Kearney v Amirbeaggi (No 3)

1. [1]

   FREE JA: This matter arises from a professional negligence claim that the applicant, Mr Brian Kearney, brought against his former solicitor, Mr Farshad Amirbeaggi and an incorporated law firm associated with Mr Amirbeaggi.

2. [2]

   The matter has a long and troubled procedural history. The procedural history up to April 2025 was summarised by Kirk JA in Kearney v Amirbeaggi (No 2) [2025] NSWCA 73 at paragraphs [6]-[30]. It is unnecessary to repeat that history here or attempt to summarise it again.

3. [3]

   It is sufficient to point to important developments since April 2025.

4. [4]

   The substantive proceedings were listed for hearing before Fagan J on 28 April 2025. Mr Kearney did not attend that hearing, but notified the associate to Fagan J that he was experiencing acute mental distress that had led to an admission at the Sydney Clinic. His Honour treated Mr Kearney as having made an application to vacate the hearing. He received evidence from Dr Grace, who was the psychiatrist treating Mr Kearney. Dr Grace was cross-examined. Fagan J dismissed the application to vacate the hearing. The hearing proceeded without the plaintiff being represented or evidence being received in support of his case. His Honour proceeded to dismiss Mr Kearney’s further amended statement of claim filed 13 October 2020 and entered judgment for the defendants.

5. [5]

   These matters were dealt with in orders that were made by Fagan J on 1 May 2025 and reasons for judgment delivered on 14 May 2025: Kearney v Amirbeaggi [2025] NSWSC 455.

6. [6]

   His Honour also made orders for costs in favour of the defendants and gave directions to allow part of the costs to be dealt with by way of a gross sum costs order. The costs in question included costs associated with previous interlocutory events, as well as the costs of the trial. The defendants provided evidence and submissions to facilitate the making of a gross sum costs order. On 17 October 2025, Fagan J handed down judgment in Kearney v Amirbeaggi [2025] NSWSC 1223, ordering that the relevant costs be paid in the gross sum of $369,432.

Amended notice of motion in the Court of Appeal

1. [7]

   On 25 September 2025 Mr Kearney filed in the Court of Appeal an amended notice of motion. It seeks a number of orders. Relevantly for present purposes, by prayer 2 Mr Kearney seeks a stay of proceedings in the Common Law Division pending the final judgments in “the appeal proceedings”. By prayer 3, he seeks a stay of enforcement of all costs orders made by Fagan J in the Common Law Division pending the conclusion of “the appeal proceedings”. That would include the gross sum costs order made on 17 October 2025.

2. [8]

   By prayer 4 Mr Kearney seeks the appointment of Mr Keiran Stoneham as his tutor under the Uniform Civil Procedure Rules 2005 (NSW) (UCPR). In the alternative, by prayer 6 of the amended notice of motion, Mr Kearney seeks an order that Mr Stoneham be allowed to act as his next friend and be permitted to speak on his behalf during court hearings. Prayer 5 seeks an order dispensing with the default requirement in r 7.14(2) that a tutor must commence or carry on proceedings through a solicitor.

3. [9]

   While Mr Kearney seeks an order for appointment of a tutor it is not essential for this to occur in order for him to be replaced by a tutor. As recognised expressly in r 7.15(1), a person may become the tutor of a person under a legal incapacity without the need for any formal instrument of appointment or any order of a court. This may be achieved by the filing of the notice of consent and certificate referred to in r 7.16. The critical requirement in this respect is that Mr Kearney must be a person under a legal incapacity. Mr Kearney has filed evidence which he contends establishes that he has at relevant times lacked capacity to act on his own behalf, and he maintains that this is still the position as of today. As Mr Kearney pointed out at the hearing on 20 October 2025, this is not so much a matter of Mr Kearney’s own self-assessment but rather a position which he advances based on the professional judgments of qualified experts, including his treating psychiatrist Dr David Grace and consulting expert Dr Donald Rowe. I will return to this issue because it has important implications for resolving the matter that is before the Court.

4. [10]

   By prayers 7 and 8 Mr Kearney seeks an order dispensing with the requirement to file a notice of appeal, and an order that his application for leave to appeal and the appeal be heard concurrently.

