Disciplinary prosecutions arising out of criminal convictions and civil findings against professionals

In disciplinary proceedings, prosecutors often wrongly assume that findings in prior decisions (usually criminal convictions) are both admissible and un-challengeable by the respondent.  Neither is true, however, at least where what is relied on by the prosecutor in the disciplinary case is something more than the fact of the conviction (e.g. the fact of the conduct which gave rise to it). Sudath v Health Care Complaints Commission (2012) 84 NSWLR 474 is much-cited, but has flown under the radar in Victoria and I must confess that I was ignorant of it until recently. It says as a matter of ratio decidendi that a professional in a disciplinary case is entitled to call evidence to contradict findings made in a previous criminal prosecution, and to do so is not of itself an abuse of process.  The same must be true, a fortiori, I would suggest, in relation to findings in a civil case.

Section 91 of the Evidence Act 2008 is often forgotten, too.  It says that evidence of a Court’s or tribunal’s decision or a finding of fact is not admissible to prove the existence of a fact that was in issue in that proceeding. Not only are reasons usually hearsay and opinion evidence, but the tender of reasons to prove the truth of what they record is specifically prohibited, except to the extent necessary to establish a res judicata or issue estoppel.  Where the common law applies, an even stricter result obtains by virtue of the rule in Hollington v F Hawthorn & Co Ltd [1943] KB 587.

I’m interested to know of how other jurisdictions deal with these questions, which also crop up in personal costs order cases, also discussed below.

Section 91 says:

‘(1) Evidence of a decision, or of a finding of fact, in an Australian or overseas proceeding is not admissible to prove the existence of a fact that was in issue in that proceeding.

(2) Evidence that, under this Part, is not admissible to prove the existence of a fact may not be used to prove that fact even if it is relevant for another purpose.’

So, for example, the fact of a disciplinary finding and sanction may be relevant in that it occurred only months before another disciplinary infraction, so that the second infraction occurred at a time when the practitioner had been chastened and should have been on her best behaviour.  The finding itself might be admissible for the purposes of establishing that proposition, but the court admitting the evidence for that purpose could not also satisfy itself that the practitioner engaged in conduct described in the reasons for that finding by reference to the reasons.

The law relating to lawyers sees this issue arise in multiple ways.  Lawyers sometimes fall to be disciplined for conduct for which they have been convicted by criminal courts.  The conviction itself may be proven by virtue of a specific exception to the exclusionary rule provided for by s. 92(1), aided by a certification provision (s. 178).  But a comment made in sentencing, for example that the lawyer showed no remorse and had limited prospects of rehabilitation, would be inadmissible in a subsequent disciplinary prosecution in relation to the same facts.

Secondly, lawyers may be charged with disciplinary offences based on conduct for which they have been adjudged fraudulent, or negligent, in civil proceedings.

Thirdly, in disciplinary proceedings, the prosecuting body may wish to establish that the lawyer is a recidivist having done much the same thing before as established by prior disciplinary findings.

Fourthly, in personal costs order applications against lawyers, the question arises whether findings in the judgment may be used against the solicitor for one of the parties.  The solicitor is, of course, not a party to the judgment.

These scenarios give rise to two separate questions, which are inter-related.  First, there is the question of whether the finding in a set of reasons relied on by the moving party may be admitted into evidence.  Secondly, there is the question of whether, if so, the findings may be challenged by the other party.  The questions are inter-related because the law of res judicata and issue estoppel is the law which governs whether previous findings can be challenged, and the exclusionary evidentiary rule has an exception to allow the establishment of res judicatae and issue estoppels.

It may in some circumstances be an abuse of process for a plaintiff to pursue a cause of action based on a contention radically inconsistent with a final determination of the same question to which the plaintiff was a party (even if the legal requirements of res judicata and issue estoppel cannot be established, because the defendant who pleads and asserts it was not also a party to the determination in question).  Courts will not generally permit convicted criminals to sue their lawyer for negligence in a case which asserts that but for the negligence, they would not have been convicted, even where advocates’ immunity is unavailable, for example.

