In Legal Profession Complaints Committee v PJO’H  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)  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”
Update: See now Daniel Warents, ‘An Unwarranted Approach: Costs Orders Against Solicitors Acting Without Authority’, a detailed and learned review of the cases: link.
Update: See now Doulman v ACT Electronic Solutions Pty Ltd  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”
The answer is, at least in NSW — Yes. In Legal Services Commissioner v MB (No 3)  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  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 , 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.’
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  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?”
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.’
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’.
Updated post, 1 July 2016: see the English High Court case Law Society of Ireland v Patrick Enright described in this case note.
Original post: In Fraser v Council of the Law Society of NSW  NSWCA 72, which is part of the subject of this post, President Kirby made some comments on the relationship between the jurisdiction to strike a practitioner off the roll and a finding or admission of dishonesty, that is, fraud. The Court of Appeal unanimously overturned the decision of a disciplinary tribunal striking off the roll a solicitor with an otherwise unblemished record for fraudulently giving a certificate of advice to a mortgagor, then not being frank about it towards the mortgagee’s solicitor and in the disciplinary investigation, and having difficulty accepting, in the disciplinary tribunal that what he had done amounted to fraud. Kirby P said that a finding of fraud is not a prima facie indicium that a lawyer ought to be struck off; everything depends on the circumstances: Continue reading “Dishonesty in a solicitor: does it require striking off?”
A 27 year old solicitor working in family law twice lied about the existence of a document, and then forged it. That was just one and a bit years after a harrowing admission application in which the Board of Examiners split on whether she should be admitted, as a result of what VCAT’s Deputy President McNamara referred to as ‘allegations of plagiarism’ at the College of Law, and a want of frankness in their disclosure. The Board had given the solicitor a stern warning at the end of the hearing. For the forgery, the solicitor was fined $3,500 and reprimanded, the Commissioner’s submission that a year’s suspension was warranted being dismissed as ‘disproportionate’: Legal Services Commissioner v SJJ, McNamara DP, 14 April 2011. If followed, this decision suggests once again that interference by VCAT with a practising certificate requires quite profound dishonesty.
As to the fine, it may be that $3,500 was a significant fine for this solicitor: her financial circumstances were described as ‘exiguous’, but she was employed as a solicitor by a respectable Melbourne firm at the time of the penalty hearing, looked set to remain so employed by her supportive employer, and her circumstances seem to have been principally affected by the size of her mortgage. The general deterrence of a fine of this sum would be enhanced if its appropriateness in the context of the solicitor’s ability to pay it were explained in greater detail. That way, solicitors weighing up the risks of forging a document against its perceived desirability (yes, that is the theory of general deterrence) would be able to remember back to the report of the case in question and think ‘Well if he was fined $5,000 and had an annual disposable income of $25,000 living in a modest home, I must be looking at a fine of something like $20,000 since my disposable income is four times his, and I live in a home twice as large as my family actually needs.’
Continue reading “Solicitor fined $3,500 for forgery”
Up-updated post, 18 May 2017: See also LSC v Huggett  NSWCATOD 67, which gathers together additional authorities at .
Updated post, 11 March 2016: In The Law Society of New South Wales v Gathercole  NSWCATOD 27, the Tribunal was asked by the applicant to order the removal of the practitioner’s name from the roll for falsely attesting a wife’s signature in her absence on a document presented to the practitioner by the fraudster husband, a bank manager. Though the Tribunal found that the conduct amounted to ‘professional misconduct of a very high degree’, the practitioner was insightful, remorseful, and had good references. So they gave him a $5,000 fine instead.
Original post: What’s the going rate by way of penalty for lawyers successfully prosecuted for falsely attesting the execution of documents? As usual in the law of professional discipline, the cases are all over the place — what is analysed below is a collection, not a line of, authorities — but I am unaware of any case in which a lawyer’s practising certificate has been interfered with solely for purporting to sign as witness a document they did not witness the execution of or for falsely giving a certificate that advice about the document was given. And you would have to say that a fine of a few thousand dollars and a reprimand is the going rate. Justice Kirby, then President of the Court of Appeal, adverting to the Court’s role as fixing the standards to be observed in determinations by disciplinary tribunals, overturned a disciplinary tribunal’s decision to strike off a solicitor who gave a false certificate of advice in relation to a mortgage, exacerbated the wrongdoing by oral representations to the mortgagee’s solicitor and was not frank in the disciplinary investigations. The Court substituted a fine and a reprimand: Fraser v Council of the Law Society of NSW  NSWCA 1992.
