NSWCA surveys fines in NSW lawyers’ discipline decisions over a decade

Russo v Legal Services Commissioner [2016] NSWCA 306 was the subject of my previous post. The Court engaged in a comparatively sophisticated review of disciplinary outcomes in like cases.  The purposes of this post is to reproduce that review and comment on the variables which ought to be taken into account in any proper survey of past outcomes.

To survey penalties in like cases has always been an important part of sentencing and should be an important part in imposing disciplinary sanctions.  Barbaro  (2014) 253 CLR 58; [2014] HCA 2 and Cth v Director, Fair Work Building Industry Inspectorate [2015] HCA 46; (2015) 326 ALR 476 do not suggest to the contrary.  They say that the purpose of a survey of like sanctions is to promote consistency in penalties but not the establishment of a range of available sanctions deviation from which is appellable.  Buchanan JA observed in R v Macneil-Brown [2008] VSCA 190, (2008) 20 VR 677 at [130]:

‘counsel can best assist a sentencing judge, not by advancing what they consider to be sentences at the lower or upper limits of a sound sentencing discretion, but by making submissions as to the existence and nature of aggravating and mitigating circumstances and providing some guide to the manner in which other judges have approached like cases by supplying sentencing statistics and citing passages from decided cases which bear upon aspects of the instant case.’

I would submit that any survey of fines as a disciplinary sanction must take into account, as an important aspect of the analysis, the financial situation of the person or persons liable to pay it.  The specific deterrence of a fine will vary greatly from one practitioner to another.  Practitioners who struggle, for personal reasons, are more likely to get themselves into trouble in the first place, and to exacerbate it by less than perfect intercourse with the Legal Services Commissioner.  Their financial situations often deteriorate too.  Specific deterrence may be achieved by imposition of a fine much smaller than would be imposed on a flourishing practitioner raking it in.  General deterrence will also be achieved if the Tribunal is transparent in taking account of financial circumstance.  In such a case, the Tribunal might indicate the kind of fine which might have been imposed had the practitioner enjoyed an average post-tax income.

Furthermore, the costs burden borne by the practitioner ought also to be taken into consideration.  Costs and fine are inter-related in this way: Environment Protection Authority v Barnes [2006] NSWCCA 246 at [88] (Kirby J speaking for the Court) applied by analogy in LSC v Bechara [2009] NSWADT 313. The extraordinary costs practitioners are liable to in Victoria following disciplinary prosecutions would very often be more than adequate to achieve specific and general deterrence.  If you are prosecuted and reprimanded, made the subject of an editorial on the front page of the Commissioner’s website, and have to cough up $40,000 in unrecoverable solicitor-client costs reasonably incurred and costs liability to the Legal Services Commissioner, that is going to make you think just as hard about doing it again as any comparatively trivial fine you might cop.

Finally, one must be astute to inflation.  In my experience, people tend to exaggerate the effect of inflation when considering older fines.  Here is a calculator which assists in measuring in today’s dollars a fine imposed some years ago.

For some reason, notwithstanding that NSW is now a part of the legal profession uniform law, the other participant in which is Victoria, no Victorian fines were part of the survey.  That strikes me as unusual, since there is a whole statutory office the purpose of which is to promote interstate uniformity in the application of the Uniform Law: the Commissioner for Uniform Legal Services Regulation.  Russo’s Case was decided under the old legislation which the LPUL replaced, and which legislation in fact governed the prosecution was one of the issues on appeal.  Interestingly, apparently because it was thought that there were no relevant differences between the two regimes, that question was not decided.

This is what the NSWCA said about its survey of fines, and about the appropriate fine in this case: Continue reading “NSWCA surveys fines in NSW lawyers’ discipline decisions over a decade”

NSW solicitor who didn’t pay counsel’s fees struck back on

Salvatore Russo, a solicitor of 29 years’ standing, was struck off NSW’s roll of solicitors on 16 April 2016 by NCAT.  He had received payment from his client for counsel’s fees but not paid counsel for years. Then he was high-handed in response to the client’s entreaties when counsel sued the client directly.  The Court of Appeal found a denial of procedural fairness by NCAT.  The Tribunal had telescoped the questions of liability and penalty into one hearing.  It had failed to give Mr Russo sufficient notice of the fact it was considering striking him off despite the fact by the end of the trial, the Commissioner was not seeking such an outcome any more. Now he’s been struck back on by the NSW Court of Appeal, a fine of $20,000 substituted for his misconduct: Russo v Legal Services Commissioner [2016] NSWCA 306.  (In fact, the striking off never came into operation, because he got a stay along the way.) Continue reading “NSW solicitor who didn’t pay counsel’s fees struck back on”