It is plain as a pikestaff, however, that not every challenge to a previous finding in reasons for a judgment or order by a party to the judgment or order will amount to a collateral attack.  As Handley says in Spencer Bower and Handley: Res Judicata (5th ed, 2019) ‘The entire corpus of authority on issue estoppel is based on the theory that it is not an abuse of process to relitigate a point where any of the … requirements of the doctrine is missing.’  And, as Cross on Evidence puts it: ‘It is not enough that there was a factual controversy in earlier proceedings. It must have been a factual controversy the subject of a specific cause of action which was adjudicated upon in those proceedings,’ citing Censori v Gillard (2015) 45 VR 605; [2015] VSC 106 at [47]].  Indeed, nought but what is ‘legally indispensable’ to a judgment will give rise to a litigation estoppel: Blair v Curran (1939) 62 CLR 464 per Dixon J.

There are at least three situations in which there will not usually be an abuse of process.  First, a challenge to reasons for an interlocutory finding may axiomatically be challenged before judgment, if there is something new to be relied on.  Secondly, obiter dicta and other findings not strictly legally indispensable to a judgment cannot give rise to a litigation estoppel, and so may always be challenged.  And thirdly, it would be a rare thing for a defendant’s good-faith challenge to a previous finding in a case to which the plaintiff was not a party to amount to an abuse of process, especially where there is something new to be relied on.  By ‘something new’, I do not mean something which could not have been with reasonable diligence relied on in the first hearing — that is a concept associated with the adduction of fresh evidence on appeal, and is not germane to the abuse of process analysis, I would argue.

To establish an abuse of process, there must be a mis-use of a court or tribunal, ordinarily established by proving a plaintiff’s use of a court’s processes for an illegitimate collateral purpose, or undue vexation of another party to the proceedings said to be abusive, or that the administration of justice would be brought into disrepute: Victoria International Container Terminal Limited v Lunt (2021) 95 ALJR 363; [2021] HCA 11 at [14] (Kiefel CJ, Gageler, Keane, Gordon and Edelman JJ).  Where the putative abuser is the defendant in a proceeding, only the third species of mis-use of a court or tribunal is likely to be a possibility.

Furthermore, to shut down litigation or a claim in litigation on the basis that it amounts to an abuse of process is a measure of last resort: ibid at [18] et seq.  Where there is an arguable abuse of process, however, the little-discussed s. 11 of the Evidence Act 2008 (Vic) might have relevance.  It provides:

‘(1) The power of a court to control the conduct of a proceeding is not affected by this Act, except so far as this Act provides otherwise expressly or by necessary intendment.

(2) In particular, the powers of a court with respect to abuse of process in a proceeding are not affected.’

By s. 93(c) of the Evidence Act 2008 (Vic), Part 3.5 does not affect the operation of the law of res judicata or issue estoppel.  So, a finding of fact or law which was legally indispensable to a judgment may be admitted into evidence to establish an issue estoppel, but it would be prima facie impermissible to admit some lesser finding into evidence in order to establish an abuse of process by collateral attack, since the doctrine of abuse of process is not a part of the law of res judicata or issue estoppel.

Gans and Palmer point out in Uniform Evidence (OUP, 2010) that s. 91(1) is ‘a ban on a particular use of [evidence of official fact-finding]: using it to find the facts that the official found.’ ‘Such a ban is unnecessary,’ they point out, ‘as it is already achieved by the hearsay and opinion rules.  The official’s decision will inevitably be a previous representation (so long as it was a separate proceeding) and an opinion.  The apparent reason for having a separate exclusionary rule for such decisions is that it prevents the use of the limitations or exceptions to either rule (for example, the restriction of the hearsay rule to intended assertions or the use of the exceptions in s 69 for business records or s. 79 for expert opinion.’

Of course, there are options available to judges to relax or dispense with the exclusionary rules of evidence including s. 91, such as s. 190(1), but they are used only exceptionally.

