Legal Services Board v Gillespie-Jones [2013] HCA 35: Legal Practitioner's Fidelity Fund

Today the High Court unanimously allowed an appeal from a decision of the Court of Appeal of the Supreme Court of Victoria, which had held that the respondent was entitled to make a claim for compensation against the Legal Practitioners Fidelity Fund (the Fidelity Fund) in Legal Services Board v Gillespie-Jones [2013] HCA 35.

The respondent, a barrister, was briefed by a solicitor to appear for a client in criminal proceedings.  The client made a series of payments to the solicitor on account of his legal costs, including barristers' fees.  However, the solicitor misappropriated most of this money, such that the amount remaining was insufficient to meet the respondent's fees.  The respondent made a claim against the Fidelity Fund.

The Board rejected the respondent's claim.  The respondent then successfully appealed to the County Court of Victoria.  The County Court held that the respondent had suffered a pecuniary loss as a result of the solicitor's default, constituted by the solicitor's failure to pay or deliver trust money to the respondent in accordance with a direction given by the client.  The County Court's decision was upheld by the Court of Appeal.

The High Court allowed the Board's appeal.  The joint reasons of French CJ, Hayne, Crennan and Kiefel JJ held that the respondent's claim against the Fidelity Fund should be disallowed, because he had not suffered a relevant pecuniary loss.  There can be no failure to pay or deliver trust money unless there is an instruction to the solicitor to pay or deliver the money, and it is not complied with.

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