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Administrative Decisions Tribunal of New South Wales |
Last Updated: 30 May 2011
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Legislation Cited:
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Legal Profession Act 1987
Legal Profession Act 2004 Revised Professional Conduct and Practice Rules 1995 |
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Cases Cited:
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Allinson v General Council of Medical Education and
Registration [1894] 1 KB 750
Coe v NSW Bar Association [2000] NSWCA 13 Council of the New South Wales Bar Association v Butland [2009] NSWADT 177 Law Society of New South Wales v Foreman (1994) 34 NSWLR 408 New South Wales Bar Association v Hamman [1999] NSWCA 404 New South Wales Bar Association v. Meakes [2006] NSWCA 340 Wentworth v New South Wales Bar Association [1992] HCA 24; (1992) 176 CLR 239 |
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1
In this matter, the Applicant, the Council of the Law Society of New South Wales
("the Society"), made an Application
against the Respondent, Geoffrey Allan
White ("the Solicitor") alleging that he was a Legal Practitioner within the
meaning of the
Legal Profession Act 2004 ("the 2004 Act") and that while
practising as such he was guilty of professional misconduct and unsatisfactory
professional conduct on multiple
grounds.
2
The Society sought the following orders:
a. That the Solicitor's name be
removed from the Roll.
b. That the Solicitor pay the costs of the
Society.
c. Such further orders as the Tribunal sees
fit.
3
The Application set out the multiple grounds, supported by particulars, for a
finding of professional misconduct against
the Solicitor, namely that:
"A. In
relation to his client Joan Bligh and her great-granddaughter Kehani Metcalfe,
the Respondent:
1. Misappropriated the sum of $45,000.00 being trust
money;
2. Wilfully breached section 61 of the Legal Profession Act 1987;
and
3. Wilfully breached section 62 of the Legal Profession Act
1987.
B. In relation to his client 336-338 Kent Street Pty Ltd
('Kent Street'), the Respondent:
1. Misappropriated the sum of $180,000.00
being trust money;
2. Wilfully breached section 61 of the Legal Profession
Act 1987;
3. Wilfully breached section 62 of the Legal Profession Act 1987;
and
4. Breached Rule 12 of the Revised Professional Conduct and Practice
Rules 1995 by borrowing from the client.
C. In relation to his
client Mark Coleman, the Respondent:
1. Misappropriated the sum of $49,000.00
being trust money;
2. Wilfully breached section 61 of the Legal Profession
Act 1987; and
3. Wilfully breached section 62 of the Legal Profession Act
1987.
D. In relation to his client, the Estate of the late Madge
Kenny, the Respondent:
1. Misappropriated the sum of $20,938.95 being trust
money;
2. Wilfully breached section 61 of the Legal Profession Act 1987;
and
3. Wilfully breached section 62 of the Legal Profession Act
1987.
E. In relation to his client Narval Matthaei, the
Respondent:
1. Misappropriated the sum of $126,666.67 being trust
money;
2. Wilfully breached section 61 of the Legal Profession Act 1987;
and
3. Wilfully breached section 62 of the Legal Profession Act
1987.
F. In relation to his client Elizabeth Street Apartments, the
Respondent:
1. Misappropriated sums of $17,137.16; $34,683.40 and $40,000.00
being trust money;
2. Wilfully breached section 61 of the Legal Profession
Act 1987;
3. Wilfully breached section 62 of the Legal Profession Act
1987;
4. Misappropriated sums of $50,000.00; $54,699.52; $2340.00;
$30,000.00; $30,000.00; $45,000.00 and $45,000.00;
5. Wilfully breached
section 61 of the Legal Profession Act 1987; and
6. Wilfully breached section
62 of the Legal Profession Act 1987.
G. In relation to his clients
generally the Respondent:
1. Misappropriated a sum of $226,256.37 being trust
money;
2. Wilfully breached section 61 of the Legal Profession Act
1987;
3. Wilfully breached section 62 of the Legal Profession Act 1987;
and
4. Caused a deficiency in his trust account.
H. In relation
to his client the Estate of the Late William Robert Smith, the Respondent:
1.
