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Ombudsman carries out own-motion investigation of Legal Services Commissioner

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

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

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

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Legal Services Commissioner resigns

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

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

Will they try once more to woo John Faine?

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

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Commissioner’s unexplained delay reduces penalty for serious misconduct

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

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

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

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

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Distinguishing between civil and disciplinary complaints

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

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

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

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

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

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

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Restraints on use of information obtained by compulsion

The rule in Home Office v Harman governs the use of documents and information obtained by people generally by various forms of compulsion in litigation: the court rules about interrogatories (a form of statute), Court orders for discovery, witness statements served pursuant to an order to do so.  But when I carefully checked this point a while ago, it seemed clear that the principle had no application outside litigation, the exception being, perhaps, arbitration.

Outside litigation, however, the main source of powers to compel the production of documents and the disclosure of information is statute, and the main repository of them mandarins.  When a mandarin (disguised say as a Commissioner, or an Inspector) obtains information by compulsion, there is an important limit on what the mandarin may do with it.  The important limit is that the information may only be used for the purpose the power of compulsion was bestowed.  This is a proposition which I vaguely knew I had read somewhere, but which has several times eluded me when I tried to look it up.  But now it’s back in my quiver, courtesy of Apache Northwest Pty Ltd v Agostini [2009] FCA 534.  The relevant High Court authority is Johns v Australian Securities Commission (1993) 178 CLR 384; [1993] HCA 56, which is posted about separately here.

Continue reading “Restraints on use of information obtained by compulsion”

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Johns v Australian Securities Commission

This is a little adjunct to my post ‘Restraints on Use of Information Obtained by Compulsion‘, a place to store away for future reference the little case note of Johns v Australian Securities Commission (1993) 178 CLR 408; [1993] HCA 56 penned by Justice McKerracher in Apache Northwest Pty Ltd v Agostini [2009] FCA 534.  In digesting the quotation from Johns, it is helpful to know what s. 25 of the Australian Securities Commission Act, 1989 said.  Here is Justice McKerracher’s case note:

Continue reading “Johns v Australian Securities Commission”

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Statutory powers of compulsion to be invoked reasonably

Justice Pagone considered the Commissioner of Taxation’s invocation of a power to compel the production of documents and information (s 264(1)(b) of the Income Tax Assessment Act 1936 (Cth)). In this case, the subject of the compulsion was the Law Institute, more used to flinging such powers around itself.  Legal regulators not infrequently list poorly formulated allegations drafted by angry laypeople and then requiring ‘a full written response’ from lawyers.   Sometimes, requiring a ‘full written response’ is specifically contemplated by statute (e.g. s. 4.4.11(1)(a) of the Legal Profession Act, 2004, which is about investigating disciplinary complaints) but sometimes it is not (e.g. s. 7.2.7 of the same Act, which relates to investigations of offences against the Act).  If the response is not ‘full’ in the way the regulators think about ‘fullness’, the respondents risk being convicted of the crime of non-cooperation (seriously: see s. 7.2.7(1)).  His Honour cautioned regulators and said they must use such powers ‘wisely and responsibly’: Continue reading “Statutory powers of compulsion to be invoked reasonably”

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The Tax Man, the Law Institute, and the public interest

Update, 14 May 2009: Justice Pagone has given a second judgment determining this dispute, which I posted about here.

Original post: Justice Pagone gave judgment in Law Institute of Victoria Limited v Deputy Commissioner of Taxation [2009] VSC 55 on 26 February 2009. His Honour noted, as ‘trite’, that the Tax Man’s power of compulsion, found as it is in a Commonwealth statute, trumps by virtue of s. 109 of the Commonwealth Constitution the obligation in the Legal Profession Act, 2004 (Vic) on the Law Institute to keep information obtained by it in carrying out its functions secret.  And that the Tax Man’s power is subject to public interest immunity.  But his Honour said the immunity needed to be considered document by document, and could not be claimed only by virtue of the characteristics of the person in possession of the information, in this case the Institute.