Because of the dishonesty inherent in this species of disciplinary wrong, the cases have traditionally been clear that it amounts to professional misconduct rather than to unsatisfactory professional conduct. But the New South Wales Court of Appeal’s decision in Xu v Council of the Law Society of NSW  NSWCA 430 bucks the trend and characterised one such instance as unsatisfactory professional conduct. All of the other cases need be re-evaluated in light of the Court of Appeal’s decision.
Below are my notes of reading the cases, for a disciplinary prosecution in which I recently acted. I was put onto some of them by readers of this blog, for which many thanks.
Continue reading “Lawyers’ false attestation of documents and fraudulent certificates of advice”
The latest decision from VCAT’s Legal Practice List is Legal Services Commissioner v JHMcC  VCAT 231, a ‘guilty plea’ to six charges of professional misconduct. A lawyer purchased a franchise to operate under the name of one of Melbourne’s leading personal injury firms — I never knew such things existed — and was responsible for 1,000 files at a time down in Traralgon. (Don’t try that at home, by the way, kids: I well remember multiple retainers when I was solicitor for a gentleman formerly of the profession who from an office in the suburbs of an Australian capital (not the respondent in this case, obviously), and with the assistance of only non-legal staff, had 1,000 personal injury files open at a time. He was a most vulgar man, insistent on telling me at every opportunity how much money he made, and of the details of his expenditure of it in pursuit of hackneyed hedonism. And he was quite often negligent, apparently regarding the excess he had to pay his indemnity insurer as a cost of business.)
Anyway, our lawyer underpaid tax and suddenly had to pay $160,000 to the tax man, putting financial stress on his business. So, when he received payment of bills from clients, he paid the whole lot into office, wrote cheques made out to barristers for their fees which had been billed to and received from clients as disbursements, and then put them into the bottom drawer to be retrieved and delivered only when convenient to the practice’s cash flow. The solicitor pleaded guilty to six charges of professional misconduct. Charge 6 was of breach of the following fiduciary duty, which I must confess is not one I had previously heard of:
‘to apply such moneys [amounts received for disbursements] in accordance with the purpose for which they were supplied by that client’.
Judge Pamela Jenkins, presently a Vice-President of VCAT and two other members were invited to impose a fine of at least $20,000 and plumped for $25,000. In addition, costs payable by the solicitor were fixed at $6,715.
In Council of Law Society of New South Wales v TWS  NSWADT 240, a three member tribunal presided over by Judicial Member Brennan handed down their decision 19 months after a two day hearing. They found that the Society’s submissions on penalty were inadequate. They reviewed the NSW authorities on the Tribunal’s powers in that circumstance, gave the solicitor notice that they were considering making a ‘protective order’ (whatever that might be, given that the sole purpose of professional discipline is ostensibly protection of the public), and told him to come back and make submissions.
What the Society had sought was a fine, a reprimand, a right to practise only as an employee for three years, and thereafter a right to seek a full practising certificate only upon doing well in certain educational courses. There were many charges, many were made out, they involved repeated and serious wrongs, and the solicitor’s defence of them strongly suggested he still did not get the extent of and nature of his wrongdoing. The review of the law is set out at  – . In Victoria, compare Law Institute of Victoria v IAB  VCAT 1998 where something in the nature of a plea bargain was engaged in between the Institute and the solicitor only to be varied against the solicitor’s interests by VCAT.