Misappropriated the sum of $126,667.67 being trust money;
2. Wilfully
breached section 61 of the Legal Profession Act 1987;
3. Wilfully breached
section 62 of the Legal Profession Act 1987;
4. Misappropriated the sum of
$53,666.63 being trust money;
5. Misappropriated the sum of $203,507.97 being
trust money;
6. Wilfully breached section 61 of the Legal Profession Act
1987;
7. Wilfully breached section 62 of the Legal Profession Act
1987;
8. Misappropriated the sum of $276,795.51 being trust money;
9.
Wilfully breached section 61 of the Legal Profession Act 1987; and
10.
Wilfully breached section 62 of the Legal Profession Act 1987.
I.
In relation to his client Jeremy Miller, the Respondent:
1. Misappropriated a
sum of $350,000.00 being trust money; and
2. Wilfully breached section 61 of
the Legal Profession Act 1987.
J. In relation to his client Mark
Coleman, the Respondent:
1. Caused a deficiency in his trust
account.
K. In relation to his client Michael Kenny, the
Respondent:
1. Misappropriated a sum of $30,000.00 being trust money;
and
2. Wilfully breached section 61 of the Legal Profession Act
1987.
L. In relation to his client Gabriss Pty Limited, the
Respondent:
1. Misappropriated the sum of $42,000.00, being trust
money;
2. Wilfully breached section 61 of the Legal Profession Act
1987;
3. Wilfully breached section 62 of the Legal Profession Act 1987;
and
4. Caused a deficiency in his trust account.
M. In relation
to his client Kenneth Harris, the Respondent:
1. Wilfully breached section 62
of the Legal Profession Act 1987.
N. In relation to his client
Pegasus Ventures Pty Limited, the Respondent:
1. Wilfully breached section
61 of the Legal Profession Act 1987; and
2. Wilfully breached section 62 of
the Legal Profession Act 1987.
O. In relation to his client Peter
Bowen-Jones, the Respondent:
1. Breached Rule 12 of the Revised Professional
Conduct and Practice Rules 1995 by borrowing from the client; and
2. Failed
to account to the client.
P. In relation to his client Robert
Doyon, the Respondent:
1. Failed to account to the client.
Q.
In relation to his client James Webb, the Respondent:
1. Wilfully breached
section 61 of the Legal Profession Act
1987."
4
On 26 November 2010, after hearing submissions on behalf of the Society, the
Tribunal delivered an Ex Tempore Decision
in the following terms:
"This
matter was commenced by an Application for Original Decision that was filed on
16 June 2010.
The Application is particularised in detail
commencing with Particular A and continuing up to and including particular Q,
comprising
99 paragraphs in all, alleging that the Respondent, Geoffrey Allan
White, is guilty of professional misconduct based on those
particulars.
There have been two (2) Replies filed by the
Respondent to date, but he has not filed any affidavit evidence in support of
either
Reply.
The Law Society relies on Affidavit evidence from
Raymond John Collins, none of which has been objected to for obvious reasons,
there
being no appearance by the Respondent. Those Affidavits have been admitted
into evidence without dispute.
In the Amended Reply to an
Application filed 26 August 2010, the Respondent states:
"For the
purpose of these proceedings only the Respondent does not contest grounds A to Q
set out in the Application."
That being the case it is not
necessary for the Tribunal to hear any evidence establishing the grounds of the
complaints and based
on that Admission and there being no contest on the
evidence, the Tribunal is comfortably satisfied that particulars A to Q of the
Application have been established.
As a consequence the Tribunal
finds that the Respondent is guilty of professional misconduct evidenced by
particulars A to Q of the
Application.
There is of course no
explanation offered for the Respondent's conduct and in the absence of any
explanation we find that we are comfortably
satisfied that the Applicant is
permanently unfit to practice as an Australian Legal Practitioner. Accordingly
we order that the
name of Geoffrey Allan White be removed from the Roll of Legal
Practitioners.
The only contest to the application raised in the
Amended Reply appears to be that the Respondent does not feel he should have to
pay the Applicant's costs of these proceedings. He has set out alleged
''Extraordinary Circumstances" in paragraph 4 of his Amended
Reply.
It is the Tribunal’s view that the
Respondent's argument in relation to the issue of costs is misconceived and
is
based on a mistaken belief that the Tribunal does not need to be satisfied that
the grounds of an Application have been established
and that he is permanently
unfit to practice before making an order that his name be removed from the
Roll.
In our view there are no extraordinary circumstances to
countermand the making of the usual costs order in proceedings such as these.
Accordingly the Tribunal orders that Geoffrey Allan White pay the Law Society's
costs as agreed or assessed.
"
5
As the Tribunal determined that a protective order was appropriate, it has
decided to publish more detailed reasons
for its Ex Tempore Decision, as
follows.
6
Section 61 of the Legal Profession Act 1987 ("the 1987 Act")
provides:
"(1) A solicitor who, in the course of practising as a solicitor in
this State, receives money on behalf of another person:
(a) must
pay the money, within the time prescribed by the regulations, into a general
trust account in New South Wales at an approved
financial institution and must
hold the money in accordance with the regulations relating to trust money,
or
(b) if the person on whose behalf the money is received directs
that it be paid or delivered to a third party free of the solicitor's
control,
must ensure that the money is paid or delivered:
(i) before the end of the
next working day or, if that is not practicable, as soon as practicable after
the next working day, or
(ii) no later than the day allowed by the
solicitor's authority or instructions (if that day is later than the day allowed
under subparagraph
(i), or
(c) if the person on whose behalf the
money is received directs that it be paid otherwise than into a general trust
account or to
a third party, must pay the money as directed and (if the money is
to be held under the direct or indirect control of the solicitor)
must hold the
money in accordance with the regulations relating to controlled
money.
(2) In any of those three cases, the solicitor must hold the
money exclusively for, and must disburse the money in accordance with
the
directions of, the person on whose behalf it is
held."
7
Section 62 of the 1987 Act provides:
"(1) A solicitor shall
keep:
(a) in the case of trust money (within the meaning of section
61) accounting records, or
(b) in the case of money other than
trust money such accounting records or other records (if any) as may be required
by the regulations,
that disclose at all times the true position in relation to
money received by the solicitor on behalf of another person.
(2)
The accounting records referred to in subsection (I) shall be kept in a manner
that enables them to be conveniently and properly
audited.
(3)
Without limiting the generality of subsection (2), the accounting records
referred to in subsection (I) shall, if the regulations
so require, be kept in
such manner as the regulations prescribe.
(4) A willful
contravention of subsection (1), (2) or (3) is professional
misconduct."
8
Rule 12 of the Revised Professional Conduct and Practice Rules 1995 ("The
Solicitors’ Rules") provides:
"12.1 A practitioner must
not borrow any money, nor assist an associate to borrow any money from a person
—
12.1.1 who is currently a client of the
practitioner, or the practitioner's firm;
12.1.2 for whom the
practitioner or practitioner's firm has provided legal services, and who has
indicated continuing reliance upon
the advice of the practitioner, or
practitioner's firm in relation to the investment of money;
or
12.1.3 who has sought from the practitioner, or the
practitioner's firm, advice in respect of the investment of any money, or the
management of the person's financial affairs.
12.2 This Clause does
not prevent a practitioner, or an associate of a practitioner borrowing from a
client, which is a corporation
or institution described in the Schedule to this
Rule, or which may be declared by the Council of the Law Society to be exempt
from
this Rule.
