Supreme Court New South Wales Medium Neutral Citation: In the matter of HIH Insurance Limited (in liquidation); Smith & ors v McGrath & ors; Baldock & ors v McGrath & ors [2014] NSWSC 922 Hearing dates: 13 June 2014 Decision date: 14 July 2014 Jurisdiction: Equity Division - Corporations List Before: Brereton J Decision: Proceedings by those plaintiffs who have not expressly authorised institution of an appeal to be dismissed. Catchwords: Legal profession - retainer - authority to institute proceedings - whether retainer to prove claim in liquidation sufficient authority for institution of appeal to the court from liquidators' rejection - where retainer includes authority to take such further steps as may be necessary and to follow the procedure under the schemes of arrangement - held, insufficient authority for institution of proceedings Legislation Cited: (Cth) Corporations Act 2001, s 1321 Cases Cited: A W & L M Forrest Pty Ltd v Beamish (1998) 146 FLR 450 Ashrafinia v Ashrafinia [2012] NSWSC 500 Atkinson v Abbott (1855) 61 ER 899 City of Glenorchy v Addison (No 2) (1967) 15 LGRA 259 Harry S Bagg's Liquidation Warehouse Pty Ltd v Whittaker (1982) 44 NSWLR 421 Hawkins Hill Gold Mining Co v Briscoe (1887) 8 LR (NSW) Eq 123 Hawksford v Hawksford (2005) 191 FLR 173 Hawksford v Hawksford [2005] NSWSC 463 Hillig v Darkinjung Pty Ltd (No 2) [2008] NSWCA 147 In re Joseph Woolf [1932] VLR 465 James v Ricknell (1887) 20 QBD 164 Knox Street Apartments v Roger Percival Flexman [2002] NSWSC 102 Picken v Shire of Alexander (1890) 16 VLR 309 Wood v Inglis [2008] NSWSC 1147 Wray v Kemp (1884) 26 Ch D 169 Category: Interlocutory applications Parties: Barry Alexander Smith (first plaintiff/respondent 13/320171) Craig Richard Baldock (first plaintiff/respondent 13/345623) Anthony Gregory McGrath as liquidator of HIH Insurance Limited (first defendant/applicant) Christopher John Honey as liquidator of HIH Insurance Limited (second defendant/applicant) Anthony Gregory McGrath as scheme administrator of FAI General Insurance Company Ltd (third defendant/applicant) Christopher John Honey as scheme administrator of FAI General Insurance Company Ltd (fourth defendant/applicant) Anthony Gregory McGrath as scheme administrator of HIH Casualty and General Insurance Limited (fifth defendant/applicant) Christopher John Honey as scheme administrator of HIH Casualty and General Insurance Limited (sixth defendant/applicant) Anthony Gregory McGrath as scheme administrator of CIC Insurance Limited (in liquidation) (seventh defendant/applicant) Christopher John Honey as scheme administrator of CIC Insurance Limited (in liquidation) (eighth defendant/applicant) Representation: Counsel: J White (plaintiffs/respondents 13/320171) B Dennis, solicitor (plaintiffs/respondents 13/345623) JRJ Lockhart SC (defendants/applicants) Solicitors: Thomas Booler & Co plaintiffs/respondents 13/320171) DC Legal (plaintiffs/respondents 13/345623) Ashurst (defendants/applicants) File Number(s): 2013/320171 2013/345623 Judgment 1Proceedings 2013/320171 ("the Smith proceedings") were commenced by originating process filed on 23 October 2013 by Thomas Booler & Co solicitors in the name of approximately 117 plaintiffs who are shareholders in HIH Insurance Limited (in liquidation) ("HIH"), claiming reversal or modification pursuant to (Cth) Corporations Act 2001, s 1321, of the decision of the first to eighth defendants ("the liquidators") - who are the liquidators of HIH, and the scheme administrators of HIH's subsidiaries FAI General Insurance Company Limited ("FAI"), HIH Casualty and General Insurance Ltd ("C&G") and CIC Insurance Limited ("CIC") (together, "the subsidiaries") - not to admit, or not to adjudicate on, proofs of debt and/or claims submitted by the plaintiffs in the liquidation of HIH and the schemes of arrangement of the subsidiaries. Proceedings 2013/345623 ("the Baldock proceedings") were commenced by originating process filed on 15 November 2013 by DC Legal (a successor firm of Dennis & Co, solicitors), in the name of approximately 2,860 plaintiffs, claiming similar relief. By notices of motion filed in each proceeding on 20 December 2013 and amended on 21 March 2014, the defendants seek the dismissal of the proceedings brought in the name of some of the plaintiffs, on the ground that the solicitors who purport to act for the plaintiffs lack sufficient authority to commence and maintain the proceedings on behalf of those plaintiffs in respect of whom the application is brought. In other words, the defendants challenge the retainer of the plaintiffs' solicitors. Background 2Prior to filing their interlocutory applications, in late 2013 the Defendants issued subpoenas for production and notices to produce calling for, inter alia, documents evidencing the authority of the solicitors on the record to commence the proceedings. No documents were produced in the Smith proceedings; but some were produced in the Baldock proceedings. While these applications were pending, the solicitors on the record for the plaintiffs have produced further authorities and costs agreements from some of the plaintiffs. The current position may be summarised as follows. 