John Byrnes & Associates (Legal) Pty Ltd v Quinn (No 2)

HER HONOUR: This matter is listed for hearing today to deal with two issues. First, whether the following order, proposed on 9 July 2021, should be made:

The second issue is what costs order, if any, should be made in respect of these proceedings.

In respect of both issues, the first defendant, Mr Quinn, relied on three primary submissions. First, at the two previous hearings (see John Byrnes & Associates (Legal) Pty Ltd v Quinn [2020] NSWSC 1840 and John Byrnes & Associates (Legal) Pty Ltd v Quinn [2021] NSWSC 834), it was submitted that the Court did not take his evidence and submissions into consideration. The Court should do so at this hearing and revisit the earlier decisions.

Mr Quinn’s submissions and evidence were canvassed and considered in my two earlier judgments and I am not going to revisit those judgments on this occasion. That is for another court.

Second, Mr Quinn has paid some of the law firm’s costs and thus some of the monies in Court should be paid to him.

As I noted in John Byrnes [2021] at [10]:

Whilst it is the case that Mr Quinn has paid some of the law firm’s fees, it is but a small portion and much remains unpaid. As I noted in John Byrnes [2021] at [14], Mr Quinn continues to owe the law firm is $104,162.59, being some $30,000 more than the monies since paid by NSW Housing into Court.

Third (and related to the second submission), Mr Quinn has made a reasonable offer to the law firm to divide up the monies in Court, which the law firm has unreasonably refused to accept. As I noted in John Byrnes [2021] at [13]:

As I noted in John Byrnes [2020] at [32] and John Byrnes [2021] at [48], it is not clear to me why a portion of the monies in Court – paid in by NSW Housing to pay Mr Quinn’s legal costs as assessed – should be paid to Mr Quinn. The purpose of the funds is to pay Mr Quinn’s legal bills, not for Mr Quinn to derive a financial benefit. This position might be different if Mr Quinn had already paid the law firm, but he has not. Further, as I noted in John Byrnes [2021] at [33], if the law firm were to accept even less funds than those paid into Court in payment of its fees, the ‘indemnity principle’ would likely mean any monies not paid to the law firm for Mr Quinn’s legal fees should be repaid to NSW Housing, not to Mr Quinn.

Fourth, I should add that Mr Quinn has on this application repeated many of the submissions made at the two earlier hearings.

In the result, as to whether the monies held in court should be paid out to the law firm on its undertaking, Mr Quinn’s submissions do not detract from what I had in mind in John Byrnes [2021] at [49]-[52] as to the way forward given the possibility that Mr Quinn may have the law firm’s costs assessed and, perchance, that assessment may result in the law firm being entitled to less than the monies in Court.

Turning then to the appropriate order, if any, for the costs of the proceedings, the plaintiff sought their costs be paid by Mr Quinn subject to any discount by reason of the proceedings effectively having been stayed for a period of time so that the law firm could comply with section 333 of the Legal Profession Act 2004 (NSW).

When the plaintiff commenced these proceedings, four prayers for relief were sought:

As matters unfolded at the hearing on 14 December 2020, only prayers 1 and 3 were pressed as, shortly before the hearing, Mr Quinn pointed out that the legal bills served by the law firm did not fully comply with the Act. On that occasion, I made a declaration in respect of an equitable lien. The law firm re-served the bills on 21 December 2020 and thereafter pressing it application for summary judgment in respect of the balance of the summons.

Having regard to the requirements of section 331 of the Act, considered in John Byrnes [2021] at [41]-[45], I do not consider it appropriate that the law firm have its costs of the proceedings until it had served bills in accordance with the Act and the requisite 30 days prescribed by section 331 had passed. This would not preclude the plaintiff having its costs for seeking, and obtaining, a declaration as to equitable lien on 14 December 2020.

For these reasons I make the following orders: