The Australian Professional Liability Blog

Update: The Bill became legislation when royal assent was given on 17 September 2019.

Original post: There is a bill before the Victorian parliament, the Legal Profession Uniform Law Application Amendment Bill 2019. What the last few sections propose to do, rather sotto voce, is ‘validate’ retrospectively everything the Victorian Legal Services Commissioner has done since the 1 July 2015 commencement of the LPUL and repeal of the Legal Profession Act 2004 (Vic) in relation to investigations which commenced before that date. It also seeks to validate retrospectively orders made by VCAT in disciplinary prosecutions in matters arising from such investigations brought by the VLSC instead of the predecessor office, the Legal Services Commissioner (LSC). The relevant provisions are even going to commence retrospectively, on the date of the Bill’s second reading (Weird! Why?).

You’re probably sick of my fascination with transitional provisions by now, but this is actually quite the silent snafu which just shows why everyone should sweat over transitional provisions. Usually I curse those who draft these damned bits of legislation, but not this time. For once the drafters made their intentions clear in clauses 26 and 27 of the transitional provisions. It’s just that, presumably, nearly everyone assumed they intended something else, and read the transitional provisions with that bias.

If a person without standing (e.g. the VLSC) sought to invoke VCAT’s 2004 Act jurisdiction, then VCAT’s decisions were nullities (The Herald and Weekly Times Pty Ltd v Victoria [2006] VSCA 146 at [33]) whether or not the respondent lawyer took the point (since parties cannot bestow jurisdiction on a statutory tribunal: Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150 at 163, 167), as this blog points out from time to time. So the validating legislation will retrospectively impose penalties upon practitioners where none previously existed as a matter of law. That’s quite an exercise of retrospective power.

The funny thing is that the VLSC responded to my clients’ arguments that she ain’t got no power and VCAT ain’t got no jurisdiction under the 2004 Act by saying that she did, and even convinced VCAT of that in one case in which the proper Applicant point was squarely taken. And the Attorney-General seemed to say in the second reading speech that the situation after the ‘validation’ will reflect parliament’s clear intent all along (hmmm). So it’s kind of weird if the VLSC or the Legal Services Board has asked the Victorian parliament to pass a law which undermines the VLSC’s contention that she has always had power to tidy up pre-1 July 2015 complaints, and kind of weird that the parliament can be bothered to clarify by ‘validation’ that which is apparently perfectly clear already. It’s all a bit ‘Nothing to see here, folks, move right along.’

The other weird thing is that VCAT seems to continue to exercise 2004 Act jurisdiction on the application of the VLSC, even after the introduction of this Bill into parliament, even while parliament’s lower house seems to be of the view that legislation is needed to allow the VLSC to invoke that jurisdiction. It could not be that VCAT is exercising jurisdiction it does not have because it is confident that such a course will in the future be retrospectively validated, so one wonders if anyone has actually raised this legislation with VCAT at a high level.

Legal regulators in Victoria seem to get themselves into this kind of imbroglio from time to time. Consider the great delegation debacle and Byrne v Marles -Gate.

Continue reading “The great transitional provisions debacle #1”

One of my clients sought in the Supreme Court of Victoria prohibition against the Victorian Legal Services Commissioner continuing a prosecution she had initiated in VCAT. He settled it and so it will not go to judgment. He said the prosecution was an abuse of process, in part because of a breach by the Commissioner of her statutory obligation to investigate as expeditiously as possible. The Commissioner’s delegates had claimed to be entitled to put the investigation on hold pending the determination of Supreme Court proceedings which had related subject matter (echoes of Victorian Legal Services Commissioner v Cahill [2017] VSCA 283).

Twice the Commissioner and the holder of the antecedent statutory office of Legal Services Commissioner had taken advice of counsel, two of them in fact. In response to a Notice to Produce, the Victorian Legal Services Commissioner redacted that part of her and the Legal Services Commissioner’s alleged delegates’ decisions which referred to the advice, and even redacted references to the names of the barristers.