3In the Baldock proceedings, the solicitors hold an authority from each plaintiff, dated 2009, that authorises them "to act on my behalf in regard to my claims against the above companies, sign a Formal Proof of Debt (Form 535), in particular to prove my claims or debt against the above companies, to act as proxy at any meeting of Creditors and to take such further action as may be necessary in relation to this matter" ("the 2009 authority"). In addition, they hold signed costs agreements from approximately 1525 of the plaintiffs. The defendants accept that the costs agreements have the effect of ratifying the retainer, and in respect of those plaintiffs who have executed one there is no remaining dispute, save as to costs. Approximately 75 of the plaintiffs have indicated that they do not wish to proceed. Approximately 28 of the plaintiffs were participants in earlier proceedings against HIH ("the Bracken proceedings"), which were settled. The defendants contended that the commencement and maintenance of the current proceedings on their behalf constituted an abuse of process by relitigation. The Court was informed that it was accepted by those plaintiffs that they could not proceed against HIH, and accepted by the defendants that they could proceed against the subsidiaries; in those circumstances, this issue requires no further consideration. That leaves approximately 1260 plaintiffs who have not yet provided a signed costs agreement (including 204 that the solicitors have been unable to contact), in respect of whom the only authority held by the solicitors is one in the form of the 2009 authority (although some of those plaintiffs have indicated orally that they will provide a costs agreement). The defendants submit that the claims of these plaintiffs should be dismissed on the basis that the 2009 authorities are inadequate authority for the institution of proceedings, but accept that it would be appropriate to allow a short further time for production of costs agreements by those who have indicated that they propose to do so. 4In the Smith proceedings, the solicitors now hold new authorities ("the 2014 authorities") from most of the plaintiffs, which authorise the solicitors "to appeal the rejection by ... the Liquidators and Scheme Administrators of the Proofs of Debts or Claim of the company ...". The defendants accept that such authority is sufficient to authorise or ratify the institution of the proceedings on behalf of those plaintiffs who have given one. The parties were able to resolve the position of the 38th plaintiff Jennifer Mona Walker, the 45th plaintiff, and the 97th plaintiff Mollytan Imperial Pty Ltd, and their status requires no further consideration. A number of other complaints that were originally agitated by the defendants either have been cured by the provision of additional evidence, or are not at this stage pressed. The only remaining dispute in the Smith proceedings pertains to the 25th and 26th plaintiffs Belinchele & Co Pty Limited and BMM & Co Pty Ltd, and the 48th and 49th plaintiffs George Raymond Filewood and Pauline Rowena Filewood. The only authorities provided by the 25th and 26th plaintiffs are dated 2010 and authorise the addressee "to complete, execute and sign any Formal Proof of Debt or Claim on my/our behalf against any or all of the abovementioned Companies ..." and also "if necessary to follow the procedure referred to in the Schemes of Arrangement in relation to the agreement and acceptance of my/our claims with the Liquidators or Administrators of the abovementioned Companies". The only authority provided by the Filewoods is one dated 2005 "to act on my behalf in regard to my claims against the above companies and in particular to prove my claims or debt against the above companies and take any further action in relation to this matter which might be necessary". The defendants apply for dismissal of the proceedings by those plaintiffs on the basis that the only authorities they have given are inadequate to authorise the institution of proceedings. Authority to institute proceedings 5On an application of this kind, although there may once have been some controversy as to who bore the onus of proof, it was common ground before me that the party impugning a legal practitioner's authority bears the legal burden of proving the absence of sufficient authority, but depending on the evidence adduced by