Three things which seem yet to be discussed at this point in proceedings interest me, in addition to the obvious issue of the future prospects of the Law Institute’s vigorous pursuit of the public interest by the non-provision of information and documents. But unless you’re a lawyer regulation geek, you might want to skip the next few paragraphs and continue reading from there, where the less arcane aspects of the judgment are further summarised. Continue reading “The Tax Man, the Law Institute, and the public interest”

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Byrne v Marles reversed by legislation

I wrote about Byrne v Marles [2008] VSCA 78 here, and suggested reversal by legislation as a possible outcome.  The government slipped the Professional Standards and Legal Profession Act Amendment Act, 2008 through pretty quietly.  Two new sub-sections in the Legal Profession Act, 2004 add to the existing parent sections that nothing within them gives lawyers a right to be heard in relation to how a complaint is to be dealt with, or whether it should be summarily dismissed.  The relevant sections including their additions are set out below, and apply to complaints received by the Commissioner after 11 December 2008. I suggest that regardless of whether the Commissioner has an obligation to invite lawyers to do so, they should often take up these issues at the outset to ensure that there is in fact a valid disciplinary complaint, that its boundaries are clear and not exceeded, and that the Commissioner does not otherwise act without power.

Continue reading “Byrne v Marles reversed by legislation”

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Some law on the Commissioner’s powers to delegate

The nature of a delegation was described in B (A Solicitor) v Victorian Lawyers RPA Ltd (2002) 6 VR 642 by counsel and repeated without disapproval by Justices of Appeal Charles and Batt:

‘a delegate acting is not an agent who exercises the [delegator’s] powers but rather, as the new repository of the powers, exercises his own powers as a delegate.’

The same judges explained the purpose of requiring delegations to be in writing:

‘In the circumstances the legislative purpose of permitting a delegation of the functions and powers to be exercised after completion of an investigation, but requiring such a delegation to be in writing, seems to us to be reasonably apparent.  We would accept the appellants’ submissions in this regard, that the requirement of a writing protects the interests of all parties concerned.’

Of course that must be so.  Those who seek to exercise invasive statutory powers, as trust account inspectors do, should carry around the original instruments of delegation with them in their briefcases.  That’s what used to happen in the old days. Continue reading “Some law on the Commissioner’s powers to delegate”

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Latest word on burden of proof in professional discipline ‘prosecutions’

In this post, I just reproduce what Deputy President Dwyer said recently about the burden of proof, right to silence, and inferences which may be drawn from the fact of the exercise by a solicitor of the right to silence. He said it in the context of a hard-fought hearing into the conduct of Kylie’s one-time lawyer, Michael Brereton, reported on in the previous post. Interestingly, the Tribunal was not critical of the solicitor’s decision not to give evidence, but asserted that it was free to draw adverse inferences against the solicitor under the rule in Jones v Dunkel, and did so with gusto, drawing support from Woods v Legal Ombudsman [2004] VSCA 247, and Golem v Transport Accident Commission [No2] [2002] VCAT 736.)

What Mr Dwyer said was: Continue reading “Latest word on burden of proof in professional discipline ‘prosecutions’”

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Kylie’s one-time lawyer goes down, with a ‘disgraceful and dishonourable’ finding

On 13 August 2008, Deputy President O’Dwyer found charges of misconduct at common law made out against Kylie Minogue’s one-time solicitor, the man towards the centre of the government’s Operation Wickenby investigation, Michael Brereton. See Legal Services Commissioner v Brereton [2008] VCAT 1723. Mr O’Dwyer found he had transferred more than $2.3 million of clients’ money out of his trust account contrary to the trust accounting rules. Since he did not turn up to the hearing, the finding is not altogether surprising. His counsel explained the solicitor ‘was attending to important business matters overseas, having invested in an information technology business with links in America and Europe,’ which makes me wonder whether he could not have used some of his investments to appear by video link. The Age‘s report is here.