A procedurally embarrassing saga in South Australia has thrown up some interesting decisions, referred to in Keung v Abbott [No 2] [2019] SASCFC 39, in which the Full Court shut down an attempt to prosecute a lawyer by proceedings commenced on 17 April 2015 for conduct which allegedly occurred between 2007 and January 2010. One of them suggests that regulators cannot claim privilege for advice they take and rely on to make administrative decisions such as whether to prosecute. Those decisions include:

Continue reading “Claims to client legal privilege made by regulators”

Legal Services Commissioner v Yakenian [2019] NSWCATOD [98] is about a solicitor of Fairfield in western Sydney, neighbour of Cabramatta and Villawood. He was referred to the NSW Legal Services Commissioner by District Court Judge, her Honour Wass DCJ.

The defendants’ solicitor requested particulars of Mr Yakenian’s builder client’s statement of claim and said the defendants would provide defences within a reasonable time after the particulars were given. They invited the solicitor to advise them if he had any difficulty with this course. He did not do so. There was also talk of a security for costs application.

The same day as the particulars were given, the solicitor snapped on default judgment for more than $750,000, filing a formal affidavit required by NSW’s procedural rules which did not mention the correspondence referred to, and then issued a bankruptcy notice against one of the defendants 3 days later, all while the defendants remained unaware they were judgment debtors and were presumably leisurely scraping together their defences. The day after the bankruptcy notice, the defendants’ solicitors wrote expressing their understanding ‘that the plaintiff would not file for default judgment until the defendants’ solicitors had served the defences, and requesting that the Solicitor let them know if that was not the case.’ He did not do so. The defendant’s solicitors said they anticipated being able to file the defence by 8 August 2016.

Even though he explained that he and counsel both advised his client not to snap on judgment and he only reluctantly followed his client’s informed instructions to do so (the solicitor said he felt pressured to comply with the instructions because the client was a significant part of the solicitor’s then fledgling practice) the Legal Services Commissioner charged him with professional misconduct constituted by snapping on judgment; by misleading the defendants’ solicitors by silence; by misleading the court by silence in his affidavit in support of default judgment; and (most puzzlingly to my mind) by issuing a bankruptcy notice without notice to the defendants.

The decision is the result of a guilty plea in a case where the solicitor represented himself, but the NCAT waved it through without much apparent anxiety about the implications of their findings and whacked him with a fine of $7,500, plus costs.

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Section 272 of the Legal Profession Uniform Law says complaints about lawyers, other than costs disputes, must be about conduct alleged to have occurred within the three years before the date of the complaint. Since today is the 4th anniversary of the commencement of the LPUL, you might think that conduct nearly six years ago could not be complained about unless the Victorian Legal Services Commissioner extended time. But the Commissioner might not agree.

Costs disputes have a shorter limitation period: 60 days after the legal costs became payable (which will not necessarily be from the date of the bill or the due date in the bill: Batrouney v Forster [2015] VSC 230 at [219], [226], [228]; Bannon v Nauru Phosphate Royalties Trust [2017] VSC 214 at [71]).

These days, all complaints are made to the Victorian Legal Services Commissioner under the LPUL, even where the conduct allegedly occurred before the LPUL’s commencement on 1 July 2015: Sch. 4, cl. 27. Then the LPUL applies to the conduct ‘with the necessary modifications’ (whatever that means) and subject to the proviso that ‘disciplinary action’ (whatever that means) taken under the LPUL may not be ‘more onerous’ (whatever that means) than would have been the case under the Legal Profession Act which preceded the LPUL.

This post considers whether the VLSC’s position that conduct which occurred before 1 July 2015, and within the 6 years prior to a complaint made after 1 July 2015, may be complained about as of right, and if not, in what circumstances the Commissioner or a delegate may extend the time. It also considers whether such decisions are reviewable. I’m interested to hear your experiences in this realm, especially how NSW’s Legal Services Commissioner is handling this issue.

