Waikato Law Review
|
|
Home
| Databases
| WorldLII
| Search
| Feedback
Waikato Law Review |
|
The essence of this case concerns the ability of the High Court to exercise its discretion, in the interests of the administration of justice, to award costs against a barrister for a breach of duty to the Court.
The appellant, Raylee Patricia Harley (Mrs Harley) acted as counsel for the respondent, Robert McDonald, in proceedings which he brought in the High Court against FAI (NZ) General Insurance Co Ltd (FAI), to recover money which he lost as a result of the collapse of Renshaw Edwards, a firm of solicitors. FAI was Renshaw Edwards’ professional indemnity insurer. In the High Court in Auckland, Giles J dismissed the respondent’s claim against FAI, with an award of costs against him of $115,606.06. Following that judgment, the respondent made a formal application for costs against the appellant and his former solicitors (Glasgow Harley). In the High Court, Giles J ordered the appellant and Glasgow Harley to indemnify the respondent, jointly and severally, for an amount of $65,000 as a contribution towards the costs that he had to pay FAI. The costs order against the appellant was made on the basis that her conduct of the proceedings against FAI amounted to a serious dereliction of her duty to the Court.
May it please the Court, the submissions for the respondent, in support of the orders of Giles J in the High Court, are as follows:
1. The High Court had jurisdiction to award costs against the appellant.
2. The High Court exercised its jurisdiction to award costs against the appellant properly on the facts properly before it.
1.1 The jurisdiction of the High Court to award costs against the appellant derives from the fact that a barrister is an officer of the Court and therefore owes a duty to the Court in the administration of justice.
1.2 Pursuant to section 43 of the Law Practitioners Act 1982, solicitors and barristers are officers of the High Court as they are admitted jointly as barristers and solicitors of the Court.
1.3 High Court Rule 46 confers an overriding discretion on the Court in all matters relating to costs and therefore gives jurisdiction to award costs against a barrister or solicitor. This rule has been construed so as to enable costs to be ordered against counsel. McGechan on Procedure states:
(d) The jurisdiction has been exercised only against a party’s solicitor, presumably because the solicitor on the record is responsible for the conduct of the proceeding. There seems no reason in principle why it should not extend to counsel.[1]
1.4 The jurisdiction of the High Court to award costs against a barrister or solicitor is also derived from the Court’s inherent jurisdiction. The Court in Accused (CA 60/97) v Attorney-General stated that:
[t]he High Court derives its general jurisdiction from its status as a superior Court and in particular from s 16 of the Judicature Act 1908 ... Due administration of justice according to law is its cornerstone.[2]
The Court in R v Moke and Lawrence stated that:
[t]he Court may invoke its inherent jurisdiction whenever the justice of the case so demands. It is a power which may be exercised even in respect of matters which are regulated by statute or by rules of the Court providing of course, that the exercise of the power does not contravene any statutory provision. The need to do justice is paramount.[3]
1.5 The Court’s inherent jurisdiction is founded on the principle that barristers and solicitors, as officers of the Court, are “... concerned in the administration of justice [and have] an overriding duty to the court ...”.[4]
1.6 The jurisdiction exercised by Giles J to award costs against the appellant receives the following highly persuasive judicial support. In Gordon v Treadwell Stacey Smith, it was stated that “legal advisers” who misconduct litigation may be ordered personally to pay costs.[5] The term “legal advisers” suggests the Court was not limiting the statement to solicitors only. In the Canadian case Young v Young,[6] it was held that Courts possessing inherent jurisdiction might, with caution, properly use that jurisdiction to order barristers to pay costs personally.
1.7 The exercise of the Court’s jurisdiction to award costs against the appellant did not contravene any statute or established principle of law.