Procedural orders in relation to the amended notice of appeal

1. [11]

   The amended notice of motion has come before the Registrar of the Court of Appeal for directions on at least two occasions. On 24 September 2025 counsel for the respondents pointed out that the amended notice of motion was problematic in circumstances where there was no appeal on foot challenging the final judgment of Fagan J (noting that as of 24 September 2025 the gross sum costs order remained outstanding). The same point had been raised in correspondence sent by the solicitors for the respondents to Mr Kearney on 23 September 2025.

2. [12]

   The formal deficiencies with Mr Kearney’s position were correctly identified by the respondents. Although there were proceedings on foot in the Court of Appeal, they had become redundant by September 2025. On 18 February 2025 Mr Kearney filed in the Court of Appeal a summons seeking leave to appeal from certain orders made by Harrison CJ at CL on 13 September 2024 and Fagan J on 17 February 2025. The orders in question were interlocutory orders relating to the case management of the substantive proceedings in the Common Law Division.

3. [13]

   On 2 April 2025 Mr Kearney filed an amended summons seeking leave to appeal. He withdrew his challenge to the orders made by Harrison CJ at CL on 13 September 2024, and sought instead to challenge various orders made by Fagan J on 17 February, 19 February, 7 March and 21 March 2025. Again, these were procedural orders relating to the case management of the matter in the Common Law Division.

4. [14]

   By 24 September 2025, the amended summons seeking leave to appeal had been rendered out of date by developments in the substantive matter in the Common Law Division. The various procedural orders that were ostensibly under challenge no longer had operative force. They had been overtaken by the final hearing and the resolution of the matter by Fagan J on 1 May 2025 (subject only to the formulation of the gross sum costs order). As counsel for the respondents submitted to the Registrar on 24 September 2025, if Mr Kearney wished to challenge the correctness of the final orders by Fagan J Mr Kearney needed to take the formal step of filing not only a notice of appeal but also an application for an extension of time to appeal from those orders.

5. [15]

   On 24 September 2025 the Registrar made orders for the filing of evidence and the relevant forms in relation to a tutor assuming responsibility for the proceedings, whether by way of appointment or otherwise. On 15 October 2025 the applicant was granted an extension of time until 27 October 2025 for filing of that material. The respondents have yet to determine if they will file evidence on the question of Mr Kearney’s capacity and the role of a tutor in carrying on the appeal proceedings. The respondents have understandably taken the position that they will make that determination after they have had an opportunity to review the material filed by Mr Kearney.

6. [16]

   The amended notice of motion was listed for further directions on 15 October 2025 before the Registrar. In the course of that directions hearing Mr Kearney indicated his desire to press for stay orders pursuant to prayers 2 and 3 of his amended notice of motion in advance of the resolution of the balance of the prayers (including resolution of the issue regarding the proposed tutor). The Registrar referred prayers 2 and 3 only of the amended notice of motion for hearing by a Judge of Appeal, on the express basis that the referral was confined to the question of whether there ought to be an interim stay imposed pending resolution of the issue regarding the proposed tutor. That is the referral that came before me for hearing on 20 October 2025.

Prayer 2 has become redundant

1. [17]

   Prayer 2 has now become redundant. It seeks an order staying the proceedings in the Common Law Division pending the final judgments in the appeal proceedings. The proceedings in the Common Law Division have now come to an end. As explained above, Fagan J made final orders in relation to the substantive proceedings in May 2025. The final outstanding issue concerned the gross sum aspect of the costs orders. That was resolved in the Common Law Division by the judgment delivered on 17 October 2025.

Prayer 3 – Interim order staying enforcement of costs orders against Mr Kearney

1. [18]

   It follows that the only issue before the Court on 20 October 2025 was prayer 3 of the amended notice of motion, seeking a stay of enforcement of all costs orders made by Fagan J “pending final judgments and conclusion of the appeal proceedings”. Because of the terms on which the matter was referred by the Registrar, the debate was further confined to the question of whether such an order ought to be made pending the resolution of prayers 4, 5 and 6 of the amended notice of motion.

2. [19]

   The respondents opposed the granting of such a stay. The respondents emphasised that Mr Kearney has still not filed any notice of appeal seeking to challenge the final orders made by Fagan J on 1 May 2025. This makes the reference in the amended notice of motion to “the appeal proceedings” somewhat misleading. On 23 May 2025 Mr Kearney filed a notice of intention to appeal from the judgment of 1 May 2025, but nothing has since been filed to commence an appeal. This is despite the respondents having raised the need for the formal position to be rectified by filing a notice of appeal and an application for an extension of time to file a notice of appeal. The respondents submit that in circumstances where Mr Kearney has not regularised the position in the Court of Appeal, despite fair warning to do so, his application for a stay is not properly in aid of any ongoing appeal process and should be rejected.

