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Legal Services Commissioner publishes annual report

The Legal Services Commissioner’s website is growing some content. Her annual report for the part-financial year ending 2006 is published there. In summary:

  • For those who enjoy the suffering of others, commencing at p. 22 there is a list of all the adverse disciplinary findings made by VCAT’s Legal Practice List, and it names the practitioners involved;
  • The Commissioner’s office has 3 executives in addition to Victoria Marles: Janet Cohen (formerly the Deputy Legal Ombudsman), David Forbes, and Diana Gillespie; 9 legal staff 2 of whom are part time; (2 out of the 13 mentioned are blokes) and 19 administrative staff;
  • She received 1,218 complaints under the new Act (6 a day), of which 664 were only disciplinary (55%), 310 were only civil (25%), and 244 were both (20%) (all of the complaints figures below are only about the new Act complaints received, except where indicated);
  • Only 33 were against barristers (3%);
  • 238 involved a costs dispute (20%), a surprisingly low figure, especially given that 553 of the complaints were about costs or bills (45%);
  • Only 117 involved a pecuniary loss dispute (10%) which shows that two-thirds of the 322 complaints characterised as being about “Negligence — including bad case handling and advice” were dealt with as disciplinary complaints or costs disputes which is most surprising;
  • Only 719 were handled by the Commissioner (59%) — the rest were referred to the Law Institute and the Bar for investigation and recommendation as to ultimate decision to be made by the Commissioner;
  • 67% of those delegated to the Law Institute involved a disciplinary complaint;
  • 14% were about wills and estates, 14% about conveyancing, 18% about family law, and only 5% about crime;
  • 6% were about conflicts;
  • There were 3 complaints of sexual impropriety;
  • There were no ‘other genuine dispute’ within the definition civil disputes in s. 4.2.2(2) of the Legal Profession Act, 2004;
  • No prosecutions were brought;
  • Not a single finalised disciplinary complaint was successful (and only 1 out of the 100 old Act complaints succeeded — it resulted in a reprimand);
  • There were 3 FOI applications to the Commissioner; and
  • The going tariff for a breach of the obligation to deliver up documents within time pursuant to the Commissioner’s power of compulsion seems to be a $500 fine and costs of $1,000.

The Office had revenue of $3.4 million (almost all from the Legal Services Board) of which $1.3 million went on staff, including training (an annualised average of $73,300 per employee, some of whom are part-time, but it gets a little complicated because the Commissioner spent $205,000 on temps), $1.1 million went to the Law Institute for functions the Commissioner delegated to it (there is a list of all delegations on p. 20) and $150,000 to the Bar for the same thing.

Astonishingly, 89% of all disciplinary complaints finalised were summarily dismissed pursuant to s. 4.2.10 of the Legal Profession Act, 2004. Almost 1 in 6 was chucked within 30 days, and almost 9 in 10 within 60. To be fair, this may represent the dross which has been sifted out, since 60% of the complaints received during the reporting period were still open at the end of the financial year, and 60% of them had been open for 2 months or longer. I say ‘astonishingly’ because I perceive it to be a radical departure from the practice of the Commissioner’s predecessors. In general, though, it is a good thing if the Commissioner uses her office’s limited resources to deal doughtily with the complaints which suggest conduct conducive of condine condemnation, while giving the drossmongers and feewhiners the short shrift they often deserve.

I saw the other day a set of circumstances which was unfortunate, and which I hope is not too often replicated. The Commissioner characterised a complaint as a pecuniary loss dispute (one of the species of civil dispute) and a conduct complaint. The particulars of the complaint read, in substance — “See the attached Family Court affidavit”. Rather hastily after the receipt of the complaint, the Commissioner exercised her discretion to bypass the dispute resolution procedures with which she is tasked in relation to civil disputes by giving the client a ticket to go off and agitate her professional negligence claim in VCAT. She referred to s. 4.3.6 of the Legal Profession Act, 2004 which says she can do so if she considers the dispute unsuitable for her to attempt to settle. The matter was referred to VCAT’s Legal Practice List. Then, the Commissioner realised that because the exact subject matter of the complaint was before the Family Court she had no power to deal with the complaint, which she dismissed pursuant to the power in s. 4.2.10(1)(e) of the Legal Profession Act, 2004, which says ‘The Commissioner may dismiss a complaint if— (e) the complaint is not one that the Commissioner has power to deal with’. Yet she did not withdraw the ticket she had mistakenly given to the c lient to refer the purported complaint to VCAT insofar as it amounted to a civil dispute in the belief that she did have power to deal with the complaint.

