Adams v Law Society of Tasmania - [2003] TASSC 31

[2003] TASSC 31

CITATION: Adams v Law Society of Tasmania [2003] TASSC 31

PARTIES:  ADAMS, Colin Bertram
  v
  LAW SOCIETY OF TASMANIA

TITLE OF COURT:  SUPREME COURT OF TASMANIA (FULL COURT)
JURISDICTION:  APPELLATE
FILE NO/S:  FCA 28/2002
DELIVERED ON:  27 May 2003
DELIVERED AT:  Hobart
HEARING DATE/S:  7 and 8 November 2002
JUDGMENT OF:  Cox CJ, Crawford and Slicer JJ

CATCHWORDS:

Professions and Trades - Lawyers - Misconduct, unfitness and discipline - Disciplinary proceedings - Inherent jurisdiction of court - Tasmania - Application for permanent stay of proceedings in the Court on basis of abuse of process.

Walton v Gardiner (1993) 177 CLR 378; Jago v District Court of New South Wales (1989) 168 CLR 23, applied.

Aust Dig Professions and Trades [127]

REPRESENTATION:

Counsel:
             Appellant:  P W Tree
             Respondent:  D F M Zeeman
Solicitors:
             Appellant:  Page Seager
             Respondent:  Butler McIntyre & Butler

Judgment ID Number: [2003] TASSC 31
Number of paragraphs: 123

Serial No 31/2003
File No FCA 28/2002

COLIN BERTRAM ADAMS v LAW SOCIETY OF TASMANIA

REASONS FOR JUDGMENT  FULL COURT
  COX CJ (DISSENTING)
  CRAWFORD J
  SLICER J
  27 May 2003

Orders of the Court:

Appeal allowed.

Order of 26 March 2002 dismissing the interlocutory application, filed on 8 October 2001, set aside.

Further proceedings on the originating application filed herein on 7 September 2001 are permanently stayed.

Serial No 31/2003
File No FCA 28/2002

COLIN BERTRAM ADAMS v LAW SOCIETY OF TASMANIA

REASONS FOR JUDGMENT FULL COURT

COX CJ
27 May 2003

This is an appeal from the refusal of an interlocutory application for a permanent stay of proceedings brought under the Law Society Act 1962 by the Law Society of Tasmania ("the Society") against a practitioner seeking such disciplinary orders as the Court thinks appropriate on the grounds of alleged professional misconduct some 16 years ago.

The proceedings were commenced in September 2001 and the particulars of misconduct alleged were first:

"That whilst a practitioner of the firm Page Seager ('the firm') during 1986 and 1987 the Respondent acted on behalf of one Michael Spaulding ('Spaulding') in relation to the purchase and sale of an interest in property at 'Gunners Quoin' at Old Beach in Tasmania in which the Respondent had an interest and without advising Spaulding to obtain independent legal advice in relation to that purchase and sale and in relation to which Spaulding suffered loss."

And second:
"… that whilst a practitioner of the firm during 1985 and 1986 the Respondent acted on behalf of Spaulding in relation to the purchase of a quarry at Old Beach in Tasmania in which the Respondent had an interest and without advising Spaulding to obtain independent legal advice in relation to that purchase and in relation to which Spaulding suffered loss."

With the originating application was filed an affidavit by a former client of the practitioner, Mr Michael Spaulding, the substance of which is set out in the reasons for judgment of Slicer J, which I have had the advantage of reading in draft form and which set out much of the factual background before the learned primary judge. I will not rehearse it in detail. The Society also filed an affidavit from its Executive Director, Mrs Janine Martin, sworn on 10 September 2001 in support of its application. That affidavit was confined to the subject matter of the Society's allegations of misconduct, to the Society's investigations of those allegations and to its correspondence with Mr Spaulding and the practitioner thereon. It did not traverse other matters of complaint made by Mr Spaulding.

On 8 October 2001, the interlocutory application for a stay of the proceedings was filed. On 20 November 2001, the practitioner swore a lengthy affidavit in which he detailed his dealings with Mr Spaulding, traversing the matters the subject of the original application and introducing in considerable detail Mr Spaulding's other complaints and material relevant to them. He also claimed being prejudiced by the destruction of a number of files relevant to his dealings with Mr Spaulding. In a subsequent affidavit sworn in March 2002, he dealt in more detail with the difficulties he had encountered in relation to his files. In the course of identifying relevant files and when they had been in his or the Society's possession, he made reference to a letter and report from Mr A G Melick, who had been engaged by the Society in 1993 to investigate Mr Spaulding's complaints. Not only did the practitioner make reference to these documents, but he annexed them and other documents in turn annexed to the report. It was in this way that a vast amount of material referred to in the reasons for judgment of Slicer J and which was relevant not to the Society's allegations of misconduct, but to a variety of other dealings between Mr Spaulding and the practitioner, came to be before the learned primary judge. I mention this by way of background because the crucial issue in respect of one of the appellant's grounds of appeal is the alleged prejudice to him by reason of the destruction of material relevant to the Society's allegations, which destruction was induced, it is alleged, by the latter's conduct in advising that its files on the Spaulding complaints had been closed.

The first ground of appeal is as follows:

"1The learned primary Judge erred in law in holding that no question of dismissal of the lot 7 matter of complaint arose on 28 January 1997 in that, by virtue of s58(3) of the Legal Profession Act 1993, upon the Council of the respondent concluding that the matter did not warrant prosecution on the grounds that there was no substantial basis for the accusations, it was compelled to dismiss the complaint, (and hence the lot 7 matter of complaint)."

This ground relates only to what is referred to as "the lot 7 matter". Mr Spaulding's complaint about this had been made to the Society in October 1992 and Mr Melick was asked to investigate it and the other complaints in early 1993. He reported to the Society under cover of a letter dated 20 December 1993. Following receipt of this letter and report, the Society wrote to the appellant on 27 January 1994:
"… the Society's Investigating Committee has now concluded its investigations and has decided that no action is to be taken against you in relation to the allegations by Mr Spaulding.
Accordingly, the Society has now closed its file in relation to this complaint."

Further complaints to the Society were made by Mr Spaulding in December 1996. On 31 January 1997, he was advised by the then Executive Director of the Society that his letter did not raise any fresh allegations or complaints other than those dealt with in Mr Melick's report. There was therefore no new complaint for the Committee to consider. He was advised:

"The Investigating Committee has concurred with the above. As previously advised, the Investigating Committee, after considering Mr Melick's Report, had concluded that the available information did not warrant the Society commencing any proceedings against Mr Adams for professional misconduct or unprofessional conduct.
As the Society has also previously advised you, the fact that the Society has decided not to institute proceedings against Mr Adams does not prevent you from bringing such proceedings. Both the previous legislation and the present legislation enables any person to make an application to the Disciplinary Committee establish under the previous legislation or to the Disciplinary Tribunal established under the new legislation."

The last paragraph of Mr Melick's report had included the sentence:
"In conclusion it would have to be said that there is no substantial basis for any of the accusations made by Mr Spaulding against Mr Adams although with the benefit of hindsight Mr Adams would [sic] not have become as closely involved with Mr Spaulding or his affairs as he did."

The Legal Profession Act 1993 ("the Act") came into force on 31 December 1994. Prior to that time the Society had no power to dismiss the lot 7 matter and did not do so. It decided not to take disciplinary action against the appellant. The Minutes of the relevant meeting record:

"Having considered Mr Melick's report it was decided that no disciplinary action should be taken against Mr Adams. Mr Spaulding is to be advised that the Society's legal adviser has conducted a detailed and wide-ranging investigation at a great deal of expense to the Society. The Society has accepted the recommendations of its legal adviser.
However, the Society will not release a copy of the legal adviser's confidential report. Mr Spaulding is to be advised that the Society does not believe there is any real prospect of any prosecution against Mr Adams being successful but that he (Mr Spaulding) is at liberty to instigate his own proceedings. Mr Adams is also to be advised of the Committee's decision."

By the Act, s58(3) it is provided that:

"(3) If, in the course of an investigation, the Council considers a complaint to be frivolous, vexatious or lacking in substance, it must dismiss the complaint."

The appellant acknowledges that this section was not in force in January 1994 when the Council's decision was made, but claims that in 1997, when it considered the complaint again, it adhered to its earlier decision to accept the recommendations of Mr Melick. Those recommendations, it was submitted, concluded that there was "no substantial basis for any of the accusations". It follows, so the argument runs, that if they had no substantial basis, they must have been "lacking in substance" within the meaning of the Act, s58(3), and the Council ought to have dismissed the complaint about the lot 7 matter. It is said that that complaint should now be treated as dismissed.

I cannot accept this argument. The Council did not purport to dismiss the complaint, nor did it form the opinion that the complaint was lacking in substance. Mr Melick's letter of 20 December 1993 did not contain any specific recommendations. He noted a number of difficulties he had experienced in conducting the investigation and expressed several opinions, including one concerning Mr Spaulding's apparent lack of credibility. The letter included this comment:

"I could have spent another year chasing up 'leads' given to me by Mr Spaulding and no matter how much time was put on this time I doubt that he will ever be happy. I have finally decided the time has come to proffer a report and if the Council requires further investigatory work I will undertake same."

The report itself does not contain any specific recommendation that the appellant ought or ought not be prosecuted, although the burden of it is that the evidence of wrongdoing was not strong and that:
"It would be dangerous to rely upon any of Mr Spaulding's allegations which are not independently corroborated especially in view of the fact that he continued to consult Mr Adams as his solicitor long after many of the matters of complaint arose and that he has been proved to be wrong on matters he was particularly adamant about including the handwriting in the diary."

The Society appears to have treated the letter and report as one recommending that no action be taken (see the Minute quoted above) but it does not follow that in adopting that "recommendation" the Society accepted every opinion expressed by Mr Melick in making it. In January 1997, the Society considered the matter again and resolved as follows:
"ED to tell Spaulding no new matter. Reiterate Investigating Committee accepted G Melick's opinion that on available material the matter did not warrant prosecution. Tell him he can bring his own prosecution."

This resulted in the letter of 31 January 1997 quoted above. Once again there was an acceptance only of the opinion that on the available material the matter did not warrant prosecution. In my view there is no substance in ground 1.

Ground 2 is as follows:

"2The learned primary Judge erred in fact in concluding that there was no evidence that in reliance on any promise made or assumption induced by the Society that the practitioner acted to his detriment, in that the learned primary Judge failed to pay any or any sufficient regard to evidence that the conveyances in question must have generated contracts, correspondence, file notes and other documents which were no longer in existence, or alternatively in respect of which there was no evidence before the learned Primary Judge that such documents were still in existence."

The evidence in respect of documentation is fully set out in Slicer J's reasons for judgment. There can be no doubt that the two transactions involving the purchase by Mr Spaulding from the appellant of "lot 7", together with the subsequent sale of it by Mr Spaulding to Mr Knight, and the purchase by Mr Spaulding, as the nominee of the appellant, of the quarry for the same price at which the appellant had contracted to buy it, would have generated some documentation in the form of contracts, correspondence, file notes and other documents. The evidence suggests that there was never a discrete file for each of those transactions or any combination of them, but rather that relevant material might well have been spread through several files created in respect of dealings by Mr Spaulding or companies under his control. It is problematical whether, with such an apparently disorganised system of filing, any particular document relevant to the transactions might have been located had they not been destroyed as obsolete. Be that as it may, it was incumbent upon the appellant to demonstrate that there was at least a likelihood that he was prejudiced by the destruction of documents relevant to the allegations of misconduct in consequence of the conduct of the Society in representing that the investigation into these allegations was complete and that they were not to be pursued. It is not the conveyancing documents themselves which any such transaction was likely to generate that would be so relevant to the appellant's defence that their loss would disadvantage him. Certainly they might have been relevant in establishing chronology, for example, but it is hard to imagine that times could not have been established by recourse to other records such as ledger entries, bank statements and various public documents such as registered transfers and the like. Furthermore, some material which clearly is relevant such as the valuation dated 27 March 1986 and prepared by a professional valuer for Mr Spaulding is still in existence.

The learned primary judge found:

"(f)There is no evidence that in reliance on any 'promise' made or assumption induced by the Society, the practitioner acted to his detriment. The practitioner claimed in his evidence that files and other written material relating to the Lot 7 matter have been destroyed or lost. Although there may have been the odd piece of paper that has been misfiled or otherwise lost, I am unpersuaded that any relevant files have been destroyed or lost. I am unpersuaded for the following reasons:
·       The practitioner did not claim that he was hindered in 1992 by reason of loss of files or other material when he made his initial response to the Lot 7 matter of complaint.
·       In his advice to the Society in 1992, counsel listed all the files he received. The practitioner said in evidence on the hearing of this application that none of these files related to the Lot 7 matter.
·       Files that the Society had retained after 1992 were later copied and given to the practitioner. In his evidence, the practitioner agreed that there was material on those files relevant to the Lot 7 matter and referred to a valuation report.
·       A record of all the files held by the practitioner's firm during all material times was tendered as an exhibit. It showed the name of the client, a reference to the matter and a number which indicated the date that the file was opened. Although many of those files have been destroyed in accordance with the firm's policy of destroying files periodically, the practitioner did not identify from the record any file that might have been relevant to the Lot 7 matter."

The appellant claims that the finding that he was not persuaded "that any relevant files have been destroyed or lost" means either that the relevant files must still be in existence or that there never were any relevant files. I think it is clear from his Honour's finding that his reference to "relevant file" was to relevant material within any file, the loss of which material may have caused detriment to the appellant. Although there was no suggestion that there were never files or material documenting the transactions in question, the learned primary judge's conclusion was that he was not persuaded that there had ever been material relevant to the alleged misconduct, the destruction of which had hindered the appellant in his defence. In my view, that conclusion cannot be assailed.

The gravamen of the two allegations is that the appellant acted for Mr Spaulding in the purchase of lot 7 from himself and the subsequent sale of lot 7 by Mr Spaulding to Mr Knight and that he likewise acted for Mr Spaulding in the purchase of the quarry effectively from himself, in each case without advising Mr Spaulding to obtain independent legal advice in relation to those transactions and that Mr Spaulding suffered loss as a result. There is no claim on the material before the Court that the appellant did not act for Mr Spaulding in respect of the transactions and no claim that advice was given to Mr Spaulding that he should obtain independent legal advice in relation to those transactions. The appellant, in responding to those complaints in 1992, did not assert the existence of any documentary material relevant to that issue and the learned primary judge was entitled to have regard to that fact in failing to be persuaded that there were any such documents. No other documentary material was later identified as being relevant to that issue and the broad claim that a file or some of the documents likely to have been generated by such transactions had been destroyed was insufficient to lead to a conclusion that the appellant had suffered a detriment as the result of the destruction of such material, assuming that course had been induced by the Society's indications that it was closing its file on the allegations.

With respect, I do not agree that in meeting the claim of loss arising out of the failure to advise Mr Spaulding that he seek independent legal advice, the appellant demonstrated that he was disadvantaged by the non-availability of a substantial number of files relating to Mr Spaulding's other transactions and financial status at the time of the impugned transactions. This was not a consideration urged upon the Court in respect of this ground by counsel for the appellant. Again, although in a general sense, all that material could be relevant to Mr Spaulding's claims to have suffered loss, nothing was identified as being of such importance that its non-availability was detrimental to the appellant in the conduct of his defence, nor has it been demonstrated that Mr Spaulding's financial position at the relevant time may not be able to be otherwise established. In my view, ground 2 has not been made out.

Ground 3 is in these terms:

"3The learned primary Judge erred in law or alternatively in fact in failing to conclude that the bringing of the prosecution by the Respondent against the Appellant was, in the circumstances, an exceptional or extreme case comprising an abuse of process."

Counsel for the appellant acknowledges that the learned primary judge's refusal to stay proceedings on the grounds of abuse of process was made in the exercise of his discretion and the constraints imposed by the Supreme Court Civil Procedure Act 1932, s45(1) on the Full Court's powers of intervention accordingly apply. That the Court has power to stay proceedings to protect its own process from abuse is undoubted (Metropolitan Bank v Pooley (1884 - 1885) 10 AC 210 at 220, Connelly v Director of Public Prosecutions [1964] AC 1254 at 1361, Jago v The District Court of New South Wales (1989) 168 CLR 23 at 25). It has been extended to prevent the abuse of process within tribunals subject to review by superior courts such as professional disciplinary tribunals (Herron v McGregor [1986] 6 NSWLR 246, Walton v Gardiner (1993) 112 ALR 289, Re a Medical Practitioner (1993) 2 Tas R 90). In the lastmentioned case, at 94, Green CJ cited the approval of Mason CJ, Deane and Dawson JJ in Walton v Gardiner (supra) at 298 of the propositions that the court:

"… has power to make an order staying proceedings if it is satisfied that the continuations of the proceedings would be 'so unfairly and unjustifiably oppressive' as to constitute an abuse of process. …" and "that the court would only be so satisfied in an exceptional or extreme case."

He also cited (at 94) the approval of those Justices of the statement of Deane J in Jago v District Court of New South Wales (supra) at 58:
"The power of a court to stay proceedings in a case of unreasonable delay is not confined to the case where the effect of the delay is that any subsequent trial must necessarily be an unfair one. Circumstances can arise in which such delay produces a situation in which any continuation of the proceedings would, of itself, be so unfairly and unjustifiably oppressive that it would constitute an abuse of the court's process."

Further, at 94 - 95, Green CJ cited from Walton v Gardiner (supra) at 300 - 301 the same Justices' view that:
"The question whether disciplinary proceedings in the tribunal should be stayed by the Supreme Court on abuse of process grounds should be determined by reference to a weighing process similar to the kind appropriate in the case of criminal proceedings but adapted to take account of the differences between the two kinds of proceedings. In particular, in deciding whether a permanent stay of disciplinary proceedings in the tribunal should be ordered, consideration will necessarily be given to the protective character of such proceedings and to the importance of protecting the public from incompetence and professional misconduct on the part of medical practitioners."

The learned primary judge was asked to stay proceedings in respect of the lot 7 matter for the following reasons:

"·   The complaint was made on 5 October 1992, nearly 10 years ago.
·    On 27 January 1994, the Society advised the practitioner that no action would be taken.
·    In May 1997, the Society concluded that there was no evidence of any 'breach of ethical standards' by the practitioner in relation to the Lot 7 matter.
·    On 15 August 2000, the Society told the practitioner it had closed its file in relation to the Lot 7 matter.
·    The practitioner's files pertaining to the Lot 7 matter, or related matters, have been destroyed.
·    The delay between the making of the complaint and the filing of the originating application is so long and, per se, prejudicial."

He said in respect of them:
"64None of the grounds, either individually or in total, warrant making the order sought. Jago has made it clear that delay per se does not constitute an abuse of the process of the Court. In order to gain an order for a permanent stay of proceedings upon the grounds of delay in criminal proceedings, the accused must show that 'the lapse of time is such that any trial is necessarily unfair that any conviction would bring the administration of justice into disrepute' per R v Clarkson [1987] VR 962 at 973, approved in Jago at 34. Disciplinary proceedings are akin to criminal proceedings and, in my opinion, the principles that apply to a claim that the proceedings are an abuse of the process of the Court in a criminal case generally apply to disciplinary proceedings. I have already made findings with respect to the claim that files and written material have been lost or destroyed. No unfairness is established upon that basis. The practitioner did not claim in his evidence that the delay had prejudiced his memory other than in a general sense. This is not surprising because he has been answering the Lot 7 matter of complaint on and off over several years. In his cross–examination, he agreed that he had a recollection of the Lot 7 matter.
65Advice by the Society to the practitioner that it had closed its file, that it had decided that no action was to be taken against him, and that there was no evidence of any breach of ethical standards, cannot ground a legitimate complaint constitutes an abuse of process. Only adverse consequences to the practitioner arising as a consequence of giving such advice are relevant to the issue of abuse of process. On the trial of the issues raised by the originating application, no injustice will arise from the fact that the 'prosecutor' changed its mind several times over the passage of years about whether it would take any proceedings against the practitioner. Indeed, unless there is a finding of misconduct, it is difficult to see how evidence of those matters will be relevant to the issues to be determined.
66Of course, any delay is prejudicial, but it is a question of degree and has to be balanced with the community's interests in ensuring that it is protected from misconduct on the part of solicitors. In this case I am unpersuaded that the prosecution of the originating summons with respect to the Lot 7 matter constitutes an abuse of the process of the Court."

The principal challenge on appeal to his Honour's exercise of his discretion was the alleged error, the subject of ground 2 which, in my view, has not been established. However, it was further contended that although his Honour had articulated the considerations relevant to the appropriate conclusion, he had failed to properly weigh them and that had he done so, he should have concluded that the prosecution of the appellant was an exceptional or extreme case constituting an abuse of process.

In my view, although there has been lengthy delay in commencing these proceedings for the reasons given by the learned primary judge, their continuation in the circumstances cannot be said to be likely to lead to an unfair trial or to be so unfairly and unjustly oppressive as to constitute an abuse of the Court's process. The same can be said in respect of the quarry matter, where the learned primary judge said:

"78Temporally and contextually, the quarry matter of complaint is closely linked to the Lot 7 matter of complaint. The position with respect to lost or destroyed files is the same as it was with respect to the Lot 7 matter, even though the quarry matter was not raised until much later. The practitioner was unable to identify from his firm's index of archived files any file that may have contained material relevant to the quarry matter. He conceded that amongst the files that the Society copied and handed to him, there was material relevant to both matters of complaint. Other than the fact that delay per se gives rise to prejudice, the practitioner did not identify any specific respect in which the delay would result in unfairness to him if the originating application proceeds to a hearing. Although the passage of time between the occurrence of the relevant events and the filing of the originating application is very long, it is clear from the written material in evidence before me that the quarry matter was not something that came 'out of the blue' in 1999, because of the nexus between it and the Lot 7 matter and the attention that the practitioner has had to give to all his solicitor/client dealings with the complainant since the first complaint was made in 1992. No basis for a permanent stay of proceedings with respect to the quarry matter is made out."