Yet more on the obligation on Legal Services Commissioners to plead their case properly and stick to it

Legal Services Commissioner v AL [2016] QCAT 237 is a decision of a disciplinary tribunal presided over by Justice David Thomas, President of QCAT and a Supreme Court judge. It is therefore of high persuasive value, and treats Queensland provisions which are the same as the equivalent Victorian provisions. And it provides what I suggest with respect are the correct answers to the following questions:

  • How negligent do you have to be before you can be found guilty of unsatisfactory professional conduct as defined in provisions which say that the concept includes ‘conduct that falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent’ lawyer holding a practising certificate? (Answer at [44] and [27]: substantial and very obvious fallings short of the standard, established by direct inferences from exact proofs.)
  • What must be pleaded specifically in a disciplinary charge? (Answer at [82] – [92]: all states of mind, not only dishonest intents, and all facts to be relied on (‘the charges to be levelled must be fully and adequately set out in the Discipline Application. As a matter of procedural fairness, the Practitioner should not be left in any doubt as to the extent of the allegations that is to be met.’)
  • To what extent is a disciplinary tribunal constrained in its decision making by the allegations specifically made in the charge? (Answer at [96] – [108]: absolutely: if no state of mind is alleged, the prosecution should not be allowed to call evidence as to state of mind; ‘it would be wrong to admit evidence the principal purpose of which is to establish conduct that lies beyond the ambit of the charge’.)
  • Does the mere fact that charges are not allowed on taxation mean that there has been overcharging such as to warrant discipline? (Answer at [76] – [77]: no)

The Tribunal dismissed charges against a solicitor who lodged a caveat pursuant to an equitable mortgage without checking that it satisfied the Statute of Frauds’ writing requirements and against a partner of her firm who took over her files when she was on holidays and billed the client for the work in attempting unsuccessfully to register the caveat.

I move from the specific facts of this QCAT case to general comment (what follows is certainly not veiled reference to the conduct of the Commissioner’s counsel in QCAT). There is a very real reason to insist on the particularization of states of mind in disciplinary tribunals, including particulars of actual and constructive knowledge. These details do not always get left out just because it is thought that disciplinary tribunals are not courts of pleading and such minutiae is not appropriate. Nor do they just get left out because they are thought to be inherent in the allegation, or because of incompetence, or mere mistake. Rather, they get left out because bureaucrats have investigated incompetently and when competent counsel come to plead disciplinary applications based on the investigation, they do not have a sufficient factual foundation to make these allegations, or perhaps are simply too timid.

But sometimes counsel with civil practices, untutored in the art of prosecutorial restraint, and safe in their private belief that the practitioner is in fact much more evil than incompetent investigation established, might fall prey to temptation. Mealy-mouthed, ambiguous allegations might be made which require the practitioner to get into the witness box. Then, all manner of unpleaded allegations as to states of mind and as to completely un-pleaded conduct, justified in relevance as tendency evidence or circumstantial evidence of the pleaded facts, might be cross-examined out of the practitioner and an unpleaded case presented to the disciplinary tribunal in closing. In a tribunal not bound by the rules of evidence, such questioning may be waved through with lip service to the proposition that objections will be dealt with by according appropriate weight to the evidence in the final analysis. Queensland leads the charge against such conduct, and I can’t help thinking it’s because Supreme Court judges seem to get involved in disciplinary decisions more often up there. All power to them. So impressed am I with this latest judgment, I have decided to go on a study tour of the Sunshine Coast in the September school holidays.

Continue reading “Yet more on the obligation on Legal Services Commissioners to plead their case properly and stick to it”

Solicitor’s correspondence with judge telling him how immature his conduct was doesn’t go down well in disciplinary tribunal

Update, 5 October 2016: this decision is under appeal.  See this post.

Original post: In Council of the Law Society of NSW v MAG [2016] NSWCATOD 40, a Sydney solicitor was disciplined for writing a private letter of complaint to a Federal Court judge the day after a decision was handed down, adversely to his client in favour of the Tax Man.  The next day he wrote to the trial judge a letter not copied to the other side which commenced:

‘As solicitor for the Applicant in this matter, I have serious concerns about your conduct and decision in this matter. These are:

1. The somewhat immature and inappropriate comments you made to me …’ Continue reading “Solicitor’s correspondence with judge telling him how immature his conduct was doesn’t go down well in disciplinary tribunal”

VCAT finds practitioner guilty of conduct prejudicing administration of justice

I only learnt in the last few years that Melbourne is one of the world’s great Jewish cities, with a globally significant series of communities of orthodox adherents.  One of those orthodox communities has delivered up an interesting case.  In Victorian Legal Services Commissioner v AL [2016] VCAT 439, VCAT’s Acting President recently found a well known Melbourne solicitor guilty of two counts of professional misconduct, constituted by breaches of each limb of r. 30.1.2 of the solicitors’ professional conduct rules.

