Scope Data Systems Pty Ltd v Agostini Jarrett Pty Ltd & Anor [2007] NSWSC 971

New South Wales Supreme Court

CITATION : Scope Data Systems Pty Ltd v Agostini Jarrett Pty Ltd & Anor [2007] NSWSC 971

HEARING DATE(S) : 12-13 June 2007

JUDGMENT DATE : 30 August 2007

JURISDICTION : Common Law Division

JUDGMENT OF : Hislop J

DECISION : The plaintiff is to pay the defendants' costs of these proceedings on an ordinary (party-party) basis to 24 June 2006 and thereafter on an indemnity basis.

Legal Profession Act LEGISLATION CITED : Supreme Court Act Supreme Court Rules Civil Procedure Act

CASES CITED : Brott v Maher [2004] VSCA 186

Scope Data Systems Pty Ltd (Plaintiff) PARTIES : Agostini Jarrett Pty Ltd (1st Defendant) Shauna Jarrett (2nd Defendant)

FILE NUMBER(S) : SC 12191/04

COUNSEL : A.P. Lo Surdo/T.M. Mehigan (Plaintiff) G. Curtin (Defendants)

SOLICITORS : Norman Waterhouse (Plaintiff) Middletons (Defendants)

- 1 - IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

HISLOP J

Thursday 30 August 2007

12191/04 Scope Data Systems Pty Limited v Agostini Jarrett Pty Limited & anor

JUDGMENT 1 HIS HONOUR: These proceedings were commenced by summons. The summons was subsequently amended. The plaintiff sought relief against its former solicitors essentially pursuant to s198M and s198N of the Legal Profession Act 1987, alternatively, pursuant to s76C of the Supreme Court Act, alternatively, pursuant to Pt 52A r 43(1) of the Supreme Court Rules, and also for breaches of contract and breach of fiduciary duty. 2 The proceedings were listed for hearing before me on 14 May 2007. On that occasion the plaintiff sought an adjournment as its counsel had withdrawn from the case for "professional reasons" at 8.00 pm on the previous Friday. The adjournment application, though opposed, was granted to enable new counsel to be briefed. With the agreement of all parties, a hearing date of 12 June 2007 was fixed. 3 On 12 June 2007 the matter again came on for hearing before me. The plaintiff sought a further adjournment and leave to amend the claim. The purpose of the adjournment was to enable the claim to be reformulated in a statement of claim as a claim for damages for professional negligence. It was suggested that other parties may be joined to the proceedings and that an application may be made for the proceedings to be heard with District Court proceedings brought by the plaintiff against other solicitors who had acted for it. The Court was informed the underlying facts to be relied upon in the reformulated case would be no different than in the claim as originally cast, save in relation to damages and, possibly, the qualification of an expert witness. The adjournment application was said to be made in consequence of the application of a fresh legal mind to the issues. The amendment was described as vital as, without it, there was a real prospect the plaintiff's case would fail. The Court was informed that if the adjournment application failed, counsel for the plaintiff would be required to withdraw for ethical considerations but a director of the plaintiff would seek leave to conduct the hearing of the case as previously formulated. 4 Counsel for the defendants opposed the application for an adjournment. He indicated that, subject to seeing the proposed statement of claim, he anticipated he would be able to meet the plaintiff's amended claim. The proceedings were stood down to enable counsel for the plaintiff to draft the proposed statement of claim. 5 When the Court reconvened, counsel for the plaintiff indicated he had been unable to obtain sufficient instructions to prepare the proposed statement of claim. He referred to a number of matters, including difficulties in determining against whom the cause of action lay, the extent of the cause of action and in formulating appropriate particulars of the claim. He said that "because of those difficulties, there are difficulties certifying, for the purposes of the Legal Profession Act, that there is a reasonable cause of action, and what that cause of action may be." He was of the opinion the plaintiff had little or no prospect of succeeding in the case as presently formulated and that if the case was forced on the plaintiff would more than likely lose. 6 Ultimately, the plaintiff sought leave to discontinue the proceedings. After some debate and consultation between the parties, the matter was discontinued when a notice of discontinuance was filed by the plaintiff pursuant to leave of the Court granted under UCPR 12.1. The leave was granted on terms, and an order was made in accordance with the following terms contained in Short Minutes agreed to by the parties: "(1) I grant leave to the plaintiff to file a Notice of Discontinuance discontinuing the proceedings against each defendant on the following terms: (a) the Notice of Discontinuance is to be filed by 4pm on 13 June 2007; (b) the plaintiff, or its assigns, may not commence or maintain any proceedings against the defendants, or either of them, upon the following causes of actions, or raise in any costs assessment: (i) the cause of action in paragraphs 1 to 6 of the Amended Summons filed on 29 July 2005;