12.3 A practitioner must not maintain a private
finance company and invite, directly or indirectly, the deposit of money with
the
company on the basis of a representation that -
12.3.1
the
money is repayable at call, or on short notice, if that is not assured when the
money is deposited; or
12.3.2
that
the deposit of the money is, or will be, secured, unless the money is
specifically secured by an instrument
identifying the lender, the amount
deposited, and the security.
12.4 A practitioner must not borrow
any money, or permit or assist an associate to borrow any money, from a private
finance company
which is operated or controlled by the practitioner or the
associate of the practitioner.
12.5 A practitioner must not cause
or permit a private finance company to pay to any depositors of money to the
company a rate of
interest on their deposits which is less than the rate charged
by the company to
borrowers.
The
Schedule
1. A banker duly authorised to carry on banking business.
2. An
insurance company duly authorised to carry on insurance
business.
3. A company registered under the Life Insurance Act 1945
of the Commonwealth.
4. A building society registered under the
Co-operation Act 1923 or listed in the Second Schedule to that
Act.
5. A building society governed by the Financial Institutions
Code 1992.
6. A credit union governed by the Financial Institutions
Code 1992.
7. A trustee company mentioned in the First Part of the
Third Schedule to the Trustee Companies Act 1964.
8. The Public
Trustee.
9. A non-bank financial institution which is governed by
the Financial Corporations Act 1974 of the Commonwealth or the Financial
Institutions Code 1992.
10. A company the securities in which are
listed on a member exchange of the Australian Associated Stock Exchanges or a
foreign company
the securities of which are quoted for trading on a stock
exchange or in a market for the public trading in securities.
11. A
government, governmental body, agency, department, authority or instrumentality,
whether foreign, federal, state or local.
12. A company having the
majority of its issued share capital to which voting rights attach owned by any
government, governmental
body, agency, authority or instrumentality, whether
foreign, federal, state or local.
13. A company related to any of
the companies referred to above or a company in which any entity of a type
described above has a substantial
shareholding as defined in Section 708(i) of
the Corporations Law.
14. A member of the immediate family of the
practitioner or a corporation, partnership, syndicate, joint venture or trust in
which,
or in the shares in which, the whole of the beneficial interest is
presently vested in one or more members of the immediate
family."
9
Section 496 of the 2004 Act provides:
"For the purposes of this
Act:
"unsatisfactory professional conduct" includes conduct of an
Australian legal practitioner occurring in connection with the practice
of law
that falls short of the standard of competence and diligence that a member of
the public is entitled to expect of a reasonably
competent Australian legal
practitioner".
10
Section 497 of the 2004 Act provides:
"(1) For the purposes of this Act:
"professional misconduct" includes:
(a) unsatisfactory professional
conduct of an Australian legal practitioner, where the conduct involves a
substantial or consistent
failure to reach or maintain a reasonable standard of
competence and diligence, and
(b) conduct of an Australian legal
practitioner whether occurring in connection with the practice of law or
occurring otherwise than
in connection with the practice of law that would, if
established, justify a finding that the practitioner is not a fit and proper
person to engage in legal practice.
(2) For finding that an
Australian legal practitioner is not a fit and proper person to engage in legal
practice as mentioned in subsection
(1), regard may be had to the matters that
would be considered under section 25 or 42 if the practitioner were an applicant
for admission
to the legal profession under this Act or for the grant or renewal
of a local practising certificate and any other relevant
matters."
11
The Solicitor's date of birth is not in evidence. However, he was admitted as a
Solicitor in New South Wales on 11 May
1979. At all material times the
Respondent was the sole principal of the firm known as 'White and Downey' which
had its office in
Balmain. He operated a Trust Account and an Office Account.
Relevantly he also operated a bank account with the St George Bank ('the
Undisclosed Account') held in the name of his
wife.
12 On 21
July 2003 the Society refused to issue a Practising Certificate to the Solicitor
for the year ending 30 June 2004
owing to his failure to lodge an Accountant's
Report and it resolved to appoint a Manager to his practice. On 1 August 2003
the Supreme
Court of New South Wales appointed a Receiver of the Solicitor's
trust property and on 21 August 2003 the Society terminated the
Manager's
appointment.
