Pannetta v Parkview Constructions Pty Ltd [2014] NSWDC 341

District Court New South Wales

Medium Neutral Citation: Pannetta v Parkview Constructions Pty Ltd [2014] NSWDC 341 Hearing dates: 8 October 2014 Date of orders: 08 October 2014 Decision date: 08 October 2014 Jurisdiction: Civil Before: P Taylor SC DCJ Decision: (1) The default judgment is set aside. (2) Plaintiff's costs of the application be his costs in the cause. (3) Stand over for directions on Wednesday, 22 October 2014 at 10am before the list judge. Catchwords: COSTS – solicitor's costs DEFAULT JUDGMENT – setting aside – adequate disclosure of fees – costs of application Legislation Cited: Legal Profession Act 2004, s 309, s 310, s 311, s 312, s 316, s 317, s 321, s 332 Legal Profession Regulations 2005 Uniform Civil Procedure Rules 2005, r 42.1, r 42.7 Texts Cited: Ritchie's Uniform Civil Procedure NSW Category: Procedural and other rulings Parties: Rocco Vincenzo Pannetta (plaintiff) Parkview Constructions Pty Ltd (defendant) Representation: Counsel: Mr M Fantin (plaintiff)

Solicitors: e.law SCL Pty Ltd (plaintiff) Salim Rutherford Lawyers (defendant) File Number(s): 2014/102358 Publication restriction: None

Judgment 1. Rocco Pannetta acted as solicitor for Parkview Constructions Pty Ltd ("Parkview") from 2004 until 2008. On about 6 December 2005 Mr Pannetta sent to Parkview a costs agreement and a costs disclosure. A number of invoices he issued to Parkview were paid, however 21 invoices were issued on 6, 13 and 27 March 2008 and 20 and 30 April 2008 totalling $181,136.97, which are alleged not to have been paid. 2. Mr Pannetta commenced proceedings by a statement of claim dated 4 April 2014. He requested a defence on 2 May 2014 and again on 29 May 2014. Particulars were requested by Parkview on 30 May 2014 and answered by Mr Pannetta on 1 July 2014 and again Mr Pannetta requested a defence. On 10 July 2014 Parkview sought from Mr Pannetta an extension until 1 August 2014 to file a defence. Mr Pannetta agreed on 14 July 2014. On 1 August 2014 Parkview again wrote to Mr Pannetta complaining that the particulars were not satisfactory and suggested Mr Pannetta review the claims. On 3 September 2014 Mr Pannetta obtained default judgment and on 18 September 2014 commenced enforcement. The issue before me is whether that default judgment should be set aside. 3. On 24 September Parkview retained lawyers and filed a motion to set aside default judgment. Mr Pannetta made an open offer on 26 September 2014 to cease enforcement action, obtain an assessment of costs, and stay proceedings under 2 February 2015 to enable the assessment to be completed. The offer was not accepted. At the hearing before me Mr Pannetta accepted that the result of the application turned on whether Parkview had an arguable defence. Mr Pannetta sought to maintain his judgment only in respect of 13 invoices totalling $168,620.22 plus interest. 4. Parkview says that the claim of Mr Pannetta would fail for a number of reasons. 5. First, Parkview submits that Mr Pannetta in a number of respects gave no estimate or range of estimates of the anticipated costs, contrary to s 309(1)(c) of the Legal Profession Act 2004. Section 309(1)(c) provides: "309 Disclosure of costs to clients (1) A law practice must disclose to a client in accordance with this Division: … (c) an estimate of the total legal costs if reasonably practicable or, if that is not reasonably practicable, a range of estimates of the total legal costs and an explanation of the major variables that will affect the calculation of those costs…" 1. Parkview submits that the costs agreement relied on by Mr Pannetta only applies to two litigious disputes and contains an estimate of likely costs in respect of one matter only. It relies on paragraph B of the costs agreement, which says: "The work we have been instructed to do is: • Conduct Abby Precast Dispute • Conduct Sydney Super Seal Dispute, • Ongoing commercial/corporate/construction/property law advice and legal matters for all Parkview entities and individual directors." 1. Parkview submits that the reference to "Ongoing" means that the agreement does not embrace new matters, and the references to the "Dispute" and to "legal matters" means that litigious matters other than the two disputes listed are not embraced by the agreement. 2. Parkview also relies on paragraph 4 of the costs disclosure, which states: "4. Estimate of Costs The following estimate is based on the information available to us to date for the Abby Precast dispute. It is an estimate, not a quotation and subject to change. 4.1 It is not possible at this time to provide an accurate estimate of the total costs. Instead a range of estimates is provided (all amounts exclusive of 10% GST): Stage 1: Instructions and investigation of the matter: $5,000.00 Stage 2: Arbitration and Litigation $10,000 - $30,000 Stage 3: Settlement negotiations $5,000.00 - $10,000 Total $15,000 - $35,000