ONE OF the biggest law firms in the State, William Fry, is suing developer Liam Carroll over his failure to pay some €3.34 million of a €4.8 million bill for legal costs.

Mr Carroll claims the bill is excessive and has instructed other solicitors to bring a complaint about it to the Law Society. Frys denies that, is seeking summary judgment for €3.34 million and says it is concerned its position relating to other actual and/or potential creditors of Mr Carroll may be prejudiced.

The case was admitted by Mr Justice Peter Kelly to the Commercial Court yesterday when, despite heated arguments earlier, there were indications that attempts will be made to resolve the dispute before it returns before the court in March.

The bill arises from a 63-day Commercial Court action in which Redfern Ltd, a company of solicitor and developer Noel Smyth, sought €140 million damages against Mr Carroll and two other developers – Larry O’Mahony and Thomas McFeely – over their involvement in broken and secret deals related to the redevelopment of the Square shopping centre in Tallaght.

The Redfern case was initiated in 2007, began in July 2009 and ran for 63 days. In June last year, Mr Justice Brian McGovern dismissed Redfern’s claims but remarked none of the parties involved emerged “with much credit for the manner in which they conducted their business dealings with each other”.

An order for costs in favour of Mr Carroll was made but a stay applies on that pending Redfern’s appeal to the Supreme Court, which could take three years.

William Fry conducted Mr Carroll’s defence in the Redfern action and, on October 28th, served a bill of costs for some €4.87 million on him, including VAT and instructions fees on a solicitor/own client basis. Some €1.4 million was paid by Mr Carroll during the hearing and Fry says some €3.3 million is outstanding.

The law firm described the Redfern case as complex and involving extensive work. Although payments on account were not kept up to date by Mr Carroll during the trial, the firm said its team of partners, solicitors and trainees continued to act for him.

Commitments by or on behalf of Mr Carroll during the trial that fees would be paid imminently, or appropriate security would be provided, were not honoured, it said.

John Gleeson SC, for William Fry, applied yesterday to have its application for €3.3 million summary judgment against Mr Carroll fast-tracked by the Commercial Court. The bill of costs was served on October 28th last but Mr Carroll did not seek to have it taxed within the one-month timeframe available before proceedings could be initiated, he said. There was also no meaningful contact from him until the law firm received a letter just before court indicating Mr Carroll intended to bring a complaint to the Law Society, he added. There was a simple assertion the costs bill was excessive but no material to support that, counsel said.

Bernard Dunleavy, for Mr Carroll, strongly opposed the application to transfer and argued the “extraordinary” costs bill was out of step with estimates provided to Mr Carroll and should be taxed by a High Court taxing master. The outcome of the Redfern appeal should be awaited given the order for costs in favour of Mr Carroll.

Mr Justice Kelly said William Fry had served the bill, compiled by a reputable firm of costs accountants, last October but nothing had happened on Mr Carroll’s side until now.

Given the lateness and unspecified nature of Mr Carroll’s complaint, and his failure to seek taxation before now, it could be considered this was a “patched together effort” on the part of Mr Carroll to “put off the evil day”.

This was a business dispute, as solicitors were businesses, not charities, he said. It was within Fry’s rights to bring the proceedings and they should not be required to wait to see what costs would be paid by Redfern, a Jersey incorporated company, after the Supreme Court determined the Redfern appeal.

After the judge’s decision on transfer, Mr Dunleavy repeated the matter should go to taxation and asked to put matters on affidavit but also asked for an adjournment to see if matters could be resolved. Mr Gleeson said he had no objection to that.

The judge adjourned the case to March 10th when he will deal with the taxation and summary judgment issues if there is no agreement.