A New South Wales principal repeatedly billed a city council for more than 30 hours’ work a day in amassing $10 million in legal fees, a Federal Court decision shows.
The impossible invoices formed part of a bill from Sydney practitioner Keith Redenbach to Broken Hill City Council, which last month was found to have been extensively overcharged by the solicitor and the three firms he operated under.
Justice Elisabeth Peden said Mr Redenbach had claimed a 25 per cent “uplift fee” and “deferred fees” from the council, which had retained him in construction litigation.
Those fees had not been authorised, and the council had overpaid higher rates than the tender rates agreed, she said.
Justice Peden found the only contractual arrangement between the council and the solicitor’s firms – Redenbach Legal, Passer Par and Broken Hill Legal – was by tender.
She found the council had not agreed to costs agreements supplied by Mr Redenbach in 2018, 2020 and 2022, which proposed to increase per-hour fees.
Over nearly eight years, Mr Redenbach’s rates climbed from $390 an hour to between $650 and $750 an hour.
“It is commercially illogical that Council would agree to such convoluted arrangements in the context of the tender processes, where it received no obvious advantage, and where there is no council document or advice or estimate from Passer Par or Redenbach Group that referred to the alleged costs agreements having application,” she said.
Justice Peden said Mr Redenbach was a “thoroughly unimpressive witness” who “appeared to intentionally refuse to respond to simple questions”.
“Mr Redenbach gave self-serving evidence and even evidence which I consider was false,” she said.
“I have not accepted Mr Redenbach’s evidence unless it was corroborated by documentary evidence or other witnesses.”
Justice Peden rejected Mr Redenbach’s allegation that council staff had agreed that “each new matter may result in varying fee arrangements and fee estimates”, and that council staff had verbally agreed to deferred fees.
She also said that “there was no explanation why as a matter of logic and good practice Mr Redenbach would not have documented the alleged conversation about deferred fees in the context of the voluminous communications between him and Council about legal fees, and directives to contain legal costs”.
In a 2022 email, the council questioned the legal costs “across the various cases …in excess of $10M”.
On six dates between December 2018 and September 2019, Mr Redenbach invoiced for between 25.5 hours and 36 hours of work a day.
His explanations for the implausible times recorded included international travel zones, a Microsoft billing system, “a minor clarification or discrepancy”, and “an understandable slip”.
“I reject that Mr Redenbach was “transparent” with Council to the extent he claims he was entitled to uplift and deferred fees and that his invoices accurately recorded time worked. He provided no cogent explanation for the invoices,” Justice Peden said.
“I also find that Council paid for services not rendered by Passer Par and Redenbach Group because of a mistaken belief that the hours charged were actually worked.”
Justice Peden found Mr Redenbach had breached his fiduciary duty to the council by disbursing trust money to himself and his firm for the payment of invoices.
She ruled that the council was entitled to an order that the almost $2.4 million in trust funds be reconstituted.
She also concluded that the Redenbach parties owed the council almost $1.6 million in equitable compensation, as well as more than $760,000 in restitution, and were liable for more than $500,000 in damages for misleading the council.
Read the decision here.
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