The rule prohibited conduct calculated to, or likely to a material degree to be, prejudicial to the administration of justice, or to diminish public confidence in the administration of justice, or adversely to prejudice a practitioner’s ability to practise according to these rules.

The practitioner’s disciplinary offence was first to state privately to his client’s father his disappointment after an orthodox Jew sitting watching someone else’s case in court had gone out of his way from the well of the court to assist police in the middle of a bail hearing in a criminal prosecution of the practitioner’s client. His second offence was committed when the man, whom I will refer to as the complainant since he lodged the disciplinary complaint which led to the practitioner’s disciplinary prosecution, rang the practitioner and asked him about comments to similar effect which the man had heard the practitioner had made, taping the call. The practitioner expressed directly to the man similar sentiments, expressly invoking the Jewish principle of ‘mesirah’ by which Jews who cooperated with secular authorities against fellow Jews in times and places where Jews enjoyed imperfect protection were ostracized. Jewish authorities have repeatedly said that the principle has no operation in modern day Australia in relation to criminal matters.

The Age has reported, in an article prominently featuring the practitioner, that victims of Jewish abusers have been pressured not to cooperate with police. It reported the Legal Services Commissioner as saying that ‘there was a general principle that made it impermissible for a lawyer to tell a witness they could not inform police about a matter because of a religious or community rule.’ I do not mean to criticise the Commissioner in this regard, because The Age sought his comments prior to the Commissioner’s receipt of the complaint, and the Commissioner was presumably simply responding to a general question about lawyers’ obligations towards witnesses in their cases. But what VCAT’s decision demonstrates is that the practitioner’s comments occurred after the conduct in question which the practitioner believed to have involved false statements based on misinformation, and were directed to a person who was not a witness and who, as far as the practitioner was aware, was simply someone who stood up in the well of the court and interfered in his client’s case. Given that, as far as the practitioner is said to have known, the man who stood up in court had no further role to play in the case or in his client’s drama more generally, it is hard to see how the practitioner could be said to have intended to pressure the man as a victim of a Jewish abuser not to cooperate further with the police in the future in bringing the abusers to justice, as seems to have been the implication. Continue reading “VCAT finds practitioner guilty of conduct prejudicing administration of justice”

The permissible forensic uses of historical mental illness in professional discipline trials

Professor Dal Pont’s excellent text Lawyers’ Professional Responsibility (5th ed., 2013) suggests at [23.145] that mental illness will rarely provide a defence to a disciplinary prosecution, the purpose of which is protective rather than punitive.  He argues, in part, that the public needs protection just as much from the mentally ill who do bad things as from the mentally flourishing who do wrong.  But that reasoning does not have any application where there is not a temporal proximity between the moment of determining liability and the moment at which the putative wrongdoing occurred. In my experience the glacial pace of disciplinary investigations usually mean that the time for setting sanctions is years after the conduct in question.  Very often, I find myself acting for practitioners whose minds are flourishing much more than at the time of their wrongdoing.

I always thought (or perhaps more accurately, hoped) that Dal Pont was a little pessimistic about the possibility of mental impairment being relevant to the determination of the question of whether unsatisfactory professional conduct or professional misconduct is.  True, there are some decisions broad statements in which support that position, but the authorities are a bit all over the place, and there are so many different kinds of conduct warranting discipline and so many fact scenarios that it seemed to me that the law must be more nuanced than some of those broad statements suggested.

Last year, VCAT’s Legal Practice List last year ruled, contrary to the position advanced by Victoria’s Legal Services Commissioner, that evidence of mental impairment was relevant to the question of whether conduct was professional misconduct or unsatisfactory professional conduct, and heard evidence from a psychologist during the liability phase of the hearing.  The two species of conduct warranting discipline arising from a breach of the rules have traditionally been delineated by enquiring whether the breach was innocent or whether it was deliberate or reckless, so that it clearly incorporates a subjective enquiry. VCAT’s decision to hear the psychological evidence on the question of liability was, as I have learnt in the course of penning this post, consistent with that in New South Wales Bar Association v Butland [2008] NSWADT 120.