In England, the rules of disciplinary tribunals generally provide for the evidential weight of findings in civil proceedings. They most commonly provide that a civil judgment will amount to prima facie proof of the findings of fact upon which it is based, but the practitioner should be entitled to challenge it and call evidence in support of such a challenge: Treverton-Jones et al, Disciplinary and Regulatory Proceedings (9th ed, 2017) at [9.88]. In England, the Solicitors (Disciplinary Proceedings) Rules 2007, for example, provided at r. 15(2) for the admissibility of findings of fact upon which a criminal conviction is based and for the circumstances in which those findings could be successfully challenged.

So it is also in Victoria. Where the parliament sought to make civil findings admissible in disciplinary fora, it so provided; s. 203 of the Legal Profession Uniform Law says:

‘Determinations of costs assessors are admissible in disciplinary proceedings as evidence as to the fairness and reasonableness of legal costs.’

How, then, have the Courts applied these laws in cases about lawyers?

The leading common law case is undoubtedly Ziems v Prothonotory, Supreme Court of NSW (1957) 97 CLR 279, which is given detailed treatment in this blog post.  The NSW Court of Appeal moved essentially of its own motion to strike off Mr Ziems who was at the time in jail having been convicted of manslaughter by killing a motorcyclist while drink driving. Fullagar and Taylor JJ considered that they were bound to consider for themselves the defence of the barrister which had failed in the criminal trial – that he was concussed from a beating at the hands of a drunken sailor from whose predations he had attempted to save a young woman, not drunk, and it appears that they were not convinced of the same fact found by the jury in the criminal trial, namely that Mr Ziems was in fact drunk; they believed his version of events about being concussed. The Court set aside the first instance decision to strike Mr Ziems off, and substituted a suspension of practice for only the duration of his imprisonment. Cross on Evidence suggests that Fullagar J’s reasoning in this regard was shared by Dixon CJ at 285, McTiernan J at 287, and that Taylor J opined that what mattered was the conduct the subject of the conviction, to be examined independently of the conviction at 302-8.

In A Solicitor v Council of the Law Society of NSW (2004) 216 CLR 253 at [18], the Court cited Ziems for the proposition that a disciplinary court must consider for itself ‘the whole position’, noting of Ziems that ‘when the circumstances of the case were exposed, the picture changed materially’.

It has been observed that ascertaining the ratio of Ziems on this question is not easy, and some doubt whether it is binding authority on this point.  Even before Ziems, however, it was well-established that findings in previous proceedings were not determinative in disciplinary proceedings.  In re a Solicitor; ex parte the Prothonotary (1953) 70 WN(NSW) 356, a solicitor had been found guilty of a criminal offence.  He had avoided conviction, but Street CJ with whom the other judges agreed said at 357a that nothing turned on that fact. When it was sought to discipline the solicitor, the Court treated the finding of guilt as having ‘probative value when [it] comes to consider the matter if an application is made to deal with the solicitor in question,’ and continued at 357b ‘Of course the mere recording of the conviction does not determine the matter, and I think the Court is then bound to have regard to the material upon which the magistrate reached that conclusion, and to review the evidence which was put before the magistrate.’  The Court then reviewed the evidence and Street CJ said ‘Having done so, and the Court’s attention having been directed to various facets of the evidence, I do not feel that I would disagree with the magistrate’s conclusion.’

In Weaver v Law Society of NSW (1979) 142 CLR 201, Mason J said:

‘Disciplinary proceedings under the Legal Practitioners Act and in the exercise of the Supreme Court’s inherent jurisdiction are not criminal proceedings, they are proceedings sui generis. When the court is called upon to examine the conduct of solicitors as officers of the court it is as much concerned to protect the public from misconduct on the part of solicitors as it is to ensure that issues already determined are not unnecessarily re-litigated. The court cannot disable itself from hearing and determining the very serious complaint against a solicitor that he has given false evidence merely because the complaint may or will involve the re-litigation of allegations of earlier misconduct of which the solicitor has previously been found not guilty.’

