Legal Services Commissioner’s obligations of fairness

I have previously reported Justice Finkelstein’s views about the obligations of those who prosecute proceedings for a penalty (‘‘I would hold that a regulatory body that brings a civil proceeding to recover a penalty is under an obligation similar to that owed by a prosecutor to an accused.’). Barristers who are briefed by the Legal Services Commissioner in disciplinary proceedings have the same obligations as barristers briefed to prosecute criminal proceedings.  But until tonight I was unaware that VCAT’s predecessor, the Legal Profession Tribunal, had actually indicated that the regulator himself (as opposed to his lawyers) owe obligations.  In Victorian Lawyers RPA Ltd v Kaine [2001] VLPT 16, Senior Member Howell,  Victoria’s most experienced decision maker in legal disciplinary matters, said of the Law Institute (which was for a while formally named ‘Victorian Lawyers RPA Ltd’) that it owed:

‘the obligations normally owed by a prosecutor, such as the obligation to bring to the attention of the Tribunal or to the attention of the practitioner any evidence that might be favourable to the practitioner’.

Continue reading “Legal Services Commissioner’s obligations of fairness”

Legal Services Commissioner’s website explains difference between professional misconduct and unsatisfactory professional conduct

Update: So far, I have had the following responses to my musing, which seems to excite you all more than I could have imagined:

‘Thats easy, fraud is directly aimed at unlawful appropriation – dishonesty may be indirectly so.’

‘Fraud v dishonesty – my thought: does fraud require there to have been a victim, where dishonesty doesn’t?’

‘Have a look at para. 10 of Brooking’s judgment in Magistrates Court of Victoria at Heidelberg Vic Full Court 2000 Buchanan, Charles and Brooking (on perversity with the mental element and an updated ignoratia lex…….   Huge philosophical literature on all terms, and therefore the differances between them.  Thanks for your blog’ and

‘Would fraud be dishonesty employed for a financial or material gain? I think of fraud as a subset within dishonesty.’

Original post:

Who knew that sitting there on the Legal Services Commissioner’s website is an explanation of his thinking about the difference between unsatisfactory professional conduct and professional misconduct? Not me, but I quote:

‘The sort of conduct that amounts to unsatisfactory professional conduct is where the lawyer has failed to meet professional standards. Professional misconduct, on the other hand, is behaviour involving fraud, dishonesty, breach of trust or conflict of interest. The aim of an investigation is to see whether it can be proved that such conduct took place.’

Very useful to know. I am writing a paper on fraud at the moment, with the aim of covering the whole concept and all of its legal ramifications in one hour.  Being in that frame of mind prompts me to ponder what the difference is between ‘fraud’ and ‘dishonesty’.

Problems abound when one spouse’s solicitor conveys matrimonial property by order of the Court

Update, 6 June 2011: A reader has helpfully pointed out that the decision digested below has been overturned by a unanimous Court of Appeal, the principal judgment having been given by Justice McMurdo.  See Legal Services Commissioner v Wright [2010] QCA 321.

Original post: The Family Court likes to order that one spouse’s solicitor act for both spouses in the conveyance of matrimonial property which it orders be sold.  That this may occur exemplifies the principle that it is not enough that clients’ interests conflict for a conflict of duties to proscribe a multiple client retainer; what is necessary is that they conflict materially in relation to the matter which is the subject of the retainer.  But I have acted in three matters where such an order has resulted in problems, and that suggests to me that there are many more such matters which have run into problems.  Generally, the problems arise from the solicitor ignoring in some way the interests of the spouse for whom he or she had previously been acting exclusively, or at least the perception that that is so.

Legal Services Commissioner v Wright [2010] QSC 168 is a variation on the theme.  It arose out of a de facto property adjustment case in Queensland’s District Court.  The Court ordered that the de facto husband’s solicitor ‘will act on [his] behalf in the conveyance of the sale of the property’, which was in the de facto husband’s name.  The de facto husband and wife were then ordered to cooperate in paying out costs of the sale (including the legal fees) and creditors before the balance was to be divided 75% to the de facto wife and 25% to the de facto husband.  The Chief Justice of Queensland wasted little ink in concluding that the wife was neither the solicitor’s client nor a third party payer, and so was not even entitled to an itemised bill when the husband’s solicitor charged over $7,000 for the conveyance, directly diminishing the amount reaching her pocket by three-quarters of $7,000.