Now the Supreme Court of NSW has reviewed the authorities and published a useful decision in the matter of BRJ v Council of the New South Wales Bar Association [2016] NSWSC 146 (Adamson J), making clear that mental illness may be relevant to the question of liability, as well as to the question of penalty where it is of course of critical relevance, citing Robinson v The Law Society of New South Wales (Supreme Court of New South Wales, Court of Appeal, unreported, 17 June 1977), a decision I have not come across before. Essentially, Justice Adamson said, it all depends on whether there was a mental element to the kind of conduct warranting discipline which is charged.  Conduct described as a failure to maintain standards of competence and diligence is not something to which the practitioner’s mental impairment is relevant.  In charges which rely on the practitioner having a particular state of mind do require analysis of the degree to which the practitioner’s state of mind was flourishing.  Professional misconduct at common law is determined by what competent and reputable peers would think of the conduct.  What they would think is affected by the degree to which the practitioner’s mind was flourishing at the relevant time.

Unfortunately for the barrister who was the subject of the disciplinary hearing under appeal in this case, all this meant that though the Tribunal and the Court accepted that her conduct was caused by her psychiatric illness, she was nevertheless properly found guilty of unsatisfactory professional conduct constituted by failing to maintain standards of competence and diligence and acting in the face of a conflict between self-interest and duty to her client.  The test for such unsatisfactory professional conduct does not enquire into the mind of the practitioner, the Court found.  Accordingly, the psychiatric causation was legally irrelevant.

See also this sister post, about the disciplinary Tribunal’s and the Supreme Court’s willingness to allow the practitioner to change her plea, once after the liability hearing but before the delivery of reasons and once on the eve of the hearing of the appeal.

Continue reading “The permissible forensic uses of historical mental illness in professional discipline trials”

Liability of directors of incorporated legal practitioners for wrongdoing of fellow directors

Legislation regulating lawyers typically deals with directors of incorporated legal practices like Victoria’s Legal Profession Act 2004’s s. 2.7.11 as follows:

‘Each of the following is capable of constituting unsatisfactory professional conduct or professional misconduct by a legal practitioner director–

(a) unsatisfactory professional conduct or professional misconduct of an Australian legal practitioner employed by the incorporated legal practice;

(b) conduct of any other director (not being an Australian legal practitioner) of the incorporated legal practice that adversely affects the provision of legal services by the practice’.

A recent decision from Sydney illustrates how disciplinary tribunals approach applications to discipline innocent co-directors of wrongdoer-directors in incorporated legal practices.  Trusted non-legal practitioner directors do not necessarily need to be supervised in everything they do by legal practitioner directors unless there is a special reason to.

In the NSW case, there was a special reason: the co-director did not renew his practising certificate which lapsed on 30 June 2011.  He had failed (to the innocent co-director’s knowledge) to comply with earlier disciplinary orders requiring that he be mentored.  Contrary to his promises to the by-then-sole-legal-practitioner-director, he caused the firm to incur an unfunded liability to a valuer retained on behalf of a client in litigation.  The valuer was instructed by the wrongdoer director in August 2011.  The Tribunal found the remaining legal practitioner director guilty of unsatisfactory professional conduct, but on the basis that her failure to supervise the by-then non-legal practitioner director caused the firm to incur a debt which it was unlikely to be able to pay if the litigation in respect of which it was incurred did not succeed.  The decision is Council of the Law Society of New South Wales v Loris Hendy [2016] NSWCATOD 20.

One thing which is puzzling is exactly on what basis it was said that a firm contracting personally to pay valuers, and then not paying them because it did not have the money to do so, was said to be conduct warranting discipline which the practitioner had an obligation to prevent by supervision.  After all, had the firm caused the client to contract directly with the valuers, or made clear to them that the firm would not be personally liable, they presumably still would not have been paid.  Presumably the client was always up for the disbursements, whether there was a successful outcome or not, since that is fairly standard.  And so, presumably, if the client had any money, the firm would have sued the client.  And presumably the firm believed on the basis of senior counsel’s advice that the client would succeed in the litigation and that the valuer would get paid out of the favourable costs award, and that, even if that did not occur, the firm would be in a position to meet the valuer’s fees.  Certainly, there was no finding to the contrary.

In the Victorian solicitors’ conduct rules in place from 2005 until recently, r. 26 said:

‘A practitioner who deals with a third party on behalf of a client for the purpose of obtaining some service in respect of the client’s matters, must inform the third party when the service is requested, that the practitioner will accept personal liability for payment of the fees to be charged for the service or, if the practitioner is not to accept personal liability, the practitioner must inform the third party of the arrangements intended to be made for payment of the fees.’