In my opinion, the appeal should be dismissed.
File No FCA 28/2002

COLIN BERTRAM ADAMS v LAW SOCIETY OF TASMANIA

REASONS FOR JUDGMENT  FULL COURT
  CRAWFORD J
  27 May 2003

I respectfully agree with the other members of the Court that there is no substance in the first ground of appeal and that the learned judge was not in error in holding that no question of dismissal of the lot 7 matter of complaint had arisen.

The second and third grounds of appeal are in these terms:

"2The learned primary Judge erred in fact in concluding that there was no evidence that in reliance on any promise made or assumption induced by the Society that the practitioner acted to his detriment, in that the learned primary Judge failed to pay any or any sufficient regard to evidence that the conveyances in question must have generated contracts, correspondence, file notes and other documents which were no longer in existence, or alternatively in respect of which there was no evidence before the learned Primary Judge that such documents were still in existence.
3The learned primary Judge erred in law or alternatively in fact in failing to conclude that the bringing of the prosecution by the Respondent against the Appellant was, in the circumstances, an exceptional or extreme case comprising an abuse of process."

Central to those grounds, as argued by counsel for the appellant, was that the learned judge erred as alleged in ground 2, that is that his Honour failed to pay sufficient regard to evidence that the conveyances in question must have generated contracts, correspondence, file notes and other documents which were no longer in existence, or in respect of which there was no evidence that they were still in existence. I note that the reference to conveyances is likely to be erroneous, but nothing turns on that.

The allegations of professional misconduct that have been made against the appellant by the respondent, are particularised in the originating application as follows:

"That whilst a practitioner of the firm Page Seager ('the firm') during 1986 and 1987 the Respondent acted on behalf of one Michael Spaulding ('Spaulding') in relation to the purchase and sale of an interest in property at 'Gunners Quoin' at Old Beach in Tasmania in which the Respondent had an interest and without advising Spaulding to obtain independent legal advice in relation to that purchase and sale and in relation to which Spaulding suffered loss.
And that whilst a practitioner of the firm during 1985 and 1986 the Respondent acted on behalf of Spaulding in relation to the purchase of a quarry at Old Beach in Tasmania in which the Respondent had an interest and without advising Spaulding to obtain independent legal advice in relation to that purchase and in relation to which Spaulding suffered loss."

The first paragraph refers to a matter of complaint raised by Michael Spaulding with the respondent and which has been referred to as the first matter of complaint (the lot 7 matter). The second paragraph refers to another matter of complaint raised by Mr Spaulding, which has been described as the second matter of complaint (the quarry matter). The reason for that is that Mr Spaulding first complained to the respondent about the lot 7 matter on 5 October 1992 and he first complained to it about the quarry matter on 4 October 1999. However, it appears likely that the events central to the quarry matter in fact occurred shortly before the events central to the lot 7 matter. Substantially all of those events occurred between 1985 and 1987, what is now a long time ago.

The lot 7 matter and its documents

On 4 November 1992 the applicant responded to complaints made by Mr Spaulding to the respondent on 5 October 1992 about a great number of matters concerning the applicant's professional dealings with him. Most of those matters are not the subject of the respondent's originating application. Arising out of those complaints it eventually resolved, nine years later in 2001, to take disciplinary proceedings that were confined to narrow issues, that is:

1that the applicant acted for Mr Spaulding in relation to his purchase from the applicant of the latter's interest in land at "Gunners Quoin" at Old Beach (lot 7), without advising Mr Spaulding to obtain advice from a legal practitioner independent of the applicant, in relation to that purchase;
2that the applicant acted for Mr Spaulding in relation to his subsequent sale of that interest to one Knight, without advising Mr Spaulding to obtain advice from a legal practitioner independent of the applicant, in relation to that sale; and
3that in relation to that purchase and subsequent sale, Mr Spaulding suffered loss.

The facts appear to include the following. In about 1984 it was agreed that an area of land at Gunners Quoin, consisting of about 500 acres, would be acquired for the benefit of a number of people, or pairs of people, to be enjoyed in respective one eighth shares as tenants in common. The applicant and his wife were to have two of those one eighth shares between them. It was a farming property at the time and each of the persons or pairs of persons intended, along with the others, to develop a portion of the land for their own respective use and enjoyment and not with the intention of re-sale in the near future.

According to a valuation report of Mr A D Jessup, dated 27 March 1986, the title to the land, being part of certificate of title volume 2321 folio 67, was in the name of Compton Pty Ltd, and it was subject to a priority notice with regard to a transfer to the applicant and the other interested persons. Mr Jessup reported that it was proposed that the property would eventually attain Progressive Stratum Rural Title. Before separate stratum titles could issue to the respective interests for each proposed lot, it was expected that there would be significant delays, because of the need to fulfil requirements that included residential development on the individual lots and the lodgement and approval of a stratum title for the dwellings. Mr Jessup reported further that as a separate title would not be issued until the completion of a building on the land and approval of a stratum title, it would not be possible to register a mortgage against the property being purchased by Mr Spaulding in the normal way. Subject to a satisfactory method of securing a mortgagee's interest in the title, Mr Jessup was of the opinion that the value for security purposes of lot 7, or perhaps more correctly the proposed lot 7, was $47,500.

When he first complained to the respondent in 1992, Mr Spaulding maintained that in or about 1984 the applicant dealt with him in respect of lot 7. He said that the applicant knew that he had money because he was his client, and suggested to him that he purchase lot 7, offering as an inducement that the applicant would do the necessary legal work for free. Mr Spaulding also maintained that at around that time he indicated to the applicant that he was interested in acquiring a nearby quarry, over which he understood the applicant to have some sort of option. He said that shortly before he and his wife signed an agreement to purchase lot 7, he told the applicant that he did not really wish to go ahead with the purchase, whereupon the applicant became upset and threatened that he would not let Mr Spaulding purchase the quarry unless he purchased lot 7. He maintained that he purchased lot 7 from the applicant for about $40,000 and later learned that the other members of the syndicate that owned the other lots, had purchased them for very much less than that.

In an affidavit sworn by him on 7 September 2001 in support of the originating application in these proceedings, Mr Spaulding said that it was in October 1986 that the applicant suggested that he purchase lot 7. He said that at that time he was also interested in acquiring the quarry. He rejected the applicant's claim that it was he who approached the applicant to purchase lot 7.

The applicant maintained that the valuation report of Mr Jessup, dated 27 March 1986, was obtained by Mr Spaulding for the purpose of fixing the price at which the applicant would sell to him an one eighth share in the land. I note that the report was addressed to Mr Spaulding. The applicant also maintained that it was the applicant who approached him in 1986 to consider selling lot 7 to him and although it was not then for sale, he agreed to do so, suggesting to Mr Spaulding that he obtain a valuation. The applicant said that the sale was completed in December 1986. It has always been the applicant's case that earlier, at about the end of 1985, Mr Spaulding approached him wishing to purchase the quarry, which he subsequently did, completing the purchase in March 1986. The applicant informed the respondent in 1992 that the purchase of the quarry was completed about nine months before Mr Spaulding's purchase of lot 7. I note that in 1993 the respondent's counsel found from material provided to him, that the purchase of the quarry was completed on 29 January 1986 and that the agreement for the purchase by Mr Spaulding of lot 7 was entered into sometime between March and October 1986. He added that an examination of the files held by the applicant's firm indicated that the land was not paid for until 10 December 1986.

An agreement for sale was entered into by the applicant as vendor and Mr Spaulding and his wife as purchasers, for the purchase by them of the applicant's one eighth interest described in the agreement as "Lot 7". The purchase price was $45,000. Although the copy of the agreement in evidence is difficult to read, it seems that the agreement provided for its completion within 30 days of its date. The copy in evidence bears 1 November 1988 as its date, but both Mr Spaulding and the applicant agree that it was in fact signed in 1986.

Also in evidence is a copy of a consequent memorandum of transfer B244861 from the applicant to Mr and Mrs Spaulding. Its date is illegible but it must have been registered on 16 March 1989, the same date as the registration of a subsequent transfer to Knight. Mr Spaulding said that because he was in a precarious financial position he decided, along with his wife I presume, to sell his interest in the land. He said that the applicant arranged for him to sell to the applicant's friend, Stephen Knight, for $47,500. The applicant asserts that Mr Spaulding already knew Mr Knight and approached him directly. In evidence is a copy of an agreement for sale from Mr Spaulding only, and not he and his wife, to Mr Knight and his wife for $47,500. Although difficult to read, it appears to bear a date in July 1987. Also in evidence is a copy of a consequent memorandum of transfer B244862 from Mr and Mrs Spaulding to Mrs Knight only for $45,000. It was registered on 16 March 1989. It is possible that the delay in registration of the transfers was a result of the problem concerning separate titles, but the matter is not explained by the evidence.

Mr Spaulding asserted that because of his poor financial position he had no choice but to sell lot 7. He claimed to have suffered a financial loss as a result of the purchase of lot 7 and its sale. I note that it appears that he accepted $45,000 from Knight, and not $47,500, in full satisfaction of the purchase price because he urgently needed the funds prior to the agreed date for completion. It is part of the respondent's particulars of the applicant's alleged professional misconduct that Mr Spaulding suffered loss.

Mr Spaulding also asserted in regard to his agreed purchase from the appellant of lot 7, that at no time did the applicant advise him that he should obtain independent legal advice before proceeding with the purchase; that there was not an individual title to lot 7 and that it might present difficulties for borrowing against the land or selling it; of the nature of the interest he and his wife were acquiring; of the rights they would have against the owners of the other interests in the land, an interest in which he assumed he and his wife were purchasing; that there was imprecision in the area or boundaries of the land he believed he was purchasing, in that it had not been surveyed and he had not been shown any survey pegs; and that there might be problems obtaining title if the proposal for the staged rural stratum title scheme fell through, having regard to the minimum lot requirements of the relevant local council. It was only in relation to the first of those alleged failures to advise that the respondent alleged professional misconduct, but nevertheless the other failures to advise as alleged by Mr Spaulding may well prove to be relevant, if only to his credit. They were asserted in Mr Spaulding's affidavit upon which the respondent will seek to rely if the originating application is allowed to proceed to a hearing.

In an affidavit sworn by the applicant on 20 November 2001, he maintained the following with regard to lost and destroyed documents relevant to both the lot 7 matter and the quarry matter:

"8Most if not all of the files pertaining to my conduct which is complained of by Mr Spaulding in both matters of complaint, and which are the subject of the application to the Disciplinary Tribunal, [sic] have been destroyed, and are incapable of being recreated. In about 1997 I attempted, with the assistance of the Law Society, to recreate the Page Seager files, but that attempt was unsuccessful. Particularly I do not have my file notes or copies of correspondence with Mr Spaulding, nor do I have any substantial or complete recollection of those matters, independently of such file notes. I therefore assert that I am disadvantaged and prejudiced by the fact that I am now required to answer for conduct which occurred up to 16 years ago, without the assistance of my files.
9Had the Society not advised me on 27 January 1994 that it intended to take no action in respect of Mr Spaulding's complaint, (ie, the first matter of complaint), I would not have allowed them to be destroyed."