Practitioners ought to be vigilant about these issues because if the Commissioner is investigating conduct which allegedly occurred more than three years prior to a post-1 July 2015 complaint, and has not properly exercised the discretion to extend time (e.g. because no extension decision was actually made, or the decision to extend the time limit was purportedly made by an investigations officer who is not a delegate of the Commissioner’s discretion to extend time), then the Commissioner and her delegates may not have power to compel information and documents, such as would justify practitioners divulging client (or other) confidences.

If there is one thing (apart from actually working out what the law is before responding to disciplinary complaints) which I wish solicitors would get right more often in disciplinary investigations, it’s this: before divulging client confidences, check that the person demanding the information is actually a delegate of the Commissioner, and check that the Commissioner is actually exercising power in a properly constituted investigation.

Continue reading “Time limit for new disciplinary complaints against Victorian and NSW lawyers”

There is a dispute playing out in the Supreme Court of Victoria about whether a contract to sell land in Mount Duneed (not the house in my picture) was concluded and enforceable.  The putative vendors say no: there was nought but a proposed sale.  The putative purchasers issued a subpoena for the production of the putative vendors’ solicitors’ file, no doubt to check what the putative vendors were saying to their solicitors at the relevant time, and to see what their solicitors were saying to them, about the putative binding contract.  (I wonder about the relevance of the file, since whether or not there is a binding agreement is to be objectively determined and what the negotiating parties thought about whether there was a contract ought to be irrelevant, but that was not the issue dealt with in the decision discussed below.) 

The solicitors produced their file, noting that the documents within it were privileged.  The putative vendors objected to inspection, asserting that the whole file was privileged.  They made an affidavit in support of the privilege claim.  In Regent 125 Pty Ltd v Brdar [2019] VSC 177, Judicial Registrar Matthews upheld the claim over the whole file.  The putative purchasers failed to convince her that the putative vendors’ affidavit was formulaic and did not descend to the detailed communication by communication justification required by the authorities.

Continue reading “Claims of privilege over the whole of a solicitor’s file”

A property developer who owns most of Melbourne’s theatres, including the Princess, the Regent, the Forum and the Comedy, sought to tax his lawyers’ fees for representing him in two appeals he brought. They had acted for him in litigation over a property development in Queensland, defending a claim that the developer and various of his companies owed the other side three million bucks.

It went on and on: the developer lost, then appealed successfully, lost on the remitter, and appealed unsuccessfully, though the other side only got a fraction of what they were after. (Incidentally, though the other side only got judgment for 10% of what they were after, the Court of Appeal held that Sloss J had not erred in ordering costs against the developer on the basis that costs should follow the event and that no issue-by-issue costs split was justified). It was an expensive exercise for the developer because the lawyers charged him $3M for defending the claim for $3M.

The original retainer was in May 2005, at which time the Legal Practice Act 1996 was in force. Then the Legal Profession Act 2004 came into operation on 12 December 2005. After that, some of the lawyers’ bills said that Mr Marriner could seek taxation under the Legal Profession Act 2004. (I’d say most Victorian lawyers’ bills had this problem after 12 December 2005 in relation to the many engagements which continued to be regulated by the 2004 Act after that date.)

The Costs Court threw out the developer’s summons for taxation for want of jurisdiction. The lawyers had charged throughout on an hourly rate, without demur from their client the developer. The Court found that the Legal Practice Act 1996 regulated his relations with them. And under that Act, there could be no taxation of fees charged under an hourly rates costs agreement: s. 101(2).

Which Act applied depended on (a) what a ‘matter’ was for the purposes of the transitional provisions between the 1996 Act and the 2004 Act, (a question I posted about here, but in relation to the next statute along, the LPUL) and (b) how different phases of the litigation should be characterised for that purpose.

Costs Judge Wood AsJ’s reasons for finding that it was all one matter governed by the 1996 Act (including the appeals which his Honour was clear were separate proceedings) are reported as Marriner v Meerkin & Apel [2019] VSC 36.