Compare r. 35 of the Legal Profession Uniform Law Australian Solicitors’ Conduct Rules 2015. To similar effect was r. 35 of the New South Wales Professional Conduct and Practice Rules 2013 (Solicitors’ Rules).  None of those were in force, of course, in NSW in 2011 when the non-legal practitioner director of the firm caused it to incur the fees, and I do not know what the rules which were in force in NSW at that time said.  At any rate, there was no reference to any such conduct rule in the Tribunal’s reasons. Assuming some similar rule was in place, it is notable that the legal practitioner director was not apparently disciplined for allowing the firm to contract the liability, but for not meeting it, or perhaps for allowing it to be contracted in circumstances where there was no guarantee that it could be satisfied if things went pear-shaped.

There are numbers of cases about the misconduct of solicitors who fail to pay counsel’s fees for no particularly good reason.  I have listed them at the end of this post.  It seems to be well established by authority that such conduct is misconduct at common law or pursuant to the generally worded statutory definitions of unsatisfactory professional conduct and professional misconduct. Couldn’t agree more, and long may such cases accumulate.  But this was a bit different.

Continue reading “Liability of directors of incorporated legal practitioners for wrongdoing of fellow directors”

Suspensions which are not suspensions and orders which are not orders

VCAT’s latest decision to come to my attention, of Member Elizabeth Wentworth, involved another solicitor who did not lodge tax returns over an extended period. He was suspended from practice for 12 months, but the suspension was suspended provided he did not breach certain conditions in the three years after the orders.  If he does, then the Commissioner may apply for the suspension of the 12 month suspension to be lifted so it comes into operation. Member Wentworth decided to leave what exactly would happen in the case of a breach to the discretion of the any future Tribunal constituted to consider it rather than providing automatically for the suspension of the suspension to be lifted.  Legal Services Commissioner v GB [2015] VCAT 254 is interesting to me for six reasons: Continue reading “Suspensions which are not suspensions and orders which are not orders”

Can an administrative agency determine that a crime has been committed?

In Australian Communications and Media Authority v Today FM (Sydney) Pty Ltd [2015] HCA 7, the High Court considered when an administrative agency can make a determination of the commission of a crime.  The case arises out of the sorry saga of two Today FM presenters impersonating the Queen and Prince Charles in inquiries of the hospital in which the Duchess of Cambridge was a patient.  ACMA conducted an investigation and published a preliminary report expressing the ‘view’ that Today FM had used its broadcasting service in the commission of an offence under the Surveillance Devices Act 2007 (NSW).  Commission of an offence in the course of use of a broadcasting service was a breach of the licence and carried with it the possibility of its revocation: s. 8(1)(g) Australian Communications and Media Authority Act 2005 (Cth). The Court said of ACMA’s ‘view’: No worries; full steam ahead, overturning a unanimous decision of a bench of the Full Federal Court presided over by its Chief Justice, and restoring the trial judge’s conclusions.

There are no doubt implications for Legal Services Commissioners and other disciplinary investigators where misconduct is defined to include the engaging in of criminal offences.  Under the uniform legislation to come into force in Victoria and NSW this year, Legal Services Commissioners will become decision makers and have the power to impose fines for professional misconduct.  I have blogged before about various cases in which a related question has arisen, of the appropriateness of administrative tribunals making determinations of the commission of offences, not with criminal consequences but with penal disciplinary consequences. Continue reading “Can an administrative agency determine that a crime has been committed?”

Self-represented solicitor guilty of misconduct for breaching a rule expressed to regulate conduct when acting for a client

A Western Australian disciplinary case, Legal Profession Complaints Committee v CSA [2014] WASAT 57 is interesting in a number of ways. A criminal lawyer was the manager of a strata corporation.  She owned two units and the complainant the third. The complainant affixed an airconditioner to a wall which impeded on a common area.  She sought legal advice.  Her lawyers wrote a letter of demand to the complainant and charged a few thousand dollars.  The complainant did not fix the problem within the 14 days demanded, so the lawyer sued in the Magistrates’ Court.  The case was settled on the basis that the airconditioner would be relocated and the lawyer withdrew the proceeding without seeking costs.  When the complainant sold the third unit, the lawyer demanded that the complainant pay her the few thousand dollars her lawyers had charged her for the advice and the letter of demand.  She did so by a letter of demand drafted for her by another lawyer, though the involvement of this second lawyer only emerged at the disciplinary hearing. When the complainant did not pay up, she sued for them in her personal capacity.  The suit was found to have no legal foundation, but the lawyer said that she mistakenly thought that it did have a legal foundation, and that civil proceedings were not her thing. The case says:

1.  The suit was an abuse of process because there was no legal foundation for suing for the recovery of ‘pre-litigation’ legal costs.

2.  The lawyer’s conduct in threatening to bring and then bringing a suit which was an abuse of process was common law misconduct but was also a breach of a rule which prohibited lawyers from claiming on behalf of a client costs in a letter of demand for recovery of a debt because she was acting for herself in writing the letter (even though no legal letterhead or reference to her status as a lawyer was involved).