In his reasons for judgment the learned judge referred to the applicant's claim in evidence that files and other written material relating to the lot 7 matter had been destroyed or lost. His Honour accepted that there may have been the odd piece of paper that had been mis-filed or otherwise lost, but he was unpersuaded that any relevant files had been destroyed or lost. The learned judge gave the following reasons for being unpersuaded:

1The applicant did not claim that he was hindered in 1992 by reason of the loss of files or other material when he made his initial response to the respondent about the lot 7 matter of complaint.
2In counsel's written advice to the respondent in 1992, counsel listed all the files (of the applicant's firm, Page Seager) he had received and the applicant said in evidence that none of those files related to the lot 7 matter.
3Files that the respondent had retained after 1992 were later copied and given to the applicant. In his evidence, the applicant agreed that there was material on those files relevant to the lot 7 matter and referred to a valuation report.
4Records of all the files held by the applicant's firm during all material times were tendered as one exhibit. Each record respectively showed the name of the client, a reference to the matter and a number which indicated the date that the file was opened. Although many of those files had been destroyed in accordance with the firm's policy of destroying files periodically, the applicant did not identify from those records any file that might have been relevant to the lot 7 matter.

With respect, I have difficulty understanding why the learned judge gave weight to the first reason he expressed. In 1992 the applicant was merely responding to correspondence arising out of numerous complaints about many matters that had been made to the respondent by Mr Spaulding. Formal disciplinary proceedings had not been taken against him. It is not conceivable that the applicant might have raised the issues of estoppel and abuse of process at that point in time. Further, the evidence of Mr Harry, the managing partner of the applicant's firm, concerning the routine disposal or destruction of old files, was that they were normally retained for eight years or possibly for as long as 10 years, and were then destroyed because of limitation of storage space. As the material events commenced in about 1985, it is unlikely that by 1992 relevant files or documents would have been destroyed or were no longer in existence. The failure of the applicant to complain at that time that files had been destroyed deserved no weight at all.

I deal next with the second reason given by the learned judge. I note that his Honour incorrectly referred to counsel's advice to the respondent being provided in 1992. It was in December 1993. I note also that what counsel listed were 23 files of the applicant's firm which counsel said he had examined. Further, although at one point the applicant said in evidence that he could not find in the list of 23 files one relating to the purchase by Mr Spaulding of an interest in lot 7, he explained that what he meant was that none of the names of the files referred to that transaction. For example, he gave evidence about a file in the list numbered 07-86-9083 in the name of Michael Spaulding re Old Beach Development that the records showed was opened on 24 March 1986. The evidence established that the file was likely to be one of those that had been destroyed by the firm in accordance with its practice. The applicant thought it likely that the file related to land purchased by Mr Spaulding about four kilometres from lot 7. However, it was also his evidence that it was not always the case with Mr Spaulding that each matter was contained within a separate file. When referring to five of the six files in existence out of all the Spaulding files that had once existed, he said:

"Yesterday while I was looking at the five files which we have I noticed in I think at least two of them there were upwards of four or five matters, and that's why I say to you that depending upon how matters arose they were dealt with for convenience in a particular file."

He added that "the files that the Law Society had did contain the materials about the so-called purchase of the land at lot number 7." It is most likely that whatever Page Seager files the respondent did have in 1993 were made available by it to its counsel. It follows from the applicant's evidence, that there once existed a file or files that contained the file documents that were created with respect to the lot 7 matter. Therefore, I conclude, with respect to the learned judge, that his reliance on the applicant's statement in evidence that none of the files listed by counsel related to the lot 7 matter, was based on a misunderstanding of the effect of the applicant's evidence.

I deal with the third of the learned judge's reasons. With respect his Honour was only partly correct. The applicant agreed in cross-examination that on 27 June 2001 officers of the respondent attended his office with files of the respondent, pursuant to an agreement that he would be permitted to have photocopies of many of the documents in those files. The purpose of the respondent's officers coming to his office was to use his facilities to carry out the photocopying. Subsequently he inspected the copies of the documents that had been so made and he agreed that among them was "relevant information" about the lot 7 matter. So far as that information extended to any documents relevant to the lot 7 matter that the applicant may have had or created when acting for Mr Spaulding with regard to it, the evidence suggested that the only ones still in existence were the valuation of Mr Jessup, to which I referred earlier, and copies of the agreement to purchase lot 7, the subsequent transfer, the agreement to sell lot 7 to Knight and its subsequent transfer. He did not agree, as his Honour implied, that there was any other material relevant to the lot 7 matter, and certainly not correspondence or file notes.. I also observe that by referring to the material that was so photocopied as being "files that the Society had retained after 1992", it is likely that the learned judge was implying that they were in fact files that had belonged to the applicant's firm and that had been given to the respondent's counsel in 1992. That was not in fact the evidence. What was put to the applicant by the respondent's counsel was that the photocopying was of "many of the documents from the Law Society files", and the applicant agreed.

I turn to the fourth and final reason of the learned judge for being unpersuaded that any relevant files had been destroyed or lost. Mr Harry produced the records of files that had been kept by the applicant's firm in the name of Mr Spaulding alone or jointly with his wife. The record covered the period 1980 to 1992. There were 13 such files recorded. The fact that the respondent's counsel listed 23 files as having been examined by him in 1993 seems puzzling at first, but the discrepancy can largely be explained by the fact that at least nine of the files examined by counsel were in names other than those of Spaulding, such as Sandman (No 4) Pty Ltd and Allscrap Pty Ltd.

It was Mr Harry's evidence that the firm's records had been searched for files relating to Mr Spaulding. Only six such files were still in existence. Two were in the name of Mr Spaulding, one in the name of Mr and Mrs Spaulding, one in the name of Allscrap Pty Ltd and the remaining two files were in the name of Pasedo Nominees Pty Ltd and related to Allscrap Pty Ltd and Sandman (No 4) Pty Ltd respectively. Of those six files, only one had been found on search to be in the firm's possession. The other five were found in the possession of Simmons Wolfhagen, a firm of solicitors that at one time had acted for the respondent. Mr Harry did not believe that there still existed any other Spaulding files. The evidence of Mr Adams was that he had perused the six remaining files and there was nothing in them relating to the lot 7 or quarry matters.

As a result of the evidence of Mr Harry and the applicant, the only conclusion reasonably open was that out of all of the files opened by the firm in the name of Mr Spaulding alone or jointly with his wife, all except three had been destroyed in the course of the firm's routine destruction of files after about eight to 10 years had passed. Further, of the 23 files listed by the respondent's counsel as having been examined by him in 1993, all except two are likely to have been destroyed or lost.

The learned judge relied on the fact that the applicant did not identify from the records any destroyed "file that might have been relevant to the lot 7 matter". I have concluded that the learned judge must have misunderstood the substance of the applicant's evidence. In my opinion the evidence compelled a conclusion that there had once existed correspondence, file notes and other documents in connection with the purchase of lot 7 and its subsequent sale to Knight, but because of the passage of years the applicant's file or files containing that material have been lost or destroyed. All that remains appear to be copies of the agreements and transfers and Mr Jessup's valuation, and perhaps financial information in the firm's accounts.

The quarry matter and its documents

Mr Spaulding made no complaint to the respondent arising out of the second matter of complaint, the quarry matter, until 4 October 1999, and even then it was not clear what his complaint was. It took some months before it was fully understood. It was first raised with the applicant on 19 June 2000, over 14 years after the relevant events occurred. Arising out of the complaint, the respondent resolved in 2001, to take disciplinary proceedings alleging:

1that the applicant acted for Mr Spaulding in relation to his purchase of a quarry at Old Beach, in which the applicant had an interest, without advising Mr Spaulding to obtain advice from a legal practitioner independent of the applicant, in relation to that purchase; and
2that in relation to that purchase, Mr Spaulding suffered loss.

The facts appear to include the following. Mr Spaulding wished to purchase the nearby quarry. He maintains that he indicated that he wished to do so at the time the applicant suggested that he purchase lot 7. The applicant maintains that Mr Spaulding acquired the quarry before the lot 7 deal arose. At one time, at least, the applicant maintained that he had entered into a contract for him or his nominee to purchase the quarry for $9,000. He said that Mr Spaulding wished to use the quarry and its rock and gravel to construct roads, and he nominated Mr Spaulding to be the purchaser in his place. According to the applicant, no consideration passed between them. According to Mr Spaulding, the quarry was initially offered to him by the applicant in lieu of monies earned by Mr Spaulding from sub-contracting plant and equipment to the applicant. The latter denies that. In 1993 the respondent's counsel said that the applicant's recollection had altered from one that he had nominated Mr Spaulding to purchase the quarry in his place, to a recollection that he had a contract pending to purchase the quarry and that he stood aside, allowing the agreement to be drawn up in Mr Spaulding's name, rather than in the applicant's name. According to the applicant, the purchase of the quarry was completed by Mr Spaulding in March 1986. The respondent's counsel found in 1993 that it was completed on 29 January 1986.

Mr Spaulding asserts that at no time did the applicant advise him to obtain independent legal advice. He maintains that when he agreed with the applicant that he would become his nominee to purchase the quarry, he also agreed with the applicant that he would supply red gravel to the applicant's subdivision at prices agreed and also to other members of the subdivision syndicate. He claims that the applicant insisted that the agreed price for the gravel had to be at cost and that what he received for extraction, loading and cartage was below the cost incurred by him, that the applicant knew that he had no experience in quarries or earthmoving and that he made a loss as a result of his purchase of the quarry. On 30 June 2000, the applicant asserted to the respondent that Mr Spaulding purchased the quarry direct from the then registered proprietor; that he had no collateral agreements with Mr Spaulding with regard to the pricing of any future supply of gravel; that he was not aware of what experience Mr Spaulding may have had with quarries; that although he did not have access to his old files relating to the purchase of the quarry, Mr Spaulding was duly advised as to what he was purchasing; that Mr Spaulding received good title for the quarry; and that he subsequently mortgaged the property, together with neighbouring properties, to Westpac.

In his reasons for judgment, the learned judge referred to the applicant's claim, made in relation to both matters of complaint, that most if not all of the files pertaining to his conduct complained of by Mr Spaulding, had been destroyed and were incapable of being recreated. His Honour rejected the applicant's claim with regard to the quarry matter, giving the following reasons:

1The position with respect to lost or destroyed files was the same as it was with respect to the lot 7 matter, even though the quarry matter was not raised until much later.
2The applicant was unable to identify from his firm's index of archived files, any file that may have contained material relevant to the quarry matter.
3The applicant conceded that amongst the files that the respondent copied and handed to him, there was material relevant to both matters of complaint.