In Prothonotary of the Supreme Court of NSW v Pangallo (1993) 67 A Crim R 77, Kirby P relied on Weaver in an application to strike Mr Pangallo off the roll of practitioners.  His Honour assumed without deciding that Mr Pangallo was entitled to establish that he was not in fact guilty of bribing a public official, notwithstanding that he had been convicted of that crime, and notwithstanding the embarrassment to the administration of justice if a different result ensued, reasoning:

‘In a sense, Weaver presented the opposite side of the problem which is now before the Court. There the issue was whether a professional investigation could take place in the Court notwithstanding an earlier dismissal of charges of professional misconduct by the Statutory Committee. Here, the issue is whether it can take place notwithstanding a relevant conviction by a court. The cases are not, therefore, exactly analogous. The discharge in earlier proceedings stands as no barrier to the Society’s claim for relief, as Weaver shows. Upon one view the conviction does stand as a barrier to the solicitor’s application to be excused upon the ground that the conviction was wrongly secured.

However, because as Mason J has pointed out, this Court must, in cases such as this, exercise its own independent jurisdiction with an eye to the performance of its duty to protect the public, I was prepared to allow the solicitor’s evidence to be given so that such separate jurisdiction could be exercised in an inquiry which went beyond the simple (but ordinarily sufficient) fact of the conviction entered here against the solicitor.’

Clarke JA, with whom Priestley JA agreed, also thoroughly reviewed the evidence in the case before concluding ‘I reject, therefore, his evidence that he was innocent of the charge to which he pleaded guilty and was convicted. There being no reason to doubt the correctness of the conviction of the offence it follows that the solicitor has been guilty of professional misconduct and is unfit to remain on the Roll of Solicitors.’  In Sudath (see below), Meagher JA, with whom Whealy JA agreed, said of Pangallo at [100] ‘This Court … permitted a legal practitioner to lead evidence challenging the correctness of his conviction.’

In NSW Bar Association v Somosi [2001] NSWCA 285, the Court rejected an argument that the barrister could not lead evidence as to his conduct in relation to a failure to file taxation returns notwithstanding that his evidence may have been inconsistent with an express finding necessary for his conviction of an offence in the District Court. Spigelman CJ said (at [80]-[82]) that the ‘public policy against collateral attack of a conviction is not engaged’ where the fact of the conviction was not challenged and the questions of professional misconduct and fitness to practise had to be assessed by reference to the underlying conduct on which the conviction was based.’  By ‘the fact of the conviction’, I understand the Chief Justice to have meant nothing more than the fact that the criminal court recorded a conviction, not that the conviction was justified on the evidence.

In Secretary of State for Trade and Industry v Bairstow [2004] All ER 325, the former managing director of a company brought wrongful dismissal proceedings against the company. The Court found that he had been guilty of grave misconduct and neglect in the performance of his duty. The Secretary applied under section 8 of the Company Directors Disqualification Act 1986 for a disqualification order and sought to rely on the findings made in the wrongful dismissal proceedings. The Court of Appeal found that the reasons for judgment in the wrongful dismissal proceedings were inadmissible in the disqualification proceedings.

In Sudath v Health Care Complaints Commission (2012) 84 NSWLR 474, a doctor who had been convicted of anally raping and subsequently assaulting his wife, sought to call evidence to contradict his wife’s evidence in his criminal prosecution and to challenge findings of fact in the criminal court’s reasons for imposing the sentence which it did.  The Court of Appeal reversed an interlocutory ruling of the disciplinary tribunal precluding the doctor from adducing evidence for those purposes.

At [31], Basten JA explained:

‘[It is not] true to say that the material sought to be relied on by the practitioner would challenge the principle of finality. The criminal proceedings have been finalised, appeals have been dismissed and the practitioner is serving a sentence, none of which will be affected by the evidence or findings in the present proceedings. What remains is a potential inconsistency between the findings made by the Medical Tribunal on the facts before it and the findings made in the criminal proceedings. If, for example, it were found on the balance of probabilities that the practitioner’s wife consented to intercourse, there would appear to be an inconsistency with the verdict of the jury, which was only consistent with satisfaction beyond reasonable doubt that she did not consent. Of course, it is no doubt possible that the jury’s verdict may have been different if the practitioner had given evidence in the criminal trial.