Update, 22 October 2010: To similar effect is Legal Services Commissioner v SJO  VCAT 1686. There, a depressed solicitor in her mid-60s with a string of previous disciplinary findings, was found to have engaged in professional misconduct in practising without a practising certificate. The solicitor’s is a sorry tale: doctor husband developed psychosis for which he refused to obtain treatment; daughter became addicted to heroin; solicitor contracted breast cancer. Mind you the Tribunal found that though a mitigating factor, the depression did not excuse the solicitor’s conduct, or explain her professed belief that by virtue of having lodged an application for a practising certificate and not having received a rejection of the application, she was entitled to practise. Somehow or other, this case managed to be heard over 8 days commencing in February. The solicitor was in her mid-60s and on her own account most unlikely to practise in the future. Rejecting the Commissioner’s unusual but not illogical argument that the solicitor should be struck off because of the incongruity in holding the solicitor out as fit to practise as a solicitor during the period in which she was not entitled to apply for a practising certificate, Senior Member Howell extended that period by a year, to 24 February 2015. Explaining the rejection, the Senior Member said:
‘Protection of the public is a relevant consideration, but the Tribunal has concluded that little, if anything, would be gained by making a recommendation to the Supreme Court that the name of [the solicitor] be removed from the Supreme Court Roll. The Tribunal does not regard it as “incongruous” that the name of a person whose name has been on the Roll for almost 40 years, and who is unlikely to practise in the future for both legal and personal reasons, should be allowed to remain upon the Roll.’
Original post: In Legal Services Commissioner v SWM  VCAT 1543, a depressed former solicitor was told not to apply for a full practising certificate until 2013. He had previously been found guilty of professional misconduct for not responding to the Legal Services Commissioner’s request for responses to complaints and other instances of inaction where action was called for. 17 times: on 1 November 2007, 7 May 2008, 19 November 2008, 3 February 2009, 28 September 2009, and on 26 November 2009. On 2 December 2009, the solicitor’s practising certificate was cancelled. He did not apply for a practising certificate on 1 July 2010, when he was permitted to do so again. This time, he was found guilty of four charges of professional misconduct.
The solicitor had an unblemished record to 2006. Illness struck his family and he became depressed. Inactivity followed. Senior Member Howell seems to have accepted that the depression explained the inactivity. Nevertheless, he ordered that the practising certificate-less former solicitor not apply for a full practising certificate until mid-2013, but allowed him to apply for an employee practising certificate on 1 July 2011. This post considers the order and alternative orders which might also be appropriate in a jurisdiction whose rationale is, it is said, protection of the public. Continue reading “Depressed serial non-responder not to practise on own account until 2013”
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”
Recently, it has been suggested that misconduct unconnected with legal practice (which the High Court has referred to as ‘personal misconduct’) may constitute professional misconduct at common law: New South Wales Bar Association v Cummins  NSWCA 284; Legal Services Commissioner v RAP  VCAT 1200, the subject of this post. This post considers whether that is correct, in light of A Solicitor v Council of the Law Society of NSW  HCA 1; 216 CLR 253. The answer to that question does not affect what I suggest may be a separate question, namely whether personal misconduct may warrant disbarment (which is clearly the case), since disbarment is not conditioned on a finding of professional misconduct, but is dependent on a finding of unfitness for practice. I am interested to hear others’ views. Continue reading “Can conduct unconnected with practice constitute misconduct at common law?”
Legal Services Commissioner v Dempsey  QCA 197 is an unsuccessful appeal from a disciplinary prosecution in which findings of dishonesty were made.
Dye v Fisher Cartwright Berriman Pty Ltd  NSWSC 895 is a case in which an application for a costs assessment (NSW version of taxation) outside the allotted 12 month period succeeded.
Young v Masselos & Co  NSWDC 169 is one of those cases where a solicitor negligently let a limitation period go by and damages had to be assessed based on the plaintiff’s prospects of winning the case foregone.
Council of the Law Society of New South Wales v Harrison  NSWADT 201 is a decision about the Law Society’s successful application to amend a charge against the respondent solicitor. It reviews a lot of NSW law about the requirements for pleading disciplinary charges, and considers the application of Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175;  HCA 27 to disciplinary hearings.
A study in the British Medical Journal has suggested that students from poorer families and students with poor marks are more likely to engage in serious professional misconduct than other students. It should really suggest that such students are more likely to get caught engaging in serious professional misconduct, but it’s interesting nevertheless. The sample space was small: the backgrounds of 59 doctors against whom serious charges of misconduct were made out were analysed.
