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The costs consequences of failing to prove a responsibly advanced allegation of fraud

The irresponsible advancement in litigation of allegations of fraud undoubtedly triggers the jurisdiction to award indemnity costs and even to make personal costs orders: White Industries (Qld) Pty Ltd v Flower & Hart (1998) 156 ALR 169, approved on appeal at (1999) 87 FCR 134, discussed in this post.

But what about responsibly advanced, but ultimately unsuccessful, allegations of fraud? In a leading case, Woodward J said:

‘It is sometimes said that [special] costs can be awarded where charges of fraud have been made and not sustained; but in all the cases I have considered, there has been some further factor which has influenced the exercise of the court’s discretion: for example, the allegations of fraud have been made  knowing them to be false, or they have been irrelevant to the issues between the parties’.[1]

That statement has been followed subsequently and, in my view, very likely represents the law in Australia.[2]

Nevertheless, it is possible to find statements made, apparently without consideration of Woodward J’s observation, in cases[3] and commentaries which appear to say that the mere failure of a fraud allegation justifies departure from the usual rules of thumb in to costs. Professor Gino Dal Pont’s outstanding Law of Costs speaks of ‘the “rule” that a party alleging but failing to prove fraud is deprived of costs even if successful in the action generally’ without citing Australian authority, before suggesting that it is too broadly formulated.[4]

Conduct rules often require lawyers in Australia to make allegations of criminality, fraud and other serious misconduct only after having warned their clients of the consequences of doing so and obtained specific instructions to go ahead and make the allegations (e.g. Victorian Bar Conduct Rules, r. 34).  Quite what such an advice ought to contain is, I suspect, not immediately apparent to most lawyers.  Conceivably, uncertainty about the content of this obligation, and fear about costs consequences even in the absence of misconduct on the part of those responsibly advancing fraud allegations, are matters which contribute to allegations of fraud being made so rarely.  It would be helpful if the law in relation to the consequences of failing in a responsibly advanced serious allegation were clarified and more widely disseminated throughout the profession. Continue reading “The costs consequences of failing to prove a responsibly advanced allegation of fraud”

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Clyne v NSW Bar Association: the leading case on unfounded allegations

Clyne v New South Wales Bar Association (1960) 104 CLR 186; [1960] HCA 40 is a unanimous decision of the Dixon Court confirming the striking off of a Sydney barrister, Peter Clyne, for making unfounded and serious allegations on behalf of a husband against the wife’s solicitor in matrimonial litigation for the admitted purpose of getting the wife’s solicitor out of the case.  Those allegations were in fact made in a private prosecution by the husband of the wife’s solicitor for maintenance. Reading the decision, one might think that striking off the rolls was a relatively harsh penalty by today’s standards for the conduct recorded, especially since his client succeeded at committal in having the wife’s solicitor presented for trial.  And also if one believes Mr Clyne’s autobiography where he asserted:

‘Particulars given by the New South Wales Bar Association made it quite clear that it was not part of the charge to say that my advice to prosecute was wrong, or improper.  Indeed, as I have mentioned before, the advice to prosecute Mann was given in writing, by the eminent and respected Sydney QC, Mr Newton, who later became (and still is) a judge of the New South Wales District Court; and no one has ever criticized Mr Newton for his advice.’

But Mr Clyne had done it before and been sternly warned (see CLR 202) and was unrepentant to the moment he was struck off. Further, he was absolutely one out of the box (he will be the subject of a further blog post) and was no doubt regarded as an excrescence on the legal system to be excised at almost any cost.  He went on to irritate the authorities as a professional tax evader and unashamed advocate of tax evasion, writing many books on the subject and others (e.g. Adventures in Tax Avoidance, How Not to Pay Any Taxes, Guilty But Insane) while living a decadent lifestyle which hopped, first class, between hotels in Sydney and his native Vienna.  Like George Herscu, one of the villains in White Industries v Flower & Hart, Clyne spent time in jail, and only avoided spending more time by fleeing America without a passport while on appeal bail.  He seems to have been intelligent and to have had enough charm to be married to a Welsh entomologist who also wrote many rather different books (e.g. Silkworms, All About Ants, and Plants of Prey).  But his autobiography (Outlaw Among Lawyers; the Peter Clyne Story, Cassell Australia, 1981) reveals a thoroughly dishonest if colourful character with very little if any regard for the law. Continue reading “Clyne v NSW Bar Association: the leading case on unfounded allegations”

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National Costs Lawyers’ Conference: you’re invited

I’m speaking on Friday at the National Costs Lawyers Conference in Melbourne.  My topic is the civil and disciplinary consequences of making serious allegations without an adequate factual foundation.  Obviously, some of those consequences include costs orders.  The Civil Procedure Act 2010 (Vic) takes things further than the obligations imposed on lawyers previously and provides a smorgasbord of hitherto unexplored remedial powers to trial judges and the Costs Court alike.  The new solicitors’ conduct rules which are on their way to Victoria will extend solicitors’ obligations too in small but important ways. Think ‘allegations’ rather than ‘serious allegations’, in fact these days.

