Carey v Freehills [2013] FCA 954

Carey v Freehills [2013] FCA 954

Freehills did not owe a duty of care to the Carey parties (including Mr Carey as controller or shareholder) nor to associated companies outside the retainer; no relevant implied retainer or assumption of responsibility arose; the alleged representations were either not made, not directed to the Carey parties, or not misleading; adequate warnings were in fact given; and the claimed losses were not caused by Freehills’ conduct within the meaning of the relevant statutes or common law; accordingly, the cross-claim fails.

Parties
Cross Claimants: Norman Phillip Carey & Ors (according to attached schedule); First Cross Respondent: Freehills; Second Cross Respondent: Australian Securities and Investments Commission
Jurisdiction
Australia
Judgment Date
20 September 2013
Procedural Posture
Cross Claim / Final Judgment
Outcome
Cross-claim dismissed
Legal Topics
Solicitor Negligence, Duty of Care, Implied Retainer, Managed Investment Schemes, Shareholder Loss, Reflective Loss, Misleading or Deceptive Conduct, Causation, Loss of Opportunity
Professional Negligence Corporations Tort Law Solicitor Negligence Duty of Care Implied Retainer Managed Investment Schemes Shareholder Loss +4 more

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Parties

Norman Phillip Carey & Ors (according to attached schedule)

Cross Claimants

Freehills

First Cross Respondent

Australian Securities and Investments Commission

Second Cross Respondent

Procedural Posture

Cross Claim / Final Judgment

Legal Issues

  1. 1 Whether Freehills owed a duty of care to the cross-claimants, including non-clients and shareholders
  2. 2 Whether Freehills’ advice constituted misleading or deceptive conduct
  3. 3 Whether there was a breach of any such duty or duty to warn or advise

Ratio Decidendi

Freehills did not owe a duty of care to the Carey parties (including Mr Carey as controller or shareholder) nor to associated companies outside the retainer; no relevant implied retainer or assumption of responsibility arose; the alleged representations were either not made, not directed to the Carey parties, or not misleading; adequate warnings were in fact given; and the claimed losses were not caused by Freehills’ conduct within the meaning of the relevant statutes or common law; accordingly, the cross-claim fails.

Court Disposition

Cross-claim dismissed

Orders

  • The cross-claim, as amended on 17 October 2011, is dismissed.
  • The parties may file and serve written submissions (not exceeding 3 pages) on or before 7 October 2013 in respect of costs, failing which the cross-claimants pay the first cross-respondent’s costs of and incidental to that cross-claim.