Generally speaking, the first reason of his Honour was valid comment, but for reasons I have explained I have concluded that the learned judge misunderstood the evidence and the position it established. The second reason was essentially the fourth reason expressed by the learned judge for rejecting the applicant's claim to the lot 7 material having been lost or destroyed. As I explained earlier when dealing with that reason, the only conclusion reasonably open on the evidence was that out of all the files opened by the firm in the name of Mr Spaulding alone or jointly with his wife, all except three had been destroyed in the course of the firm's routine destruction of files after about eight to ten years had passed, and of the 23 files listed by the respondent's counsel as having been examined by him in 1993, all except two are likely to have been destroyed or lost. I similarly conclude, for the reasons I gave when dealing with the lot 7 matter, that the learned judge must have misunderstood the substance of the applicant's evidence, for in my opinion the evidence compelled a conclusion that there once existed correspondence, file notes and other documents in connection with the purchase of the quarry, but because of the passage of years the file or files containing that material have been lost or destroyed.

I refer to the third and last reason expressed by the learned judge for rejecting the applicant's case that relevant documents in his files relating to the quarry matter have been lost or destroyed. It is true that the applicant conceded that amongst the photocopies made by officers of the respondent and given to him in June 2001, there were documents relevant to both the quarry matter and the lot 7 matter. Insofar as his evidence related to documents relevant to the lot 7 matter, I have dealt with it. Insofar as it related to documents relevant to the quarry matter, all the applicant conceded in evidence was that among documents exhibited to affidavits sworn for the purposes of the proceedings, were documents copies of which were among the documents photocopied by the respondent's officers and given to him. However, that was not a concession by him that there therefore existed copies of correspondence, file notes and other materials he would have had on his file or files when he acted for Mr Spaulding in relation to the quarry matter. With respect, the learned judge once again appears to have misunderstood what the applicant accepted in evidence. With one possible exception, none of the exhibits to affidavits is a copy of a document that the applicant may have had on file when he was acting for Mr Spaulding in relation to the purchase of the quarry. The only possible exception is a bundle of eight pages of invoices in the name of M J Spaulding & Son addressed to C Adams & Associates for the extraction, loading, supply, screening and spreading of gravel. Two of those pages are dated 6 March 1986 and 14 July 1986 respectively. All other exhibits bearing on the quarry matter are essentially correspondence to or from the respondent or its counsel, arising out of its handling of and dealing with Mr Spaulding's numerous complaints. He did not of course, make a complaint arising out of the quarry matter until October 1999 although I note that some of the respondent's correspondence since 1992 did touch on the quarry matter.

As I concluded in relation to the lot 7 matter, the evidence compelled a conclusion that there had once existed correspondence, file notes and other documents in connection with the purchase of the quarry by Mr Spaulding, but because of the passage of years the applicant's file or files containing that material have been lost or destroyed. It is likely that nothing of the material remains in existence. I note that not even a copy of the contract to purchase the quarry, either by the applicant or by Mr Spaulding, appears to be in existence. Certainly it has not been exhibited to any affidavit. It is doubtful whether the invoices to which I referred were ever on the applicant's file or files concerning Mr Spaulding's purchase of the quarry, but in any event they could only be of marginal assistance, if any, to the applicant when defending the originating application.

Abuse of process

Therefore, I am of the opinion that the second ground of the appeal succeeds. Although I doubt that the claim of estoppel is soundly based, it is my determination that if the learned judge had correctly found that relevant correspondence, files notes and other documents that were once on the applicant's files, have since been destroyed or lost, the applicant's claim that the proceedings are an abuse of process should have succeeded.

The Court's power to make an order staying the proceedings should only be exercised in an exceptional or extreme case. I regard this to be such a case. The Court should exercise the power if it is satisfied that the delay has brought about a situation where the continuation of the proceedings would be so unfairly and unjustifiably oppressive, or involve unacceptable injustice or unfairness, as to constitute an abuse of process. Walton v Gardiner (1993) 177 CLR 378 at 392; Jago v District Court of New South Wales (1989) 168 CLR 23 at 58. See also Re A Medical Practitioner (1993) 2 Tas R 90.

Most of the material events occurred between 1985 and 1987. For a period of several years prior to 1992, the applicant acted for Mr Spaulding, his wife and companies in which Mr Spaulding had an interest, with respect to a great number of transactions. In 1992 Mr Spaulding complained to the respondent against the applicant about a number of matters arising out of or in connection with the relationship of solicitor and client that had existed between them. One of the complaints concerned the lot 7 matter. The applicant responded to the complaints, which were comprehensively investigated by the respondent and its counsel. In January 1994 the respondent's council accepted its counsel's recommendations that no disciplinary action should be taken against the applicant and he was advised accordingly. He was told that the respondent had closed its file. Mr Spaulding was also informed of the respondent's decision. Over two years' later Mr Spaulding sought to reagitate his complaint about the lot 7 matter and the other matters set out in his 1992 letter of complaint. He wrote to the respondent in September and October 1996. On 30 October 1996 the respondent advised him that it had determined to adhere to its 1994 decision not to take any proceedings. He wrote further to the respondent and by letter dated 31 January 1997, the respondent advised him once again that it adhered to its decision to take no action. He was told that he could commence his own proceedings if he wished. On 17 April 1997, the respondent wrote to the applicant for his response to a further complaint by Mr Spaulding about an unrelated matter. After an investigation, the respondent informed Mr Spaulding on 22 May 1997 that there was no evidence of any breach of ethical standards as had been alleged and accordingly the respondent did not intend to take any further action in relation to the complaint. Later, Mr Spaulding made another complaint to the respondent, that was investigated.

By 1999 the applicant's firm had destroyed or lost the only remaining records of the file notes, correspondence and other documents, with the exceptions to which I have referred, that had once been on its files relevant to the lot 7 and quarry matters of complaint. The applicant had been given to understand in 1994 that the lot 7 matter would not be pursued. Mr Spaulding had made no complaint about the quarry matter over the period of approximately 13 years since its events occurred, notwithstanding that he had complained about many other matters. Understandably the applicant and his firm had allowed the relevant material to be lost or destroyed. They were justifiably led to believe that there was no need to retain the material.

On 4 October 1999, Mr Spaulding made a number of fresh complaints to the respondent about the applicant. The nature of the complaints was unclear and it was not until the following year that it was understood. On 19 June 2000, the applicant was first informed of the quarry matter of complaint and his response was sought to it. Meanwhile, on 17 April 2000, the respondent revived the lot 7 matter. Why that occurred up to 14 years after the happening of the most relevant of the events and six years after the decisions were made in January 1994 not to take disciplinary proceedings in relation to it and to close the file, was not clear to the learned judge.

The delay that occurred between the occurrence of the relevant events between 1985 and 1987 and the commencement of the disciplinary proceedings in 2001 was unjustified and unreasonable. That it led to the applicant's records being lost or destroyed is likely to have caused him severe prejudice.

The issues on each matter of complaint will not be restricted to whether the applicant advised Mr Spaulding to seek independent legal advice. It is likely that there will be many other issues for determination. For example, with regard to the quarry matter of complaint, an issue that is likely to be important is how it came about that Mr Spaulding acquired the quarry. If there was merely a contract pending, as the respondent's counsel referred to it in his opinion of December 1993 as being the applicant's version of events, and the applicant was persuaded by Mr Spaulding to allow him to purchase in his place, it may well be that the applicant did not misconduct himself by thereafter acting for Mr Spaulding in the purchase, without advising him to seek independent legal advice. The factual detail will be important on the question. If on the other hand, the applicant was already bound by a contract to purchase the quarry and in some way he persuaded Mr Spaulding to replace him as purchaser, asking him to do so in lieu of the applicant having to pay him monies that he owed, as appears to be Mr Spaulding's version of the events, it may well have been professional misconduct on the applicant's part to act for Mr Spaulding without advising him to seek independent legal advice. Documents that once existed may well have assisted the ascertainment of the true facts about such matters. It appears that not even the contractual documents are still in existence. The determination of such facts will now depend almost entirely on the oral assertions of the two principal witnesses, Mr Spaulding and the applicant, based on their claimed memory of events up to 18 years ago, without the assistance of documents that might well have been vital to the issues.

With regard to the lot 7 matter of complaint, there are a considerable number of issues between the applicant and Mr Spaulding. The latter has maintained that the applicant persuaded or induced him to acquire lot 7 from the applicant and subsequently threatened that he would not allow him to purchase the quarry, unless he proceeded with the purchase of lot 7. The applicant disputes those assertions. If Mr Spaulding's version of the events is true, the failure of the applicant to advise him to seek independent legal advice might well have amounted to a serious case of professional misconduct. If on the other hand, the applicant's version of the events is true and it was Mr Spaulding who approached him to sell lot 7 and that he persuaded Mr Spaulding to obtain a valuation, following which they agreed that the sale price would be $2,500 less than the valuation, the applicant's conduct in acting for Mr Spaulding, without advising him to seek independent legal advice, may make it at the very least a less serious case of misconduct. Further, Mr Spaulding has maintained that he was at no time advised of problems with the title to lot 7. In that regard there no longer appears to be any written record of advice he was given by the applicant about that or any other aspect of the transaction, either orally or by correspondence. There is evidence of Mr Jessup's valuation, that was addressed to Mr Spaulding, which explained title difficulties and possible problems they might present for borrowing purposes. If there was ever a record of what passed between Mr Spaulding and the applicant as a result, it appears to have been permanently lost.

There are plainly many facts that are in dispute between the applicant and Mr Spaulding. The resolution of some of them might only assist the determination of their respective credit, but documents that existed at the relevant time might well have been of considerable value. Further, as pointed out by Slicer J in his reasons for judgment, the lost or destroyed documents may well have assisted the determination of the respondent's claim that Mr Spaulding suffered loss arising out of both matters of complaint.

I conclude that the delay, on the part of both the respondent and Mr Spaulding, in prosecuting the latter's complaints against the applicant, with the consequence that the hearing of the originating application will not take place until up to 18 years after the occurrence of some of the material events and about 16 years after the last of them, and that in the meantime relevant documents, a number of which would plainly have been of considerable assistance in determining the true facts, have been lost or destroyed, has brought about a situation where it will be unfairly and unjustifiably oppressive to the applicant as to amount to an abuse of process, if the proceedings are not permanently stayed, in all their respects.

For these reasons I would uphold the appeal, set aside the order dismissing the application for a stay and in lieu thereof, order that further proceedings on the originating application filed on 7 September 2001 be permanently stayed.
File No FCA 28/2002

COLIN BERTRAM ADAMS v LAW SOCIETY OF TASMANIA

REASONS FOR JUDGMENT FULL COURT

SLICER J
27 May 2003

In September 2001, the Law Society of Tasmania ("the Society") sought disciplinary orders against the appellant ("Adams"), a legal practitioner, on the grounds of "alleged professional misconduct". An application by the practitioner appellant for a permanent stay of the proceedings was dismissed for the reasons stated in The Law Society of Tasmania v A (A Practitioner) [2002] TASSC 9. Had the prosecution concerned a recent event or an historic matter just reported to the Society, the circumstances giving rise to either the disposal of the stay application or this appeal would be unexceptional. However, the matters complained of occurred in the period 1984 - 1987 and the history of the conduct of the complainant, Michael Spaulding ("Spaulding"), and the Society during the intervening period warrants detailed consideration. That need arises, not because the complaint involves a legal practitioner with an appellate process conducted by judicial officers who are members of the same professional discipline, but because of the requirements of procedural fairness in the resolution of long held grievances and events now distant.

