Carew Counsel Pty Ltd v French

(2002) 4 VR 172; [2002] VSCA 1

Victorian Court of Appeal

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Interrogate

Catchwords

1. Tort Law
2. › Negligence
3. › Professional negligence
4. › Solicitor's duty of care
5. › Breach of retainer
6. › Whether solicitor negligent in failing to serve declaration of intention to present debtor's petition on creditor
7. › Standard of care where novel and untested statutory provisions
8. › Bankruptcy Act 1966 (Cth), Division 2A, ss 54A, 54E, 54H
1. Costs
2. › Solicitor's equitable lien
3. › Fruits of litigation lien
4. › Whether lien extends to costs incurred after settlement of litigation
5. › Whether costs 'immediately incidental' to recovery of fruits of litigation
1. Bankruptcy
2. › Declaration of intention to present debtor's petition
3. › Stay period
4. › Enforcement suspended during stay period
5. › Duties of person entitled to deduct money owing to declared debtor
6. › Whether garnishee order holder is 'secured creditor'
7. › Bankruptcy Act 1966 (Cth), ss 54A, 54E, 54H, 54L

Quick Take

A solicitor acting for an impending bankrupt is not negligent for serving a declaration of intention to present a debtor's petition on the party holding the debtor's funds (under s 54H) rather than on creditors (under s 54E), particularly where the statutory provisions are novel and untested and the time frame is urgent. The solicitor's equitable lien over the fruits of litigation does not extend to costs incurred after settlement in dealing with competing claims on the settlement monies, as such work is not 'immediately incidental' to the recovery of the fund. The interpretation of Division 2A of the Bankruptcy Act, including whether a garnishee order holder is a 'secured creditor' under s 54L, remains unresolved.