13
The Application was particularised in detail. However, in his Amended Reply, the
Solicitor stated (at paragraph 3):
"For the purposes of these proceedings
only, the Respondent does not contest the grounds A-Q set out in the
Application".
For this reason, the Tribunal does not intend to cite
the Particulars of the Application in these
Reasons.
14 The
Solicitor did not appear at the Hearing of the matter. Rather, he sent a letter
to the Tribunal in the following
terms:
"I refer to your letter of 20 October
2010 and advise that I have no objection to the constitution of the Tribunal as
therein advised.
Without intending any disrespect to the Tribunal,
I will not be able to attend at the hearing of this matter on 26 November 2010
due
to work commitments."
The
Evidence
15
The Society relied upon Affidavits sworn by Raymond John Collins sworn 15 June
2010 and 1 November 2010, respectively,
each of which was tendered with Exhibit
Notes attached. This evidence was admitted into evidence on behalf of the
Society.
16 The
Solicitor did not file any Affidavit evidence and his Amended Reply indicated
that he did not oppose the Tribunal
making a protective order, but that he
opposed the Tribunal making a costs order against him, for the following reasons
(see paragraph
4):
"The Respondent relies upon the following material facts
and circumstances:-
(a) The Respondent opposes Order 2 sought in
the application on the grounds that, pursuant to Section 566 of the Legal
Profession Act 2004 (NSW) ("the Act"), exceptional circumstances
exist.
(b) The Respondent submits that exceptional circumstances
exist pursuant to the Act for the following reasons:-
(i) The
Respondent's stated position since the Applicant first foreshadowed these
proceedings in March 2008 has been that he had no
objection to his name being
removed from the Roll of Legal Practitioners;
(ii) Since March 2008
the Respondent's position has always been that he did not wish to contest the
alleged facts forming the basis
of the Applicant's application. The Respondent's
position was adopted in order to minimise costs and simplify any application
which
may be brought;
(iii) Notwithstanding those concessions, the
Applicant has continued to amass costs in what should have been a simple
application
involving minimal preparation just to enliven the Tribunal's
jurisdiction;
(iv) The Respondent became bankrupt on 24 April 2006
and was discharged from bankruptcy on 23 May 2009;
(v) The
Respondent has worked as a subcontractor delivering telephone directories since
December 2003 to 18 June 2010 and has, since
this date, been seeking an
alternative occupation as a bus operator with State Transit Authority. As at the
date of this reply, the
Respondent is unemployed and has minimal
savings.
(c) Annexed hereto are copies of relevant correspondence
between the Respondent and the Applicant.
(d) In the circumstances,
the Respondent submits that there should be no order as to costs. Alternatively,
if any such order is made,
the costs order should reflect the fact that the
Respondent has never sought to contest the order that he be removed from the
Roll
of Legal Practitioners. Accordingly, the Applicant's costs should be
limited to one or two days only."
Findings and Considerations
Relevant to
Penalty
17
The Tribunal is satisfied that the evidence in this matter clearly supported and
established the particulars in the Application,
which the Solicitor admitted to,
although he purported to do so "for the purposes of these proceedings only".
Accordingly, we are
satisfied that all of the Complaints particularised in the
Application have been made
out.
18 The
Tribunal is also satisfied that the Solicitor was given ample opportunity to
place any evidence that he wished to
rely upon before it and indeed he was
legally represented during the Society's investigation of the multiple
complaints.
19 In
New South Wales Bar Association v. Meakes [2006] NSWCA 340
("Meakes"), Tobias JA said:
"Yet these were the very matters which
were wholly within the knowledge of the respondent and which he was [sic] did
not offer to
answer in the witness box. On the contrary, he chose the safety of
the well of the Tribunal. Notwithstanding the advice of his then
senior counsel,
the respondent's refusal to enter the witness box and provide evidence with
respect to the matters referred to should
have been the subject of harsh
criticism by the Tribunal. Moreover, if that evidence had otherwise been
relevant to the issue, his
refusal to provide it would have significantly
detracted from the weight to be attached to the tendered character references.
