In July 2017, we shared a Case Note of Lukic V De Luca Leonard (No.2). The only issues left to be resolved were whether the solicitor De Luca – Leonard
would be ordered to pay ordinary costs or indemnity costs. His Honour Harrison J ordered on 27th September 2017 that the solicitor should
pay indemnity costs.
This was a matter where the Solicitor/Defendant De Luca – Leonard, had successfully represented the Client/Plaintiff Lukic in relation to injuries the
client suffered during her employment. The substantive work injury damages claim was settled in 2014 for $300,000. The solicitors bill, inclusive of
costs and disbursements was $75,000. The breakdown of those fees is not available in the judgement.
In 2016, the client saw new solicitors, alleged an overpayment of $55,025, and demanded the recovery and an itemised bill of costs.
The solicitor did not provide an itemised bill as the 12-month period had expired.
The court considered the defence raised by the solicitor to have been a “hopeless case”, (page 6 of the judgement) and his Honour went on further
to say, “I am not prepared to agree with Counsel’s submission that Ms De Luca-Leonard’s defence of the claim was conducted in good faith.”
In short, the court considered that the solicitor had no prospect of success.
There are two very significant points that come from this matter:
- (1)There is no time limit which restricts clients from demanding an itemised bill of costs and seeking a costs assessment.
- (2)If a lawyer seeks in some way to defend such an application by a client in court, that lawyer is subject to an order for indemnity costs at best.
In this case, the lawyer De Luca – Leonard entered into verbal and written dialogue with the new solicitors for the client, all of which worked against
her in court. She instructed solicitors privately, as well as Counsel, all to no avail. In fact, the cost was wasted as his Honour considered she had
no prospect of success in the first place and her defence was not conducted in good faith.
In the end after paying for her own representation, now the representation of the other side and still going through the costs assessment process the successful
court case she ran for the client Lukic would have been a catastrophic loss. Added to this financial loss is the enormous emotional toll it must have
taken on her.
It is clear from this and many other authorities that the court will always exercise its discretion in ordering a solicitor to produce an itemised bill
of costs, no matter how old the case may be or how long ago it may have been finalised.
In this regard, the retro-active aspects of the costs cover policy is very useful and a vital consideration for any risk prevention strategy.
In every lawyers file storage facility there may be a time bomb ticking away ready to go off. If that bomb goes off, you might want to have as much insulation
as possible to cushion the blast.
Costs Cover can provide you with that insulation.
By John Andriano – Accredited Specialist Personal Injury Law