The Commissioner is to be commended for making some sense of the very complex business transactions in which the solicitor and his clients were involved, and achieving the making out of the allegations of misconduct which were made out. So too the Tribunal, which had a difficult task in the absence of participation by the solicitor, and produced a spare but careful set of reasons. But it was not all wins for the Commissioner. Continue reading “Kylie’s one-time lawyer goes down, with a ‘disgraceful and dishonourable’ finding”

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From the newspapers

Friday is definitely law news day. The Australian and the Australian Financial Review both have several pages of law news of a Friday. I might try to bring to the attention of you readers articles of interest from both on a relatively regular basis.

First though, some things from not-Friday. ABC Radio National’s The Law Report has the founder of Crimassist (which I mentioned here) tête-à-tête with the CEO of the Law Institute of Victoria. And The Age reported this week on a VCAT Legal Practice List case where a legal regulator is again alleged to have put illegally obtained evidence to use against a lawyer, this time the lawyer towards the centre of the tax fraud investigation, Project Wickenby. His bid to stay his disciplinary hearing pending what he said were imminent criminal charges failed, and the disciplinary hearing will proceed on Tuesday.

The Times has an article on a House of Lords decision which has put an end to what sounds like a relatively undesirable system in Old Blighty of allowing prosecutors to apply ex parte for orders anonymising witnesses in fear of their life if they testify. Better to preserve the common law rule that a defendant is entitled to confront his accusers than to risk some guilty folk walking free for want of evidence against them.  And the English are reviewing their system of no-win no-pay retainers. But unlike in Victoria, where the maximum success fee is 25% of the ‘normal’ fee (whatever that is), in England, a solicitor whose client succeeds can double their ‘normal fee’.

Le Oz has an article on a 34 year old Perth lawyer convicted of attempting to pervert the course of justice by convincing a witness not to give evidence against her de facto, who stood charged with conspiracy to commit a violent crime. The Western Australian Legal Practitioners Complaints Committee was meeting yesterday to consider her future as a lawyer. The comparison with that other case involving a 30 something female criminal lawyer and her late gangster de facto may be interesting. It also reports that the inter-state argy-bargy on a uniform national electronic conveyancing system in which Victoria has featured prominently has been resolved. A good thing too: this boring subject was clogging the Legal Affairs pages for too long. Meanwhile, the Conveyancers Act, 2006 (Vic.) came into operation on 1 July 2008. It repeals the bit in the Legal Profession Act, 2004 about conveyancers.

Amazingly, The Fin has a man with a barrister’s wig on its front page with the caption ‘Many barristers have grown frustrated with outdated practices’ as a hook to an article about the not especially newsworthy opening up of a new 18 room barristers chambers. It’s privately run you see, unlike the chambers owned by the Victorian Bar where 63 per cent of Victoria’s barristers are accommodated. I went and checked out Dawson Chambers today. They’re pretty flash, and house several of my mates, but sport views of the next door building. They’re set up by Stephen O’Bryan SC and David Klempfner. Stephen’s brother Norman O’Bryan SC is my landlord at Melbourne Chambers.

The Fin also reports on a NSW law which will make it a criminal offence for causing ‘annoyance or inconvenience’ to participants in World Youth Day. I wonder whether there is a Papal immunity which will immunise his Holiness from prosecution for the inconvenience of the sinfulness of contraception.