Senior Member Howell decided last year in Legal Services Commissioner v RMB  VCAT 51 that there is a mens rea element to professional discipline offences under the Legal Profession Act, 2004, in that there is a defence of ‘honest and reasonable mistake’. That fascinates me, since under the previous Act, misconduct and unsatisfactory conduct was often delineated by the presence or absence of knowledge that the conduct engaged in breached a norm of conduct. Conduct in ignorance of its wrongfulness was punishable as unsatisfactory conduct. Now, though, there is no knowledge element built into the definitions of the 2004 Act, and there seems to be no particular reason why the concept of honest and reasonable mistake which has been imported from the criminal law, might not apply equally to cases of professional misconduct and unsatisfactory professional conduct. Continue reading “Honest and reasonable mistake as a defence to disciplinary charges”
In Legal Services Commissioner v R-MB  VCAT 182, Senior Member Howell found a repeat offender had failed to comply with a demand from the Legal Services Commissioner for a written explanation of conduct the subject of a complaint. The Bureau de Spank argued that the infraction should be regarded as professional misconduct rather than unsatisfactory professional conduct, as contended for by the practitioner. One of the reasons put forward was that the solicitor had previously been found guilty of the same thing. The Bureau suggested there were authorities in support of this proposition, but did not identify them. Neither party appears to have brought to Senior Member Howell’s attention an authority decided by another member sitting in VCAT’s Legal Practice List this year which suggested ‘prior offences’, or their absence was irrelevant in the determination of exactly this question. On that occasion, VCAT said:
’15 I have had some difficulty deciding whether the conduct of the applicant is unsatisfactory professional conduct or professional misconduct. Part of the difficulty has been whether I should take into account the fact that the respondent has had no previous determinations made against him of a disciplinary nature. In my view, that is something that should be taken into account on the matter of penalty but it should not be taken into account as a matter of what charge for which he should be found guilty.
16 I compare this to the hearing of a criminal matter, although it is a disciplinary matter and something entirely different, but the similarity is that a criminal court would not look at prior convictions until it had decided what breach or what act had been committed. In this particular instance, it is appropriate that I should not look at past conduct until I have decided what act has been committed, ie whether it is unsatisfactory professional conduct or professional misconduct.’
Now it’s my turn not to identify the authority, but only because I was in it, and I don’t blog my own cases.
I did a plagiarism case before the Board of Examiners last year, and looked up the cases then. My colleague Patrick Over also reviewed them for his prosecution on behalf of the Legal Services Commissioner of the plagiarist solicitor in Legal Services Commissioner v WJK  VCAT 108, and cleverly found a case from the old Solicitors’ Board which my researches did not pick up. Senior Member Howell (who was the Solicitors’ Board, back in the day) helpfully digested the authorities (there is also, of course, Re OG  VSC 520, noted by me here): Continue reading “Legal plagiarism cases: a non-exhaustive review”
In Legal Services Commissioner v WJK  VCAT 108, a sole practitioner who has written a legal text and published a number of articles succumbed to temptation when the pressures of life got to him and meant he did not have time to do a proper job of writing a 10,000 word research paper for his Master of Health and Medical Law at Melbourne Uni. He plagiarised extensively from two published articles which he did not acknowledge at all. I can tell you, I presently have the greatest of sympathy for full-time lawyers who have to squeeze Masters study into their lives. But I must confess to a degree of incomprehension as to why the solicitor, having gotten away with the plagiarism and garnered a good mark, thought publishing the plagiarism in the Journal of Law and Medicine was a good idea.
He made admissions at an early stage after he was caught out, but persisted to the end of the misconduct hearing with mitigatory evidence which was rejected as implausible. He pleaded guilty to two counts of professional misconduct at common law which specifically alleged that his plagiarism was deliberate. His practising certificate was cancelled and he will not be getting a new one within 6 months of the cancellation taking effect.
The distinction between ‘professional misconduct’ and ‘unsatisfactory professional conduct’ is usually elusive. Guidance from an appellate court in relation to cognate legislation is therefore valuable. It seems that one instance of ‘incredibly sloppy’ work involving innocent false representations being made to the other side, if it is comprised of a series of closely related bits of conduct in relation to the one matter, is not what is contemplated by the words ‘substantial or consistent failure to reach or maintain a reasonable standard of competence and diligence’. CYX v Council of the Law Society of NSW  NSWCA 430 (previously blogged here) is a decision I regard as indicating an appropriately restrictive approach to identifying ‘professional misconduct’, a finding which should carry with it the opprobrium associated with the worst professional wrongs. The NSW Court of Appeal overturned a finding by New South Wales’s Administrative Appeals Tribunal’s of professional misconduct. Continue reading “NSW Court of Appeal on difference between ‘professional misconduct’ and ‘unsatisfactory professional conduct’”