The Commissioner settled 10% of civil disputes. She let 5% through to VCAT’s pecuniary loss dispute jurisdiction, which would explain why it’s been quiet down in the Legal Practice List. That means 85% never went anywhere for various reasons. She summarily dismissed 53%. She refused to extend time 18 times.

Of the complaints summarily dismissed, 41% were dismissed for being frivolous, vexatious, misconceived or lacking in substance. 9% were dismissed because the Commissioner formed the view the complaint required no further investigation. One-third were dismissed on the basis the Commissioner did not have jurisdiction.

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And another Court of Appeal sets aside another gross overcharging conviction

As reported in today’s Australian Financial Review, the NSW Court of Appeal has told the Administrative Decisions Tribunal’s Legal Services Division that it got it wrong when it found a Sydney solicitor guilty of gross overcharging. The case is  LN v Legal Services Commissioner  [2007] NSWCA 130  Though the solicitor signed the bill, he did not really read it, and the Legal Services Commissioner obviously didn’t think hard enough about the charge, since the solicitor got off on the basis that he did not have personal culpability for gross overcharging. It is not well understood that there is no concept of vicarious liability for professional misconduct or unsatisfactory professional conduct. He might have been disciplined for failure to supervise, I suppose, but that was not what he was charged with. The relevant decisions below are here and here.

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Court of Appeal sets aside unduly harsh outcome in gross overcharging prosecution

PJQ v Law Institute of Victoria[2007] VSCA 122 is the part 1 of the last chapter in a story of good tactical plays characteristic of professional discipline specialist Sam Tatarka in the representation of a solicitor charged with gross overcharging, and applying trust monies to pay his fees without the appropriate paperwork. It sounds like a plea bargain was entered into whereby the solicitor pleaded guilty to the charges on the basis that what led to the overcharging was overzealous representation and disorganization rather than dishonesty and in return, the prosecutor — the Law Institute of Victoria — would not make submissions as to penalty. But that is speculation. When it came time for ‘sentencing’, the solicitor offered an undertaking to the Tribunal that any file in which he proposed to charge more than $20,000 would be independently costed by a costs consultant. The Tribunal enquired whether he would submit to such costing by the Law Institute’s costs assessing service. The solicitor said yes.

In Law Institute of Victoria Limited v PJQ [2005] VLPT 8, the Full Legal Profession Tribunal came down hard, accepting the expert opinion of a man without a law degree that appropriate legal costs for a proceeding of the kind in which the solicitor had represented his client were half what he had charged, and suspending the solicitor from practice for 12 months. To the surprise of the President of the Court of Appeal, the Tribunal made no mention of the alternative to suspension represented by the undertaking despite going through the ritualistic ‘no punishment happening here’ recitations (‘Our task does not involve punishment of the legal practitioner. Our task is to provide for the protection of the public, including deterrence of the legal practitioner and the profession generally from like conduct…’; ‘Conscious of the necessity to place the barrier high before depriving a member of the profession of their practising certificate we have given all the circumstances of this case the most careful and repeated consideration.’ etc.).

President Maxwell, with whom Justices Chernov and Nettle agreed, held that the Tribunal’s inexplicable failure to mention in its reasons the undertaking offer suggested that its sentencing discretion had miscarried.  His Honour actually acknowledged with refreshing forthrightness that penalisation is part of sentencing for professional discipline offences, but, by his words, sought to give real meaning to the concept that protection of the public is what professional discipline is all about, by quashing the Full Tribunal’s orders and, on resentencing, making no orders in recognition of the substantial costs already incurred by the solicitor and the partially endured suspension: Continue reading “Court of Appeal sets aside unduly harsh outcome in gross overcharging prosecution”