Continue reading “A matter where ‘matter’ mattered”

Summary AB v Law Society of NSW [2018] NSWSC 1975 is a decision of Davies J given on 19 December 2018, quashing the Law Society’s decision under the Legal Profession Uniform Law (NSW) to prosecute a former solicitor for falsely attesting a passport application form, having been told, and believing, that the signature was genuinely applied by the signatory, but not in the solicitor’s presence. The decision was quashed because the Law Society failed to disclose to the solicitor, despite demand, during the disciplinary investigation all relevant documents, in breach of the obligation of procedural fairness, and because its reasons for its decision to prosecute were not reasons at all, and so amounted to jurisdictional error. In this latter respect, the decision is an application of the law set out in Levitt v Council of the Law Society of NSW [2017] NSWSC 834 (see this blog post) and the decision dismissing the appeal from that decision, reported at [2018] NSWCA 834.

How the decision came to be anonymised is not referred to in the reasons. Can anyone tell me how that happened?

Continue reading “The disciplinary investigator’s duty of disclosure; more on inadequate reasons following a disciplinary investigation”

Summary The Legal Profession Act 2004 was repealed on 1 July 2015.  But transitional provisions probably give it ongoing life in relation to all disciplinary investigations which commenced prior to that date (see this blog post), even where the resultant disciplinary prosecution post-dates 1 July 2015.  This post suggests that such prosecutions in VCAT (of which there are still many) are now subject to VCAT’s usual costs regime under s. 109 where the presumption is that there will be no order as to costs, and there is no favouratism for the Commissioner. 

That is a great improvement on the previous situation when costs were in practice always awarded to the Commissioner and never awarded against the Commissioner, with the Commissioner often getting full costs despite being unsuccessful in some respects.  The costs of the Commissioner’s employee were allowed on County Court scale D, despite the remuneration under that scale greatly exceeding the wages paid to the employees on top of fees paid to counsel, on whom the Commissioner is extraordinarily reliant.  My impression is that the average costs order in a simple matter which is largely uncontested is  $10,000, but costs orders of $50,000 and up may attend upon contested matters which take several days to try (take VCAT’s most recent disciplinary decision, for example: $87,000 claimed by the Commissioner against a poor old sole practitioner out in the suburbs).

The previous position prevailed because of a provision in the VCAT Act 1998 which has been amended consequent upon the repeal of the Legal Profession Act 2004 so as no longer refer to that Act. 

Mind you I have tried this argument out in VCAT twice already and made no progress with it, though VCAT has provided no reasons as to why it is incorrect.

Continue reading “Costs in disciplinary prosecutions under the Legal Profession Act 2004: excellent news for disciplined solicitors?”

Murder and madness Violence and the courts’ response was prominent as an issue, because it was an election year in Victoria, and so was racism because of the Minister for Making Refugees Disappear and other senior government people.  I liked John Silverster’s end of year article which celebrated the fact that crimes were down 7% and 3,000 extra police were in training.  A miserable law and order scare campaign ill-executed by state and federal Liberals ultimately bombed spectacularly when Dan Andrews stared it down.  For example, the shadow Attorney-General John Pesutto lost the seat of Hawthorn to a retired school principal who does not drive, John Kennedy (not the Hawks legend of the same name, or the Hawks legend’s Hawks playing son of the same name) and the Liberals held Brighton (Brighton!) by only 865 votes against a late-announced 19 year old Labor candidate who also doesn’t drive and who spent $1,750 on his campaign.  The newly elected Liberal member then surprised many by railing in his maiden speech against duck shooting and expounding environmental concerns more generally.

Continue reading “2018: Not Such A Good Year (Marriage, Sex, Birth, Politics, Murder and Madness)”

Europe  The peasants revolted in France, which seemed to take everyone by surprise.  Seems President Macron’s honeymoon period, following his remarkable 2017 election, may be over.  England thought about changing prime ministers but thought better of it, while it agonized over what sort of Brexit it should have, or whether they should vote on the whole thing again.  New Caledonia finally had a referendum about whether to break away from France.  Slightly more than half of those of the eligible voters who voted said ‘Non’, but they get to do it all over again in 2020, and maybe in 2022 too.