In
these circumstances, the only inference one can draw from the respondent's
refusal to give sworn testimony in this matter was that
his evidence would not
have assisted his case in resisting a finding of professional
misconduct.
The Tribunal should not have been required to speculate
as to the basis upon which the respondent charged the fees he did. As an
experienced
barrister with an unblemished record, one would have expected him,
as Meagher JA expressed it in Coe, to have mounted the witness box and
explained the mysteries surrounding charges which had been found to be grossly
excessive. In
my opinion the failure of the respondent to give sworn evidence
was
inexcusable."
20
Further, in Coe v NSW Bar Association [2000] NSWCA 13 ("Coe"),
Meagher JA (at [21]), with the agreement of Priestley JA, repeated with approval
the following observations made by the Tribunal
in that case and which are
apposite to the present case:
"In the circumstances where a prima facie
[case] against a legal practitioner has been presented and where the
practitioner wishes
the Tribunal to accept an explanation as to how the conduct
came about it is inappropriate and irregular for the legal practitioner
to
attempt to do so through submission from the Bar table. If he wishes the
Tribunal to accept some explanation as to how the conduct
came to take place
then in our view he has an obligation to meet the situation by explanation on
oath."
21 In the
absence of Affidavit evidence from the Solicitor in these proceedings, the only
means of informing the Tribunal
of his intentions at the time that the conduct
(the subject matter of the grounds in the Application) occurred was by way of
sworn
oral evidence from the Solicitor. However, unlike the scenario in
Meakes and Coe, the Solicitor chose not to attend the hearing. The
Tribunal concurs with the views expressed by Tobias JA in Meakes in this
regard.
22 The
conduct that is the subject of these proceedings occurred between approximately
1995 and 2003, during which the 1987 Act was in force. However, as the current
Application was filed after the commencement of the 2004 Act, the Savings and
Transitional provisions of the 2004 Act
apply.
23 Clause
17 of Schedule 9 of the 2004 Act provides that these proceedings are to be dealt
with under the 2004 Act, save that the Tribunal may not make any determination
or order of the disciplinary nature against the Solicitor that would be more
onerous than could have been made under the 1987 Act. This does not concern the
Tribunal as it was empowered to make the orders sought in the Application under
both the 1987 and 2004
Acts.
24 Mr
Barnes submitted that the evidence, which includes two (2) reports from Mr
Watson as Receiver of the Solicitor's trust
property, indicates that Mr Watson
found it necessary to have the Solicitor, the Solicitor's wife and the
Solicitor's daughter formally
examined in the Supreme Court. In the Tribunal's
view, this augers against a finding that the Solicitor co-operated with the
Receiver
during his investigation of his financial
affairs.
25 Mr
Barnes also submitted that the evidence indicates that the Solicitor engaged in
a deliberate and persistent course
of conduct between 1995 and 2003 which
involved the misappropriation of significant amounts of trust monies he then
applied for his
own benefit and that of his immediate family. Further, in an
effort to make good earlier misappropriations, he engaged in conduct
that could
be described as "robbing Peter to pay Paul", in which transactions were nearly
always misdescribed on the relevant Trust
ledgers. The benefit derived by the
Solicitor and his family included the acquisition of real property and even the
payment of the
Solicitor's taxation
liabilities.
26
The Tribunal is comfortably satisfied that all grounds of complaint
particularised in the Application have been made
out and that the Solicitor is
guilty of Professional Misconduct as follows:
a Multiple counts of
misappropriation of trust monies (totalling $2,079,358.85);
b Sixteen
(16) counts of Wilfully breaching Section 61 of the Legal Profession Act
1987;
c Fourteen (14) counts of Wilfully breaching Section 62 of the
Legal Profession Act 1987;
d Two (2) counts of breaching Rule 12 of the
Revised Professional Conduct and Practice Rules 1995 by borrowing from his
client;
e Three (3) counts of causing a deficiency in his trust
account; and
f Two (2) counts of failing to account to his
client.