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Confirmed: your client can privately prosecute you for misconduct

Acting President Bowman handed down a decision on Friday in Cedric Naylor’s Case [2007] VCAT 958 approving the existing practice of VCAT, and before it the Legal Profession Tribunal, of entertaining professional misconduct allegations against lawyers by their clients as part of applications to set aside costs agreements. Entertaining them, that is, outside the disciplinary investigation and prosecution procedures in Part 5 of the old Legal Practice Act, 1996, and regardless of whether those who otherwise prosecute disciplinary charges would have brought a charge.  Under the old Act, a costs agreement could be set aside upon proof by the client of (i) dishonesty in the solicitor, or (ii) misconduct or unprofessional conduct in the retainer, or (iii) a want of fairness and reasonableness of the agreement. Judge Bowman  ruled that it was not necessary for the solicitor to be found guilty of misconduct or unsatisfactory conduct in the ordinary way, by a prosecution by a legal regulator under the disciplinary provisionso of the Act before the client could rely on the second ground, but he did say that if misconduct is made out in an old Act case, then no disciplinary consequences such as a suspension of a practising certificate can follow in that hearing.  But, armed with the result in the s. 103 application, there seems to be nothing to stop the client sending the reasons in to the regulator and requesting investigation of the conduct already determined to be misconduct by the body which would hear any charge flowing from the investigation. And so, of course, there seems to be nothing to stop the client from threatening to do so in little spats over fees.

Continue reading “Confirmed: your client can privately prosecute you for misconduct”

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Misconduct charge no. 21 against Victorian silk stayed as abuse of process

The latest and possibly last chapter in the tribulations of Victoria’s most senior female silk is to be found in M v VCAT [2007] VSC 89, a decision of Justice Mandie. The barrister was charged on 4 July 2005 with 24 charges of misconduct, and ended up after a hearing of the first half of the charges with a finding of only 4 counts of unsatisfactory conduct. All but one of the second half were abandoned, but the Bar, as prosecutor, sought to amend the last remaining charge so as to substitute an allegation of unsatisfactory conduct for the original charge of misconduct. VCAT found it had no power to grant leave to amend a charge, and the barrister convinced the Supreme Court to stay the hearing of the last charge as an abuse of process, VCAT having refused to do so. It was an abuse because the Bar wished to proceed with the misconduct charge not so as to make out an allegation of misconduct, but so as to provide a vehicle for a finding of unsatisfactory conduct under a statutory power which empowered VCAT to make a finding of unsatisfactory conduct after hearing a misconduct charge. Justice Mandie found:

‘[58] … It would bring the administration of justice into disrepute to permit the Bar to prosecute a charge of misconduct while at the same time saying the opposite, namely, that it was not advancing a case of misconduct or seeking a finding of misconduct. It is an entirely different position to that which might have arisen had the charge been proceeded with and, after all the evidence was in, the Bar conceded that the evidence supported only a lesser charge [i.e. unsatisfactory conduct]. The use of a misconduct charge simply to obtain a finding of a lesser charge when the case for misconduct is completely disavowed before the hearing commences is, I think, a misuse of the statutory procedure and, indeed, as the plaintiff submitted, contrary to the spirit of the Act, given the requirement that the Bar be satisfied when bringing the charge that there is a reasonable likelihood that the Tribunal would find the practitioner guilty of misconduct. If the Bar has reached the view, as it has, that a case of misconduct cannot be made out and it does not seek to do so, such a charge ought not as a matter of justice and fairness be heard.’ Continue reading “Misconduct charge no. 21 against Victorian silk stayed as abuse of process”

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Criminal defence lawyer to be vicariously responsible for investigator’s deception?

Legal Blog Watch draws our attention to a CNN report of a Wisconsin lawyer who is said to have gone too far in defending a middle-aged man against allegations of sexual assault and child pornography involving  a boy. Neither article states the facts adequately, so see this article too. It was alleged that the accused showed the 13 year old pornography on the accused’s computer. The lawyer wanted the boy’s computer, suspecting it would contain useful undiscovered material demonstrating that what was on the accused’s computer was nothing new to the boy. So he sent a private investigator over to the boy’s house with a story that his household had been selected for a free laptop in exchange for his old computer. There was a cover story about a company researching school students’ computer use. It worked. The boy’s family handed over the old computer, including hundreds of pornographic images which the lawyer then sought to tender in his client’s criminal trial, and the boy got a new laptop. The Wisconsin Supreme Court wil now decide whether the lawyer’s deception through the proxy of the investigator was one step too far in the vigorous and fearless defence of his client.