1.8 Section 94 of the Law Practitioners Act 1982 permits the Court to exercise its summary jurisdiction over practitioners and to make such order as it thinks fit in respect of the practice of any practitioner, on any reasonable cause shown. Section 94(1) states:
[e]xcept as provided in sections 92 and 93 of this Act, nothing in this Act shall affect the summary jurisdiction of the Court over practitioners; ... the Court shall have full power ... to make such order as it thinks fit respecting the practice of any practitioner, on reasonable cause shown.[7]
1.9 In B v Canterbury District Law Society it was stated that the Court’s summary jurisdiction, preserved by section 94 of the Law Practitioners Act 1982, is “required, of course, to enable the Court to regulate the conduct of practitioners relating to the conduct of litigation and their status and responsibilities as officers of the Court”.[8]
1.10 It is submitted that the appellant’s serious dereliction of duty to the Court constitutes a reasonable cause shown, pursuant to section 94 of the Law Practitioners Act 1982.
1.11 It is acknowledged that barristers have a level of immunity from civil liability; however, this immunity is confined to claims for civil relief by their client.[9] Accordingly, it is submitted that barristers are not immune from sanctions for a breach of duty to the Court.
1.12 It is acknowledged that the case of Orchard v South Eastern Electricity Board[10] reflects the English position with regard to common law immunity of barristers from an award of costs against them until the enactment of wasted costs legislation.[11] However, this was the position only because barristers were not officers of the Court.
2.1 The decision of the High Court to award costs against the appellant can properly rest solely on the appellant’s gross dereliction of duty to the Court, arising from her conduct of the trial, about which the appellant has had the opportunity to be heard, and despite the fact her case was of itself hopeless.
2.2 In Myers v Elman, Lord Wright said that the Court’s jurisdiction to make an order for costs is enlivened where a practitioner has conducted himself or herself in such a manner that the conduct involves “a failure on the part of a solicitor to fulfil his duty to the court and to realise his duty to aid in promoting in his own sphere the cause of justice”.[12]
2.3 The criteria for exercise of the Court’s jurisdiction to make an order for costs against a barrister may be determined on the same basis by which solicitors are personally liable for costs in comparable circumstances. Such liability arises upon serious dereliction of duty to the Court. Myers v Elman,[13] is the leading authority for this test. This test has also been approved in Australia in Da Sousa v Minister of State for Immigration, Local Government and Ethnic Affairs.[14]
2.4 It is submitted that, as an officer of the Court whose role is to assist in the administration of justice, a barrister cannot properly perform that role where he or she is grossly negligent or incompetent. The judgment in Myers v Elman[15] is highly persuasive authority for the fact that gross negligence or incompetence on the part of a barrister or solicitor can amount to a serious dereliction of duty to the Court.
2.5 In De Sousa v Minister for Immigration, Local Government and Ethnic Affairs, French J regarded the proceedings instituted by the solicitor in that case as reflecting a “... serious failure to give reasonable attention to the relevant law and facts ...”, that amounted to a serious dereliction of duty to the Court.[16]
2.6 It is acknowledged that Giles J has considered matters concerning the appellant’s conduct that were not confined to her conduct of the trial in question and on which she was not given the opportunity to be heard at the costs hearing. It is submitted that those matters were confined to the appellant’s general conduct in relation to the discharge of her obligations to the respondent. It is further submitted that these matters did not affect the decision of Giles J, as evidence properly before His Honour regarding the appellant’s conduct of the trial was sufficient to find a gross dereliction of duty to the court.
2.7 The pleadings, the appellant’s final submissions, and Giles J’s substantive judgment[17] indicate, as Giles J identified,[18] that the respondent’s case was advanced on the basis that the summary judgment procured by the appellant against the Renshaw Edwards partners, of itself satisfied the provisions of the Law Reform Act 1936 and was enough to found liability of FAI to pay under their polices of professional indemnity insurance for Renshaw Edwards and a partner Basil Jones.
2.8 In essence, as Giles J identified, the appellant’s case did not identify an event that fell within the ambit of an insured peril under the policies. The statement of claim in the summary judgment proceedings alleged a liability to pay a contract debt. Breach of contract was demonstrably not an FAI Policy insured peril. The appellant failed to appreciate this fatal defect, even after it was pointed out to her by Giles J, and advanced no tenable basis for avoiding it.