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What happens when complainant lodges complaint with wrong regulator and it gets transferred

In Byrne v Marles [2008] VSCA 78, the subject of this earlier post, another issue arose. Justice Nettle confirmed that a complaint made to anyone other than the Commissioner is invalid as a trigger for the operation of the Legal Profession Act, 2004, but that if it finds its way to the Commissioner otherwise than by the complainant re-lodging it with her, and the complainant says he’s happy for the complaint to continue as a complaint to the Commissioner, then that counts as a deemed lodging by the complainant of a complaint with the correct regulator. Continue reading “What happens when complainant lodges complaint with wrong regulator and it gets transferred”

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More cases

I only just caught up with the fact that the Court of Appeal has overturned Justice Gillard’s decision in Kabourakis v Medical Board of Victoria [2005] VSC 493, the subject of an earlier post. See [2006] VSC 301.

VCAT’s Vice President Harbison, sitting in the Legal Practice List for the first time I am aware of, has contributed what appears to be a most interesting addition to the authorities about whether solicitors engage in trade and commerce for the purposes of the Fair Trading Act, 1999 (and, by analogy, of the Trade Practices Act, 1974), and whether solicitors may ever be sued under the Fair Trading Act, 1999. As to which, see this earlier post. The decision is Walsh v PJCC&A Pty [2008] VCAT 962 which I will certainly be posting a detailed analysis of.

Then a NSW decision has illustrated again the problem of sloppy regulators failing to consider whether what purports to be a complaint received by them is in fact a complaint as defined by the Act which regulates them (an allegation in both of the cases noted here). This time it was NSW’s Legal Services Commissioner, Steve Mark, getting bashed up by the NSW Administrative Appeals Tribunal’s Legal Services Division in Legal Services Commissioner v SG [2008] NSWADT 48:

’64 As stated, Mr Mark determined that a complaint had been made of deliberate charging of grossly excessive amounts of costs, when no such complaint had been made.

65 Without any further evidence or effort to obtain a valid expert opinion, the LSC instituted the complaint and brought this matter before the Tribunal on the equivocal opinion expressed by Mr McIntyre. Samantha Gulliver investigated the complaint on behalf of Mr Mark, however what, if anything, resulted from such investigation was not placed before the Tribunal. Continue reading “More cases”

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It’s ok for solicitors to try to resolve complaints directly with the complainants

I have always been a bit chary about allowing lawyers for whom I act to communicate directly with complainants, thinking it often more desirable for communications to be principally with the Legal Services Commissioner once the complaint process was initiated. Turns out it was a rare moment of over-anxiety on my part. In Legal Services Commissioner v JFB [2008] VCAT 842, a prosecution for failing to cooperate with a demand by the Commissioner for a written explanation in response to a complaint, Member Butcher said:

‘5. Since the application has been made the [solicitor] has provided some material to the Legal Services Commissioner and it is the view of the Commissioner that this does not constitute a full written explanation. By way of plea, Counsel on behalf of the [solicitor] outlined the circumstances in relation to the complaint and appraised the Tribunal of the [solicitor’s] endeavours to resolve the complaint through the complainant rather than by communication with the Legal Services Commission. This is not an uncommon course of action, however it ignores the statutory requirement that members of the legal profession respond to the Commissioner when required to do so. It may well be that matters which are the subject of complaint can be resolved between the legal practitioner and the client or indeed other person who has made the complaint and it would never be said that this should not be attempted, however this does not take away from the requirement and the duty to respond to the Commissioner.’ (my emphasis)

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Suddenly, solicitors are losing their practising certificates for not cooperating with the Bureau de Spank

Update, 13 June 2008: In Legal Services Commissioner v GT [2008] VCAT 982, the solicitor failed to respond to a Bureau demand for 8 months. The complaint about which the Commissioner sought information was of not attending to client affairs, just like the complaint which, amongst others, gave rise to two misconduct findings and two ‘standards breaches’ about 10 years ago.  He got off with a light fine: $500, and costs agreed at about $1,500 on the basis that he was:

’employed by The Micah Law Centre Incorporated, which was conducted by All Saints Anglican Church at Greensborough.