The possibility that the Tribunal may make findings which call into question the outcome in the criminal proceedings, does not necessarily mean that for the practitioner to give evidence inconsistent with such findings would be an abuse of its process. No case relied upon by the Commission demonstrated that a defendant or respondent in proceedings brought by another party could be prevented from tendering relevant and admissible material in his or her defence because such material would invite a contrary finding of fact to one achieved by a differently constituted tribunal in other proceedings.’

At [83] Meahger JA with whom Whealy JA agreed said:

‘It is not uncommon for the jurisdiction of an administrative tribunal to exercise disciplinary … powers to be founded upon its being satisfied after inquiry as to the fact of a conviction or as to a person not being of good character or being unfit to practise. In the latter cases, if there is a contest as to the occurrence or significance of the conduct relied upon as relevant to the assessment of character or fitness to practise, material which tends to show whether that conduct occurred or places it in context is relevant to the subject matter of the inquiry.

This remains so even if the conduct has been the subject of an earlier conviction or adverse finding and the evidence sought to be led contradicts the finding or fact essential to the conviction. The mere fact of inconsistency does not of itself excuse the tribunal from inquiring into the relevant facts or give significant weight to earlier convictions or findings of a court.’

At [104], his Honour concluded:

‘For these reasons the Tribunal erred as a matter of law in excluding or limiting the use of evidence sought to be led by the appellant because that evidence would be inconsistent with his conviction for common assault or the evidence or findings referred to in the ruling. The leading of the evidence could not for that reason alone constitute an abuse of its process. The Tribunal wrongly proceeded upon the basis that it did. The ruling should be set aside and the Tribunal must reconsider the objection of the respondent to the admission of the evidence proffered.’

In Oldham v Law Institute of Victoria [2012] VCAT 571, the practitioner had acted in dereliction of his duties to the Supreme Court and to the administration of justice by commencing group proceedings in circumstances where he did not have instructions of the lead plaintiff to do so.  He failed to remove the lead plaintiff when he demanded as much. A group proceeding was dismissed as a patent abuse of process: [2011] VSC 165.

J Forrest J made scathing observations of the practitioner in decisions referred to at para 9 of the VCAT decision, including that his conduct was a serious breach of ethical obligations, a patent abuse of process, and arguably a contempt of the Supreme Court: see the VCAT decision at [10]. His Honour had made those findings after careful and considered attention; they were not mere incidental comments to be passed over lightly: [11].

But given that Mr Oldham’s conduct of the case was in the hands of his professional indemnity insurer, and in light of much oral evidence in relation to the same matters as had been the subject of J Forrest J’s findings, including that the practitioner was inexperienced in class actions and relied heavily on counsel who had made errors which he did not detect, Judge Bowman came to a much more benign understanding of the practitioner’s actions which, he acknowledged, ‘may, at first glance, seem surprising and at odds with his Honour’s remarks’: [11].  It seems that in that case, the disciplinary regulator properly accepted that the previous findings of the Supreme Court in civil proceedings were not binding upon the practitioner.

In Prothonotary v Gregory [2017] NSWCA 101, the practitioner was convicted of dishonesty offences in the Supreme Court of Victoria. An appeal to the Court of Appeal failed. The NSW Law Society informed the Prothonotary (NSW) of the conviction and the Prothonotary sought that the practitioner be struck off in the NSW Court of Appeal, sitting as a tribunal of first instance. The Prothonotary was represented by the Crown Solicitor and counsel. The Court, exercising its inherent jurisdiction, said at [30] that

‘the Prothonotary’s case attributed greater evidentiary significance to the findings of the sentencing Judge and of the Victorian Court of Appeal than can be justified under the relevant provisions of the Evidence Act 1995 (NSW). Accordingly, this Court has had to approach the application without the benefit of admissible evidence that would have shed light, for example, on the Respondent’s motive for engaging in the conspiracy and the full nature and extent of his dishonesty.’