3.  There is no defence of honest and reasonable mistake in professional discipline.

4.  It is inappropriate for a disciplinary tribunal to make what the prosecutors described as ‘an incidental finding of dishonesty’ in relation to statements made during the investigation in respect of which no charge had been laid in the disciplinary proceeding.  Any such allegation ought to be the subject of a separate process (though the Tribunal then went ahead and found that the allegation was not made out on the Briginshaw standard anyway). Continue reading “Self-represented solicitor guilty of misconduct for breaching a rule expressed to regulate conduct when acting for a client”

NSW solicitor who failed to pay counsel’s fees struck off

Updated post (25 July 2014):  The answer to the question posed by the original post is: yes, he will be struck off.  Here are the reasons: Council of the Law Society of NSW V Andreone (No2) [2014] NSWCATOD 81.  His failure to make submissions on the question would not have assisted.  On the question of whether monies received by solicitors from clients for payment of counsel’s fees are trust monies, and on whose behalf they are held, see Legal Services Board v Gillespie-Jones [2013] HCA 35 about which Melbourne University’s Associate Professor Bant’s learned commentary may be found here.

Original post (published as ‘Will Solicitor Who Failed to Pay Counsel’s Fees be Struck Off?’): The Law Society of NSW wants a solicitor who persistently delayed in paying counsel struck off. The NSW equivalent of VCAT has found the professional misconduct established: Council of the Law Society of NSW v Andreone (No. 1) [2014] NSWCATOD 49, and a hearing on sentencing is pending.  In this case, clients had paid bills which included claims by the solicitor for counsel’s fees by electronically depositing monies into the firm’s office account — probably at the firm’s direction, as the Tribunal found.

The Tribunal found without reference to authority that those payments were trust monies to the extent that they satisfied the claims by the solicitor for counsel’s fees, the solicitor not having paid the counsel at the time of their receipt.  In other words, the solicitor held the monies on trust for the barristers. But it seems that the Tribunal considered the solicitor’s misappropriation of trust monies and the failure to pay the fees as separate instances of professional misconduct.  In other words, the mere failure to pay the fees, given its intentionality and persistence, amounted to professional misconduct.  This is what the Tribunal said: Continue reading “NSW solicitor who failed to pay counsel’s fees struck off”

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”

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”

The civil and disciplinary consequences of making an allegation of serious wrongdoing without a proper foundation

Friends, I need your help, again.  Certain promises I made to write about and present on the civil and disciplinary consequences of making allegations of serious wrongdoing (e.g. fraud) without a proper foundation are coming home to roost.  I’m looking at:

  • disciplinary sanction of lawyers via Legal Services Commissioner, etc. prosecution;
  • personal costs orders against lawyers;
  • costs consequences for parties (common law in relation to exercise of the unfettered discretion re solicitor-client rather than party-party costs and displacing the presumption that costs follow the event where allegations of fraud are not made out, and Civil Procedure Act 2010 (Vic.)); and
  • what is a ‘proper foundation’?

My miserable situation in this season of sun, frivolity and child-minding is a need to work out what these consequences are so that I can provide learned disquisition.  In the process I have learnt something about Dr Peter Clyne, the protagonist of Clyne v NSW Bar Association (1960) 104 CLR 186; [1960] HCA 40.  What a wonderful addition to my knowledge of the rogues’ gallery of which I consider myself a connoisseur; I even bought his autobiography on eBay today but his ‘How Not to Pay Your Debts’ is still available.  The Hikers described his conduct during the course of an ‘orgy of litigation’ between his client, the husband, and the wife as ‘irresponsible’, ‘mischievous’, ‘objectionable’, indefensible, ‘inexcusable’, and, rather wonderfully I think, ‘monstrous’.  A unanimous Dixon Court confirmed the good doctor’s striking off.  You can read about his life afterwards, including as a Magistrate in Zambia, here, and possibly less reliably, here.

So here is a general call-out for good authorities on these questions, especially decisions which really assist in understanding what a ‘proper factual foundation’ is, since many authorities relate to allegations which are so obviously unsustainable that they do not really illuminate where the line lies between the merely poor and the truly discreditable argument (Clyne), or proceed on the basis of admissions (AM v Legal Practitioners Disciplinary Authority [2010] NTSC 02), or are fantastically complicated (the case just referred to and Victorian Bar Inc v CEM QC [2006] VCAT 1417).  I would also be very grateful for any detailed commentaries on this aspect of the conduct rules for solicitors and barristers alike, and Australian decisions in relation to costs (since many of those cited by Dal Pont are Canadian or English).

