How wrong can you be?

Punters' peril ... $400,000 damages for professional negligence confiscated from client because solicitor enjoyed immunity ... Five judge panel flexes its brain power to bolster the fortress 

HOW could we have missed Donnellan v Woodland - the NSW Court of Appeal's five-bench Christmas present to solicitors? 

Maybe it was because the facts were pretty dry: easements, s.88K of the Conveyancing Act, and wasted costs. 

The exciting bit was the advocates' immunity, where the immune person was not an advocate. 

It needed a real brains trust to cement this in place: Beazley, Basten, Barrett, Maj Gen Hoeben, and Sackville. 

Back in another decade (March 1998) Peter Woodland, and his then wife, were granted development approval by Manly Municipal Council to subdivide their Seaforth property - on condition they would provide a system of on-site storm-water detention. 

Woodland went to his solicitor, Patrick Donnellan of Gosford, about the possibility of instead obtaining an easement for drainage. 

Donnellan, the appellant, gave written advice to Woodland that an application for a drainage easement under s.88K of the Conveyancing Act would be likely to succeed: 

"We think that it is quite likely that the court would grant the easement for drainage ... in the sense that [the easement] provides a solution to drainage which is practical and beneficial."

Paddy also told his client that in his view the council would likely "throw in the towel" and agree to grant the easement to avoid the cost of court proceedings. 

According to Woodland - although this point was disputed - Donnellan also advised him that he had "good prospects of having [his] own legal costs recovered should the matter proceed to court".

So, when Manly Municipal Council denied his request for a grant of the easement, Woodland acted on his lawyer's advice and commenced proceedings against the council in the Supreme Court.

The council then made two offers of compromise in the course of the proceedings. 

Again, acting on Donnellan's advice, Woodland rejected the offers. 

John Hamilton, in the Mumblers Division of the court, rejected the s.88K application on the basis that the on-site pump system specified in the original development consent had not been shown to be an unviable alternative to the easement. 

He ordered Woodland to pay the council's costs of proceedings, including indemnity costs, and subsequently leave to appeal the costs order was not granted.

Initially Woodland was successful in professional negligence proceedings against Donnellan, recovering $414,053.69 in damages for the costs of the failed s.88K proceedings. 

But, the hefty five-panel appeal bench had other ideas and set aside Justice Robert Shallcross Hulme's findings and ordered Woodland to pay Donnellan's costs.

Beazley, for the court, held that the duty of a solicitor in respect of the settlement of claims is simply to assist a client to make an informed decision about whether or not to settle. 

That's reassuring. It's going to be hard to be negligent on the settle/fight equation. 

Donnellan's advice that Woodland had a strong case under s.88K was not clearly wrong as a matter of law. 

To illustrate the point Beazley said there were conflicting views in the equity division as to the proper application of the section. 

Again, different views are a nice escape hatch, because nobody can ever be wrong. 

Nor was there sufficient evidence to show that Woodland would have ever settled with Manly Municipal Council, but for Donnellan's advice with respect to the compromise offers. 

In any event, the solicitor was protected by the advocates' immunity. 

Applying D'Orta-Ekenaike v Victoria Legal Aid, the immunity stretched to a solicitor's negligent work done out of court if it leads to a decision affecting the conduct of the case in court. 

So, if he had been negligent Donnellan was home and hosed, swallowing a handfull of immunity pills. 

The fearless five wasted little time in reinforcing the idea that claims involving wasted costs are safely locked inside the immunity fortress. 

Home side: 500. Visitor: nil. 

Reporter: Pat Bateman