The complaint

The complaint, as formulated in the originating application, was that of alleged professional misconduct with permitted sanctions provided by the applicable legislation, the Law Society Act 1962, s16(2), being:

"(a) to removing from or striking off the roll the name the name of the practitioner, or the names of the practitioners, to whom the application relates;
(b)suspending him or them from practice;
(c)imposing on him or them a fine not exceeding 50 penalty units;
(d)payment by any party of costs; and
(e)otherwise."

That the application was brought to this Court indicates that the Society, in the exercise of discretion, regards the allegations as serious.

The allegations of professional misconduct as particularised are:

"That whilst a practitioner of the firm Page Seager ('the firm') during 1986 and 1987 the Respondent acted on behalf of one Michael Spaulding ('Spaulding') in relation to the purchase and sale of an interest in property at 'Gunners Quoin' at Old Beach in Tasmania in which the Respondent had an interest and without advising Spaulding to obtain independent legal advice in relation to that purchase and sale and in relation to which Spaulding suffered loss.
And that whilst a practitioner of the firm during 1985 and 1986 the Respondent acted on behalf of Spaulding in relation to the purchase of a quarry at Old Beach in Tasmania in which the Respondent had an interest and without advising Spaulding to obtain independent legal advice in relation to that purchase and in relation to which Spaulding suffered loss."

Whilst any claim for compensation was disavowed by the Society, the claim that a client "suffered loss" as a result of the alleged misconduct was, and remains, a significant component in the allegation. That a claim of compensation has not been pursued either by Spaulding or through the Society, suggests that the purpose intended was that of professional sanction, rather than economic redress, and makes it necessary to examine the origin of the grievance of the actual complainant.

General background

Adams, as a member of the firm, Page Seager, acted on behalf of Spaulding and his associated corporate and trust entities in a number of commercial transactions and dealings during the relevant period 1980 - 1989. In September 1984, Adams, together with six other persons, purchased land comprising some 500 acres known as "Gunners Quoin", intending to develop the property for mutual benefit, rather than commercial profit. The nature of the title was such that it could be held as "private open space" held by stratum title without the requirement for an approved subdivision plan. However, as is evidenced from a plan annexed to a valuation report dated March 1986, the owners had agreed for the area to be broken up into eight irregular, but comparable, blocks, held by various persons and/or their partners or spouses. The minimum lot size permitted by the relevant planning scheme was 20ha.

It is Lot 7 of that proposed division which forms the basis of the first portion of the complaint.

Near the land Gunners Quoin, there was a quarry, ownership of which was useful for the development of roads on the jointly owned land. Adams had purchased the quarry for himself or a nominee, intending to use it for the provision of rock and gravel for the intended roads for the whole of the land. The assignment of that land to Spaulding, the timing of and circumstances giving rise to that assignment, constitute the second transaction grounding the complaint of misconduct.

Adams had acted for Spaulding from at least 1980 when Spaudling had been involved in commercial disputation concerning the payment of insurance following the loss of a fishing vessel. He continued to act until 1990 when Spaulding became bankrupt, or 1991 when two of the companies previously controlled by Spaulding were wound up.

In 1990, Spaulding was declared bankrupt. At that time, he had been involved in a number of complex commercial enterprises involving contracts, property purchases, family trusts, equipment, taxation, co-directors and a particular disputation with Pasminco concerning removal and disposal of mineral and chemical waste. In particular, the financial difficulties arose from a venture involving the disposal of scrap and waste products with the Electrolytic Zinc Works operated by Pasminco. Adams had acted for Spaulding and a controlled company in the course of that disputation, but in an ensuing action involving Pasminco, a different legal firm acted for the controlled company.

No complaint was made to the Law Society prior to the date of bankruptcy or the civil litigation involving Pasminco.

On 5 October 1992, Spaulding made a written complaint to the Society which raised claims of improper or negligent conduct during the period 1980 - 1992. They can be summarised as matters concerning:

(1)the purchase and sale of the land at Gunners Quoin "in or about 1984" and, by inference, the relationship of that purchase with the quarry land;
(2)business dealings involving the "EZ Company and a Victorian company called Australian Waste Processors Pty Ltd ('A W P')";
(3)the handling of two corporate entities and a family trust all involving Spaulding and/or his family;
(4)the acquisition and sale of an expensive piece of equipment;
(5)a loan between two corporate entities and the dissipation of the proceeds of an investment made shortly before the date of bankruptcy;
(6)favours, including the supply of materials, said to have been extracted by Adams from Spaulding in return for advances of money held by Page Seager on trust for corporate entities previously controlled by Spaulding;
(7)receipt by Adams of cash provided by Spaulding in improper circumstances;
(8)wrongful retention of files and documents, the property of Spaulding, his family trusts and companies.

Whilst only the first matter complained of is the subject of this appeal, the theme common to the eight areas of complaint is one of economic loss and harm, resulting in bankruptcy and collapse of corporate entities. The initial complaint (comprising nine pages) and the ensuing material and detail, add lengthy and interwoven material in support of that general theme. Each response was met with rebuttal and subsidiary allegations. The statement of grievance and its formulation made it difficult for a disciplinary body to identify the issues and provide for resolution. A grievance, made in an "open ended" form, makes it difficult for any respondent to make proper answer, since the ensuing rebuttal often raises matters not previously stated. In this case, the matters raised by Spaulding became more and more detailed, touching on personalities, attitudes and complex interrelationships, both commercial and personal. A file note made on 25 October 1996 by an officer of the Society during a meeting with Spaulding in the following terms:

"he handed me letters dated 17.10.96 & 25.10.96
'i'll break the society with complaints ¾ it's costing you money'
when he realised i'd written his statement down, he added 'but they will be genuine complaints'"

might well explain the attitude of Spaulding. He blamed his former solicitor for his misfortune and sought redress or retribution. Such might have been his entitlement, but the method made it difficult for Adams to make answer and the Society to resolve the conflicting accounts.

Given the consistent theme of economic harm caused by professional misconduct, the allegation of economic loss made in these proceedings has a complexity greater than that which would ordinarily appear from the substance of the complaint.

Response

The Society received the complaint in October 1992. It wrote to Adams on 13 October and received a detailed reply in November. It is convenient to compare the two versions which relate to the substance of these proceedings:

spaulding

adams

"The first specific matter of complaint concerns the manner in which Mr Adams dealt with me in respect of a purchase and sale of land at Old Beach in or about 1984.

Mr Adams together with four other people purchased approximately 300 acres of land at Old Beach to subdivide. Mr Adams had advertised for people to invest in that land with him. Mr Adams knew that I had money because I was his client, and he suggested to me that I purchase one of the proposed sub divided blocks owned by him or a member of his family. He also contracted my services to undertake the various road works on the land. As an inducement for me to agree to purchase he informed me that he would do the legal work involved in the transfer free.

At around that time I had indicated to Mr Adams that I was interested in acquiring a quarry at Old Beach over which I understood him to have some sort of an option.

Shortly before my wife and I signed a contract to purchase the block I told Mr Adams that I did not really wish to go ahead with the purchase. Mr Adams was upset at my remark and threatened that if I did not purchase the land he would not let me purchase the quarry.

I purchased the land from Mr Adams or a member of his family for approximately $40,000.00, and I learned later that the other members of the syndicate purchased for very much less than that.

Approximately one year after I purchased Mr Adams' land my wife and I got into financial difficulties and I told Mr Adams that I wanted to sell the land. Mr Adams then arranged for me to sell the land to a friend of his, a Mr Steven Knight, solicitor of Dobson, Mitchell & Allport. I made an approximately loss on the purchase and sale of around $3,000.00.

Mr Adams handled the transfer of the land to me, and the sale of the land as my solicitor. At no time in either the purchase negotiations or sale negotiations did Mr Adams ever suggest that I obtain legal advice from another solicitor.

I believe Mr Adams to have acted improperly in that he should not have acted for me as purchaser and at the same time act for himself as vendor. Nor should he have acted as my solicitor in the transaction and at the same time involve me in what could be described as a commercial venture with him. I believe also that he should not have acted for me in negotiations for the sale of the land to a friend of his.

In approximately October 1986, and I cannot be certain of the date, Mr Spaulding approached me and requested that I consider the sale to him of the allotment (Lot No 7) adjacent to mine. The property was not for sale at the time and after a brief consideration of the approach my wife and I decided to sell. I deny that I approached Mr Spaulding with a proposal for sale. We had no idea of a relevant price and I suggested that Mr Spaulding obtain a valuation for the subject property. Mr Spaulding obtained a valuation from a Mr Greg McNamara, as I recall it. Mr Spaulding offered to purchase the property for $45,000.00 which I understand was the figure referred to in the valuation, and this offer was accepted. The purchase was completed in December 1986. I offered to do Mr Spaulding's legal work on the purchase without charge and did so.

To respond to Mr Spaulding's allegations I state:

A That the purchase of the quarry at Old Beach was completed approximately 9 months prior to his purchase of Lot no 7.

B There was never any threat or coercion for Mr Spaulding to complete the contract for Lot 7, and the 'leverage' he refers to, being the threat not to allow him to purchase the quarry, is an absolute fiction. As I have previously stated he already owned the quarry at the time he sought to purchase Lot No 7.

C Mr Spaulding was fully aware from his dealings with me and my co-developers that the development of Gunners Quoin was not one which involved, or was one designed to achieve a profit from the development. The original owners purchased as co-owners and each undertook his own separate development of a housing lot. The co-owners equally shared the original purchase price of the land and the associated road and hydro costs, and any other charges.

D Mr Spaulding knew that the sale to him of Lot 7 was a market transaction and this is why a valuation was obtained."

On the material presented at the hearing of this appeal, it would appear that the Disciplinary Tribunal had taken the view that it either lacked jurisdiction or believed that it was not appropriate to deal with the matter. Certainly by this stage the newly appointed Legal Ombudsman had become involved in the matter and the Attorney-General continued to take an interest in the prosecution of the complaint.

The Society formally decided on 24 March 2001 to refer to the Supreme Court "allegations of professional misconduct" and advised Adams accordingly on 27 March. These proceedings were commenced on 7 September 2001.

Conduct of proceedings

On 8 October 2001, Adams filed an interlocutory application seeking a permanent stay on the grounds that:

(1)the decision to dismiss the complaints made in January 1994 and/or May 1997 gave rise to estoppel precluding further proceedings;
(2)the use of these proceedings constituted an "abuse of process";
(3)the time elapsed constituted procedural unfairness and a denial of natural justice.