In King v Muriniti (2018) 97 NSWLR 991, the Court held that s. 91 only operates where findings in one proceeding are sought to be adduced in a separate proceeding.  It held that the personal costs order application against one of the party’s solicitors was not a separate proceeding for those purposes, and Basten JA suggested at [46] that it would be an abuse of process for the solicitor to seek to challenge findings in the judgment to which the question of costs was ancillary, a dictum which found its way into various texts.

Care must be taken in extrapolating general propositions from King.  First, the Court has wound back its rhetoric recently in Mercia (see below).  Secondly, it is a case about statutory construction, involving the interaction of s. 99 of the Civil Procedure Act 2005 (NSW) and s. 91 of the Evidence Act 1995 (NSW) the terms of which in a sense implied that evidence of a court’s findings would be relevant.  Costs are awarded by reference to the parties’ (and, where relevant, non-parties’) conduct during the proceeding, which axiomatically unfolds under the gaze of the judge.  The operation of s. 91 might be said to be irrelevant in such a case, since the judge could simply reach back into her memory of the unfolding of events, and arrive at the same findings as had previously been recorded in her judgment, such that to give operation to s. 91 would be absurd.  But the same could not be said of findings which were the subject of the proceedings (e.g. that one of the parties was negligent before the proceedings commenced).  Those events did not unfold before the judge.  Personal costs order cases are therefore conceptually distinct from disciplinary proceedings based on other civil findings made by courts, e.g. of a practitioner’s fraud, even though the personal costs jurisdiction is said to have a disciplinary element to it.

Secretary to the Department of Justice and Regulation v LLF [2018] VSCA 155 makes glancing reference to Sudath.  At [42], Beach, McLeish and Niall JJA stated that in those cases where the fact of a previous criminal conviction was not a jurisdictional fact upon which the relevant decision maker’s jurisdiction was founded, ‘the essential facts underlying the conviction are not immune from challenge and the conviction is conclusive only of the fact of the conviction itself’.  It said so in a slightly different context, namely a challenge to a working with children check decision.

In Muriniti v Mercia Financial Services [2021] NSWCA 180, the trial judge permitted the solicitor who was the subject of a personal costs order application to challenge the findings in the judgment to which the question of costs was ancillary.  Bell P with whom Gleeson JA agreed pointed out that Basten JA’s dictum about abuse of process did not form part of the ratio in King v Muriniti. Mr Muriniti sought to challenge King, but the Court did not consider Mercia to be a suitable vehicle for such a challenge.

I have my doubts about King.  Nothing in the text of s. 91 suggests that it is limited to findings in separate proceedings.  It is inconsistent with Flinn v Flinn [1993] 3 VR 712; [1999] VSCA 134 which the NSW Court distinguished in King on the basis that both parties accepted that the solicitor respondent to a personal costs application could challenge the findings in the judgment to which the costs question was ancillary. And it is more doctrinally pure to recognise that s. 91 has prima facie application to all findings, including those made in the same proceeding, but to recognise that:

(a) nothing precludes the court from making the same findings again, in the same proceeding, based on the same evidence, such that s. 91 is not very useful when it is sought to be deployed in the same proceeding as the findings sought to be excluded; and

(b) s. 91 can be waived under s. 190 if the need arises, e.g. if it were apparent that (a) was true but it would be ridiculous to go through the same exercise again.

It would not always be ridiculous, however.  The solicitor might argue that different inferences should be drawn from the same evidence, or may have different evidence.  As Sudath demonstrates, different findings in relation to the same questions are tolerated by the law, especially where it is a defendant rather than a plaintiff who is seeking to have the court arrive at a different finding.  The mere fact that a defendant asks a court to make findings inconsistent with a previous finding is not evidence of an abuse of process.  It’s perfectly legitimate.

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