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New South Wales Law Society misconceivedly suspends sole practitioner’s PC peremptorily

November 5th, 2014 · No Comments

In Dennis v Council of the Law Society of New South Wales [2014] NSWSC 1487, the Law Society suspended a sole practitioner’s practising certificate with immediate effect and appointed a manager to his practice.  He had not responded to commands by a trust investigator to produce documents and answer questions in relation to a disciplinary complaint.  The Society said that he had failed to do so wilfully and without reasonable excuse, and this, it said, made it necessary to abolish the man’s livelihood.

Hoeben CJ at CL found that the commands were invalid in law, and there had been no failure at all to comply with them.  But even if the Society’s interpretation of the provisions of the Legal Profession Act 2004 (NSW) in question had been correct so that there had been a failure to comply with them, his Honour said, this would still not have been an appropriate occasion on which to exercise the ’emergency powers’ which the Law Society exercised.  It simply was not ‘necessary’ for the protection of the public to shut down a sole practice like that.  Especially since, prima facie, the appropriate place for the complainant to raise the practitioner’s conduct was in the proceedings in the Supreme Court of Victoria which were the backdrop to the conduct complained of and which were pending at the time of the complaint.  And more especially still where the practitioner had cited the commercial sensitivity to that litigation of confidential information sought by the Law Society and had suggested that the investigation be paused pending the imminent completion of those proceedings.

Given that the complaint in which the practitioner was said wilfully to have failed to obey the stipes’ commands was the complaint of a non-client, I will be interested to learn what it is about NSW law which means that the solicitor could be obliged to deliver up privileged information even if the commander had the power to issue the commands.  The Victorian Bureau de Spank has no such powers: B v Auckland District Law Society [2003] UKPC 38, a decision of the Privy Council and Legal Services Commissioner v Shulsinger [2010] VCAT 965.

The solicitor had declined to comply with the purported commands politely, expressly by reference to the advice of counsel, and in well-reasoned correspondence asserting that the trust investigator had no standing to command him to do anything, her appointment having concluded with the final report following her earlier investigation which had apparently resulted in disciplinary charges which were then pending in NCAT.

The investigator had been appointed on 16 May 2013 and she produced a final report on 28 August 2013.  Meanwhile, a new complaint had come in, on 17 July 2013 from a Melbourne lawyer at M+K Lawyers, associated with the Great Southern class action in the Supreme Court of Victoria. But the Society apparently did two-fifths of bugger all prior to September and did not even publish the complaint to the solicitor until mid-October leading Hoeben CJ to ponder on whether there really was a public protection emergency being played out.  Then they tasked the same investigator with investigation of the new complaint.  Why it might be appropriate in NSW for a trust inspector to investigate a disciplinary complaint with nothing to do with trust monies is a puzzle this Victorian blogger is presently ruminating on.

The Law Society took the view that since an investigator had already been appointed to investigate the ‘affairs’ of the practice, that appointment could be recycled to investigate this new complaint which post-dated the appointment.  Not so, said Hoeben CJ.  Properly interpreted, the appointment is to investigate specific concerns in existence at the time of the appointment and terminates upon the giving of a final report.

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Tags: External administration · Legal Profession Act · Practising certificates · Professional regulation · regulators' duties · Suspension · Trust money · trust monies