Kearney v Amirbeaggi (No 3) [2025] NSWCA 234 is a decision of the New South Wales Court of Appeal handed down on 22 October 2025. The case arose from Brian Kearney’s professional negligence claim against his former solicitor, Farshad Amirbeaggi, and his firm. After Kearney failed to appear at the trial due to hospitalisation for mental distress, Fagan J dismissed the proceedings and later made a gross‑sum costs order of $369 432 against him (Recent Cases).
In the Court of Appeal, Kearney filed an amended notice of motion seeking an interim stay of the enforcement of those costs orders and the appointment of a tutor to act for him. He argued that he lacked legal capacity because of severe psychiatric illness and that his interests should be protected by a tutor under the Uniform Civil Procedure Rules. As at the hearing he had not filed a formal notice of appeal, but the Court was prepared to treat his draft grounds as sufficient for the purpose of assessing whether a stay should be granted pending resolution of his capacity issues.
Evidence from psychiatrists Dr Grace and Dr Rowe showed that Kearney had recently been hospitalised, had attempted suicide and continued to experience profound psychological distress. Free JA considered this material and held that there was a seriously arguable issue that Fagan J may have erred by proceeding with the hearing in Kearney’s absence despite medical evidence of incapacity. In those circumstances, the Court accepted that there was at least a rational prospect that an appeal on that ground could succeed.
In determining whether to grant a stay, the Court balanced the competing considerations. The respondents were concerned about delay in recovering their costs, pointing to the long procedural history of the case and the risk that appeal proceedings would be protracted. However, the Court accepted that a short temporary stay would cause little prejudice to the respondents while preventing further harm to Kearney’s mental health. Importantly, the stay was confined to the period required to resolve the tutor issue and would last only a matter of weeks.
Free JA therefore ordered that enforcement of the costs orders be stayed until the issues concerning Kearney’s legal incapacity and representation by a tutor were resolved. If the prayers in the amended notice of motion were not dealt with by 11 December 2025, the respondents would be at liberty to apply to have the stay lifted. The costs of the stay application were ordered to be costs in the appeal if and when it was instituted.
This judgment is significant because it demonstrates the Court’s willingness to adopt a compassionate procedural approach when a litigant’s mental health and legal capacity are in question. It recognises that the interests of justice may require a temporary halt to enforcement actions while ensuring that vulnerable litigants are properly represented. The decision also underscores that, even where the procedural steps of an appeal have not yet been completed, the Court may grant interim relief to safeguard a litigant’s rights when there is a seriously arguable ground of appeal and the balance of convenience favours a stay.
For practitioners, Kearney v Amirbeaggi (No 3) serves as a reminder of the importance of considering a client’s capacity to conduct litigation. When credible medical evidence indicates that a party cannot properly manage their case, seeking the appointment of a tutor and an interim stay may be necessary to protect their interests. The case also illustrates the Court’s approach to balancing the prejudice to a successful party in enforcing costs orders against the potential injustice of proceeding against a person who lacks legal capacity.
