Appeal court revokes judgment on legal fees

The Court of Appeal yesterday overturned a judgment of the First Hall of the Civil Court concerning the manner in which legal fees were established by the Registrar of Courts.

St George's Park Co Ltd had filed a writ of summons against Dr Hugh Peralta, Dr Noella Grima and the Registrar of Courts.

The company told the first court that it had engaged the legal services of the two lawyers to terminate a lease agreement it had entered into with Clouds Catering Ltd.

The lawyers had sought to terminate the lease, to recover the premises and to enforce the daily penalty of Lm200 from the date of termination of the lease to the date when Clouds vacated the property.

Before judgment was delivered in the suit filed by St George's Park Co Ltd, Dr Peralta and Dr Grima had renounced their brief and sought payment for their services according to law. They obtained a bill of costs from the Court Registrar stating that their legal fees amounted to Lm9,541.

The company objected to this bill and it filed legal action against the two lawyers and the Court Registrar requesting the revocation of the bill of costs.

The First Hall of the Civil Court dismissed the company's writ and the company appealed to the Court of Appeal composed of Chief Justice Vincent Degaetano, Mr Justice Joseph D. Camilleri and Mr Justice Joseph Filletti.

The Court of Appeal noted that the first court had based its conclusions on the provisions of section 750 of the Code of Civil Procedure. However, no one section of the law could be viewed out of context. Attention had to be given to ensure that no anomalies took place.

Both Dr Peralta and Dr Grima had claimed that they had requested a bill for their services on the basis of the valuation they had arrived at following agreement with the company. But the court noted that this did not result from the evidence produced.

The company's representative, Anthony Borg, had agreed that a value had to be submitted to the court for the purposes of issuing a bill. Mr Borg had accepted that the daily penalty of Lm200 be included in the valuation. But Mr Borg had made it very clear that he was doubtful that the daily penalty would ever be recovered from Clouds.

According to Mr Borg there was an agreement that a nominal value in respect of this daily penalty be included in the valuation. It was therefore clear, said the court, that no agreement as to the daily penalty had been reached, save that it be in a nominal value.

The Court of Appeal declared that in theory, the daily penalty would amount to €263,219 (Lm113,000), but in reality everyone connected to the case knew that this amount would not be recoverable from Clouds. This was known to the two lawyers too.

The court concluded that Dr Peralta and Dr Grima were entitled to request an official bill even before the court case was decided upon.

However, they and the Court Registrar were wrong not to have applied a capping of the daily penalty.

In this case, the value of the penalty was never to be actually realised.

The court, therefore, upheld the appeal lodged by St George's Park Co Ltd and revoked the judgment of the first court.

The Court of Appeal revoked the official bill of Lm9,541.55 and ordered the two lawyers and the Court Registrar pay for the costs of the proceedings.