that party, the legal practitioner may have an evidential onus [Hawksford v Hawksford (2005) 191 FLR 173 (at [33]-[55]) (Campbell J); Wood v Inglis [2008] NSWSC 1147, [20] (Barrett J); Ashrafinia v Ashrafinia [2012] NSWSC 500, [21] (Slattery J)]. In Hawksford, Campbell J observed (at [59]): There is no evidence about the circumstances in which the document came into existence. As Michael signed the document, I can infer that he has knowledge of those circumstances. Even bearing in mind that it is the plaintiffs who bear the onus of proving lack of authority, the fact that the defendants have not explained those circumstances in evidence enables me to draw more strongly the inference which is available from the words of the document that it related to a single piece of litigation. 6The defendants tendered the subpoenas and notices to produce, and such authorities as had been produced in answer to them. The plaintiffs have tendered additional authorities and costs agreement. If it were to be contended that the construction of the written authorities in evidence was expanded by the effect of other contemporaneous communications which might have illuminated the context in which the authorities were signed, or that there were additional oral authorities (which, where there is a written retainer, would probably not have been relevant: see Wray v Kemp (1884) 26 Ch D 169, 171), the plaintiffs bore the evidentiary onus of adducing evidence of those communications. They did not seek to do so. Accordingly, the question turns on the existence and adequacy of the written authorities. 7The critical question on this application is whether the 2009 authorities in the Baldock proceedings, and the 2005 Filewood authority and the 2010 Belinchele/BMM authorities in the Smith proceedings, are sufficient authority for the solicitors to institute proceedings under s 1321 for review of the liquidators' rejection of the plaintiffs' proofs. The defendants submit that as those authorities do not expressly refer to court proceedings or an appeal, they are inadequate to authorise the institution of the proceedings. The plaintiffs' solicitors rely in particular on the words "and to take such further action as may be necessary in relation to this matter" in the 2009 authority, the similar words "and take any further action in relation to this matter which might be necessary" in the 2005 Filewood authority, and the words "if necessary to follow the procedure referred to in the Schemes of Arrangement in relation to the agreement and acceptance of my/our claims" in the 2010 Belinchele/BMM authorities. 8In this context, the cases have tended to require specific authority to institute proceedings. In Atkinson v Abbott (1855) 61 ER 899, a solicitor was retained "to proceed against the trustees and executors of my late father's will to obtain the probate thereof, and to take such proceedings as may be considered expedient to obtain an account of the trust property under my said father's will". He instituted a suit in the Ecclesiastical Court to compel probate, pursuant to which the executors provided an account which would not have been satisfactory in the Chancery Court. After three years of inaction, the solicitor instituted a suit in Chancery for an account. Kindersley V-C said (at 900) that to institute a suit a solicitor should have a clear and explicit authority, and that the retainer was insufficient to authorise proceedings other than the probate suit in the Ecclesiastical Court: Now it is the duty of a solicitor to obtain a written authority before he commences a suit, and that written authority ought to be sufficient and explicit. It is not sufficient that he obtain an authority to take proceedings to get an account; it must be an authority to institute a suit; I do not mean that it must contain the precise words, but it must be in substance a clear authority to institute a suit; and a solicitor does not do his duty if he obtains an instrument which is vague and indefinite, on which he can act or not as he likes, and say, "this is an authority, and whenever it suits my convenience I will act on it." ... Now it is said that the Ecclesiastical Court could have nothing to do with the administration of the personal estate, and therefore that the instructions to take proceedings must mean taking proceedings in this Court. That may possibly be the construction that would be put on it by a professional man, but it is certainly not the construction that would present itself to the mind of such a person as the Plaintiff, who, it is stated, is in humble circumstances and an uneducated man. But if [the solicitor] meant that, he should have taken care to make it unambiguous. It is no more than an authority to get the will proved and to obtain an account; if [the solicitor] had applied to the executors, and they had rendered one, the terms of the authority would have been satisfied ... I am of opinion that there is nothing in the retainer to authorize the filing of this bill. If a solicitor rests, as he ought, on a written retainer as his authority for filing a bill, he ought to have it explicitly stated. 