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Can you be prosecuted for mere negligence?

There is no doubt that mere negligence cannot constitute misconduct in the traditional concept of that expression: Myers v Elman [1940] AC 282 at 288; Re Hodgekiss (1959) 62 SR(NSW) 340 at 351; Re Veron (1966) 84 WN (Pt 1) (NSW) 136 at 143 (CA); Re Miles (1966) 84 WN (Pt1) (NSW) 163 at 173 (CA); Pillai v Messiter (No 2) (1989) 16 NSWLR 197. Gross negligence, or a pattern of simple negligence, may amount to misconduct. And to say that mere negligence cannot constitute misconduct is not to say that things characterisable as negligence and things characterisable as professional misconduct are mutually exclusive. Delay is a different kettle of fish: that can certainly be misconduct. This post looks at some modern definitions of unsatisfactory professional conduct and cites authorities for the blindingly common sense proposition that mere negligence without more ought not found any disciplinary charge against a lawyer. Continue reading “Can you be prosecuted for mere negligence?”

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Dob-in rule lurks in Victorian solicitors’ practice rules

A newish conduct rule compels solicitors to report every dishonest act by another practitioner, and every act which is prejudicial to the administration of justice or which would diminish public confidence in its administration. This is not just my fancy; the Law Institute itself says that the rule requires dobbing in and is not only about self-reporting. Relevantly, rule 30 of the Professional Conduct and Practice Rules 2005 says (and this is not a quote): Continue reading “Dob-in rule lurks in Victorian solicitors’ practice rules”

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Misconduct constituted by barrister’s misleading mediation statements

In Legal Services Commissioner v M [2006] LPT 012, a leading Brisbane barrister was fined $20,000 (his fees of $9,100 plus $10,900 penalty) for engaging in fraudulent misrepresentation on the instructions of his client in a mediation in which the insurer was induced to pay the barrister’s cancer-riddled plaintiff client over $1 million on a claim based on a near-normal life expectancy. He was found guilty of professional misconduct, and publicly reprimanded (I wonder whether a solicitor was sitting blithely by and escaped prosecution). Frankly, I reckon he was lucky to get away with a fine and reprimand given that he contested the charge by reference to the “startling” contention, described by the Tribunal:

“[25] The respondent argues that his conduct in continuing to rely on the Evidex reports without disclosing the cancer facts was not tantamount to some representation that he was not aware of facts that could deleteriously impact on longevity.  His case characterizes the compromise negotiations as “commercial”, conducted on a tacit, common assumption that, in deciding whether to settle, the parties would rely exclusively on their own resources and information.  There would not, it is said, have been a reasonable expectation that influential information communicated during the negotiations would not knowingly be false.”

But the content of what must surely be the pre-eminent professional non-client duty – not to mislead — is not well-known, and litigation is so obese with toleration of falsehoods, that I have some limited sympathy for the confusion the barrister claims to have fallen into, having researched the issue. Because, contrary to the idiotic utterances of some regulators, legal ethics are not intuitive.  There is no “gut feel” test. Legal ethics frequently involve a duty not to volunteer the truth. Continue reading “Misconduct constituted by barrister’s misleading mediation statements”

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No appearing on behalf of others in VCAT when your practising certificate’s suspended

The Victorian Civil and Administrative Tribunal (Amendment No. 17) Rules 2006 will introduce a new class of people prohibited from representing others in VCAT: lawyers whose practising certificates are suspended or who have been struck off the role of practitioners. No doubt some bright spark had her practising certificate suspended and decided to continue practising by appearing for others in VCAT on the pretext that you don’t have to be a lawyer to do so (in fact, if you are a lawyer, your client has to seek permission to have you represent them: see s. 62 of the VCAT Act, 1998). The new rule 4.24 will say:

“Classes of persons disqualified from being professional advocate

(1) For the purposes of section 62(8) of the Act, a person is disqualified from being a professional advocate if—

(a) the person, being or having been a legal practitioner, has been the subject of disciplinary proceedings under the law of Victoria, another State, a Territory or the Commonwealth and has been found guilty in those proceedings of professional misconduct (by whatever name called) or of another breach of professional standards, whereby the person is not currently permitted to practise”.