3. [20]

   Over the course of the weekend before the hearing Mr Kearney provided to the Court a 25 page document described as a “draft notice of appeal”. He also provided a 22 page document described as “draft grounds leave to appeal”. Mr Kearney confirmed at the hearing on 20 October 2025 that these documents set out the grounds on which he would propose to challenge the decisions made in the Common Law Division that have led to the dismissal of his claim and the making of adverse costs orders. This includes, but is not limited to, the judgment of Fagan J of 1 May 2025.

4. [21]

   Mr Kearney indicated that if the absence of a properly filed document is the decisive impediment to obtaining a stay, he would seek an adjournment to enable him to regularise the position by filing a notice of appeal incorporating the proposed grounds.

Application of principles governing the granting of a temporary stay

1. [22]

   In Michael Hill Jeweller (Australia) Pty Ltd v Gispac Pty Ltd [2024] NSWCA 128 at [5] Payne JA explained that the principles governing the granting of a stay pending appeal are analogous to those governing the grant of interlocutory relief before trial. A party applying for a stay must show that the appeal raises serious issues for determination and that there is a real risk that the appellant will suffer prejudice or damage if the stay is not granted. If those matters are established, it becomes necessary to consider the balance of convenience and the competing rights of the parties. The absence of arguable grounds of appeal is likely to be determinative against a stay application: see Di Liristi v Matautia Developments Pty Ltd [2021] NSWCA 163 at [5].

2. [23]

   The respondents are right to point to the problematic status of the current position in the Court of Appeal. Mr Kearney is seeking a temporary stay of adverse costs orders ostensibly in support of his challenge to the correctness of the judgments that have given rise to those orders, but he does not have an appeal on foot challenging the relevant decisions. Ordinarily that might be considered fatal to a stay application of this kind. However, the circumstances of the current case are unusual. Mr Kearney has filed extensive evidence which demonstrates that, at the very least, he has been suffering from severe psychological distress over many months, to the point of hospitalisation and attempted suicide. Mr Kearney has expressly raised a question about whether his condition reaches the level, and/or has at relevant times in the past reached the level, that he is and/or has been a person under legal incapacity within the meaning of Pt 7 Div 4 of the UCPR. There is a related extant issue, scheduled to be addressed in coming weeks, about whether a tutor can and should now take carriage of the appeal and any applications on behalf of Mr Kearney (including any further stay of enforcement of the costs orders against him).

3. [24]

   In these unusual circumstances, for the purposes of dealing with the application for an interim stay of short duration, it is appropriate to look past the formal deficiencies and proceed on the basis that the draft documents that have been filed by Mr Kearney serve to identify the grounds of appeal that he seeks to rely on to challenge the relevant decisions of Fagan J and (to the extent relevant) other judicial officers who made case management decisions leading to the final hearing and judgments of Fagan J. Given the unusual combination of circumstances, it is not appropriate to require, as a prerequisite to treating the documents in this fashion, that Mr Kearney file documents to institute an appeal in these terms. For the same reasons I did not consider it appropriate to adjourn the hearing of the stay application to allow Mr Kearney to convert the prolix draft appeal documents into a filed notice of appeal. There is an unresolved issue about whether Mr Kearney currently has the capacity to act on his own behalf and there is a real prospect that it may soon be the responsibility of a tutor to make decisions as to what form the appeal may take, if the tutor decides to formally institute the appeal. It is in the interests of all parties, and conducive to the proper administration of justice by the Court, that if a tutor takes responsibility for commencing and maintaining the appeal the notice of appeal should reflect the informed consideration of the tutor about the real issues to be agitated on the appeal.

4. [25]

   This is not to overlook the fact that any appeal that is sought to be instituted is also out of time. Whether instituted by Mr Kearney or by a tutor, any notice of appeal will now need to be accompanied by an application for an extension of time. It is sufficient for present purposes to find, as I do, that there is a seriously arguable basis for such an extension of time being granted, having regard to the same evidence about Mr Kearney’s mental condition that I have referred to above.

