Bakovski v Lenehan [2014] NSWSC 671

Supreme Court New South Wales

Medium Neutral Citation: Bakovski v Lenehan [2014] NSWSC 671 Hearing dates: 15-18 April 2013; 1-3 May 2013 Decision date: 27 May 2014 Jurisdiction: Common Law Before: Hall J Decision: (1) Subject to orders and directions set out below, I propose entering judgment in favour of the plaintiffs against the second defendant for breach of duty under the retainer with the plaintiffs, and the first defendant, as vicariously liable for the acts and omissions of the second defendant in respect of the following: (a) Loss and damage in the amount of $243,278.41. (b) Pre-judgment interest on that amount, calculated in accordance with s 100 of the Civil Procedure Act 2005, Part 6 r 6.12 of the Uniform Civil Procedure Rules 2005, and Practice Note SC Gen 16, calculated from 11 December 2004 to 27 May 2014 and thereafter to date of entry of judgment. I note interest on the above basis from 11 December 2004 to 27 May 2014 is calculated at $201,234.57. (2) Leave granted to the parties to make an application and submissions in relation to: (a) The calculation of the amounts referred to in (1)(a) and/or (1)(b) above. (b) Costs and any ancillary or consequential orders. (3) The parties are to bring in short minutes of order to give effect to this judgment. (4) The proceedings will be re-listed in respect of orders (2) and (3) at 9.30am on Monday, 2 June 2014. Catchwords: NEGLIGENCE - professional negligence - breach of retainer - plaintiffs were borrowers under a loan/mortgage transaction - plaintiffs mistakenly believed they were guarantors to the mortgage and not the borrowers under the loan - plaintiffs would not have entered into the transaction had they known they were the borrowers - plaintiffs had limited understanding of English - failure by defendant solicitor to advise plaintiffs as to the legal effect and risks of the mortgage transaction - solicitors required to give such advice as called for in the circumstances of each case - harsh and oppressive terms of the loan/mortgage required the defendant solicitor to give specific and strong advice to the plaintiffs not to accept the loan offer and warn of the risks in doing so - solicitor breached duty to exercise reasonable care, skill - consequential loss incurred by plaintiffs refinancing mortgages - defence of contributory negligence not established - apportionable claim in accordance with Part 4 of the Civil Liability Act 2002 (NSW) - apportionment of liability between concurrent wrongdoers Legislation Cited: Civil Liability Act 2002 Civil Procedure Act 2005 Fair Trading Act 1987 Uniform Civil Procedure Rules 2005 Cases Cited: Astley v Austrust Ltd (1999) 197 CLR 1; [1999] HCA 6 Briginshaw v Briginshaw (1938) 60 CLR 336 Chandra v Perpetual Trustees Victoria Limited [2007] NSWSC 694 Dartberg Pty Ltd v Wealthcare Financial Planning Pty Ltd [2007] FCA 1216 Fox v Percy (2003) 214 CLR 118 George v Webb [2011] NSWSC 1608 Ghunaim v Bart [2004] NSWCA 28 Ginelle Finance Pty Ltd v Diakakis [2007] NSWSC 60 Hungerfords v Walker (1988) 171 CLR 125 Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd [2013] HCA 10; (2013) 247 CLR 613 Kayteal Pty Ltd v Dignan [2011] NSWSC 197 Perpetual Trustee Company Limited v Ishak [2012] NSWSC 697 Podrebersek v Australian Iron & Steel Pty Ltd (1985) 59 ALR 529 Provident Capital Ltd v Papa [2013] NSWCA 36; (2013) 84 NSWLR 231 Reinhold v New South Wales Lotteries Corporation (No 2) [2008] NSWSC 187 Vella v Permanent Mortgages Pty Ltd [2008] NSWSC 505 Watson v Foxman (1995) 49 NSWLR 315. Yates v Mobile Marine Repairs Pty Ltd [2007] NSWSC 1463 Texts Cited: Revised Professional Conduct and Practice Rules 1995 Category: Principal judgment Parties: George Bakovski (First Plaintiff) Vera Bakovski (Second Plaintiff) Norman Rutherford Lenehan t/as Lenehan & Co (First Defendant) James Socrates Arkoudis (Second Defendant) Representation: Counsel: E Finnane (Plaintiffs) G Curtin SC (Defendants) File Number(s): 2010/269931