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The barrister and the trust monies saga ends in 6 month holiday

Update: 14 October 2007  The Court of Appeal refused leave to appeal, and the High Court refused special leave to appeal too, on 5 October 2007.

In Victorian Bar Inc v DAP, [2006] VCAT 2293 Judge Bowman, Tony Southall QC and T Harper suspended the barrister’s practising certificate for 6 months and ordered him to pay costs. He had been found guilty of misconduct constituted by breach of a prohibition in the Legal Practice Act, 1996 on barristers receiving trust monies (otherwise than through their clerks) (s. 178). Breach of the provision was also amenable of being prosecuted as a crime, punishable by up to 2 years’ imprisonment. That that was so was considered to be a measure of the seriousness with which Parliament viewed the offence. Continue reading “The barrister and the trust monies saga ends in 6 month holiday”

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Procedural fairness: “Murray letters” considered by Victorian Court of Appeal

B (A Solicitor) v Victorian Lawyers RPA Ltd (2002) 6 VR 642 (Ormiston, Charles and Batt JJA)

The Law Institute corresponded with the solicitors in this matter between 1998 and October 2000. The CEO Ian Dunn, wrote what is known in the game as “a Murray letter” on 16 October 2000. That is a letter summarising the tentative conclusions of an investigation giving a practitioner a final opportunity to comment before a final decision to lay a charge. The two solicitors in this case were given 7 days in which to respond. One of them replied at length and indicated he did not desire an extension of time, the other did not request an extension. Later, their lawyers took the point that the charge was invalid and the Tribunal’s jurisdiction not properly invoked. The Tribunal found it had jurisdiction. The Court of Appeal had no jurisdiction to entertain an appeal in relation to this aspect of the Tribunal’s decision because, it found, the finding that sufficient time had been afforded was a question of fact, and it had jurisdiction only to hear appeals on a question of law. Nevertheless, the majority ventured some dicta. Continue reading “Procedural fairness: “Murray letters” considered by Victorian Court of Appeal”

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Disciplinary tribunal can’t find misconduct by commission of crime

Legal Practitioners Conduct Board v Ardalich [2005] SASC 278

A solicitor suffered from what used to be known as “manic depression“. He had been charged with criminal offences of forgery but not convicted on mental grounds. The South Australian Legal Practitioners Disciplinary Tribunal heard charges that the solicitor was guilty of misconduct in having committed different crimes which had never been prosected. The Full Court of the Supreme Court of South Australia held that the Tribunal had over-reached itself in purporting to make findings about the commissions of crimes by the solicitor, but said that acts (admitted by the solicitor) that would be criminal unless met by the defence of insanity were enough to warrant a finding of unprofessional conduct, the purpose of which was not the punishment of the solicitor but the protection of society. So the Full Court struck him off the roll of practitioners. (See also the previous post).

Continue reading “Disciplinary tribunal can’t find misconduct by commission of crime”

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Insanity not a defence to professional discipline proceedings

Legal Practitioners Conduct Board v Ardalich [2005] SASC 278

The solicitor referred to in the next post could not escape a finding of unprofessional conduct because of his mental state, even though the species of unprofessional conduct alleged against him was the commission of serious criminal offences to which insanity was a defence. The South Australian Court of Appeal explained: Continue reading “Insanity not a defence to professional discipline proceedings”

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On the perils of the undersupervised law clerk

Legal Practitioners Complaints Committee and JCB [2005] WASAT 213

A sole practitoner dictated many precedent letters for his routine suburban personal injuries practice. His law clerk of 16 years’ experience, an arts graduate and a one-time law student, did all the work in a workers compensation file: she took instructions, signed letters taken from the precedent bank, negotiated with the counterparty, and was charged out at $240 per hour plus GST and $30 per short letter, $50 per one-page letter and $70 per long letter. The solicitor was unable convincingly to establish that he had done anything very much at all.

