The great delegation debacle: B (A solicitor) v Victorian Lawyers RPA Ltd

B (A Solicitor) v Victorian Lawyers RPA Ltd (2002) 6 VR 642 (Ormiston, Charles and Batt JJA)

The Law Institute of Victoria Limited used to be named Victorian Lawyers RPA Ltd. It, and the Victorian Bar, were the only two RPAs (Recognised Professional Associations) set up under the Legal Practice Act, 1996, which allowed for an unlimited number of RPAs. Under s. 313 of that Act, it was entitled to delegate in writing powers and functions to employees. If it did not do so, its board (styled “the Council”) would have had to make every decision.

The Law Institute charged two solicitors with misconduct. Six months later, it sought leave to withdrew the charges, on the basis that its “failure to follow strict process” had resulted in the charge laid being a nullity. The Tribunal allowed the Law Institute to do so, refused to dismiss the charges, and refused to order costs.

The Law Institute’s Council minuted a recommendation that its powers under s. 151, the provision requiring the RPA to take certain courses at the end of a disciplinary investigation, and giving it certain discretions, be delegated to its CEO, Ian Dunn. At the end of the minutes, the word “confirmed” was typed, and they were signed by the Chair.

Pursuant to s. 151, Dunn signed new charges against the same solicitors, purportedly as delegate of the Law Institute. The Court of Appeal found that the Legal Profession Tribunal had erred in finding it had jurisdiction. It found that a written minute of an oral recommendation to delegate a power was not a written instrument of delegation. Because the person who signed the charge had no authority to do so, the Tribunal’s jurisdiction was not properly invoked, and it had no jurisdiction. The Court of Appeal ordered the charges dismissed.

For the peak lawyers’ body in the State practising under the business name “Professional Standards” it was an embarrassing lapse which threw the world of professional discipline into chaos for months (Ormiston JA observed at [3] that he found it “surprising that a body made up of qualified and experienced lawyers should take a course as was here adopted without there having been some explicit authority which would justify their actions”.) Because the procedural defect did not apply only to the particular delegation in question, huge numbers of decisions stood amenable of being set aside, or ignored (since an order made by a statutory Tribunal without jurisdiction need not be obeyed). Urgent retrospective legislation had to be rushed through parliament.

The architects of this most exquisitely technical of victories were Terry O’Conner and barristers he retained, Rod Garrett QC and Bob Miller.

Charles and Batt JJA started with an excoriation of the Law Institute:

“The history of the matters reveals a scandalous position, for, although with one exception all the transactions the subject of the charges appear to have been completed before 1 January 1997 (when the majority of the provisions of the new Act came into force), and many of the events occurred in 1993 and even earlier, the abovementioned charges were not laid until 30 October 2000 and, as already indicated, proceedings in the Tribunal have reached the stage only of a determination of a challenge to the jurisdiction of the Tribunal to hear and determine those charges. Whether this position is the result of dilatoriness on the part of the RPA, or a lack of effort by it in prosecuting the charges before the Tribunal, or the adoption of dilatory tactics by the appellants does not directly arise for investigation, but it should not occur again.”

The majority recorded that only after 14 written submissions , and a fortnight short of a year after the jurisdiction application, had the Tribunal decided it had jurisdiction.

The solicitors had argued that:

“a writing was required by s. 313 in order to permit the ready identification of the delegate, and the precise powers and functions devolved, the period of their devolution and any conditions of their exercise, thus protecting the interests of the RPA, the delegate, any persons affected by the exercise of powers so delegated, and the public. …

a delegate acting is not an agent who exercises the RPA’s powers but rather, as the new repository of the powers, exercises his own powers as a delegate.

… In the case of a body corporate … one would expect to find an instrument of delegation with the seal of the RPA. Only when a formal delegation, an actual exercise of the power, had occurred, delivered into the hands of the delegate, could that person then satisfy anyone of the fact and means of his appointment.” (see [33])

The majority said at [39]:

“In the circumstances the legislative purpose of permitting a delegation of the functions and powers to be exercised after completion of an investigation, but requiring such a delegation to be in writing, seems to us to be reasonably apparent. We would accept the [solicitors’] submissions in this regard, that the requirement of a writing protects the interests of all parties concerned. Furthermore, it seems to us that the wording of s.313 is plain and unambiguous.”

At [44] they concluded that there was no written delegation and that accordingly, the Tribunal had not had jurisdiction, the charge which purported to invoke that jurisdiction having had no legal effect.

Ormiston JA agreed with the majority, but added this at [4] to [5]:

“The corporation’s minutes are not a means of delegating in writing a power of such an important kind. They are intended to record the proceedings and decisions of the Council as a board of directors, but even the language here adopted, that of ‘approving’ a ‘recommendation’ does not connote an immediate delegation. Of course, when first prepared the minutes are but a draft of what ultimately has to be approved and as such they are not an authorised act of the RPA. When confirmed, a month and a day later, they were merely the record of what occurred at the previous meeting and the decisions recorded could not have taken on any new legal significance. The signature of confirmation was that of the ‘chairman’, but that for the purpose of minutes means only the chairman of the meeting, although in the case of the RPA that customarily is the chairman of the Council and thereby of the Board of Directors. The authority given by the Council (as the Board) to the chairman on each such occasion of confirmation is merely to record that confirmation as verifying the minutes as a true record. There was no intended power here given to the chairman otherwise to effectuate a delegation in terms of the section. It is well accepted that a chairman has limited powers in acting on behalf of the board of a corporation, so that to act on its behalf for the purpose of effectuating a delegation would require specific authority so to act.

In conclusion, it would seem remarkable that a delegate seeking to ascertain or confirm his or her authority pursuant to a delegation would have to sift through several pages of unrelated and often confidential minutes in order to find the terms of the delegation ‘in writing’ and the confirmation of those minutes. In the present case it would have been necessary to look at pages 111 and 112 of the minutes of the RPA for 18 May 2000 for the delegation and then to page 123 for the later confirmation.”

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