Where one spouse agrees on the other spouse’s solicitor conducting a conveyance otherwise than expressly for both of them, this case suggests that they would be well advised either to provide for an obligation to pay the solicitor’s fees of a kind which brings them within the definition of ‘third party payer’, or fix the fee payable for the conveyance, or contract for an entitlement to an itemised bill, and thereafter to be deemed by agreement to be a third party payer. Continue reading “Problems abound when one spouse’s solicitor conveys matrimonial property by order of the Court”

Getting access to Family Court files to defend yourself against a disciplinary complaint

In Echlin & Kagan [2011] FMCAfam 272, a Federal Magistrate noted a decision of interest to this blog, about solicitors obtaining access to Family Court files for the purposes of responding to Legal Services Commissioner complaints, as follows:

  1. In Oates & Q and Another [2010] FamCAFC 202 the Full Court considered the issue of access to a Court file. In that decision the Full Court was considering an appeal brought by the wife in that case against an order made by Cohen J granting access to the Court file in respect of property proceedings between the husband in that case and the wife to the husband’s new de-facto partner, who was a solicitor. The de-facto partner sought the file for the purpose of defending herself in a complaint made by the wife to the Office of the Legal Services Ombudsman. Continue reading “Getting access to Family Court files to defend yourself against a disciplinary complaint”

Lodging a civil complaint with the Legal Services Commissioner limits you to compensation of $25,000 per complaint

First of all, happy new year!

The take-home point of this post is that if you lodge a civil complaint (e.g. a pecuniary loss dispute or a costs dispute) with the Legal Services Commissioner, you limit the amount of compensation you can get in VCAT to $25,000 because of s. 4.3.2(1)(c) of the Legal Profession Act, 2004. That prevents the commencement of proceedings in relation to the subject matter of the complaint until the complaint has been finally determined, or dismissed, by which time it will often be res judicata, at least in those cases where the final determination is by VCAT or the Supreme Court or the Court of Appeal (subject, perhaps, to (i) the operation of s. 4.2.14(2), which is what the Court of Appeal calls the ‘two bites of the cherry’ provision, and (ii) the possibility of adding a Fair Trading Act, 1999 cause of action to a proceeding originally instituted in VCAT under the Legal Profession Act, 2004, discussed below).  In this touchy feely win win alternative dispute resolution Civil Procedure Act, 2010 world, it is apparently anomalous that those who choose to travel to VCAT’s Legal Practice List via the obvious alternative dispute resolution channel (i.e. via a civil complaint to the Commissioner’s dispute resolution jurisdiction) are penalised so severely in comparison with those who proceed immediately to litigation in that List by invoking the parallel jurisdiction of the Fair Trading Act, 1999. Continue reading “Lodging a civil complaint with the Legal Services Commissioner limits you to compensation of $25,000 per complaint”

Legal Services Commissioner’s new modus operandi

The Legal Services Commissioner has delivered a speech which captures well the changes he has wrought in that office.  It is fair to say that his new modus operandi is less legalistic, and designed to concentrate on the hard cases.  He has instructed his staff to use the telephone, and, if necessary, to jump in a taxi and go and visit practitioners.  Previously, this was an organisation with the following characteristics: Continue reading “Legal Services Commissioner’s new modus operandi”

England’s new Legal Ombudsman

The English spent £20 million on a new Legal Ombudsman who, since Thursday, has had power to issue fines of up to nearly $50,000.  He is the former director of a homeless shelter, Adam Sampson, pictured.  He is not a lawyer, but his wife is a barrister. This is his website.  And this — yes — is the Ombo’s blog.  And this is his branding: ‘Fair, open, effective, shrewd and independent’.  I hate lawyers’ absurd branding exercises (I was going to have business cards printed saying ‘Stephen Warne: Good, but Cheap’), but I like his. The Guardian‘s Afua Hirsch’s takes may be read here and Neil Rose’s here. Listen to this and learn Australia:

‘”We’re going to be inquisitorial,” she [Elizabeth France, Chairwoman of the Ombudsman’s office’s Board] says. “The ombudsman’s team will look at the evidence they’re presented with, ask any questions they need to ask and level up the playing field to the extent of helping to articulate a complaint, but they will be doing it in a way which is not bearing, I hope, any resemblance to the legal process.”