5. [26]

   The draft grounds of appeal filed by Mr Kearney are voluminous, repetitive and in some cases unclear. It is sufficient to observe that Mr Kearney has identified a seriously arguable issue about the correctness of the decision under appeal as it relates to Mr Kearney’s capacity to appear at the hearing. When the matter came on for final hearing before Fagan J and Mr Kearney failed to appear, he was at the time hospitalised because of apparently acute psychological distress. That presented a difficult question for the trial judge to resolve, in circumstances where the respondents disputed that Mr Kearney lacked mental capacity to act and pressed for the hearing to proceed in his absence. This was also not the first time that Mr Kearney had allegedly become incapacitated when he was required in court to advance his case.

6. [27]

   Fagan J was not persuaded to accept that Mr Kearney was lacking the capacity to appear. His Honour inferred that Mr Kearney was not genuinely affected by disabling psychiatric symptoms when he presented to Dr Grace in the days prior to commencement of the hearing: J[39]. His Honour placed particular weight on the fact that Mr Kearney had demonstrated through a number of appearances a capacity to advance his cause with apparent vigour which Fagan J perceived to be inconsistent with the later claim of incapacity. His Honour concluded that the Court’s longitudinal exposure to Mr Kearney’s conduct and state of mind over a number of hearings gave the Court a significant advantage over Dr Grace when it came to assessing whether Mr Kearney’s claimed pathological panic prior to the final hearing was genuine: J[46].

7. [28]

   It is sufficient for the purposes of this stay application to observe that the evidence before his Honour raised a serious question about Mr Kearney’s mental capacity to participate in the hearing, which in turn gives rise to an arguable ground of appeal about his Honour’s treatment of that evidence. As the respondents correctly pointed out at the hearing of the stay application, Mr Kearney will face significant obstacles in overturning the findings of Fagan J on the factual question in circumstances where those findings turned in part on cross-examination of Dr Grace and his Honour’s assessment of the reliability of Dr Grace’s evidence in light of the cross-examination. There are also issues to be confronted by Mr Kearney about what would have occurred if the hearing was adjourned, given the indications of Fagan J about the orders that he would have made if persuaded that Mr Kearney’s claimed psychiatric indisposition was genuine: J[58]. While these matters are relevant to the ultimate prospects of Mr Kearney succeeding, they do not in my view go so far as to avoid the conclusion that in light of the evidence before Fagan J there are arguable grounds of appeal going to the correctness of the conclusion that Mr Kearney did not lack capacity.

8. [29]

   The respondents also point out, correctly, that the gross sum costs order related not only to the final hearing but also to interlocutory orders at earlier stages. The respondents submit that to the extent that Mr Kearney seeks to impugn those interlocutory orders, it will be necessary for him to demonstrate error at those anterior points. While this is accurate, I do not consider it necessary to determine if there is a seriously arguable issue about the correctness of each of those interlocutory orders. It is sufficient to focus on the intended challenge to the orders of 1 May 2025, in circumstances where the gross sum costs order was at least partly dependent on the validity of those orders.

9. [30]

   The next question that arises is whether Mr Kearney has established that there is a real risk that he will suffer prejudice or damage if the stay is not granted. Here it is necessary to say something about the practical effect of the stay order, given its temporary nature. On the current timetable, the issue regarding whether Mr Kearney lacks capacity and the associated appointment or recognition of a tutor is likely to be heard and resolved by the Court in early November (if the respondents do not decide to adduce evidence on the matter) or a matter of weeks thereafter (if the respondents require time to file evidence). Mr Kearney is subject to a direction to file his evidence by 27 October 2025, which is a date that already reflects an extension requested by Mr Kearney. I have determined the present application on the assumption that Mr Kearney will comply with that court deadline, as he assured me he can. Any delay in that regard could be a factor relevant to any later application to lift the stay.

10. [31]

    It follows that an interim stay order precluding the enforcement of the costs order would only be in place for a short period of time. There is no evidence to suggest that, absent a stay, this process would move at such a pace as to enable enforcement to be achieved within that timeframe, so as to visit financial consequences on Mr Kearney during the period for which the interim stay would otherwise apply. The respondents have not indicated by evidence or otherwise any specific plans to commence enforcement action. They have merely indicated that they wish to be at liberty to start the process of enforcement.