Continue reading “2018: Not Such a Good Year (‘Great’ Powers)”

Africa  Peaceful protests in 15 of Sudan’s 18 provinces against the kleptocracy of Omar al Bashir persisted in Sudan for 10 days, definitely about high prices and probably about three decades of corruption.  He responded with police and army killings, beatings, tear gas, mass arrests and death squads, calling the protesters from all sectors of society including doctors ‘foreign stooges and infidels’, and throwing the opposition leader into jail for good measure.  The President is a soldier who took power in a military coup, is indicted for genocide in Darfur by the International Criminal Court (the only serving head of state to have been charged with crimes against humanity), and is said to have US$9 billion in London banks.  It sounds like the plot of a Sacha Baron Cohen movie.  Unfortunately not.

Continue reading “2018: Not Such a Good Year (Africa)”

Sport The third World Nomad Games in the Kyrgyz Republic were a great success. 

Continue reading “2018: Not Such a Good Year (Sport, the Arts)”

It was not a year of celebrity or otherwise notable deaths. The Grim Reaper must have saved them for a year sparse of spectacular executions by Trump buddies, which this year was not.

Aretha Franklin, the Queen of soul and a civil rights activist, and Stephen Hawking, both of whom lived amongst the stars, probably topped the international list of regular passings. Hawking was a great supporter of British Labor, of universal health care, nuclear disarmament, Al Gore’s presidential campaign, and anti-Brexit. He actively championed action against climate change.

Continue reading “2018: Not Such a Good Year (Obituaries)”

Oh what a year for professional misconduct:

Michael Cohen President Pussygrabber’s lawyer and fixer, Michael Cohen, exposed incidentally by the Mueller investigation as an outright crook, was sentenced to three years in America’s particularly unpleasant slammers for (amongst other things) inexplicably paying off women who allegedly falsely claimed to have had extra-marital relations with the President, a violation of campaign finance laws. One of the women, ‘Stormy Daniels’, sued the President for defamation over one of his tweets ‘A sketch years later about a nonexistent man. A total con job, playing the Fake News Media for Fools (but they know it)!’ She said it insinuated that she had lied about the man whom she sketched having threatened her against going public with her allegations. The President had the suit struck out under a law designed to protect against strategic lawsuits against public participation (SLAPP), the judge ruling that the tweet was ‘rhetorical hyperbole’ protected by the first amendment. Ms Daniels is to pay the President’s legal fees (the claim was for 580 hours at up to US$840 per hour) fixed at nearly US$300,000.

Brett Kavanough The misconduct against Judge Brett Kavanough must not have been established to the satisfaction of the senate committee which confirmed President Pussygrabber’s nomination of the arch-conservative whose appointment imperils Roe v Wade. The hearing was excruciating in its hopelessness (highlights here); senators have no idea how to cross-examine.

Continue reading “2018: Not Such a Good Year (Professional Misconduct)”

If you want to read a real journalist’s wrap of The Year, see The Age here, another from The Age here, 7:30’s, the Saturday Paper’s here, or for a cheerier wrap, see The Guardian’s Brigid Delaney here.  And this New York Times wrap of the year in photojournalism is great. I must acknowledge the heavy debt of what follows to Wikipedia, without which extraordinary resource much of which follows could not have been written by me.

Me, myself I had a lovely year, though I must be getting old: a child from my reader’s course became a QC (congratulations Dr Button QC); a kid below me at school is the Dean of Law at the University of Singapore (Professor Simon Chesterman); a youth I used to have morning tea with in Law School, Professor Carolyn Evans, is already an ex-Dean of the Melbourne Law School; her boyish husband who was admittedly quite good at mooting is the Solicitor General of Australia (Stephen Donahue QC); my body got grumpy.

Continue reading “2018: Not Such A Good Year (Me, War, Terror)”