Relevant to the determination of this appeal are the particulars stated in the interlocutory application, claiming:

"1That that part of the complaints the subject of this application, identified in an affidavit of janine marcia martin sworn on 10 September 2001, and hereinafter referred to, as the 'first matter of complaint', [comprising some of the allegations made against the respondent by michael spaulding in a letter dated 5 October 1992 ('Spaulding's 1992 complaint')] be permanently stayed, on the grounds that:-
(a) …
(b) …
(c) …alternatively, it is an abuse of process because:-
(i)…
(ii)…
(iii)…
(iv)…
(v)A fair hearing of the first matter of complaint is not possible because:-
(A) the respondent's files pertaining to the transactions or matters out of which the first matter of complaint arises have been destroyed; and further
(B) the delay between Spaulding's 1992 complaint being received by the applicant and the bringing of this application is extreme, inordinate, not satisfactorily explained and incurably prejudicial.

3 That that part of the complaints the subject of this application, identified in an affidavit of janine marcia martin sworn on 10 September 2001, and hereinafter referred to, as the 'second matter of complaint' [comprising allegations made against the respondent to the applicant by michael spaulding in a letter dated 1 October 1999 ('Spaulding's 1999 complaint')] be permanently stayed on the grounds that it is an abuse of process because:-
(a)although first made on 1 October 1999, Spaulding's 1999 complaint relates to alleged misconduct on the part of the respondent in 1985 and 1986;
(b)a fair hearing of the second matter of complaint is not possible because:-
(i)the respondent's files pertaining to the transactions or matters out of which the second matter of complaint arises have been destroyed; and
(ii)the delay between the applicant receiving Spaulding's 1999 complaint and the bringing of this application is inordinate, not satisfactorily explained, and incurably prejudicial."

The learned primary judge dismissed the application The Law Society of Tasmania v A (A Practitioner) (supra).

The grounds of appeal stated in the notice of appeal claim:

"1The learned primary Judge erred in law in holding that no question of dismissal of the lot 7 matter of complaint arose on 28 January 1997 in that, by virtue of s58(3) of the Legal Profession Act 1993, upon the Council of the respondent concluding that the matter did not warrant prosecution on the grounds that there was no substantial basis for the accusations, it was compelled to dismiss the complaint, (and hence the lot 7 matter of complaint).
2The learned primary Judge erred in fact in concluding that there was no evidence that in reliance on any 'promise' made or assumption induced by the Society that the practitioner acted to his detriment, in that the learned primary Judge failed to pay any or any sufficient regard to evidence that the conveyances in question must have generated contracts, correspondence, file notes and other documents which were no longer in existence, or alternatively in respect of which there was no evidence before the learned Primary Judge that such documents were still in existence.
3The learned primary Judge erred in law or alternatively in fact in failing to conclude that the bringing of the prosecution by the Respondent against the Appellant was, in the circumstances, an exceptional or extreme case comprising an abuse of process."

There is no substance in ground 1 for the reasons stated by the learned primary judge and, absent specific error, ground 3 is a matter within an appropriate exercise of judgment. The appeal concerns a discrete and narrow point, namely the findings in relation to the absence of files and the likelihood of their containing relevant material and the effect of prejudice. It has been necessary to analyse in detail the nature of the complaint and its history in order to identify and consider that discrete issue.

Documentation

Page Seager had acted for Spaulding or his corporate entities for some 10 years. His commercial activities were numerous and many files had been created and maintained. Many of them had been delivered to the Society or directly to retained counsel.

In his affidavit sworn on 20 November 2001, Adams relevantly deposed:

"8 Most if not all of the files pertaining to my conduct which is complained of by Mr Spaulding in both matters of complaint, and which are the subject of the application to the Disciplinary Tribunal, have been destroyed, and are incapable of being recreated. In about 1997 I attempted, with the assistance of the Law Society, to recreate the Page Seager files, but that attempt was unsuccessful. Particularly I do not have my file notes or copies of correspondence with Mr Spaulding, nor do I have any substantial or complete recollection of those matters, independently of such file notes. I therefore assert that I am disadvantaged and prejudiced by the fact that I am now required to answer for conduct which occurred up to 16 years ago, without the assistance of my files.
9 Had the Society not advised me on 27 January 1994 that it intended to take no action in respect of Mr Spaulding's complaint, (ie, the first matter of complaint), I would not have allowed them to be destroyed."

and in a subsequent affidavit sworn on 5 March 2002, he stated:
"2 Since completing my earlier Affidavit the Applicant's solicitors have delivered to me five files which were previously held by Mr Peter Manser and Messrs Simmons Wolfhagen. Such files were located by the Applicant during its discovery of documents. The five files which I now have in my possession are:

(i)	86 0397	M J & C A Spaulding re Sale Vessel Valda 'S';
(ii)	87 1530	M J Spaulding re Purchase from Ackerley;
(iii)	91 2027	Allscrap Pty Ltd re Sale to Ellis - 111 Musk Road, Sandford;
(iv)	91 1547	Pasedo Nominees Pty Ltd re Allscrap Pty Ltd;
(v)	92 3569	Pasedo Nominees Pty Ltd re Sale - Hurst Street, Bridgewater Sandman No 4.

In addition, following a search for relevant files within the firm archive store, one (1) file connected with Mr Spaulding has been found. The file reference is 897801 M J Spaulding re Venture Agreement.
3    The content of the files does not cause me to resile from my earlier Affidavit and in particular, the matter referred to in paragraph 8 thereof. The files are irrelevant to any issue in relation to the application and relate to other matters of which I or other persons within Page Seager had carriage in connection to Mr Spaulding's affairs.
…
7    The list of files referred to Mr Melick's advice are the files which the Applicant took possession of prior to Mr Melick commencing his enquiries and report. I recall that a large box containing a number of files were returned to me by the Law Society at or about the same time that [sic] also advised me that Mr Spaulding's complaint had been dismissed. I recall that shortly thereafter I requested that the box of files to [sic] be returned to archive storage.
8    Having considered the list of files referred to in paragraph 7 hereof, and again having regard to paragraph 8 of my earlier Affidavit, sworn herein, I stand by my assertion that I am disadvantaged and prejudiced by the fact that I am now required to answer for conduct which occurred up to sixteen years ago without the assistance of my files.   The files which are listed in Mr Melick's advice would have contained file notes and correspondence with Mr Spaulding and the like which would have assisted me a recollection and reconstruction of relevant events in the face of allegations Mr Spaulding has made. Those files are no longer available to me and I say they have been destroyed in the ordinary course of my firm's maintenance of old file materials."

There was additional substantial evidence relating to requests made by Adams for the return of files and documentation by the Society and further evidence of five files supplied by another firm of solicitors.

In cross-examination at the hearing of the interlocutory application, Adams was asked to identify files which remained in existence and the relevance of their contents. He maintained that in many instances a number of concurrent or contemporaneous matters would be included in the one file and that identification of a particular file did not necessarily mean that it comprised all of the material relevant to that transaction. Experience suggests that in many instances a number of matters might be discussed with a client at the one consultation, all recorded on the one file note. Adams maintained that examining counsel was:

"… assuming that each matter was contained within a separate file"

but that such:
"… wasn't always the case with Mr Spaulding."

While he conceded that it was the usual practice to "keep matters on each file", he had noticed that:
"…yesterday while I was looking at the five files which we have I noticed in I think at least two of them there were upwards of four or five separate matters, and that's why I say to you that depending upon how matters arose they were dealt with for convenience in a particular file"

and further:
"… for example yesterday I noticed in one file there were upwards of three or four writs, defences and pleadings at one time."

In relation to the files originally obtained by the Law Society, he stated, without challenge, that:

"… the files that the Law Society had did contain in fact the materials about the so-called purchase of the land at lot number seven.

and that:
… it's common ground that those files contained that material."

Whilst it is clear from his evidence that the Society had agreed that he could copy material remaining in its possession, it was equally clear that much documentation had been lost during the period 1984 - 2002. While some or all of the files examined by counsel in 1992 remained in existence, it does not follow that all of the materials dealing with the quarry transaction and the form and means of payment were available. Adams agreed with a suggestion by cross-examining counsel that:

"… as at the 24^th of February 1998, at least, in your mind, there may have been in existence materials relating to these issues before the Court in your control?"

The evidence of Adams was corroborated by John Harry, the managing partner of Page Seager, who deposed in his affidavit sworn on 5 March 2002:

"2   I have caused searches to be undertaken as to what Page Seager files were in the [sic] existence and which may still be in existence in relation to Mr Michael J Spaulding. Annexure marked with the letter 'A' is an extract from an opinion produced by Mr A G Melick which lists the Page Seager files that he had examined.
3    It is the normal policy of Page Seager that all archived files are routinely culled and destroyed after a period of some eight (8) years after they have been archived.
4    I believe that all of the files relating to Mr Spaulding have been destroyed with the exception of the following five files that were in the possession of Simmons Wolfhagen solicitors and have been returned to Page Seager as follows:

(i)	86 0397	M J & C A Spaulding re Sale Vessel Valda 'S';
(ii)	87 1530	M J Spaulding re Purchase from Ackerley;
(iii)	91 2027	Allscrap Pty Ltd re Sale to Ellis - 111 Musk Road, Sandford;
(iv)	91 1547	Pasedo Nominees Pty Ltd re Allscrap Pty Ltd;
(v)	92 3569	Pasedo Nominees Pty Ltd re Sale - Hurst Street, Bridgewater Sandman No 4;

and the following file held by Page Seager:

(vi)

89 7801

M J Spaulding re Venture Agreement."

When asked in cross-examination whether, on receiving notice of the complaint in 1992 he had not thought it prudent to ensure the preservation of the files, he answered:

"I didn't address it at all, …, in point of fact I thought Mr Spaulding's complaint had been dismissed."

He explained the record system then employed by the firm and produced archive records showing the method employed. However, an earlier card index was no longer in existence. That Harry had done his utmost to locate and produce all relevant material is illustrated by his following answer:
"The police came up - around with a warrant. I wanted to know what files we had in relation to Mr Spaulding, I told my office manager to do a thorough search, to give me a report, and that's it."

The learned primary judge dealt with the question of documentation and time elapsed as it impacted on different aspects of the application for stay.

In relation to the claim of estoppel, he concluded that he was unpersuaded that Adams had acted to his detriment, stating at par56:

"The practitioner claimed in his evidence that files and other written material relating to the Lot 7 matter have been destroyed or lost. Although there may have been the odd piece of paper that has been misfiled or otherwise lost, I am unpersuaded that any relevant files have been destroyed or lost. I am unpersuaded for the following reasons:
·    The practitioner did not claim that he was hindered in 1992 by reason of loss of files or other material when he made his initial response to the Lot 7 matter of complaint.
·    In his advice to the Society in 1992, counsel listed all the files he received. The practitioner said in evidence on the hearing of this application that none of these files related to the Lot 7 matter.
·    Files that the Society had retained after 1992 were later copied and given to the practitioner. In his evidence, the practitioner agreed that there was material on those files relevant to the Lot 7 matter and referred to a valuation report.
·    A record of all the files held by the practitioner's firm during all material times was tendered as an exhibit. It showed the name of the client, a reference to the matter and a number which indicated the date that the file was opened. Although many of those files have been destroyed in accordance with the firm's policy of destroying files periodically, the practitioner did not identify from the record any file that might have been relevant to the Lot 7 matter."

