High Court refuses to extend the advocates’ immunity – Kendirjian v Lepore [2017] HCA 13

On 29 March 2017 the High Court handed down its judgment in Kendirjian v Lepore [2017] HCA 13 (Kendirjian v Lepore), choosing to maintain the advocates’ immunity as recently outlined by the High Court in Attwells v Jackson Lalic Lawyers Pty Ltd [2016] HCA 16. Kendirjian v Lepore silences a NSW line of jurisprudence that attempted to extend the advocates immunity. In this blog post I discuss what the advocates immunity is, the extent of the advocates’ immunity prior to Kendirjian v Lepore, and the effect of the decision.

What is the advocates’ immunity?

Advocates’ immunity is a common law doctrine that barristers and solicitors will be protected from claims brought against them arising from their conduct of litigation. For example if a client brings an action in negligence against their barrister for failing to cross examine a key witness on a crucial point in proceedings, the barrister may be protected from the negligence claim by the advocates’ immunity. Some jurisdictions (i.e. the UK and NZ) have abolished the advocates’ immunity completely. The advocates’ immunity applies in Australia in limited contexts. 

What was the extent of the advocates’ immunity in Australia prior to Kendirjian v Lepore?

A distinction is made between advocates’ in-court work and advocates’ out of court work. In-court work such as the example given in the preceding paragraph will attract the immunity. However, out of court work will only attract the immunity if it is sufficiently connected to in court work. The connection required has been described as:

·         “Work done out of court which leads to a decision affecting the conduct of the case in court”; and

·         “Work intimately connected with work in a court”.

These tests were first formulated by the High Court in Giannarelli v Wraith (1988) 165 CLR 543 at 559-560 (per Mason CJ) and were again affirmed by the High Court majority in D’Orta-Ekenaike v Victoria Legal Aid (2005) 223 CLR 1 at 31 (per Gleeson CJ, Gummow, Hayne and Heydon JJ). In 2016 in Attwells v Jackson Lalic Lawyers [2016] HCA 16 the High Court again affirmed these tests and refused to extend the immunity. A very brief summary of the three cases follows:

1.       Giannerelli v Wraith (1988) 165 CLR 543; [1988] HCA 52

Mr Giannerelli commenced negligence action against his barrister who allegedly failed to advise he had a good defence to perjury proceedings and failed to object to certain inadmissible evidence tendered by the Crown. The Victorian Full Court held that the advocates’ immunity applied to protect the barrister from the negligence claim. Mr Giannerelli appealed to the High Court. The High Court majority (4:3) dismissed the appeal. Mason CJ’s leading judgment forms the basis of advocates’ immunity jurisprudence in Australia. The following extract from pages 559-560 of the CLR is frequently cited:

“Preparation of a case out of court cannot be divorced from presentation in court. The two are inextricably interwoven so that the immunity must extend to work done out of court which leads to a decision affecting the conduct of the case in court. But to take the immunity any further would entail a risk of taking the protection beyond the boundaries of the public policy considerations which sustain the immunity. I would agree with McCarthy P in Rees v. Sinclair (1974) 1 NZLR 180 where his Honour said (at p 187):

"... the protection exists only where the
particular work is so intimately connected with the
conduct of the cause in Court that it can fairly be
said to be a preliminary decision affecting the way
that cause is to be conducted when it comes to a
hearing".”

The High Court majority held that the immunity applied to Mr Giannerelli’s counsel. Counsel had overlooked the operation of a section of the Royal Commissions Act, failing to raise the section as a defence and failing to raise it as a ground of objection to the reception of evidence. Both these failures fell within the category of in court work as they were clearly incidents of the conduct and management of the case in court.

2.       D’Orta-Ekenaike v Victoria Legal Aid (2005) 223 CLR 1

Mr D’Orta-Ekenaike was charged with rape and alleged that his legal representatives (Victoria Legal Aid and a barrister engaged by VLA) were negligent in advising him that he did not have any defence to the charge, that he would receive a suspended sentence if he entered a guilty plea at committal, and if he did not plead guilty and contested the charge at trial and was found guilty he would receive a custodial sentence. The alleged negligent advice was supposedly given on two occasions in barristers chambers, two days before the committal hearing and on the day of but before commencement of the committal hearing.

The High Court majority approved the reasoning of Mason CJ in D’Orta. The joint judgment of Gleeson CJ, Gummow, Hayne and Heydon JJ quoted the passage of Mason CJ extracted above, summarising the test as “work done out of court which leads to a decision affecting the conduct of the case in Court” or “work intimately connected with work in a court”. I have extracted the relevant paragraph:

“Again, we consider that no sufficient reason is proffered for doing so. In particular, there is no reason to depart from the test described in Giannarelli as work done in court or "work done out of court which leads to a decision affecting the conduct of the case in court"or, as the latter class of case was described in the Explanatory Memorandum for the Bill that became the Practice Act, "work intimately connected with" work in a court. (We do not consider the two statements of the test differ in any significant way.)”

The advice given to Mr D’Orta-Ekenaike was advice about whether to enter a plea at committal. A committal effects whether the matter goes to trial. The advice on plea was work an advocate did out of court but led to a decision which affected the conduct of the case at the trial. The advocates’ immunity therefore applied.   

3.       Attwells v Jackson Lalic Lawyers [2016] HCA 16

A bank commenced proceedings against a company and its guarantors. On the first trial day of proceedings in the Supreme Court of New South Wales, counsel for the guarantors informed the court the proceedings had settled, and consent orders reflecting the settlement were made by the court. The guarantors then commenced action against counsel alleging negligence in the advice to consent to judgment being entered against them in the terms of the consent orders and in failing to provide advice as to the effect of the consent orders.  

