum of the counterclaim, it was appropriate not to record the proceedings, that decision was scarcely immutable, and there is no obvious reason why the decision was not reversed, at least once the application was made to the magistrate to disqualify himself for apparent bias, and once the defendant had indicated that he was proposing to appeal. There is no -- 14 of 16 -- 15 reason to think that the application for disqualification was a tactical manoeuvre simply designed to force the magistrate to record the proceedings; I accept that the defendant was genuinely concerned at the time about whether he was going to get a fair hearing, and it was this that prompted both the application for disqualification and the decision not to proceed with the counterclaim. [44] On the other hand, the fact that issues as they arose were being dealt with in a somewhat abrupt fashion would not necessarily give rise to the impression that they were being dealt with unfairly or that the magistrate had pre-judged the issue between the defendant and the plaintiff. Although a litigant in person is commonly given more leeway in relation to the conduct of trials, even in relation to points which are without substance, there is, I think, no rule of law requiring that, so that it is not an error of law to behave differently in a particular case. Some allowance also needs to be made for the nature of the point being taken by the defendant when assessing the way in which it was dealt with. The point about the plaintiff appearing by counsel was one properly dealt with fairly quickly, and in favour of the plaintiff, and it may well be appropriate in such circumstances simply to tell the defendant that he was wrong. Much depends on the situation at the time, and an appeal court should be reluctant to interfere in a matter such as this. [45] Ultimately I have come to the conclusion that it would not be appropriate to set aside the decision on the ground that the magistrate ought to have disqualified himself for apparent bias. I do, however, consider that there are, for reasons I have set out, a number of errors of law committed by the magistrate in the course of the dealing with this matter as he did, and for that reason it is appropriate that the judgment be set aside and that there be a new trial. There are plenty of magistrates in Brisbane so it should not cause any particular difficulty if I further direct that the new trial take place before a different magistrate. Conclusion [46] In all the circumstances therefore I order that the appeal be allowed, the judgment of 31 January 2001 be set aside and that there be a new trial of the claim and counterclaim before a different magistrate. The only recoverable costs so far as the appellant is concerned is the filing fee on the Notice of Appeal and I will order that the respondent pay the appellant’s costs of the appeal which I fix in that sum, an amount of $126. [47] I have already noted that the various orders that were made at the beginning of the proceeding on 31 January were not made in response to any application on the part of the plaintiffs, although the judgment on the application for summary judgment was in response to an application by the plaintiff which ought not to have been made. Nevertheless, if the defendant had proceeded with his counterclaim, there may not have been ultimately any substantial injustice to the defendant because, had that counterclaim succeeded, the magistrate could well have made an appropriate adjustment to the judgment. For example, if the defendant did prove that the plaintiff was negligent and that part of the consequences of that negligence -- 15 of 16 -- 16 was that the work done by the plaintiff was of no value to the defendant, either the judgment for the plaintiff against the defendant could have been discharged or the amount of the judgment on the counterclaim could have been increased by that amount so as to offset it. [48] It seems to me to be clear that the real reason why the defendant did not proceed with his counterclaim is the fact that the magistrate took the earlier decisions on procedural matters on 31 January, and accordingly, in my opinion, the plaintiff is not responsible for those errors of the magistrate which were of greater significance. The respondent applied for an indemnity certificate under the Appeal Costs Fund Act, and in my opinion, it is appropriate to grant the respondent such a certificate. -- 16 of 16 --