In QGC Pty Limited v Alberts (No.4),1 the Federal Court of Australia found that the firm which acted for a native title party in the reestablishment of an Indigenous land use agreement (ILUA) was entitled to an equitable lien over, and other enforceable rights in respect of, financial benefits paid into court.
The applicant had commenced proceedings due to concerns of an Aboriginal society no longer being capable of receiving or administering moneys payable under an ILUA.2 The native title party had appointed a firm to act for them in order to seek a replacement for the society as a nominated entity.
The course pursued by the firm was unsuccessful. However, that failure provoked a solution which the parties decided to pursue in agreeing to entity establishment orders and their subsequent implementation.3
The court then considered whether funds held in court and future payments by QGC would be distributed equally to the nominated entity in accordance with the establishment orders. It was also determined whether the firm was validly appointed by the native title party to act on its behalf as to make them liable for the firm’s costs and disbursements. The court subsequently considered whether the firm had an equitable lien over, or enforceable right in respect of, financial benefits paid into court for costs claimed.4
The appointment issue
A member of the native title party had contended that the party was not “required to make any decision under the ILUA” in relation to the firm’s retainer to act for it.5 It was argued that this was outside the scope of cl.3(a) of the ILUA and therefore, the party had to act unanimously in the absence of a provision authorising them to act by majority.
The court determined that, under the ILUA, the party was required to decide how to enable the trust moneys of QGC to be paid to a new nominated entity, which included appointing a lawyer.
The majority signatories had appointed the firm to pursue the litigation, and clause 3(a) of the ILUA authorised the party to make such a decision by majority. In any event, regardless of whether cl.3(a) applied, the party was able to act by majority because it and its members were not trustees.6 The retainer remained on foot because it continued to be authorised by the majority of signatories.
The lien issue
It was considered whether the firm’s efforts had a causal link to the successful creation of the nominated entities to which the funds held in court would be paid, to justify the firm’s claim for an equitable right to be paid from those funds.7
It was contended that the firm’s efforts did not result in obtaining a judgement, award or compromise for payment of monies to their client, as there were “no fruits to [their] labour”.8
The court found that the firm’s conduct was instrumental to obtaining the result that the entity establishment produced. While the result was not identical to the intention behind the firm’s advice, their course resulted in the construction of the ILUA that enabled the money in court and due in future to be distributed to the nominated entities. Unless the firm had pursued the litigation as they did, there would not have been orders of the kind.9
The court applied the principles of Roam,10 noting that, “the fact the solicitors’ retainer had ended before their client negotiated the compromise did not break the chain of causation that the solicitors’ work had led, at least in part, to a compromise and thus they were entitled to enforce their equitable right to be paid out of the settlement”.11
Compliance with the LPA
The Registrar issued a certificate of taxation for the bill of costs prepared by the firm which certified costs recoverable. This certificate of taxation was deemed enforceable because r40.32(2) of the Federal Court Rules 2011 gave it the force and effect of an order of the court whether or not there was any non-compliance by the firm with the state law in the Legal Profession Act.12
The court declared that the firm was entitled to enforce its equitable right to $299,384.18 as the taxed solicitor/client costs recoverable on their claim against money held in court.13
Sarah Millar is a law clerk at Queensland Law Society Ethics and Practice Centre. This article has been approved by Grace van Baarle, Manager, Ethics Solicitor, QLS Ethics and Practice Centre.
1  FCA 1590 (QGC Pty Limited v Alberts (No.4)).
2 Ibid 7.3
3 QGC Pty Ltd v Alberts (No.2)  FCA 540.
4 QGC Pty Limited v Alberts (No.4) n1, 15.
5 Ibid 43.
6 Ibid 57.
7 Ibid 58.
8 Ibid 63.
9 Ibid 75.
10 Roam Australia Pty Ltd v Telstra Corporation (trading as Telecom Australia)  FCA 980 (Roam).
11 QGC Pty Limited v Alberts (No.4) n1, 74.
12 Ibid 82.
13 Ibid 87.