9That case was followed by Chitty J in Wray v Kemp, where an authority "to act as my solicitor in the administration of my late husband, Mr John Wray's, estate", and "to investigate the accounts of the mortgagee, and take such steps as you may think proper in the matter on my behalf" was held insufficient to authorise the institution of proceedings for an account (at 171-2): The retainer of the 9th August, 1883, was clearly insufficient to authorise the commencement of an action in the name of Ann Wray. To justify a solicitor in commencing an action he must obtain a written authority to take proceedings to ·get an account: Atkinson v Abbott. ... As there has been writing you cannot rely upon a verbal retainer. In Atkinson v Abbott the retainer, after the lapse of three years was considered to be exhausted. ... I would add that on the question whether the retainer to Aaron Wray was sufficient, I agree with what was said by Kindersley, V.C. in Atkinson v Abbott, that a solicitor must be very careful to have his retainer very carefully worded, especially when given on behalf of an ignorant, uneducated person. The Vice Chancellor did not think the retainer in that case sufficient, and the case was decided on that ground, and not, as has been suggested, on the ground that the retainer was exhausted. This retainer, signed by Ann Wray, who appears to be an ignorant woman, is not so strong as the retainer in Atkinson v Abbott which requests the solicitor "to proceed against the trustees and executors, and to take such proceedings, &c" words which have a certain legal ring about them - but was held insufficient. Putting it as the best, this is an ambiguous document, and in my opinion, is not sufficient to justify the issue of this writ... 10In Hawkins Hill Gold Mining Co v Briscoe (1887) 8 LR (NSW) Eq 123, Stephen J (at 129-130) said that a general retainer was insufficient authority to institute proceedings and that there had to be specific authority to do so, though his Honour accepted that such authority might in some circumstances be implied: As to the first question, I am of opinion that such authority is necessary. The mere fact of acting generally as solicitor for a client does not per se confer any right to institute a suit on his behalf. I give no opinion as to what is sufficient to constitute such an authority; it may of course be written or verbal, and possibly may in some cases even be implied from surrounding circumstances. All I decide now is that an authority of the nature I have denoted is necessary. ... I think the power of instituting suits at their own will, and perhaps for their own advantage, would be a dangerous one to put into the hands of solicitors. 11In James v Ricknell (1887) 20 QBD 164 Wills J, with whom Grantham J agreed, held that while a retainer to recover a debt (the precise terms of which do not appear in the report) was sufficient authority to proceed up to judgment and execution, it did not without further specific instructions authorise the conduct of subsequent interpleader proceedings that arose in the course of execution (at 166): This retainer covers the proceedings in the original action up to judgment and execution. Proceedings in interpleader are substantially a second action, and nothing but very strong authority would induce me to hold that the plaintiff as a solicitor has any right to embark in them without express instructions from his client... I think we may very safely declare the law to be that under an ordinary retainer a solicitor is not entitled to engage in proceedings in interpleader without consulting his client and receiving special instructions. 12In Picken v President Etc of the Shire of Alexander (1890) 16 VLR 309, the Full Court of the Supreme Court of Victoria expressed (obiter) differing views as to whether the solicitor for an unsuccessful party required express authority to apply for a new trial after final judgment had been given, Higginbotham CJ being inclined to the view that no further authority would be required, but Williams J suggesting that the solicitor's authority ceased with final judgment in the absence of further express instructions. However, neither view is inconsistent with express authority being required for an appeal, as distinct from an application to the trial judge for a new trial. 