So there will not be lengthy to-ing and fro-ing between the parties, for example. Complaints will not stretch on for months (not that many do now, in fairness to the existing bodies). Miss a deadline and, unless the lawyer has a very good excuse for doing so, the ombudsman will make his decision without their input. The only remedy then will be judicial review.’

Disciplinary penalties for pre-2006 conduct

There are still disciplinary cases coming through the system in respect of conduct which occurred before 12 December 2005, the date on which the Legal Profession Act, 2004 commenced.  Back in those days, the maximum fines the Legal Profession Tribunal could render under the Legal Practice Act, 1996 were $1,000 for unsatisfactory conduct and $5,000 for misconduct (unless the Full Tribunal sat, in which case, a maximum fine of $50,000 was available for misconduct).  Recently, the Legal Services Commissioner accepted, in a disciplinary prosecution, that the penalty for a disciplinary wrong committed before 12 December 2005 ought not to exceed the maximum penalty available at the time. That is so even where the post-12 December 2005 investigation of the pre-12 December 2005 conduct was properly carried out pursuant to the Legal Profession Act, 2004 and where the VCAT proceedings in which the fine is rendered are governed by the 2004 Act.

So, assuming the Commissioner maintains a consistent position, the highest fine he is likely to contend for in any unsatisfactory conduct charge in respect of pre-12 December 2005 conduct is $1,000, making the desirability of prosecuting such conduct, as opposed merely to reprimanding the practitioner, questionable. Continue reading “Disciplinary penalties for pre-2006 conduct”

New Legal Services Commissioner to talk on his office’s new direction

On Tuesday week, the 17th, Michael McGarvie, Victoria’s somewhat-new Legal Services Commissioner (he has been Commissioner or Acting Commissioner for coming on 10 months) is going to give a talk at the Leo Cussen Institute at 5.30 p.m.  Mr McGarvie has acknowledged the need to build trust with the profession, and to reduce the extraordinary delays in complaint handling with which his predecessors have been associated.  The jury is still out in those regards, but it is early days, and at least change is being pursued, some of which sounds quite promising. Leos bill the ‘unique’ event, which will cost you a mere $95, as follows: Continue reading “New Legal Services Commissioner to talk on his office’s new direction”

Penalties privilege and the corporate interrogee

Graymarshall Pty Ltd v Department of Environment, Climate Change & Water [2010] NSWLEC 54 is a decision of NSW’s Land and Environment Court about the application of the privilege against penalties (related to, but separate from, the privilege against self-incrimination). A regulator issued a notice compelling the production of information to a company. The statute provided that the privilege against self-incrimination was not a good answer to refusing to comply with the notice. It also said that there was a presumption that a contravention of the Act by the company was a contravention by the directors.  There are similarities between this legislative scheme and the Legal Profession Act, 2004‘s scheme for the investigation by the Legal Services Commissioner of incorporated practitioners.  Justice Pepper said: Continue reading “Penalties privilege and the corporate interrogee”

Legal professional privilege and disciplinary complaints by non-clients

If you are a solicitor and someone other than your client or former client has lodged a disciplinary complaint against you in Victoria, you should not disclose the subject matter of any communications to which legal professional privilege attaches, or might arguably attach, unless you are instructed to do so by your client or former client. Nor should you give up any document which records such a communication, or disclose any communication which tends to reveal the content of a privileged communication.

That is so even if the Legal Services Commissioner purports to compel the information, for in the case of investigations of non-client complaints, the client’s or former client’s privilege trumps the Commissioner’s powers of compulsion.  If you have already disclosed privileged communications, assuming that the Commissioner had the power to compel you to do so, you should be aware that the disclosed communications may well still be privileged notwithstanding the disclosure to the Commissioner, and so unable to be used against you in a disciplinary prosecution arising from the investigation, and you should probably advise your client or former client.

