The Legal Profession Uniform Law commenced in Victoria and NSW on 1 July 2015. The Legal Profession Act 2004, which created the statutory office of Legal Services Commissioner was repealed at the same time, though transitional provisions gave the Act, and the office, ongoing operation. As explained by my last post, the new statutory office of Victorian Legal Services Commissioner was created. The Legal Services Commissioner was to tidy up part-complete complaints and disputes unless regulations specified a substitute (e.g. the Victorian Legal Services Commissioner). No such regulation was made until just the other day. Michael McGarvie retired. Fiona McLeay was appointed Victorian Legal Services Commissioner in February 2018.
All new complaints were to be made to the Victorian Legal Services Commissioner, or so it seemed. Transitional provisions are found in Schedule 4 of the LPUL. Clause 27 appears to state specifically what is to happen in the case of a complaint first made post-LPUL about pre-LPUL conduct, whether the complaint is characterised as a simple consumer matter, a consumer matter which is a costs dispute, a disciplinary matter, or some combination of those things. It commences:
This clause applies to conduct that– (a) happened or is alleged to have happened before the commencement day; and (b) could have been, but was not, the subject of a complaint (or, if relevant, a request for dispute resolution).
If that condition is satisfied, the investigation may be commenced under the LPUL. Then the LPUL applies ‘with the necessary modifications’, so long as ‘an investigation of the relevant kind could have been commenced under the [Legal Profession Act 2004] in relation to the conduct had the old legislation not been repealed.’ The Victorian Legal Services Commissioner can’t take disciplinary action which is more onerous than the Legal Services Commissioner could have taken under the 2004 Act. Whatever ‘disciplinary action’ means, it is unlikely to refer to action taken in or following an investigation of or attempt to resolve a complaint to the extent that the Commissioner characterises it as a ‘consumer matter’, rather than a ‘disciplinary matter’.
The language is a bit vague because it had to deal with the transition between two different states’ Acts which were repealed and substituted with the LPUL. Perhaps it is that vagueness which has had an unfortunate result. That result is that the Costs Court has made a ruling which the Victorian Legal Services Commissioner interprets as depriving her of LPUL jurisdiction to deal with complaints she characterises as consumer matters where the conduct in question pre-dates 1 July 2015 and perhaps even where the conduct in question post-dates 1 July 2015 but is in relation to a matter in which instructions were first taken before 1 July 2015.
The consequence is that since the Costs Court’s decision, consumers with complaints about their lawyers’ pre-1 July 2015 conduct have been deprived of rights they might reasonably think parliament intended to bestow on them, including the right to have expert, costs-free, extra-curial determination by the Victorian Legal Services Commissioner of costs disputes and negligence claims, the right to have consumer matters ‘investigated’, and the right to go to the Commissioner’s office with disputes where the total fees are up to $100,000 or more, instead of only disputes where the fees are up to $25,000.
The LPUL wrought big changes in this space in Victoria. Previously, the Legal Services Commissioner could only attempt to resolve what were called under the Legal Profession Act 2004 ‘civil complaints’ (the species of which were ‘costs dispute’, ‘pecuniary loss dispute’, and ‘other genuine dispute’). if he failed, the parties had to fund and bring VCAT proceedings themselves, exposing themselves to the risk of an adverse costs order. Under the LPUL, the Victorian Legal Services Commissioner is made into a decision maker, the go to decision maker for disputes about comparatively small amounts of fees ($10,000 or less).
The Commissioner must deal with all complaints properly made: s. 315. She can investigate and deal with complaints which she characterises as costs disputes where the total fees are less than $100,000 or where the fees which are in dispute are $10,000 or less excluding GST. She can make determinations in relation to disputed costs of up to $10,000 plus GST. (It is not the case that her dispute resolution and investigation powers are available only where the total fees are $10,000 or less or the amount of fees in dispute is less than $10,000. All that is limited is her power to make a binding decision. Investigation using her powers of compulsion, and expert free dispute resolution services are still of enormous benefit to punters even if, at the end of those processes, they still have to go off to the Costs Court or VCAT to have their costs dispute determined.)
The purpose of this post is to consider the Costs Court’s decision, Sullivan v Snodgrass, unreported, 23 October 2017 (I can send you a copy), and the Victorian Legal Services Commissioner’s interpretation of it. I conclude that there are arguments to be made against the finding made by the Costs Court, and in any event, the Court’s reasoning can have operation only in relation to post-1 July 2015 complaints about legal costs because the reasoning depends on cl. 18 of the transitional provisions, and that clause only preserves the operation of provisions relating to legal costs. Even while the Costs Court’s decision stands, the Commissioner would appear to have full power under the LPUL to investigate, attempt to resolve, and determine post-1 July 2015 complaints about pre-1 July 2015 conduct except to the extent that the complaint falls within the 2004 Act’s provisions about civil complaints which are costs disputes. Very likely, the Victorian Legal Services Commissioner could circumvent this finding of the Costs Court by characterising a post-1 July 2015 complaint about a matter in which instructions were first given before 1 July 2015 as a disciplinary complaint.
Why the powers that be didn’t fix this problem while they were fixing the Great Transitional Provisions Debacle #1 is a mystery to me.
Continue reading “The Great Transitional Provisions Debacle #2”