Counsel for the guarantors sought to extend the advocates’ immunity, arguing that the immunity extends not only to negligent advice leading to a final judicial determination but also to negligent advice that leads to an agreed settlement. The High Court unanimously rejected this argument which they categorised as out of court work with insufficient connection to in court work:

“In short, in order to attract the immunity, advice given out of court must affect the conduct of the case in court and the resolution of the case by that court. The immunity does not extend to preclude the possibility of a successful claim against a lawyer in respect of negligent advice which contributes to the making of a voluntary agreement between the parties merely because litigation is on foot at the time the agreement is made. That conclusion is not altered by the circumstance that, in the present case, the parties' agreement was embodied in consent orders”.

In 2016 the High Court was constituted by French CJ, Kiefel, Bell, Gageler, Keane, Nettle and Gordon JJ. In 2017 with the departure of Chief Justice French, Justice Kiefel stepped up to the role of Chief Justice and Justice Edelman was appointed as a new judge of the High Court. The constitution of the court deciding Kendirjian v Lepore was therefore different to the High Court that decided Attwells in 2016. Nethertheless, the High Court refused to reconsider Attwells or extend the situations in which the advocates’ immunity will protect barristers and solicitors from suit.

Conflicting NSW authority

Prior to Attwells, the NSW Court of Appeal handed down the decision of Donnellan v Woodland [2012] NSWCA 433 (Donnellan). Mr Woodland commenced proceedings against his lawyers who had provided advice about offers to compromise (offers to settle outside of court proceedings usually in an effort to avoid the costs associated with court proceedings - these offers can continue to be made even when court proceedings have commenced) in drainage easement proceedings under s88K of the Conveyancing Act 1919 (NSW). It was not necessary for the Court of Appeal to decide whether the advocates’ immunity applied because they found Mr Donnellan had not been negligent. Nevertheless, Macfarlan J (with whom Leeming JA and Begin CJ in Eq agreed), found that if Mr Donnellan had been negligent, the immunity would have applied, as the omission or conduct relating to the offers to compromise had affected the conduct of the case in the court by requiring the court proceedings to continue. 

I won’t go into the details of the case too much because:

1.       It is a clear case of judicial activism on the part of the Court of Appeal (3 judges of the 5 on quorum) to extend the immunity in the face of clear High Court authority to the contrary, especially when it was not necessary to determine the issue; and

2.       Although the District Court and Court of Appeal (3 judges unanimously) in Kendirjian v Lepore relied on the case, the High Court rejected the NSW approach, as it is incongruous with both D’Orta-Ekenaike and the more recent High Court authority of Attwells.

Facts and background of Kendirjian v Lepore

Mr Kendirjian was injured in a car accident in November 1999 and commenced legal proceedings against the driver for damages. On the first day of the District Court trial the driver offered to settle for $600,000 plus costs. The offer was not accepted, the trial proceeded and Mr Kendirjian was awarded only $308,432.75 plus costs by the District Court judge. Mr Kendirjian commenced negligence proceedings against his solicitor Mr Lepore and his barrister, who both claimed that the advocates’ immunity protected them from the negligence claims.

The District Court and Court of Appeal both held that the advocates’ immunity protected Mr Kendirjian’s legal representatives from his negligence claim. Both courts relied on the obiter dicta in Donnellan to support their conclusions.

Question to be determined by the High Court

Does the immunity extend to negligent advice given to reject a settlement offer where court proceedings are on foot?

High Court analysis

The High Court unanimously held that the advocates’ immunity did not extend to protect Mr Kendirjian’s legal representatives from the negligence action. Edelmen J wrote the leading judgment. Edelman J reiterated the importance of the 2016 case of Attwells where a High Court majority held the advocates’ immunity did not extend to advice which leads to a compromise of litigation by agreement between parties, or advice not to settle proceedings which leads to the continuation of proceedings (note that Nettle J and Gordon J dissented on the advice not to settle point). There must be a functional connection between the advocate’s work and the determination of the case. Negligent advice not to settle proceedings gives rise only to a historical connection between the advice and continuation of litigation and this is not a sufficient connection for an advocate to be immune from suit.

The appellants argued that Attwells should be distinguished and in the alternative that Attwells should be reopened to reconsider the part of the decision where the joint judgment approves the remarks of Mason CJ in Giannarelli. Counsel argued that part of Mason CJ’s remarks in Giannerelli had not been approved by the joint judgement in D’Orta-Ekenaike and that therefore the scope of the immunity could be extended. Edelmen J refused to accept this argument, stating that there is no apparent difference between work done affecting the conduct of the case in court and work done affecting the way that case is to be conducted at the hearing, and even if there was a difference, this was not evident in the joint judgment in D’Orta-Ekenaike.

The appeal was unanimously dismissed by the High Court. However, Justice Nettle and Justice Gordon departed from the majority in their reasoning. Nettle J agreed that the advocate’s immunity did not apply in light of the High Court’s decision in Attwells but reiterated the view he expressed in Attwells that the advocates’ immunity should be extended to situations where negligent advice leads to the rejection of a settlement offer and a less favourable outcome at trial. The immunity should be extended as where the negligence action proceeds it is likely to result in the re-litigation of issues determined at trial.  Gordon J acknowledged the appeal should be dismissed in light of Attwells but agreed with Nettle J’s additional reasons and reiterated her position as expressed in Attwells that the immunity should be extended.

Short summary of the law today

The advocates’ immunity will apply where the work done out of court leads to a decision affecting the conduct of the case in court or where the out of court work is intimately connected with work in a court. The connection must be more than merely a plausible historical connection. There must be a functional connection between the work of the advocate and the determination of the case. The giving of advice either to stop or continue litigation does not itself affect the judicial determination of the case.