8 He said that he was overwhelmed by the amount of work that he was required to perform.  He said that he worked six days each week, and sometimes seven days.  He said that he suffered from a “severe bronchial viral infection” for ten weeks prior to December 2007.  During that period he struggled to attend to his work, but was required to do so because there was no other person to attend to his files.  He added that he became physically and emotionally exhausted, and that his work had severely impacted upon his marriage.’

and that ‘he is without employment, and … he has not applied to renew his practising certificate as from 1 July 2008.  He also said that he is taking “time out for rest and recuperation”, and to re-build his relationship with his wife.’

Original post: This post is about recent s. 4.4.11(1)(a) prosecutions of 8 solicitors. Section 4.4.11(1)(a) of the Legal Profession Act, 2004 says that if the Bureau de Spank asks for a full written explanation of the conduct the subject of a complaint (or an investigation of the Commissioner’s own volition), or compels the production of apposite documents, the solicitor must cough up within the time specified in the demand, which may not be fewer than 14 days (but is routinely expressed as ‘within 16 days’ though within 16 days of what is not specified). Its predecessor was s. 149 of the Legal Practice Act, 1996. So many people are getting prosecuted that it was getting too boring to blog. But just when I was about to ignore them, VCAT started getting tough, and actually cancelled a couple of blokes’ practising certificates and said it would have cancelled another’s but for the fact that he was retiring anyway. Continue reading “Suddenly, solicitors are losing their practising certificates for not cooperating with the Bureau de Spank”

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Court of Appeal wreaks havoc with most current Legal Services Commissioner investigations

Update, 2 September 2010: Just noticed this and thought to store it away here as potentially interesting: http://jade.barnet.com.au/Jade.html#article=229752.

Update, 7 August 2010: The saga continues.  See this post.

Update, 17 June 2008: The Age has caught up with this story. It’s a funny old article. Weirdest is this comment ‘A prominent senior counsel said the system was unfair, and any complaint should be forwarded immediately to the subject of the complaint.’ In my experience, the Commissioner does almost invariably send the complaint immediately to the solicitor, and that’s not what the case was about anyway.

Original post: In Byrne v Marles [2008] VSCA 78, the Court of Appeal has thrown a very lean cat amongst some very fat pigeons in a decision which may invalidate all current investigations of the Legal Services Commissioner unless it is overturned on appeal or remedial legislation is passed with retrospective effect (which was the response after the great delegation debacle). The Court found that the Commissioner’s referral to the Law Institute for investigation of what she characterised as a disciplinary complaint was ‘invalid’. In following her absolutely standard practice, the Court said the Commissioner had failed to give natural justice to the solicitor by deciding to characterise the complaint as a disciplinary rather than civil complaint and by deciding not to dismiss it summarily without investigation, without allowing the solicitor to be heard in relation to those preliminary decisions. Anyone — complainant or lawyer — who has a current complaint which is not heading in the desired direction should seek advice from a lawyer with expertise in relation to the professional discipline of lawyers. It is conceivable that the decision may provide options for those against whom professional discipline prosecutions have succeeded under the Legal Profession Act, 2004. Given that the Commissioner never, in my experience, invites discussion about the preliminary questions of whether to dismiss the complaint before commencing an investigation, or on the proper characterisation of the complaint, it seems likely that most of the Commissioner’s decisions to investigate complaints will be ‘invalid’. Continue reading “Court of Appeal wreaks havoc with most current Legal Services Commissioner investigations”

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VCAT suggests natural justice requires Bureau to wait indefinitely for practitioner’s response

In Legal Services Commissioner v SAC [2008] VCAT 576, a solicitor ignored the Bureau for over 6 months before the Bureau moved to prosecute him for non-compliance with the Commissioner’s demands.  After the charge was laid but before it was heard, the solicitor provided an adequate response and apologised. Didn’t do him any good though: he still copped a finding of misconduct, and has to pay $2,400 in fines and costs.  Member Butcher made this comment: Continue reading “VCAT suggests natural justice requires Bureau to wait indefinitely for practitioner’s response”