A lawyer has been ordered to repay a client after the Supreme Court ruled that he had overcharged her by more than $60,000.

Linda Swan complained that lawyer Rick Woolridge had billed her five percent interest monthly rather than annually, but Mr Woolridge argued that they had agreed to the higher interest rate and that he was still owed more than $24,000 in (principally) unpaid fees.

The court had heard that Mr Woolridge’s law firm represented Ms Swan in a civil property dispute, which appeared before the Court of Appeal and the Supreme Court but did not end in her favour.

Ms Swan reportedly struggled to pay her legal fees, taking out a loan but after paying more than $170,000 began to question how she had been billed. She said she should have been billed five percent annual interest paid monthly but she had actually been billed five percent monthly interest — 60 percent annual interest — and as a result had overpaid the defendant more than $60,000.

Mr Woolridge, however, told the court that the defendant was well aware that she was being charged five percent monthly interest in light of her delinquency based on a conversation between the two, and that she should have been able to tell by her invoices the rate of interest being charged.

In a judgement dated February 14, Chief Justice Ian Kawaley wrote: “Based in part on the defendant’s office administrator’s evidence, I find that the plaintiff was under considerable financial stress flowing from the litigation and over and above her legal fees when she was paying the relevant bills.

“It is entirely plausible that in these circumstances she struggled to pay as much as she could, not querying the amounts claimed until realised what the scale of her payments was as demands for further payments kept coming.

“In addition, I find that the plaintiff did not receive regular bills or statements from which she could easily ascertain either how much she had paid altogether as against how much money was still outstanding, or what interest rate was being charged.

“I have no difficulty in finding that the plaintiff did not consciously enter into an agreement to pay 60 percent simple interest per annum (or more on a compounded basis).

“Clear evidence would be required to support a finding that she entered into such an extraordinary bargain.

“The defendant’s case was that all that was verbally agreed was ‘five percent per month’.

“The limited documentary evidence did not support a finding that the parties agreed a 60 percent per annum interest rate paid on a monthly basis.”

Mr Justice Kawaley wrote that the parties never reached any binding agreement on the interest rate payable by the plaintiff and dismissed Mr Woolridge’s counter claim.

In his ruling, he said that seven percent per annum is the statutory rate, and in the absence of an agreement, the defendant was entitled to a five percent interest rate on the outstanding balance.

The Chief Justice awarded Ms Swan judgement in the sum of $63,498.60, and pre-judgement interest of seven percent per annum until judgement, together with interest on the judgment debt at the same rate until payment.