11. [32]

    Mr Kearney does not seek to rely on any financial prejudice or damage that he would suffer in the absence of an interim stay by reason of having to meet the costs liabilities. Nor, relatedly, does he say that his ability to prosecute the appeal would be impaired in the absence of a stay because of financial impacts that would affect his ability to pay for the litigation.

12. [33]

    Instead, Mr Kearney points to evidence that his psychological condition is apt to deteriorate in a substantial way to the extent that he has to engage in litigious procedures. Mr Kearney accepts that any further prosecution of an appeal will necessarily impose a psychological burden of this kind, including to resolve the issue about a tutor. However, he says that any steps to enforce the costs orders over the coming weeks will add to the psychological burden in a way that presents a serious danger to his mental health and welfare. The evidence does provide a reasonable basis for making that asserted connection.

13. [34]

    In circumstances where it seems inevitable that Mr Kearney will have to endure a psychological burden if he wants to persist with the litigation, the exacerbation of his mental ill-health might be considered to be somewhat marginal. However, it is a real and identifiable consequence of allowing the respondents to proceed with action to enforce the costs orders against Mr Kearney. Although there was no evidence about specific measures likely to be taken in the coming weeks by the respondents in this regard, the premise of the respondents’ opposition to the interim stay was that they wish to have the option of starting the process of enforcement. In the circumstances, there is a real risk that in the absence of a stay Mr Kearney will suffer prejudice or damage of the kind he fears.

14. [35]

    As to the balance of convenience, this is a situation where neither side can point to substantial prejudice from either the grant or refusal of the stay. I have described above the position of Mr Kearney. As for the respondents, they are not in a position to show that they will suffer any particular prejudice, beyond a short delay in starting the process of enforcement. Beyond a short delay, that is not said to have any downstream consequences in terms of the respondents ultimately obtaining the fruits of the costs orders, if they remain entitled to them. The respondents cannot point to any evidence that there is a risk of dissipation of relevant assets by Mr Kearney, such that there is a pressing need to commence enforcement of the costs orders immediately to avoid frustration of the respondents’ rights.

15. [36]

    In the circumstances, this is a situation where the balance of convenience involves comparing two relatively weak claims of prejudice, namely a real but nevertheless marginal psychological impact on Mr Kearney and a short delay in the respondents being able to commence the process of enforcement. The balance of convenience favours Mr Kearney in this regard.

16. [37]

    The respondents have expressed concern about the prospect of an extended delay in being able to commence enforcement proceedings. Informed by the troubled procedural history of the proceedings in the Common Law Division, the respondents legitimately point to a risk that the Court of Appeal proceedings, if they are maintained, will become similarly protracted. That in turn could give more weight to a concern about delay in enforcing extant costs orders. However, the application before me is confined to an interim stay only. As matters stand, it is likely to be in place for only a matter of weeks. That assumes, among other things, that Mr Kearney proceeds to file the evidence that is currently due on 27 October 2025 and that there is no other unexpected impediment to a resolution of the issues concerning incapacity and representation of Mr Kearney’s interests through a tutor soon thereafter. To address the possibility that the Court is not in a position to resolve those issues as efficiently as is presently anticipated, I will grant liberty to apply to the Court for a lifting of the stay if those issues are not resolved by 11 December 2025. That is not to assume that it would necessarily be appropriate to lift the stay in those circumstances. Rather, the order is intended to provide a mechanism for the respondents to seek to reagitate their concerns if that situation arises. As for the position after the Court has resolved the issues raised by prayers 4, 5 and 6, if Mr Kearney or his tutor makes an application for a further stay and the respondents maintain their opposition on the basis of concerns about delay in enforcement, the Court will need to assess the impact on the respondents in that different context.

17. [38]

    The orders of the Court will be:

    1. (1)

       Subject to further order of the Court, enforcement of the costs orders made in the proceedings by Fagan J in the Common Law Division is stayed until prayers 4, 5 and 6 of the amended notice of motion filed by the applicant on 25 September 2025 are resolved (including by their withdrawal or by dismissal).

    2. (2)

       If prayers 4, 5 and 6 of the amended notice of motion filed by the applicant on 25 September 2025 have not been resolved by 11 December 2025, the respondents have liberty to apply to the Court of Appeal Registrar for an order lifting the stay in order 1.

    3. (3)

       Costs of the hearing in respect of orders 2 and 3 of amended notice of motion filed by the applicant on 25 September 2025 shall be costs in the appeal (including any application for an extension of time to appeal), if and when instituted.