A reprimand is not just a slap over the wrist; the value of precedents in disciplinary sentencing

In Peeke v Medical Board of Victoria [1994] VicSC 7 at p. 6, Marks J commented in a judgment substituting a reprimand for the inferior tribunal’s 6 month suspension that a reprimand should not be regarded as a trivial penalty:

‘I have mentioned that the Board referred to a reprimand as trivialising a serious lapse in professional standards.  I am not able to agree with the Board that a reprimand is a trivial penalty.  It may be inappropriate or inadequate in many circumstances, but a reprimand, to a professional person, has the potential for serious adverse implications.’ Continue reading “A reprimand is not just a slap over the wrist; the value of precedents in disciplinary sentencing”

Another solicitor struck off for not paying counsel’s fees

A South Australian solicitor has been struck off for a panoply of wrongs, one of which included failing to pay counsel’s fees: Legal Practitioners Conduct Board v Wharff [2012] SASCFC 116.  On this subject, broadly construed, see also: Council of the Law Society of NSW v PJB [2012] NSWADT 153Council of the Law Society of NSW v ML [2012] NSWADT 146, and Council of the Law Society of NSW v HI [2012] NSWADT 203 (where the NSW solicitor was struck off).  See also Legal Services Board v G-J [2012] VSCA 68 (re the Quistclose trust which may arise when a client pays solicitors moneys for the specific purpose of paying counsel’s fees), Victoria Lawyers RPA Limited v M O Lawyers Lawyers Pty Ltd TO217 of 2002, 31 October 2001 and Law Institute of Victoria Limited v SO & GS,TO555 & TO556 of 2005 10 November 2005, and Legal Services Commissioner v JHMcC [2011] VCAT 231 noted in this post.

In Wharff,  A Full Court of the South Australian Supreme Court (Kourakis CJ, Blue and Stanley JJ) said:

‘A solicitor who engages a barrister or solicitor agent undertakes a personal liability, either in honour or in contract as the case may be, to pay the barrister’s or agent’s fees, unless otherwise agreed.[3]  Where a legal practitioner undertakes such a personal liability, it is unethical to ignore his or her obligation, and hence a wilful or persistent refusal or failure to pay fees can amount to unprofessional conduct.[4]’


[3]    Rhodes v Fielder, Jones and Harrison [1918-19] All ER 846 at 847 per Lush J (Sanke J agreeing); Re Robb (1996) 134 FLR 294 at 310 per Myles CJ, Gallop and Higgins JJ.

[4]    Rhodes v Fielder, Jones and Harrisons [1918-19] All ER 846 at 847 per Lush J (Sanke J agreeing); Law Society of New South Wales v McCarthy [2002] NSWADT 58 at [46] per Malloy, Robinson QC and Kirk; Law Society of New South Wales v Graham [2007] NSWADT 67 at [29] per Karpin ADCJ, Pheils and Fitzgerald.

Continue reading “Another solicitor struck off for not paying counsel’s fees”

Gross overcharging penalties surveyed

In Legal Profession Complaints Committee v PJO’H [2011] WASAT 95 (S), delivered on 20 February 2012 and not yet on Austlii, the Tribunal helpfully reviewed the penalties awarded in the gross overcharging cases over the years before suspending the respondent from practice for 6 months (the Committee wanted 18).  Two other things are notable about the case.  First, the Complaints Committee’s costs of the matter were $134,000 and were described as reasonable.  Second, the practitioner drafted his character witnesses’ evidence himself.  Didn’t go down well.  The decision was the work of a tribunal of three presided over by Justice Cheney.  Here’s the Tribunal’s survey:

‘In Re Veron; Ex parte Law Society (NSW) [1966] 84 WN (Pt 1) (NSW) 136, the practitioner was struck off following findings of some 65 instances of overcharging clients in respect of personal injury actions. The overcharging was found to be deliberate and there were related charges proved against the practitioner involving dishonesty or fraud in respect to the practitioner’s dealings with his clients and their money. Continue reading “Gross overcharging penalties surveyed”

More on the need for specific instructions before commencing proceedings on behalf of others

Update: See now Doulman v ACT Electronic Solutions Pty Ltd [2011] FMCA 232.  A solicitor accepted instructions from a fellow solicitor to recover fees allegedly owing by a client.  The proposed plaintiff was a company which the fellow solicitor had until shortly before the retainer been authorised to represent.  The solicitor, acting honestly, accepted these instructions from the fellow solicitor at face value: the proposed plaintiff was well known to him.  He found out only far down the track that the proposed plaintiff had been sold by the fellow solicitor before the instructions were given so that the solicitor had instituted litigation and bankrupted the defendant when he had no instructions to do so from the company.  The proceedings were a nullity.  Everything had to be unravelled.  The solicitor was ordered to pay the costs of this exercise on a party-party basis: he should have done a company search or sought written confirmation of the fellow solicitor’s authority to bind the company. There is a one-paragraph note of the case at ALJ vol 85 no 9 (September 2011) at 537.  Thanks to the Law Institute Library through the LIJ’s ‘In Reference’ page for bringing the case to my attention.

