Papua New Guinea Law Reports - 1981
[1981] PNGLR 392
N319(L)
PAPUA NEW GUINEA
[NATIONAL COURT OF JUSTICE]
MARSH
V
HAY
Waigani
Pratt J
9 October 1981
12 October 1981
LEGAL PRACTITIONERS - Bills of costs - Bill in taxable form - Lump sum bill not included - Client’s right to bill in taxable form before action - Legal Practitioners Act 1954, ss. 24, 28, 29, 30.
LEGAL PRACTITIONERS - Accounts and trust moneys - Fund paid in to meet costs and disbursements - Necessity to obtain specific direction from client as to payment - Legal Practitioners Act 1954, ss. 24, 28, 29, 30.
A solicitor’s client has a right to demand, receive and have taxed a proper bill of costs in taxable form before being sued for non-payment.
The Graziano, and Young & Williams’ Bill of Costs (M.P. 50 of 1980) Kearney Dep. C.J. 24th July, 1981, (unpublished) applied.
Woolf v. Trebilco [1933] V.L.R. 180; 39 A.L.R. 142 referred to.
A statement listing by day or month various items of work carried out by a solicitor and stipulating at the end thereof a specified figure and including another specified figure for disbursements is a lump sum bill and is not a bill of costs in taxable form.
An agreement between solicitor and client whereby the client pays funds to cover present and future costs and disbursements:
(a)      requires the solicitor to deposit such funds to the client’s trust account and to withdraw them only with specific directions related to specific bills: and
(b)      does not deprive the client of the right to have such costs and disbursements itemized and justified.
Summons.
This was a summons seeking presentation of a solicitor’s bill in taxable form.
Counsel:
J. Nihill, for the plaintiff.
The defendant in person.
Cur. adv. vult.
12 October 1981
PRATT J:  In November, 1980 the plaintiff, Leonard Noel Marsh, received through his post office box at Tinputz in Bougainville a statement, bearing date 13th November, 1980, listing by day or month various items of work carried out by the defendant in his capacity as a barrister and solicitor for the plaintiff in respect of a share transfer in Ramazon Timbers Pty. Ltd., and stipulating at the end thereof a figure of K5,529.14. The final page of this document sets out a number of disbursements individually costed totalling K3,885.43. Mr. Hay says he does not know why this document was despatched by a member of his office but that it does not amount to a bill of costs: I think the reason being that the money had already been paid to him out of funds held in the client’s trust account and thus there was no need for the document to be despatched at all. Whatever it is, it is not a bill in taxable form but a lump sum bill probably used in order to save time and perfectly acceptable when no dispute arises (see for example Bowen C.J. in Eq. in Florence Investments Pty. Ltd. v. H. G. Slater & Co.[dcxli]1 and also Kearney Dep. C.J. in an unpublished National Court judgment Re Graziano, and Young & Williams’ Bill of Costs[dcxlii]2). That there is a right in a client to demand and receive a proper bill in taxable form before being sued for non-payment is in my view quite clear (again see Kearney Dep. C.J. in the case already mentioned and the reference therein to Costs, Solicitor and Client, by Saddington & White 1947—also s. 29 of the Legal Practitioners Act 1954). That there is also a right to have such bill taxed and hence have it in taxable form is also clear, (see s. 28 and s. 30(1) of the Legal Practitioners Act and Woolf v. Trebilco[dcxliii]3. Even if the bill is paid, that is still not a bar to the client making a subsequent application for taxation though special circumstances must exist if a period of twelve months has elapsed— (s. 29(3) of the Legal Practitioners Act). I might add that the bill of course would have to be in taxable form. It is only then that the period of twelve months becomes relevant.
In addition to the document of November, 1980 however, the plaintiff had earlier received three separate documents dated 19th December, 1979, for K575.00, 13th March, 1980, for K5,153.15, including K1,403.15 for disbursements, and 5th August, 1980, for K999.92. The total of these “bills” leaving aside disbursements is some K204.22 less than the document received in November, 1980. Each of these three documents was again in the form of a lump sum bill and is not in taxable form.
In the summons for determination before me, the plaintiff asks:
(a)      that he be presented with a bill in taxable form and
(b)      that such bill be referred to the Taxation Officer to be taxed.
Mr. Hay has conceded that none of the documents referred to is a bill in taxable form. He says he was never asked for one until the present summons was served upon him. I have no evidence to the contrary. Mr. Hay also deposes in his affidavit that between 11th December, 1979, and 19th September, 1980, he received six payments from the plaintiff “expressly for payment thereout of costs and disbursements”. It is clear to me that none of these payments could be regarded as specifically related to the three bills received in December 1979, March 1980 and August 1980. It may well be that a client pays money to his solicitor to cover present and future costs and disbursements but that does not mean that funds can be withdrawn from the client’s trust account without specific directions related to specific bills presented to the client. An agreement between solicitor and client to pay all just and proper costs and disbursements does not mean that the client forgoes the right to have such costs and disbursements itemized and justified (see for example Ex parte Levy[dcxliv]4), although this is subject in Papua New Guinea to s. 24 of the Legal Practitioners Act. Such an agreement however would stipulate clearly the nature of the work involved and a specific amount in payment thereof, signed by the client. I am advised that the practice has developed in Papua New Guinea of not requiring a specific signed direction from a client for payment of a particular sum out of his trust account to meet a specific account for solicitor’s costs. If this is so, I have no doubt it developed from more leisurely and less formal times in the country, and I regard the practice as highly undesirable and fraught with hazard when taken in the context of modern-day Papua New Guinea. There is no evidence to suggest that the client in this case authorized such transfer of funds from his trust account to meet the individual items costed against him and counsel for Mr. Marsh claims from the Bar table that no such specific direction was given. The end result would be that even if the “bills” already presented had been in taxable form, the transfer from this client’s account in payment for the solicitor’s costs with a specific signed direction by the client, could amount to a “special circumstance” warranting the application of the proviso contained in s. 30(3) of the Legal Practitioners Act when a period in excess of twelve months has elapsed since presentation of the taxable bill.
However Mr. Hay concedes that neither the document of 13th November, 1980 nor the three other “bills” furnished during 1979 and 1980 amount to anything more than a general lump sum bill in each case. They are not in taxable form. This I consider ends the matter but when taken in conjunction with a claim that the bills have been paid without any specific direction from the client to do so, I consider the need for the rendering of a proper bill and a taxation thereon are even more pressing.
I therefore order—
(1)      that a solicitor’s bill covering matters referred to in a document dated 13th November, 1980, and including a full itemization of all disbursements be prepared under O. 91, r. 47 of the National Court Rules to be delivered to the plaintiff’s solicitor on or before 2nd November, 1981;
(2)      that the said bill be referred to the Taxation Officer to be taxed and the taxing officer shall certify what shall be found due and owing between the parties giving credit for all amounts received by the defendant already from the plaintiff and that costs of such reference shall be charged according to the event of such taxation;
(3)      that the costs of this summons be paid by the defendant, such costs to be taxed on the same day but immediately following taxation of the bill referred to above in the event of the parties failing to agree.
Ordered accordingly
Solicitor for the plaintiff: Beresford Love & Company.
Solicitor for the defendant: Russell Hay.

[dcxli][1975] 2 N.S.W.L.R. 398 at pp. 402 to 403.
[dcxlii]M.P. 50 of 1980 dated 24th July, 1981.
[dcxliii][1933] V.L.R. 180; 39 A.L.R. 142.
[dcxliv](1902) 19 W.N. (N.S.W.) 252.