Sims v Chong [2015] FCAFC 80

The Full Court of the Federal Court held unanimously that the advocate’s immunity does not apply to an interlocutory decision to strike out a cause of action. 

In Sims v Chong [2015] FCAFC 80 the Full Court of the Federal Court[1]  also queried, without deciding, whether the advocate’s immunity will apply to statutory liabilities including claims of unconscionable conduct under theAustralian Consumer Law. The case provides a useful examination of the scope of the advocate’s immunity from suit and the public policy of the need for finality in litigation[2].

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The appellant (‘Sims’) retained the respondent (‘Chong’) as his solicitor in a claim relating to his ownership of certain trademarks, patents and strategies, and the use by agreement of that intellectual property by Suda Ltd (‘Suda’). A series of orders were made first in the WA District Court and then in the WA Supreme Court striking out successive versions of the statement of claim, culminating with the WA Supreme Court on 21 February 2015 making orders striking out the action.

Rather than appealing the WA Supreme Court’s decision, Sims sued his solicitor Chong in the Federal Court for failing to represent him competently and for misleading or deceptive conduct by representing a competency that she did not have.

Decision at first instance

Barker J at first instance[3] summarily dismissed Sims’ case against Chong pursuant to s 31A of the Federal Court Act 1976 (Cth). His Honour held that the case against Chong should be struck out as an abuse of process because it necessarily involved a review of the WA Supreme Court’s decision on 21 February 2014 to strike out the claim in contract against Suda Ltd. In addition, Barker J referred to D’Orta-Ekenaike and held that Chong was protected from suit by the advocate’s immunity as the drafting of the statement of claim in the WA Supreme Court action was ‘plainly work done out of court which leads to a decision affecting the conduct of a case in court’.[4]

Full Court’s decision

The Full Court upheld Sims’ appeal and held that the statement of claim brought against Chong was not an abuse of process. It extended beyond the claim in contract that had been made against Suda in the WA Supreme Court, particularly insofar as it related to representations Chong made as to her professional ability to act as Sims’ lawyer, and because it alleged a failure by Chong to provide proper advice regarding alternative claims that could have been pursued against Suda.

In holding that the advocate’s immunity did not apply in the circumstances, the Full Court referred to Alpine Holdings Pty Ltd v Feinaeur [2008] WASCA 85 (‘Alpine’). In Alpine it was alleged that the plaintiff’s legal advisor had misrepresented the damages likely to be awarded at trial, and a claim was brought in negligence and for misleading and deceptive conduct. The WA Court of Appeal held that the claim against the legal advisor did not involve a derogation from or an undermining of the finality principle referred to inD’Orta-Ekenaike because it would be unnecessary to re-open the Court’s decision as to the damages ultimately awarded. In the circumstances of Alpine, the advocate’s immunity was held not to apply.

The Full Court held, similarly, that Sims’ claim was for the loss of the opportunity properly to present his case. In that circumstance, Sims was not attempting a collateral attack on the WA Supreme Court’s decision. In any event the WA Supreme Court’s decision to strike out the statement of claim was not a final determination of the controversy between the parties,[5] and so the finality principle was not engaged.

Statutory liability and the advocate’s immunity

Interestingly, the Full Court also considered the statutory causes of action Sims relied on, if established, may not fall within the protection of the advocate’s immunity.

This issue was comprehensively discussed in Nikolaidis v Satouris [2014] NSWCA 448 (‘Nikolaidis’) in respect of statutory misleading or deceptive conduct. There is no binding High Court authority on the point, although Callinan J in Boland v Yates Property Group Pty Ltd 74 ALJR 209 said inobiter that he considered that the advocate’s immunity extended beyond claims in negligence.[6] In Nikolaidis the NSW Court of Appeal held that the advocate’s immunity applies to claims for statutory misleading or deceptive conduct, but accepted that, as the immunity has its roots in public policy, it is not an absolute immunity; it might therefore yield in other circumstances to a competing public policy.[7]

The Full Court accepted that it ought to apply Nikolaidis as a fellow intermediate court within the Australian jurisdiction.[8] However, it pointed out that, if the statutory liability Sims ultimately invoked involved unconscionable conduct, then different public policy considerations and different qualitative differences might arise, beyond the pubic policy of finality underpinning the advocates immunity. The Full Court regarded this as a further reason to set aside the trial judge’s orders striking out Sims’ proceeding as an abuse of process.

Conclusion

The scope of the advocate’s immunity remains capable of providing fertile ground for argument. As a footnote, the High Court on 4 August 2015 refused special leave to Nikolaidis in respect of whether the advocate’s immunity applies to statutory causes of action, but primarily on the basis that the case did not provide an appropriate vehicle to reconsider the scope of the immunity.[9]

In contrast, on 7 August 2015 special leave was given in Attwells & Anor v Jackson Lalic Lawyers Pty Ltd in respect of whether the immunity applies to settlements of litigation.[10]

In any case, it seems plainly correct that the advocate’s immunity ought not to apply to interlocutory decisions, because by definition they do not finally determine the rights of the parties. Of course, for that very reason, parties are generally unlikely to purse claims against legal practitioners when their interlocutory rights alone have been affected.