Owens v Galvin  VSCA 33(11 March 2014) (BEACH JA and McMILLAN AJA)
|Catchwords||NEGLIGENCE – Legal practitioners – Barrister – Scope of retainer – Barrister’s duty to advise – Content of duty – Standard of care – Whether barrister negligent in failing to advise about additional ways of ending bankruptcy – Barrister not negligent – Causation – Hindsight – Hoyts Pty Ltd v Burns (2003) 77 ALJR 1934, 1945  referred to – Wrongs Act 1958, ss 48, 49, 50, 51, 52 and 58. BANKRUPTCY – Advice concerning options to terminate bankruptcy – Bankruptcy Act 1966, ss 73, 153A, 153B and 179. COURTS AND JUDGES – Bias – Actual bias – Apprehended bias – No allegation of bias made at trial – Appellant’s allegations of bias without foundation.|
54 In grounds 1 to 8, the appellant makes complaint about the judge’s conclusions that the respondent did not breach any duty he owed the appellant in failing to advise her of the possibility of making a second composition proposal and/or of the possibility of the appellant herself engaging a financier to access equity in property owned or controlled by the appellant.
55 There was no dispute in the trial below, or on this appeal, that the respondent owed the appellant a duty of care – or that the standard of care and skill required of the respondent in giving professional advice was that which may be reasonably expected of a legal practitioner (in this case, a barrister) possessing a special skill in the area of insolvency.
56 In considering the issues of content of duty and breach, as the trial judge said, it is necessary to have regard to all of the circumstances of the respondent’s retainer. The trial judge found that the respondent was never asked to provide a detailed and comprehensive advice on all issues and in respect of all options open to the appellant. That said, a failure of the respondent to be so instructed by the appellant does not necessarily answer the question whether the respondent’s failure to give particular advice might or might not constitute a breach of duty. Similarly, as her Honour said, the failure of the appellant to ask a specific question of the respondent is also not necessarily determinative.
57 In argument before us, the appellant submitted that it was wrong to say that the respondent was never asked to provide a detailed and comprehensive advice on all issues and in respect of all options open to the appellant. In support of this submission the appellant relied upon a passage in her evidence in chief where the appellant gave evidence that a few days before 27 September 2005, she had a conversation with the respondent wherein she said that ‘she needed to speak to him about what steps [she] could take to resolve her bankruptcy’. However, in our view, when one looks at the whole of the evidence, it was well open to the trial judge to make the finding her Honour made about what it was in fact that the appellant sought advice about from the respondent.
58 A theme of the appellant’s complaints in respect of the issue of breach of duty is that the trial judge should have concluded that, once it was determined that the respondent did not give the advice in respect of which the appellant makes complaint, the respondent was negligent. In effect, it appeared to be the appellant’s submission that there was either an absolute duty to give this advice, or that proof of the fact that the advice was not given conclusively determined the issue of negligence (if not the proceeding) against the respondent. To the extent these were the submissions of the appellant, we reject them. The matter fell to be determined in accordance with the question of what was reasonable in all the circumstances – having regard to the requisite standard of care, the standard being what could reasonably be expected of a barrister possessing a special skill in the area of insolvency and bankruptcy.
59 Having reviewed the evidence and the appellant’s arguments advanced in support of grounds 1 to 8, it is sufficient for us to say that we see no error in the trial judge’s conclusions on the questions of duty and breach. At one level it could be said that the resolution of the relevant issues in this case might have been different had the appellant asked the respondent specifically whether she was permitted to make a second proposal to her creditors. However, the appellant, as she conceded in evidence, never asked this question. In the circumstances, it is difficult to see how one could be critical of the respondent for failing to advise that the appellant could make a second offer to her creditors.
60 As to the possibility of advice being given by the respondent to the appellant that the appellant could herself engage a financier, again we see no error in the trial judge’s approach. As her Honour described it, the fact that the appellant took a role in the attempted sale of the Hill Street property tends to belie the suggestion that the appellant did not have some belief that she had a capacity at least to approach a financier on her own behalf in order to see whether she could finance her way out of her bankruptcy. Again, it seems to us difficult to be critical of the respondent for not suggesting this option in the absence of some specific enquiry by the appellant of him.
61 Before proceeding further, it is necessary to say something about the appellant’s complaints concerning the way inwhich the trial judge dealt with, and made findings about, the appellant’s credit. In our view, the trial judge’s approach to the issue of the appellant’s credit was free from error and, specifically, free from the errors asserted by the appellant in her written and oral argument. The appellant was a witness who was, from time to time, difficult. Indeed, at times the appellant was combative. In the context of this case, we think the judge’s approach in resolving any conflicts in the evidence in favour of what is recorded in contemporaneous documents was eminently sensible, and entirely sound. Her Honour’s findings in relation to the evidence of the two principal witnesses (the appellant and the respondent) were measured and, contrary to the appellant’s submissions, well supported by the evidence.
62 While dealing with this topic, we should say specifically that there is nothing in ground 12. In ground 12, the appellant asserts that the judge erred in making adverse findings as to her credit when she ‘was without legal advice from 2005-2009’. First, even if it be accepted that the appellant was without legal advice from 2005 to 2009, we see no basis for that fact impugning any of the trial judge’s findings. Secondly, as the recitation of the relevant history that we have already made reveals, it is not correct to say that the appellant was without legal advice from 2005 to 2009. The appellant retained counsel for the proceedings in the Federal Magistrates Court, the Federal Court and the High Court in 2007 and 2008. Further, while the solicitor on the record in the Federal Magistrates Court and Federal Court proceedings in 2007 was the appellant’s firm, in the High Court a different solicitor was on the record as representing the appellant.
Brisbane Barrister – David Cormack