Clarke v Wakeling & Anor [2009] NSWSC 1230

1. HIS HONOUR: Nature of Proceedings The plaintiff has brought proceedings against the first defendant (Mr Wakeling) alleging that he acted as her solicitor in certain loan transactions and that he carried out that function negligently. There were three loan transactions. The plaintiff claims the loss of the moneys loaned and for consequential loss such as legal fees incurred when seeking to recover the loan moneys from the borrower. No claim is made in contract. The claim is based on negligence. 2. Although two defendants are named, the Court was advised on the first day of the hearing that the second defendant had agreed to indemnify Mr Wakeling. The same counsel represented both defendants. The matter was conducted as if Mr Wakeling were the only defendant. 3. The issue between the parties is essentially a factual one. If the plaintiff’s version of events is accepted, the liability of Mr Wakeling is clear. If only part of the plaintiff’s evidence is accepted, or if it is rejected substantially, a question may still arise as to the extent of the duty owed by Mr Wakeling to her. Factual Background 4. Except as otherwise indicated, I find the facts to be as follows. 5. At the time of these events, Mr Wakeling held a practising certificate as a solicitor and was the principal of the firm Wakeling and Associates. 6. The plaintiff at the time of trial was aged 50. She had tertiary qualifications in interior and fashion design obtained in France in the 1970’s. She arrived in Australia in 1985 with only a poor knowledge of English. Soon after her arrival, she gained employment as a retail manager in a designer shop. She worked in the fashion industry until 1990. 7. In 1994 she married Richard Clarke and there was one child of that union. The plaintiff and Mr Clarke divorced in 1997. As a result of the divorce, the plaintiff received assets to the value of about $1.3 million. In 2001, the plaintiff owned two unencumbered properties: one, an apartment in William Street, North Sydney and the other, a townhouse in Hayberry Street, Crows Nest. 8. In about March/April 2001 the plaintiff commenced a romantic relationship with Peter Jones. That relationship was harmonious until about April 2002. Thereafter, it continued on an intermittent basis until December 2002. There was a reunion for a short period of probably less than a month in early 2003. The relationship then ceased entirely. For a period of approximately 4-5 months (December 2001 until April 2002) the plaintiff was living with Mr Jones in his apartment in Shirley Road, Wollstonecraft. 9. As of July 2001, the plaintiff and a neighbour, Ms Dawn Wade, had been friends for over three years. At that time the plaintiff had agreed to participate in a real estate development project which Ms Wade was organising in respect of a property in Emmett Street, Crows Nest. Ms Wade and the plaintiff were also considering other real estate development projects which included the acquisition of a hotel at Gloucester in country New South Wales. There was a project involving a wine bar or hotel in Crows Nest, which the plaintiff and Ms Wade considered, but did not proceed with. 10. In 2001 Mr Jones was a property developer. He was developing a project at Olympia Road, Naremburn (“the Naremburn project”). This project involved the construction of a number of townhouses at that location. The company which was carrying out the project was South Australian Buying Corporation Pty Limited (SABC), a company controlled by Mr Jones. 11. Mr Wakeling first met the plaintiff at a dinner party held at Mr Jones’ apartment in Shirley Road in August 2001. The other attendees at the dinner party were Mr Jones and Ms Wade. At that time Mr Wakeling had known Mr Jones for approximately 15 years and over that time, had performed legal work for him. In August 2001 he was acting for Mr Jones and SABC in relation to the Naremburn project. He said that he was owed between $10,000 and $15,000 for legal fees for work done in relation to that project. He had agreed to wait for payment until the project was completed. Read about this case: Court Website Austlii Jade

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