By way of summary Goddard Elliott v Fritsch concerned a mentally ill man who was involved in a family law proceeding in the Family Court. He settled on the door of the court on terms which were 'overly generous to his wife' (at ) and he sued his solicitors and counsel for negligence on the basis that they took and acted on instructions which the man did not have the mental capacity to give. There was also an allegation of negligence arising out of lack of preparation for the trial.
All parties except the law firm, Goddard Elliott, settled their claims and the matter proceeded to a trial before Bell J. Goddard Elliott also issued a counterclaim for their fees. Bell J found that the solicitors were not liable for negligence by reason of 'an ancient principle, surviving in Australia, which immunises solicitors and barristers against liability for loss and damage caused by court-related negligence' (at ).
Bell J discussed generally the state of advocates' immunity in Australia at  to :
790 The common law immunity of suit for advocates is ancient. It has been abolished in the United Kingdom, New Zealand and Canada never had it. In Australia, by authority of the High Court which binds me, it has been retained.
791 The scope of the immunity in Australia was identified in Giannarelli and confirmed in D’Orta-Ekenaike. According to Mason CJ in Giannarelli, the immunity applies to the in-court work of an advocate and certain out-of-court work as well. In relation to work done out of court, the principle is that the immunity extends to ‘work done out of court which leads to a decision affecting the conduct of the case in court’. In that connection, the Chief Justice approved the statement of McCarthy P in Rees v Sinclair that the immunity applied to work which was intimately connected ‘with the conduct of the cause in Court’. In D’Orta-Ekenaike, Gleeson CJ, Gummow, Hayne and Heydon JJ said the tests pronounced by Mason CJ and McCarthy P did not ‘differ in any significant way’. McHugh J held that lawyers owed ‘no actionable duty of care in respect of out-of-court conduct that is intimately connected with in-court conduct. They do, however, owe actionable duties of care in respect of conduct that is not intimately connected with in-court advocacy.’
792 The rationale for the immunity is the general public interest in ensuring, and maintaining public confidence in, the administration of justice. Historically, that general public interest purpose of the immunity embraced more specific considerations, such as the difficulty of examining on the spot judgments made by advocates about the conduct of a case in court, ensuring barristers represented their clients fearlessly in court and the adverse consequences for the administration of justice which arise from the re-litigation of concluded proceedings. In Giannarelli, it was confirmed that the immunity rested entirely ‘on considerations of public policy’, but mainly on the basis of the last two considerations. In reviewing the immunity in D’Orta-Ekenaike, the High Court focussed chiefly on the third consideration – finality. As we have seen, Gleeson, Gummow, Hayne and Heydon JJ held the central justification of the immunity was ‘the principle that controversies, once resolved, are not to be reopened except in a few narrowly defined circumstances’. Their Honours later emphasised the point. They said the underpinning of the system of justice was ‘the need for certainty and finality of decision. The immunity of advocates is a necessary consequence of that need’.
Bell J then went on to discuss the law concerning advocates' immunity in the specific circumstances of the case, between  and . I won't detail those discussions here.
Bell J found that the solicitors were negligent because they failed to properly prepare the matter for trial and because they took and acted on instructions which the client did not have the mental capacity to give, and of which they should have been aware (at ). However Bell J held that the solicitors were immunised from, and therefore not liable for, negligence by reason of advocates' immunity which His Honour found 'deeply troubling' (at ):
Advocates’ immunity operates in Australia to shield solicitors and barristers from liability for negligence (and other wrongs) occurring in the course of work leading to decisions about, or intimately connected with, the conduct of a case in court. After examining decisions of the High Court of Australia which bind me, I have decided that advocates’ immunity supplies a complete defence to Mr Fritsch’s claim for damages against Goddard Elliott. Its capacity negligence (as does its preparation negligence) falls within the immunity because it occurred in the course of work leading to decisions about, or intimately connected with, the conduct of a case in court, which is a very wide test. By reason of the immunity, Goddard Elliott is not liable to pay damages for the loss which its negligence caused Mr Fritsch, a conclusion to which I am driven by the binding authorities and find deeply troubling.The end result was that the solicitors were successful in suing for their fees by way of counterclaim.
On a side-note, apportionment of liability for concurrent wrongdoers under Part IVAA of the Wrongs Act 1958 was also discussed by Bell J at  to . It appears that counsel and the expert witness remained nominal parties in order to allow an apportionment of liability under Part IVAA. Bell J considered the principles applicable where some parties have settled and others remain in the litigation at  to :
1108 There is nothing in the proportionate liability provisions preventing one or more concurrent wrongdoers from settling with the plaintiff or even among themselves. The terms of settlement between one concurrent wrongdoer and the plaintiff can have no relevance to the plaintiff’s continuing claim against another concurrent wrongdoer until the court has made a finding of liability against that latter wrongdoer. The court has not yet determined what relevance the terms of settlement may have after such a finding has been made. What is clear, and relevant to the present case, is that the liability for damages of a remaining concurrent wrongdoer who is found to have breached their duty of care does not depend ‘on the amount recovered or recoverable under the terms of settlement [with another wrongdoer], at least insofar as the plaintiff does not recover an amount in excess of his or her total loss and damage’. The liability of the remaining concurrent wrongdoer, like the liability of all concurrent wrongdoers who are parties, depends on and is limited by their just share of responsibility for the loss and damage as assessed by the court under s 24AI(1).
1109 As we have seen, each of Mr Ackman, Mr Rosen and Mr Ferguson have settled with Paul in the proceeding in this court. I have made orders dismissing the claims by Paul against them with no order as to cost. Paul obtained no amount of damages under the settlements. He obtained only contributions to his legal costs. There is no basis for going behind the terms of the settlements in that regard. Therefore the settlements will not be relevant to the proportionate liability assessment which I must make in relation to Goddard Elliott as the remaining concurrent wrongdoer. The assessment will be carried out in accordance with the principles which I will hereafter explain. Consistently with the practice adopted in this court, the settling defendants have been retained as nominal parties to the proceeding for the purpose of the application of the proportionate liability provisions. This is necessary for the maintenance of Goddard Elliott’s reliance on those provisions.The matter has been widely reported, particularly because of the criticism by Bell J of the application of advocates' immunity to the facts of the case. Strangely enough, the Age published an article 'Judge questions barristers' immunity' which detailed the settlement sums paid by counsel and the expert witness (presumably by their insurers) to resolve the case against them.
As noted by Bell J, advocates immunity has been abolished in other Commonwealth jurisdictions. It will be interesting to see what happens if the matter is appealed, and how far it goes.