13In In re Joseph Woolf [1932] VLR 465 it was held that an application to a judge to review a taxation of costs, being in the nature of an appeal, was not within the original retainer to conduct divorce proceedings. It was conceded that a fresh retainer would be necessary to authorise an ordinary appeal. 14In City of Glenorchy v Addison (No 2) (1967) 15 LGRA 259 the Full Court of the Supreme Court of Tasmania (Gibson ACJ, Crawford and Neasey JJ) held that a retainer to take proceedings to recover a debt authorised all ordinary means to do so up to judgment, but did not authorise an appeal (at 260): If a retainer to take proceedings to recover a debt includes a retainer to institute an appeal, then logically it must also include a retainer to continue to appeal or to seek leave to appeal to as many superior courts as possible. This cannot be so, particularly having regard to the expense to which a client would be put. A solicitor authorised to recover a debt is authorised to use all ordinary means for the recovery of the debt and the retainer covers the proceedings in the original action up to judgment and execution, but does not extend to interpleader proceedings arising in the course of execution [James v Ricknell (1888) 20 QBD 164]. It has been held that an application to a judge to review a taxation, being in the nature of an appeal, was not within the original retainer to conduct divorce proceedings, and, in the same case, it was conceded by counsel that a fresh retainer would be necessary to authorise an ordinary appeal [In re Joseph Woolf [1932] VLR 465]. 15In Knox Street Apartments v Roger Percival Flexman [2002] NSWSC 102, Gzell J held that a power of attorney which authorised the attorney to sell and transfer lots in a proposed strata plan "and otherwise attend to all such matters and things as are to be carried out or are envisaged as being attended to by the Attorney pursuant to the Joint Venture Deed" did not authorise the institution of suits (at [10]). His Honour accepted that where authority is given to do particular acts followed by general words, the general words are restricted to what is necessary for the proper performance of the particular acts (at [18]). 16In Hawksford, Campbell J, having referred to Hawkins Hill Gold Mining Co v Briscoe as authority for the proposition that a general retainer does not, aside from express terms to this effect, of itself confer any authority on the lawyer to institute legal proceedings on the client's behalf, added that "the fact that a solicitor is instructed to act on behalf of a client concerning one matter confers no authority to act concerning a different matter" (at [62]). 17From the above cases, the following can be distilled. Fundamentally, the extent of a lawyer's authority depends on the construction of the retainer, in which terms can be implied as well as express [Hawkins Hill Gold Mining Co v Briscoe]. However, generally speaking, clear and specific words are required to authorise the institution of court proceedings [Atkinson v Abbott; Wray v Kemp; Hawkins Hill Gold Mining Co v Briscoe]. This is because of the serious consequences, including in particular exposure to the possibility of adverse costs orders [City of Glenorchy v Addison]; and also because a solicitor ought not readily be implied to be authorised to decide whether or not to institute proceedings [Hawkins Hill Gold Mining Co v Briscoe; Atkinson v Abbott]. Where words to the effect of authorising "such further steps as may be necessary" follow the main object of the retainer, those words are not sufficient to authorise institution of proceedings where the specific words would not do so, the general words being restricted to what is necessary for the proper performance of the particular acts [Kemp v Wray; Knox Street Apartments v Flexman]. While authority to institute proceedings once given extends to final judgment and execution, it does not authorise institution of an appeal without further express instructions [James v Ricknell; In re Joseph Woolf; City of Glenorchy v Addison]. 18None of the 2005, 2009 or 2010 authorities in suit in this case expressly refers to the institution of proceedings in a court. The 2005 Filewood authority authorises the solicitor "to act on my behalf in regard to my claims against the above companies and in particular to prove my claims or debt against the above companies and take any further action in relation to this matter which might be necessary". The 2009 authority is one "to act on my behalf in regard to my claims against the above companies, sign a Formal Proof of Debt (Form 535), in particular to prove my claims or debt against the above companies, to act as proxy at any meeting of Creditors and to take such further action as may be necessary in relation to this matter". The 2010 Belinchele/BMM authority is "to complete, execute and sign any Formal Proof of Debt or Claim on my/our behalf against any or all of the abovementioned Companies ..." and also "if necessary to follow the procedure referred to in the Schemes of Arrangement in relation to the agreement and acceptance of my/our claims with the Liquidators or Administrators of the abovementioned Companies". 