Until recently, the Commissioner took the view that legal professional privilege was impliedly abrogated in the case of non-client complaints by necessary intendment of the Legal Profession Act, 2004.  Not so.  The reasons why follow below.  These propositions are good law in VCAT’s Legal Practice List, at least.

Remember that it is still the common law which regulates legal professional privilege for the purposes of Legal Services Commissioner investigations and (except to the extent that it adopts the Evidence Act, 2008 in any particular proceding) in VCAT’s Legal Practice List. Continue reading “Legal professional privilege and disciplinary complaints by non-clients”

Steve Mark

On 3 March 2010 in Parramatta, Steve Mark, NSW’s Legal Services Commissioner is giving a talk on ‘Walking the Ethical Tightrope:  Balancing the Responsibilities of In-House Counsel to Key Stakeholders’.  If you would prefer to read the speech on your Ipad in the bath, click here. He would do well to include a grab from series 2 of ‘Damages‘, the brilliant HBO legal drama starring Glenn Close, Rose Byrne, and — as Claire Maddox, corporate counsel of a murderous and polluting energy company —  Marcia Gay Harden. I am quite ignorant about Mr Mark, but from what I can tell about the NSW Legal Services Commission, it seems to do some innovative and good things. His speeches are collected at this page. He has some other hats too which make him sound like a decent kind of bloke: Continue reading “Steve Mark”

Experienced private practitioner appointed Legal Services Commissioner

The Acting Legal Services Commissioner, Michael McGarvie, has been appointed Legal Services Commissioner. A photo published in 2004 may be found here. The government’s press-release is mirrored here. Mr McGarvie is very much from the profession’s private practice sector, and used to the realities of dealing with punters; he was for a long time a partner in the plaintiffs’ personal injury practice at Holding Redlich until he went to the Supreme Court as its CEO in 2006, where he oversaw a period of considerable change.  His wife is a lawyer with a plaintiff’s firm, and he is the brother of Richard McGarvie QC and the sister of Ann McGarvie who is, amongst other things, a sessional member of VCAT, the tribunal in which Mr McGarvie will continue to bring disciplinary prosecutions of lawyers.  His father, the late Richard McGarvie was a Supreme Court judge and Governor of Victoria.

Although it might be said that partners of plaintiffs’ lawyers firms are taking over the law (the Law Institute’s CEO, Michael Brett Young, was formerly Managing Partner of Maurice Blackburn, and the Victorian Government Solicitor, John Cain also hailed from there), I suspect that the appointment will be regarded by the predominantly conservative profession more favourably than the appointments of Kate Hamond or Victoria Marles before him.

When the Commissioner’s website is updated with Monday’s news, Mr McGarvie’s official profile will presumably be posted here.  Mr McGarvie takes the post at a time when widespread dissatisfaction with the Commissioner’s office has found a focal point in one of the scathing reports of Victorian regulators the Ombudsman is not backwards in coming forwards with.  A key problem to be addressed will undoubtedly be the glacial pace at which investigations proceed.

Commissioner’s obligation to charge dishonesty if he intends to allege it

Relatively recently, I posted on the question of whether a Bureau de Spank desiring to rely on a practitioner’s dishonesty or other form of conscious wrongdoing must expressly allege it in the charge, and discussed Walter v Council of Queensland Law Society Incorporated (1988) 77 ALR 228 at 234; [1988] HCA 8.  Now, in Legal Services Commissioner v Madden (No 2) [2008] QCA 301 the Queensland Court of Appeal has had a go, and reversed a decision of the Court’s Chief Justice sitting on the Legal Practice Tribunal.  The solicitor had previously been disciplined in relation to his trust account.  He was charged with gross delay in litigation which resulted in applications by the other side to compel the achievement of various interlocutory steps.  He dealt with those applications without advising his client, agreed on his client’s behalf to pay costs, withdrew money to pay those costs from monies held in trust on account of fees and disbursements, and then charged the client fees for his work in fixing up his own mistake.  He also acted for both husband and wife in the preparation of a pre-nup, apparently stuffing it up, and then later acted in a matrimonial dispute for the husband alone, described as a particularly obvious conflict of duties.