Original post: I had to look hard recently at the cases about lawyers’ obligation to have proper instructions before commencing proceedings on behalf of others. Pretty obvious really, but the grey area exists where lawyers receive instructions from agents of the client, especially where the agent is specifically authorised to retain solicitors, but not specifically authorised to commit their principal to litigation.  Victorian disciplinary tribunals have dealt with such conduct by meting out penalties ranging from a fine of $1,000 in 2011 money to recommending that the practitioner be struck off the rolls.  As this astonishing divergence of dispositions attests, everything depends on the precise facts and the motivations of the practitioners.

Further to this related post, what follows is my case notes of the three Victorian disciplinary decisions I am aware of dealing with this form of conduct warranting discipline.  Are you aware of any similar cases in Victoria or elsewhere? Continue reading “More on the need for specific instructions before commencing proceedings on behalf of others”

Should the liability for costs of a disciplinary prosecution impact on the level of punishment?

The answer is, at least in NSW — Yes. In Legal Services Commissioner v MB (No 3) [2009] NSWADT 313, a tribunal presided over by Deputy President Haylen gave the following reasons for punishing the respondent solicitor for gross-overcharging with a fine of $6,500:

‘The Tribunal accepts that the fine should be at the lower end of the range and so determines to impose a fine of $6,500. In arriving at this level of fine, the Tribunal has taken into account the large amount of costs to be met by the respondent practitioner and has formed the view that, in this case, the level of costs are a relevant consideration in assessing the overall penalty to be imposed upon the respondent. There appeared to be some debate arising from the discussion in Meakes as to the appropriateness of such an approach but in another context, the Court of Criminal Appeal has expressed the view that the level of costs is a relevant consideration in setting the level of a fine. In the Environment Protection Authority v Barnes [2006] NSWCCA 246 Kirby J, speaking for the court, rejected a submission for the appellant that the penalty imposed was a miniscule proportion of the maximum penalty applicable, stating that the individual fines which totalled $4,500 were accompanied by a costs order of approximately $16,000 and that the costs “were an important aspect of the punishment of Mr Barnes”. At para [88], his Honour stated:

Returning to the penalty imposed upon Mr Barnes. As a matter of first impression, the fines imposed appeared unduly lenient, suggesting error. However, the fines were part only of the penalty. Mr Barnes was obliged to pay substantial costs. Her Honour made it clear that, but for that fact, the fines she would have imposed would have been much higher.

Although Barnes involved the imposition of a criminal penalty, there is, in principle, no reason to depart from that approach when dealing with the very serious issue of professional misconduct and the level of fines that might be imposed on practitioners.’

What, exactly, is a reckless contravention of a conduct rule?

Under the Legal Practice Act, 1996, the distinction between what was then called ‘misconduct’ and what was then called ‘unsatisfactory conduct’ of the kind constituted by a breach of a conduct rule or of a provision of the Act, depended on whether the breach was wilful or reckless, in which case it was misconduct, or not, in which case it might amount to unsatisfactory conduct.  That distinction was abandoned in the Legal Profession Act, 2004, but continues to be used by VCAT’s Legal Practice List as a guide to determining whether a breach of the rules or the Act amounts to the more or less serious of the categories of disciplinary wrongdoing, now known as ‘professional misconduct’ and ‘unsatisfactory professional conduct’.  The meaning of ‘reckless’ in this context has long been governed by an unreported decision of JD Phillips J, Zaitman and Law Institute of Victoria, Supreme Court of Victoria, 9 December 2004.

It was summarised in the biggest Victorian lawyers’ discipline case in recent years, Victorian Bar Inc v CEM QC [2006] VCAT 1417, and the relevant passage is a much easier way to work out what ‘reckless’ means in this context than a consideration of Zaitman’s Case which does not give up its essence easily.  The whole passage is set out below, but the take home point is that:

‘in order to establish recklessness, it is necessary to show that [the lawyer] appreciated the risk that their conduct in a particular instance might possibly amount to a breach of the rule, and knowing that risk, proceeded, intending to take that risk. In circumstances where [the lawyer] holds a bona fide belief that their conduct does not amount to a contravention of the rule, it cannot be reckless for [him or her] to proceed.’

Continue reading “What, exactly, is a reckless contravention of a conduct rule?”