19In each of them, the particular authority and main object of the retainer is proof of the claim which, in the context in which it appears and in the context of companies in liquidation, means the proof of the claims with the liquidator or scheme administrator as the case may be. These authorities authorise the lodging of proofs of debt, and any further action necessary to prosecute the proof of debt up to and including adjudication by the liquidators. If there were to be an appeal, this requires specific authority and was not covered by the original retainer [James v Ricknell; In re Joseph Woolf; City of Glenorchy v Addison]. There is no evidence of surrounding circumstances or other communications with the plaintiffs, which might have enabled an inference to be drawn that the clients understood and intended that legal proceedings by way of an appeal from the liquidator, exposing them to the risk of an adverse costs order, be taken. Where the words used are readily explicable as having as the main object of the retainer the lodgement and prosecution of a proof of debt, the references in the 2005 and 2009 authorities to "taking such further action" are, in the absence of words that clearly include the institution of curial proceedings, inadequate to authorise the institution of proceedings [cf Wray v Kemp; Knox Street Apartments v Flexman]. 20The 2010 Belinchele/BMM authority in the Smith Proceedings contains the additional words "... if necessary to follow the procedure referred to in the Schemes of Arrangement in relation to the agreement and acceptance of my/our claims ... ". The procedure under the schemes involves, inter alia, a submission of a Final Claim Form for estimation; a determination by the Scheme Administrators as to whether a Claim gives rise to a Liability under the Scheme; a negotiation and agreement process between the Scheme Administrators and the Scheme Creditor where all or part of a Claim has been rejected; and if agreement cannot be reached, an adjudication process by a Scheme Adjudicator. Clause 27 of the Scheme provides as follows: F. SCHEME CLAIM ADJUDICATION 27. Scheme Claim Adjudication 27.1 This clause 27 shall apply when the Scheme Administrators have referred to one or more of the Scheme Adjudicators for determination after the Estimation Date whether a Notified Liability gives rise to an Established Scheme Claim and the value of that Established Scheme Claim. 27.2 The Scheme Adjudicator shall determine the value of the Established Scheme Claim concerned on the basis of any submissions made by the Scheme Creditor and any Scheme Company. The Scheme Adjudicator shall act as an expert and not as an arbitrator. 27.3 The amount of a determination of a Scheme Adjudicator shall, subject to any mathematical or other manifest error and insofar as the law allows, be binding on the Scheme Administrators, each Scheme Company and the Scheme Creditor as the amount of the Established Scheme Claim. The Scheme Adjudicator is not required to give reasons for his or her determination unless requested to do so by the Scheme Administrator or the Scheme Creditor within 30 days of the determination. Every Scheme Creditor is entitled to appeal the decision of a Scheme Adjudicator under section 1321 of the Corporations Act but otherwise, and so far as the law permits, there shall be no right of appeal from such a determination. A Scheme Creditor's right of appeal under section 1321 of the Corporations Act is not restricted to any mathematical or other manifest error with regard to the amount determined by the Scheme Adjudicator. 21The 2010 Authority provides only for following the procedure "in relation to the agreement and acceptance of my/our claims". That refers to the agreement and acceptance of the claim by the liquidator, and does not speak to circumstances where the relevant claims are not accepted. While the latter part of clause 27.3 acknowledges - though it does not create - the right of appeal given by Corporations Act, s 1321, that is not part of the procedure for agreement or acceptance of claims, but something that follows their rejection. The phrase in question is amply explained as applying to the procedure that applies up to and including reference to and determination by the scheme adjudicator. Accordingly, those words do not of necessity include an appeal to the Court and, consistent with the authorities to which I have referred, in the absence of express words should not be construed as giving the solicitors authority, without further authorisation, to commence proceedings under s 1321. 