He was found guilty of “neglect” in failing properly to supervise the clerk and of “unprofessional conduct” in grossly overcharging. The first finding gave rise to a reprimand, the second to a $2,000 fine. Costs claimed at $10,000 were allowed at only $5,000 on the basis that the solicitor successfully resisted a third charge of constructively misrepresenting that the law clerk was a solicitor and on the basis that the retention of senior counsel by the prosecuting Committee was unnecessary. The third charge failed because no evidence was sought to be adduced of the solicitor’s complicity in the alleged deception, a timely reminder of an oft-forgotten principle that there is no disciplinary version of vicarious liability (a different concept from the wrong of failure to supervise). The law as to the supervision of clerks is well summarised in a neat and detailed judgment of Justice Barker, a Supreme Court Judge.

Continue reading “On the perils of the undersupervised law clerk”

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Epic battle re trust monies results in misconduct finding against barrister

Victorian Bar Inc v DAP No. 6 [2006] VCAT 1226

A barrister banked $50,000 into his personal account, arguing that it was a “retainer” and not monies held on account of future fees. VCAT found that it could not have been a retainer because that is a modest fee paid to a barrister to prevent them from acting against the payer, and the barrister already could not act against the complainant at the time of the payment because of his close involvement as his counsel over many years prior to the payment. The difference between “wilful” and “reckless” breach of the Legal Practice Act, 1996 or rules of conduct was explained. The interlocutory decisions in this matter were digested earlier. Continue reading “Epic battle re trust monies results in misconduct finding against barrister”

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Queensland Legal Services Commissioner

The Office of the Queensland Legal Services Commissioner has, like VCAT, set up a searchable full-text database of disciplinary decisions in Queensland. A Queensland case on gross overcharging, resulting in a 12 month holiday for the solicitor caught my eye: Council of the Queensland Law Society Inc v Roche [2003] QCA 469. It is full of expressions like “inexcusable rapacity”. One of the charges was 12 minutes for wrapping a box of chocolates.

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3 years’ holiday for not making ongoing discovery

Guss v Law Institute of Victoria Ltd [2006] VSCA 88 (Maxwell P gave the lead judgment, Callaway and Chernov JJA agreeing)

A solicitor’s right to practice was suspended for three years and he was ordered to pay costs of $31,500 for failing to comply with the obligation of ongoing discovery in relation to what was prima facie a privileged copy of a document produced by an expert witness a few days before trial which, had the existence of the copy document been disclosed to the other side, might have put the other side onto a train of enquiry which might have led to relevant evidence. Continue reading “3 years’ holiday for not making ongoing discovery”

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Misconduct in acting in face of duty and associate’s interest conflict

Legal Services Commissioner v JAF [2006] VCAT 581 (Cullity, Shattock, Hannebury) Acting for vendor and purchaser; conflict between duty and interest (of solicitor’s associate)

The Full Tribunal were not impressed with this solicitor who acted for the vendor and the purchaser which was a trust of which his wife was a beneficiary, but did the rule they relied on extend to prohibit acting in the face of a conflict between duty and the interest of an associate? Continue reading “Misconduct in acting in face of duty and associate’s interest conflict”

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A very generous approach to a Hungerfords damages claim tacked onto a misconduct prosecution

Law Institute v KTBH [2006] VCAT 350 (Senior Member Howell)

There were separate disciplinary and negligence proceedings against the solicitor over the same facts. At the end of the disciplinary hearing, and on the basis of the prosecutrix’s submissions, Mr Howell decided to determine the negligence case and get the whole thing over and done with. He found there had been a delay by the solicitor in getting a woman compensation. Though VCAT was not empowered to order interest on the woman’s claim, he gave her Hungerfords damages, that is, damages in the nature of interest, and calculated the damages by reference to the penalty interest rate. This note is critical of that decision.

Continue reading “A very generous approach to a Hungerfords damages claim tacked onto a misconduct prosecution”