2.9 Furthermore, as Giles J identified, the appellant was invited by His Honour carefully to reflect upon and reconsider her case in light of her concession as to the application of the doctrine of avoidance for material non-disclosure. The fact that both insurance policies were clearly avoidable for material non-disclosure was or should have been known to the appellant in the conduct of her case. Despite the invitation of Giles J to reconsider, the appellant elected to proceed.
2.10 On the basis of submissions 2.7 to 2.9, it is submitted that the appellant’s conduct in the trial constituted a serious failure to give reasonable attention to the relevant law and facts, which constituted gross incompetence and therefore amounted to a serious dereliction of duty to the Court.
2.11 In summary, the decision of the High Court served the public interest in the administration of justice by holding the appellant accountable for breaching her duty to the Court as a result of her conduct of the trial.
In conclusion, for the respondent, it is respectfully submitted that:
1. The High Court had jurisdiction to award costs against the appellant. This jurisdiction derives from the fact that a barrister is an officer of the Court and therefore owes a duty to the Court in the administration of justice. The Court’s jurisdiction is specifically derived from High Court Rule 46 and the Court’s inherent jurisdiction. Furthermore, the Court’s jurisdiction to award costs against the appellant is not curtailed by barristers’ immunity from civil liability and is permitted by section 94 of the Law Practitioners Act 1982.
2. The High Court exercised its jurisdiction to award costs against the appellant properly on the facts properly before it. The High Court’s decision can properly rest solely on the appellant’s gross dereliction of duty to the Court, arising from her conduct of the trial, about which the appellant has had the opportunity to be heard, and despite the fact that her case was of itself hopeless.
Accordingly, the respondent submits that the High Court Judge’s order of costs against the appellant should stand and that this appeal be dismissed.
May it please the Court, that concludes the submissions for the respondent.
[*] LLB honours student, University of Waikato, winner, 2001 McCaw Lewis Chapman Advocacy Contest. The competitors in the Contest were required to stand in the shoes of either counsel for the plaintiff or counsel for the defendant, and present an argument as at the date of the hearing in the Court of Appeal.
[1] McGechan, R McGechan on Procedure (1985-88) HR46.11.
[2] (1997) 15 CRNZ 148, 151, per Henry J (CA).
[3] [1996] 1 NZLR 263, 267, per Thomas J (CA) (emphasis added).
[4] Rondel v Worsley [1969] 1 AC 191, 227, per Lord Reid (HL).
[5] [1996] NZCA 110; [1996] 3 NZLR 281, 293, per Blanchard J (CA).
[6] (1993) 108 DLR (4th) 193, 284, per McLachlin J (SCC), by a 6 to 1 majority.
[7] Law Practitioners Act 1982, Part VII – Discipline Within the Legal Profession – Jurisdiction of the High Court and Court of Appeal (emphasis added).
[8] [1997] NZCA 308; (1997) 11 PRNZ 196, 201, per Thomas J (CA) (emphasis added).
[9] Rees v Sinclair [1974] 1 NZLR 180, 186-7, per McCarthy P (CA).
[11] This gave the Court jurisdiction, by statutory power, to award costs against barristers.
[12] [1940] AC 282, 319 (HL) (emphasis added).
[13] Ibid. This case was heard prior to the enactment of specific wasted costs legislation in the United Kingdom: see submission 1.12.
[14] [1993] FCA 146; (1993) 114 ALR 708 (FCA); see also White Industries (Qld) Pty Ltd v Flower & Hart (a firm) [1998] FCA 806; (1998) 156 ALR 169 (FCA).
[15] Supra note 12, at 304, per Lord Atkin.
[16] [1993] FCA 146; (1993) 114 ALR 708, 713 (FCA).
[17] Unreported, High Court, Auckland, CP 507/96, 11 December 1997.
[18] The following references from Giles J’s judgment are taken from McDonald v FAI (NZ) General Insurance Co Ltd [1999] 1 NZLR 583, 593-4 (HC).
NZLII:
Copyright Policy
|
Disclaimers
|
Privacy Policy
|
Feedback
URL: http://www.nzlii.org/nz/journals/WkoLawRw/2001/12.html