The Chief Justice made findings of dishonesty in the absence of any allegation of dishonesty in the charge.  One might say, in fact, that he went out of his way to do so.  First he sought comment in relation to whether on the agreed facts, the Tribunal was free to draw inferences that dishonesty actuated the solicitor’s conduct, and invited the Commissioner to amend the charge so as to allow exploration of that issue.  His Honour adjourned the hearing to give the Commissioner time to think about that. On the return of the hearing, the Commissioner declined the invitation to amend.  So the Tribunal put out a document specifying, as a matter of procedural fairness, the inferences it was considering drawing, and invited argument.  The solicitor swore an affidavit responding to the Tribunal’s document.  The Commissioner’s counsel cross-examined the solicitor, but did not put it to him that he had acted dishonestly. The Tribunal then concluded that the solicitor had acted dishonestly, and decided to strike him off rather than go with the fine and reprimand recommended by the Commissioner.  Ooffa!

‘Wrong way. Go back!’ said the Court of Appeal.  It started with a general proposition:

’54 It is … a well recognised rule of practice in civil proceedings that, although the word “dishonesty” is not necessarily required, any charge of dishonesty must be made in clear terms.  In a well known passage in Belmont Finance Corporation Ltd v Williams Furniture Ltd & Ors [1979] Ch 250 at 268  Buckley LJ said: Continue reading “Commissioner’s obligation to charge dishonesty if he intends to allege it”

Ombudsman carries out own-motion investigation of Legal Services Commissioner

A former client of mine, dissatisfied with the adverse outcome in a complaint he lodged making serious allegations against a senior member of the profession has tipped me off to an own motion investigation conducted into the Bureau de Spank by the Victorian Ombudsman.  The results, reproduced below, will not assist morale at the Bureau (compare his excoriation of the migration agents’ Bureau).  But solicitors can expect, I suppose, for the investigation process to become a bit more investigative than the gentlemanly exercise it has been as long as I can recall, and for more prosecutions to be brought.

In the hierarchy of regulators, I doubt that the Legal Services Commissioner is a particularly desirable post, but it should be.  Regulate the lawyers diligently, and the scope for all the others’ wrongdoing which the other regulators regulate is likely to be retarded.  It should also be desirable because it would be fun: the Commissioner doesn’t have to worry about the privilege against self-incrimination, and at least in complaints brought by former clients, can cruise past the usual irritant to pious investigators, legal professional privilege.  Imagine an investigation where you can gun for fines of $50,00o per offence, or the inherently spectacular thrill of seeing a lawyer fall from his perch with the wonderfully archaic fanfare of being struck from the rolls, but where you can essentially administer as many interrogatories as you like.  And imagine that default in answering the interrogatories is a crime the investigation of which is to be carried out by an investigator you personally get to choose in your capacity as head honcho of the Legal Service Board!  It should be enough to make an investigator pant with excitement.  Many a federal policewoman would probably give up her taser in exchange for these kinds of powers.

Continue reading “Ombudsman carries out own-motion investigation of Legal Services Commissioner”

Legal Services Commissioner resigns

Update, 14 September 2009: Here are some comments made by the Commissioner to a journalist from The Australian about how her office might be remodelled, namely by giving consumers a more formal voice within her office.

Original post: Victoria’s Legal Services Commissioner, Victoria Marles, resigned today, effective 23 October 2009, to take up a position in the not-for-profit sector.

Will they try once more to woo John Faine?

The newbie’s job will be uncertain.  What will the effect on the states’ Commissioners’ offices of national regulation now being pursued with increased vigour?  Either they will be abolished and their staff fight with one another for positions in the one smaller more efficient national regulator, or they will become a part of one muscular unified Australia-wide scheme of regulators around which a well-understood national law of lawyers’ obligations can gather jurisprudence and engender quality texts.

