The limitation period on Solicitors running account (WIP) commences on the date of the last entry

Stockley Furlong (a firm) v Hyde [2022] QSC 285

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – JOINDER OF CAUSES OF ACTIONS AND OF PARTIES – MATTERS RELATING TO LIMITATION PERIOD – where the defendant seeks leave pursuant to r 376(4) of the Uniform Civil Procedure Rules 1999 (Qld) to plead a cause of action for account arising out of a dispute over the payment of legal fees between 2009 and 2016 – where the alleged indebtedness arose from an entire account into which all liabilities and payments were carried in order of date resulting in a single balance – whether this amounted to a running account – where the plaintiff contended that leave should be refused because the cause of action for an account was, in part, statute-barred by operation of s 10(2) of the Limitation of Actions Act 1974 (Qld) 2007 where the plaintiff further contended that leave should be refused as the cause of action for an account did not arise out of the same facts or substantially the same facts already pleaded by the defendant – whether, in the case of a running account, the cause of action for an account accrued when the last payment on that account was made by the defendant or whether the cause or causes of 2 action accrued more than six years prior to the commencement of the proceeding – whether the cause of action for an account arises out of the same facts or substantially the same facts as those which have already been pleaded by the defendant

The Plaintiff claimed monies for outstanding monies under a running account up to October 2016. The Plaintiff commenced proceedings on this running account in October 2016. The Defendant paid monies on this account at various times resulting in the claimed balance as of October 2016. The proceedings were variously transferred from the Magistrate Court to the District Court to the Supreme Court from the date of filing till September 2021.[4]

The Defendant by Counterclaim claims that the fees paid were in excess of those allowed to be claimed under the Costs Agreement and that there was a double counting of interest. [6 – 9]. This is an application for leave pursuant to r 376(4) of the Uniform Civil Procedure Rules 1999 (Qld) to plead a cause of action for an account. The Plaintiff maintains that the Defendant’s Counterclaim is statute barred to six years by operation of s10(2) of the Limitation of Actions Act 1974 (Qld). [10]

Considering the extensive delays in these proceedings Burns J referred to s16(2)(c) of the Civil Proceedings Act 2011 (Qld) where the limitation period may be extended where the period was “current at the date the proceeding was started”. Accordingly for the purpose of the limitation period the limitation period was suspended in October 2016 not September 2022. However, the Plaintiff did not argue the statutory sealing date but argued that the limitation period ran on the dates that the Defendant paid various payments on the running account. Burns J referred to Re Footman Bower & Co Ltd [1961] Ch 443 at 451 to 452 where the limitation period runs from that date of the last date of the running account.

In respect to Solicitors legal fees this is like that of an entitlement under s335(5) of the Legal Profession Act (QLD) 2007 to assess costs that runs from the date of the last invoice where the invoices are related to the same matter/ instructions (see Re Lynch and Co Bill of Costs [2000] QSC 3 at [12] and Turner v Mitchells Solicitors [2011] QDC 61) [13]. In this situation the Defendant may still seek an assessment as the limitation period was stayed as at October 2016 pursuant to s335(5) of the Legal Profession Act (QLD) 2007

Leave was granted to include the additional claim noting that charging of interest on interest and over-payment is a textbook remedy for a Defendant seeking reimbursement of alleged overcharging. [14]