$450 gets you 6 CPD points across four categories including (thanks to me) ethics, some lunch and some wine. But you wouldn’t pay all that money just to hear me.  You’d pay it to hear the Supreme Court’s Justice Croft give the keynote address, Dr Sue McNicol SC talk about legal professional privilege in taxations (I’m so waiting to have her authoritatively sort out this hoary chestnut for me), Federal Court Registrars Pringle and Burns on party-party taxations in the Federal Court, a psychologist on professional wellbeing and a panel including Cate Dealehr and two eminent interstate costs lawyers updating delegates on recent cases on costs disclosure and costs agreements.

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WA disciplinary tribunal says it’s misconduct for a doctor passing a crash not to stop and offer assistance

Update: This decision was reversed on appeal: Dekker v Medical Board of Australia [2014] WASCA 216.  The Court of Appeal did not find that there was no duty to assist.  Rather, they found that there was insufficient evidence before the disciplinary tribunal for it to find the existence and acceptance in the profession of such a duty, because the existence of such a duty was never put to the doctor by the tribunal and because the tribunal failed to take into account on the question of liability (as opposed to penalty) all the surrounding circumstances, including that the doctor was in a state of shock.

Original post: Eleven and a half years after a 2002 car accident south of Port Headland a radiologist has been found guilty of the Westralians’ version of professional misconduct (‘improper professional conduct’) but not of conduct which peers would regard as disgraceful or dishonourable, for failing to render medical assistance.  The decision is Medical Board of Australia v Dekker  [2013] WASAT 182.  It makes a bold assertion of general application without identifying or discussing any authority about the factual scenario in question, which must surely occur regularly all over the world and — one would have thought — be much pondered:

’39 It is improper conduct in a professional respect for a medical practitioner who is aware that a motor vehicle accident has or may have occurred in their vicinity and that anyone involved has or may have suffered injury not to make an assessment of the situation, including the nature of any injuries and needs of persons involved, and render assistance, by way of first aid, when the practitioner is physically able to do so, notwithstanding that the practitioner immediately reports the matter to police or other emergency services. It matters not that there is no existing professional relationship between a medical practitioner and the persons involved in the accident. Because saving human life and healing sick and injured people is a core purpose and ethic of the medical profession, and because members of the profession have the knowledge and skills to do so, the failure by a medical practitioner to make an assessment and render assistance when he or she is aware that a motor vehicle accident has or may have occurred in their vicinity and that people have or may have been injured, when the practitioner is physically able to do so, would, notwithstanding that the practitioner reports the matter immediately to police or other emergency services, reasonably be regarded as improper by medical practitioners of good repute and competency, and there is a sufficiently close link or nexus with the profession of medicine.’

Civil liability in tort has been imposed on a doctor who refused to attend upon an emergency involving a non-patient: Lowns v Woods [1996] Aust Torts Reports 81-376 (NSWCA).  But in that case the then proximity-based test for establishment of a duty of care was satisfied by a number of factors which included that:

  • a request was made for assistance in respect of what the doctor understood to be a medical emergency which he was willing to provide (but only on the condition that the patient be brought by ambulance to his practice);
  • he was specifically told that ‘We need a doctor.  We have already got an ambulance’;
  • he was able to do so: he was at work, available, competent at administering the requisite treatment, and could have done so promptly being only 300 m away from the patient;
  • to attend involved no threat to his person;
  • he was not incapacitated so as to make giving treatment more difficult: he was not drunk, or ill, or tired; and
  • there were statutory provisions which made it misconduct to fail to render assistance to a person in urgent need of medical attention without reasonable excuse.

See Kylie Day’s ‘Medical Negligence – the Duty to Attend Emergencies and the Standard of Care: Lowns v Woods” (1996) 18(3) Sydney Law Review 386.

The tortious duty was squarely founded on the fact of a request in a professional context for treatment of the kind in which the doctor practised. Public policy was expressly acknowledged as relevant to the determination of the tortious liability. Since the existence of a professional obligation was a matter that told in favour of the development of a new category of duty of care, civil lawyers ought not be entirely blase about the latest apparent development of the disciplinary law courtesy of the Westralians.

Continue reading “WA disciplinary tribunal says it’s misconduct for a doctor passing a crash not to stop and offer assistance”