Commissioner’s unexplained delay reduces penalty for serious misconduct

Speaking of the need for speed as Justice Heydon and I were on this blog yesterday, there are two other instances worthy of reporting.

First, the High Court has recently considered the need for speed in criminal proceedings, and were not nearly as excited about it as in commercial litigation. This time, they rolled the court below for saying that enough delay was enough and staying a criminal prosecution that had hung around for too long, resulting in the loss of exculpatory evidence.  The decision in R v Edwards [2009] HCA 20 might have application by analogy in disciplinary cases. It is blogged about at Quis Custodiet Ipsos Custodes, and there is a short note in the latest Law Institute Journal.

Secondly, delay by the Legal Services Commissioner has had a consequence in a serious disciplinary prosecution.  Parliament requires the Bureau de Spank to conduct their investigations ‘as expeditiously as possible’, and to give the complainant progress reports at least 6 monthly: s. 4.4.12, Legal Profession Act, 2004.  If the Commissioner complies with these injunctions, the degree of expedition which is possible is not always great.  In fact, sometimes the rate at which investigations progress is astonishing.  So glacial can progress be that the possibility that climate change sceptics might actually have some kernel of truth buried away beneath all of their hot air (-not) begins to nag at you.  There is a letter in the latest Law Institute Journal complaining about the Commissioner’s April 2009 response to a solicitor’s September 2008 letter (August 2009, p. 10).

An unexplained period of apparent inactivity of 18 months was taken into account in favour of the lawyer prosecuted for misconduct in Legal Services Commissioner v ER [2009] VCAT 1445.  This is a factor which might be brought to bear in many a plea in a disciplinary prosecution.  What Judge Ross’s tribunal said on this issue is: Continue reading “Commissioner’s unexplained delay reduces penalty for serious misconduct”

Distinguishing between civil and disciplinary complaints

In the latest Byrne v Marles ([2009] VSC 210), Justice Beach seems to have found that any particular allegation made by a complainant may properly be characterised as both a civil and a disciplinary complaint.  If the Legal Services Commissioner receives a complaint, she must investigate it to the extent it is a disciplinary complaint and must try to settle it to the extent it is a civil complaint.  There is no particular difficulty where two allegations are found in one complaint document, and one is characterised as a civil complaint and another is characterised as a disciplinary complaint.  In my experience, that is what the Commissioner always does: she chooses between the two alternatives in relation to any one allegation as if they are mutually exclusive.

Since ‘any genuine dispute’ between the complainant and the lawyer complained about is a civil complaint, however, one might think that all disciplinary complaints in which the complainant has a dispute with the lawyer complained about will amount to both a civil and a disciplinary complaint.  And since an allegation will be a disciplinary complaint if it is of conduct which ‘falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent’ lawyer, there will be many civil complaints which will also be disciplinary complaints.

In such a circumstance, unless the Commissioner summarily dismisses the whole complaint under s. 4.2.10, she must try to settle it (insofar as it is a civil complaint), and (insofar as it is a disciplinary complaint) she must investigate it.

If Justice Beach’s logic is applied, profound challenges await the Commissioner.  They are inherent in the Act’s injunction in relation to one dispute to investigate it in the public interest with a view to prosecuting and penalising the lawyer, while at the same time trying to resolve the dispute between the complainant and the lawyer.  Most obviously, what is the Commissioner to do about s. 4.3.5(4)? It says:

‘Evidence of anything said or done in the course of attempting to resolve a civil dispute is not admissible in proceedings before [VCAT] or any other proceedings relating to the subject-matter of the dispute.’

Are there to be two sets of responses, in one of which (in the civil complaint) the lawyer makes socially appropriate concessions, apologises, and agrees to pay money in return for confidentiality, and in the other of which (the disciplinary complaint), the lawyer takes all appropriate technical points and, while being fully frank and open as required by the Act, concedes nothing? And imagine the disquiet the lawyer’s insurer will have knowing that the Commissioner will be able to compel the provision of answers from a practitioner, as if interrogating him, in the disciplinary complaint which will run parallel with the professional negligence claim constituting the civil complaint. Continue reading “Distinguishing between civil and disciplinary complaints”