Double indemnity

Another case of Keddies overcharging - this time by $150,000 ... Keddies' case collapses in Court of Appeal ... Indemnity costs at trial and on appeal ... Flailing about as costs and damages mount in ongoing breach of contract saga ... Splitski at Brydens 

A fresh scrunch for the Keddies Kiddies in the NSW Court of Appeal. 

This time they tried to overturn orders made last June in the Dizzo by Judge Linda Ashford, in another fees rorting case. 

Stavre Bazdarov made the mistake of going to Keddies following a botched hernia operation. 

On the first day of the hearing in November 2005 his case settled for $450,000 inclusive of costs. 

Keddies deducted $290,325.01 for its costs and disbursements. 

The plaintiff thought that was beyond the pale and went back to the District Court to try and retrieve some of the money, claiming breach of contract. 

Judge Ashford thought that a fair and reasonable amount for Keddies' costs was $60,000. 

She allowed barrister Dennis Wheelahan QC fees of $23,000 and junior counsel Eugene Romaniuk $14,300. 

Total fees and disbursements allowed came to $135,258, which meant Keddies overcharged was in excess of $150,000. 

Keddies did not contest about $19,000 worth of charges and other amounts of around $5,000 were not properly accounted for.

The firm unilaterally increased its hourly rate beyond what had been agreed. There were duplicate entries and costs for a concurrent workers compensation claim were included on the medical negligence account. 

There was no explanation as to why a cheque was perused for 18 minutes and another one for six minutes. 

Senior and junior counsel were billed out for five days, even though the case settled on the first day. The solicitor at Keddies handling the case, Irena Pechanats, made no inquiry whether the barristers had the benefit of other work on those days.  

Judge Ashford found the plaintiff's claim for breach of contract was successful and after deducting amounts that had been prepaid to the plaintiff entered a verdict of $160,000 for Bazdarov, plus interest which the parties ultimately agreed would be $78,669.28 - $238,669 all up. 

See District Court judgment

On March 16, 2011, before the trial, the plaintiff made an offer that he would accept $120,000, excluding legal costs. 

Since the verdict was beyond that amount, Keddies was ordered to pay the plaintiff's costs on the ordinary basis up to March 17, 2011 and on an indemnity basis thereafter, that is, up to and including June 24, 2011. 

Keddies appealed, with the argument that an action for damages for breach of contract was not available to a solicitor's client who had received a bill, paid it but later alleged that he or she had paid too much. 

Mark Brabazon SC, for Keddies, accepted that if the proposition for which he contended had been advanced at trial, it would have been open to the plaintiff to have further amended his statement of claim to allege some other remedy, such as money had and received, breach of fiduciary duty and/or breach of trust in order to meet the defence now raised. 

Bathurst, Whealy and Tobias determined that the appellants would not be permitted to raise the argument that a breach of contract case was not available to the plaintiff.  

The central plank of the Keddies' appeal collapsed. 

At this stage Stavre Bazdarov's case was being run by his executrix, Snezana Bazdarov. 

About two weeks after Keddies filed their appeal the estate made an offer of compromise of $225,000, excluding legal costs of the appeal, plus costs of the trial on an indemnity basis after March 17, 2011. 

It was a discount on the amount then payable of nearly seven percent. 

Tobias, with whom Bathurst and Whealy agreed, rejected the kiddies' argument that the offer of compromise did not comply with UCPR r 20.26(2), nor were there any other exceptional circumstances that should deprive Bazdarov of indemnity costs for the appeal.  

Russell Keddie, Scott Roulstone and Tony Barakat were ordered to pay the estate's costs of the appeal on the ordinary basis up to August 5 last year and on an indemnity basis after that. 

See Court of Appeal reasons

Another in the lengthening string of losses for the Three Musketeers. 

*   *   *

IN other developments from PI-World, there is news on the street that the law shop of Brydens has split in two. 

Bandeli Hagipantelis has left is long-standing partner Robert Bryden and they are both to carry on under their own flags. 

Both Bandeli and Robert are currently before the stipes, with legal services czar Steve Mark insisting they breached rules about personal injury spruiking. 

In other proceedings the Court of Appeal in Kelly v Jowett found that substantial costs were incurred by a plaintiff in a family provisions case as a result of the "serious neglect" of Bryden and Hagipantelis. 

The court ordered the two solicitors to personally pay the plaintiff's costs on an indemnity basis. 

Bryden is one of the grand fromages on the Law Society council and also brings his special expertise to the board of LawCover.