22It follows that each of the disputed authorities is inadequate to authorise the institution and maintenance of the proceedings, and that the claims of those plaintiffs whose only authority is in those terms must be dismissed. Sufficient time will have elapsed by the time these reasons are delivered for any plaintiffs who had indicated an intention to execute a costs agreements to do so, and accordingly the claims of all plaintiffs who have not given an authority to the effect of the 2014 authority, or a costs agreement, should be dismissed. 23Ordinarily, a solicitor who takes unauthorised steps in litigation is required personally to pay the costs they have caused the parties to incur [Hawksford, [111] (Campbell J); Hillig v Darkinjung Pty Ltd (No 2) [2008] NSWCA 147, [47]-[52] (McColl JA; Beazley and Giles JJA agreeing); A W & L M Forrest Pty Ltd v Beamish (1998) 146 FLR 450, 458 (Young J)]. Where a solicitor is found not to have been validly retained by one or more of multiple plaintiffs, the appropriate order is that the names of the relevant plaintiffs be struck out and that the solicitor pay so much of the defendant's costs of the proceedings as are attributable to their having been made a party [Harry S Bagg's Liquidation Warehouse Pty Ltd v Whittaker (1982) 44 NSWLR 421, 430D-G (Powell J)]. 24In principle, the solicitors who brought the dismissed claims should pay the costs, but it is unlikely that their pendency materially increased the costs of the proceedings, apart from those of the motions for dismissal. In the Baldock proceedings, the defendants have achieved a substantial measure of success by way of dismissal of a significant proportion of the plaintiffs' claims, both in number and in value; the solicitors should pay the defendants' costs of the motion. In the Smith proceedings, only four plaintiffs are affected, and most of the originally disputed cases were not pursued, albeit in some cases after curative action was taken. A litigant who disputes a solicitor's retainer runs the risk that any apparent want of authority may be cured by supplementary evidence, or ratified, and I am unpersuaded that the fact that in many individual cases no adequate authority was held until shortly prior to the hearing of the motion and that the defendants did not press the motion in respect of them only after further authority was obtained is sufficient to warrant a costs order in favour the defendants; in the Smith proceedings, there should be no order as to costs. Conclusion 25The disputed authorities authorise the lodgement and prosecution of proofs of debt or claim up to and including adjudication, but do not authorise the institution of curial proceedings. The authority to "take any further such action in relation to this matter" refers to further action necessary for the performance of the particular acts authorised in the authority, including the prosecution of a proof of debt up to the point of adjudication, but are insufficient to justify the institution and maintenance of court proceedings by way of appeal from the liquidators' decision. The authority to follow "the procedure referred to in the Schemes of Arrangement in relation to the agreement and acceptance of my/our claims" refers to the procedure that applies up to and including reference to and determination by the scheme adjudicator, and does not confer authority to commence proceedings under s 1321 in relation to those claims. The claims of those plaintiffs whose only authority is in those terms must be dismissed. In the Baldock proceedings, the defendants have achieved a substantial measure of success, and the solicitors should pay the defendants' costs of the motion. In the Smith proceedings, there should be no order as to costs. 26The defendants should bring in short minutes to give effect to this judgment. Sufficient time has passed since the hearing that, when the orders are made, no further time need be allowed for those plaintiffs who have indicated an intention to do so to produce costs agreements. In the Baldock proceedings, the short minutes should also make formal provision for the disposal of the claims of those plaintiffs who have indicated that they are no longer proceeding. In the Smith proceedings, the short minutes to be brought in should make formal provision for the disposal of the application in respect of the 38th plaintiff Jennifer Mona Walker, the 45th plaintiff, and the 97th plaintiff Mollytan Imperial Pty Ltd in accordance with the agreement reached between the parties. 27The Court directs that the defendants bring in short minutes to give effect to this judgment on a date to be fixed. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 18 July 2014