27 The
Tribunal is further satisfied that the Solicitor's conduct satisfies the test in
Allinson v General Council of Medical Education and Registration [1894] 1
KB 750, namely:
"If it is shewn that a medical man, in the pursuit of his
profession, has done something with regard to it which would be reasonably
regarded as disgraceful or dishonourable by his professional brethren of good
repute and competency, then it is open to the General
Medical Council to say
that he has been guilty of 'infamous conduct' in a professional
respect."
28 The
role of the Tribunal in making orders under s 562 of the 2004 Act is primarily
to protect the public (see: Wentworth v New South Wales Bar Association
[1992] HCA 24; (1992) 176 CLR 239 at 250-1). However, its orders can also be used to mark the
community's disapproval of lapses from the high standard legitimately
expected
of legal practitioners and they also act as a general deterrent to other
practitioners and therefore assist in maintaining
proper standards within the
legal profession (see: Law Society of New South Wales v Foreman (1994) 34
NSWLR 408 at 441 and New South Wales Bar Association v Hamman [1999]
NSWCA 404 at
[21]).
29 In view
of the seriousness of the Solicitor's conduct, the Tribunal determined to remove
his name from the Roll of Legal
Practitioners pursuant to s 562(2)(a) of the
2004 Act, on the basis that he is clearly not a fit and proper person to be held
out as a Legal Practitioner to the public (see: Foreman at 444 and see
generally at 440 -
446).
30 In
relation to the issue of costs of the Application and more particularly the
Solicitor's "contest" to the making of
an order for costs against him, the
Tribunal notes that while the Amended Reply indicates that the Solicitor adopted
his "position"
of not wishing to contest the facts alleged in the Application
"in order to minimise costs and simplify any Application which may
be brought",
he did not sign a Statement of Agreed Facts and/or Instrument of Consent,
although a proposed Statement and Instrument
were prepared by the Society and
served upon him and are in
evidence.
31 It
is also apparent that the Solicitor believed that all that was required for the
Society to secure the making of a
protective order was for it to file an
Application "just to enliven the Tribunal's jurisdiction". However, his belief
is not soundly
based.
32 The
Tribunal's role in this regard was considered by the Tribunal in Council of
the New South Wales Bar Association v Butland [2009] NSWADT 177, although in
that matter the parties tendered a signed Instrument of Consent and invited the
Tribunal to make orders by Consent under
s 564(1) and s 154(1) of the 2004 Act.
The Tribunal held:
“29 Section 564(1) and (10) of the
Legal Profession Act make it plain that the Tribunal has a discretion whether or
not to make orders consented to in an instrument of consent under that
section.
The Tribunal does not act, nor should it be seen, as merely a "rubber stamp " -
see the comments of the Federal Court in
a similar context in Australian
Communications and Media Authority v WE.NET.AU Pty Ltd [2008] FCA 1530 at
[8J. Nonetheless, the consents of the parties and the Legal Services
Commissioner are matters that deserve significant weight.
30. These
circumstances are similar to, and some guidance can be derived from, cases where
Courts exercising regulatory or disciplinary
powers are presented with joint
submissions by the parties (often including the relevant regulator) as to the
appropriate civil penalties
and consent orders which they request the Court to
make. These often occur in matters under the civil penalty regimes such as those
established by the Trade Practices Act 1974 (Cth) or the Corporations Act 2001
(Cth) and involving, respectively, the Australian Competition and Consumer
Commission or the Australian Securities and Investments
Commission.
31. Barrett J set out the Supreme Court's approach to
consent orders in regulatory matters (including orders in relation to
disqualification
from management) under the Corporations Act and related
legislation in Australian Securities and Investments Commission v Elm
Financial Services Pty Ltd [2005] NSWSC 1020; (2005) 55 ACSR 411; [2005] NSWSC1020, as
follows:-
"9 The parties have, in each case, agreed the duration of
the disqualification. That, however, does not absolve the court of its duty
to
consider the appropriateness of the penalty in the light of the agreed facts and
the surrounding circumstances. This is made clear
by the decisions of the Full
Federal Court in NW Frozen Foods Pty Ltd v Australian Competition and Consumer
Commission [1996] FCA 1134; [1996] FCA 1134; (1996) 71 FCR 285 and, more recently, Minister for
Industry Tourism and Resources v Mobil Oil Australia Pty Ltd [2004] FCAFC 72;
[2004] ATPR 41-993 (and see, in the present statutory context, Australian
Securities and Investments Commission v Vizard (2005) 54 ACSR 395). In the Mobil
Oil case (at [51]) the following propositions were seen as emerging from the
reasoning in NW Frozen Foods:
"(i) It is the responsibility of the
Court to determine the appropriate penalty to be imposed under s 76 of the TP
Act in respect of a contravention of the TP Act.
(ii) Determining
the quantum of a penalty is not an exact science. Within a permissible range,
the courts have acknowledged that a
particular figure cannot necessarily be said
to be more appropriate than another.
(iii) There is a public
interest in promoting settlement of litigation, particularly where it is likely
to be lengthy. Accordingly,
when the regulator and contravenor have reached
agreement, they may present to the Court a statement of facts and opinions as to
the effect of those facts, together with joint submissions as to the appropriate
penalty to be imposed.
(iv) The view of the regulator, as a
specialist body, is a relevant, but not determinative consideration on the
question of penalty.
In particular, the views of the regulator on matters within
its expertise (such as the ACCC's views as to the deterrent effect of
a proposed
penalty in a given market) will usually be given greater weight than its views
on more i(subjective " matters.
(v) In determining whether the
proposed penalty is appropriate, the Court examines all the circumstances of the
case. Where the parties
have put forward an agreed statement of facts, the Court
may act on that statement if it is appropriate to do so.
(vi) Where
the parties have jointly proposed a penalty, it will not be useful to
investigate whether the Court would have arrived
at that precise figure in the
absence of agreement. The question is whether that figure is, in the Court's
view, appropriate in the
circumstances of the case. In answering that question,
the Court will not reject the agreed figure simply because it would have been
disposed to select some other figure. It will be appropriate if within the
permissible range."
10 There has been some criticism of this
approach as involving "platitudes": see per Weinberg J in Australian Prudential
Regulation
Authority v Derstepanian [2005] FCA 1121. And in Vizard (above), the
court imposed a higher penalty than that agreed by the partiers and sought by
the regulator.
11 It is clear that the court is in no way
constrained by the parties' agreement and that, having made the declaration of
contravention,
it must exercise its discretion as to penalty. In the present
case, the factual background does not, to my mind, indicate that the
respective
periods of disqualification proposed by the parties are
inadequate.
32. This approach was subsequently adopted by Brereton
J in Australian Securities and Investments Commission v Maxwell [2006] NSWSC 1052; (2006) 59 ACSR
373, [2006] NSWSC1052.
33. If the necessary adjustments to these
principles are made to take into account, the express statutory regime under
s.564 of the
Legal Profession Act and the particular nature of the disciplinary
powers being exercised by the Tribunal, we believe they provide useful guidance
as
to the exercise of the Tribunal's discretion in cases such as the
present."
33
For these reasons, the Tribunal finds that the Society's actions in filing and
prosecuting the Application, which necessarily
involved costs associated with
preparation of the Application for hearing, are justified. We find that there
are not exceptional
circumstances that support the
Solicitor’s Application and we order that he pay the
Society's costs of the Application,
as agreed or assessed.
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