In dealing with the issue of "abuse of process" and in particular the loss of relevant files, he concluded:

"I have already made findings with respect to the claim that files and written material have been lost or destroyed. No unfairness is established upon that basis. The practitioner did not claim in his evidence that the delay had prejudiced his memory other than in a general sense. This is not surprising because he has been answering the Lot 7 matter of complaint on and off over several years. In his cross-examination, he agreed that he had a recollection of the Lot 7 matter.
Advice by the Society to the practitioner that it had closed its file, that it had decided that no action was to be taken against him, and that there was no evidence of any breach of ethical standards, cannot ground a legitimate complaint constitutes an abuse of process. Only adverse consequences to the practitioner arising as a consequence of giving such advice are relevant to the issue of abuse of process. On the trial of the issues raised by the originating application, no injustice will arise from the fact that the "prosecutor" changed its mind several times over the passage of years about whether it would take any proceedings against the practitioner. Indeed, unless there is a finding of misconduct, it is difficult to see how evidence of those matters will be relevant to the issues to be determined.
Of course, any delay is prejudicial, but it is a question of degree and has to be balanced with the community's interests in ensuring that it is protected from misconduct on the part of solicitors. In this case I am unpersuaded that the prosecution of the originating summons with respect to the Lot 7 matter constitutes an abuse of the process of the Court."

He dealt with the "quarry matter" separately in the following terms:

"On behalf of the practitioner, Mr Tree submitted that prosecution of the originating application insofar as it related to the quarry matter, would be an abuse of the process of the Court because:
·    although the complaint was made in 1999 it related to events that happened in 1985 and 1986;
·    the delay in bringing the complaint is inordinate, not satisfactorily explained and incurably prejudicial;
·    the practitioner's files relating to the complaint have been destroyed.
For the reasons already given, delay per se does not make proceedings an abuse of the Court. Delay may be evidence that the proceedings will be unfair. But, relevant to this case, unless there will be unfairness to the practitioner if the originating application proceeds to a hearing, there will be no abuse of the process of the Court.
Temporally and contextually, the quarry matter of complaint is closely linked to the Lot 7 matter of complaint. The position with respect to lost or destroyed files is the same as it was with respect to the Lot 7 matter, even though the quarry matter was not raised until much later. The practitioner was unable to identify from his firm's index of archived files any file that may have contained material relevant to the quarry matter. He conceded that amongst the files that the Society copied and handed to him, there was material relevant to both matters of complaint. Other than the fact that delay per se gives rise to prejudice, the practitioner did not identify any specific respect in which the delay would result in unfairness to him if the originating application proceeds to a hearing. Although the passage of time between the occurrence of the relevant events and the filing of the originating application is very long, it is clear from the written material in evidence before me that the quarry matter was not something that came "out of the blue" in 1999, because of the nexus between it and the Lot 7 matter and the attention that the practitioner has had to give to all his solicitor/client dealings with the complainant since the first complaint was made in 1992. No basis for a permanent stay of proceedings with respect to the quarry matter is made out."

His Honour was correct in observing that the practitioner had been unable to identify "from his firm's index of archived files any file that may have contained material relevant to the quarry matter", but with respect, the question was far wider. The index relevant to portion of the period was no longer in existence. The evidence established that notes and documentation were not always placed on a particular file. It had not been established that all files retained after 1992 remained in existence. The practitioner could do no more than claim general prejudice since it was impossible to claim that "file note X" had been placed on "file Y". The multiplicity of dealings between Adams and Spaulding over many years made identification of a specific item impossible.

The varying formulations of the complaints concerning the "quarry property" and "Lot 7" with subsidiary concerns, made documentation essential ingredients in any fair resolution of the proceedings.

But a more fundamental problem remained despite the findings made by the learned primary judge. The particulars of misconduct contained the allegation of detriment. It is one thing to conclude that a lawyer acting for a friend is unwise unless separate advice is obtained. It is another to suggest that the other "suffered loss" or that the lawyer obtained personal benefit. These two issues formed the core of Spaulding's complaint. In order to meet the fundamental claim by Spaulding, it would be necessary to reconstruct the history of dealings and identify the stage at which Spaulding's financial affairs deteriorated. The claim that he was obliged to purchase Lot 7 when he was financially insecure is serious. The sale to Knight raises a similar question. Whether the terms of purchase for the quarry property were unfair and caused economic loss to the advantage of Adams goes to the heart of a claim of unprofessional conduct.

The mechanics of the transactions were not in dispute. Adams did act for Spaulding, was the owner of Lot 7 and had an interest in the "quarry property". He did not suggest the taking of independent advice. There was little, if any, need for documentation on those matters. It was the financial ramifications and timing of the transactions which were central to the nature of the "professional misconduct". The dealings in relation to the "quarry property" involved others and records of their consultation and involvement might have served to place the transaction in a different context.

The claims stated in the affidavit sworn 7 September 2001 of "difficulty in borrowing" (par10(a)), "rights and interests" (par10(b) and (c)), "imprecision of boundaries" (par10(d)), and "stratum title" (par10(c)), might be met with material located on a general file referable to the other owners of Gunner's Quoin which might have revealed notes of discussions and comment.

There is a secondary, but no less important, basis for not confining the issue of delay and the lost files to the precise documentation relating to the identified transactions. Spaulding had made many and varied complaints concerning dealings between 1984 and 1990. There was a strong likelihood that many of these matters would be raised during the course of these proceedings, either as matters going to credit, explanatory of a fact in issue or showing a course of conduct indicative of abuse of a professional relationship for personal gain. Those matters are raised or their potential alluded to in Spaulding's affidavit filed in support of the application. The following extracts from that affidavit illustrate the potential:

"14At the time of this [Lot 7] proposed purchase there existed a close relationship between myself and the practitioner. He was aware of the difficult financial situation that I was in.
15I was in a precarious financial position at the time of my purchase of the land from the practitioner. I eventually had no choice but to sell my interest in the land [Lot 7]. I indicated this to the practitioner and he arranged for me to sell it to his friend Mr Stephen Knight, a solicitor at Messrs Dobson Mitchell & Allport. My interest in the land [Lot 7] was originally purchased for $45,000.00 and I agreed to sell it to Mr Knight for $47,500.00.
…
19Because of my desperate need for funds I agreed to discount the final instalment of the purchase price from Mr Knight in return for earlier payment of that instalment. I subsequently learned that the practitioner confirmed on my behalf to the solicitors for Mr Knight that the subsequently discounted outstanding amount of purchase price for that sale was made in full satisfaction of Mr Knight's liability under the sale contract.
20As well as that loss suffered by me because of my desperate need for funds at that time I also suffered in other ways financially because of the purchase of the interest in the land from the practitioner.
21The purchase of the interest in the land from the practitioner by me and my wife was something that we could not cope with financially because of our other financial commitments. As a consequence, before we went ahead with the purchase of the interest in the land we had no alternative but to sell my fishing vessel the 'Valda S' together with a 40 pot crayfish entitlement. We sold this for the sum of $150,000.00. We had owned the boat for 6 years and did not intend to sell it but for the purchase of the interest in the land. The price that we received for the vessel and the crayfish entitlement was a reasonable one in all of the circumstances but the sale of these items lost to us a valuable means of annual income.
…
29The agreement on price of the gravel to be supplied by me from the quarry to the practitioner and any other members of the syndicate previously referred to was reached between me and the practitioner and at the practitioner's insistence it had to be at cost. I received $2.00 a metre for cartage and $2.00 a metre for extraction and loading. These figures were in fact below cost incurred by me.
…
31Because of the practitioner's previous dealings with me he was aware that I was a commercial fisherman and he was also aware that I had no experience in quarries or earth moving. I first met the practitioner approximately 12 months before entering into the quarry transaction."

The finding of the learned primary judge that the absence of files had not been claimed to give rise to specific prejudice was not warranted by the evidence and, with respect, constitutes specific error. The finding that Adams was unable to identify relevant files from an index was correct, but did not take into account that no index existed for portion of the relevant time. The conclusion that their absence did not establish unfairness is, upon detailed analysis, not in accordance with the evidence.

The conclusion that ground 2 is made out does not necessarily give rise to the upholding of ground 3. However, it is sufficient to permit the setting aside of the order dismissing the interlocutory application.

It is appropriate for this Court to consider the application afresh rather than order a rehearing. I would confine my consideration to the claim that the combination of delay and the absence of documentation or, at least, the inability to properly search for such documentation, renders the continuation of these proceedings oppressive. The general term "abuse of process" describes an inherent jurisdiction of a superior court in a variety of circumstances. The categories have been identified by the High Court in Walton v Gardiner (1993) 177 CLR 378, a case involving disciplinary proceedings conducted by a tribunal constituted under the Medical Practitioners Act, 1938 (NSW). In their joint judgment, Mason CJ, Deane and Dawson JJ defined the concept and its application in broad terms, stated at 392 - 393:

"The inherent jurisdiction of a superior court to stay its proceedings on grounds of abuse of process extends to all those categories of cases in which the processes and procedures of the court, which exist to administer justice with fairness and impartiality, may be converted into instruments of injustice or unfairness. Thus, it has long been established that, regardless of the propriety of the purpose of the person responsible for their institution and maintenance, proceedings will constitute an abuse of process if they can be clearly seen to be foredoomed to fail (See, eg, Metropolitan Bank v Pooley (1885) 10 App Cas 210, at pp 220-221; General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 115, at pp 128-130). Again, proceedings within the jurisdiction of a court will be unjustifiably oppressive and vexatious of an objecting defendant, and will constitute an abuse of process, if that court is, in all the circumstances of the particular case, a clearly inappropriate forum to entertain them (See, generally, Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538). Yet again, proceedings before a court should be stayed as an abuse of process if, notwithstanding that the circumstances do not give rise to an estoppel, their continuance would be unjustifiably vexatious and oppressive for the reason that it is sought to litigate anew a case which has already been disposed of by earlier proceedings (See, eg, Reichel v Magrath (1889) 14 App Cas 665, at p 668; Connelly v DPP [1964] AC 1254, at pp 1361-1362). The jurisdiction of a superior court in such a case was correctly described by Lord Diplock in Hunter v Chief Constable of the West Midlands Police ([1982] AC 529, at p 536) as 'the inherent power which any court of justice must possess to prevent misuse of its procedure in a way which, although not inconsistent with the literal application of its procedural rules, would nevertheless be manifestly unfair to a party to litigation before it, or would otherwise bring the administration of justice into disrepute among right-thinking people'."

It is not necessary, for the purpose of this appeal, to consider whether a narrower view preferred by some members of the court in Jago v District Court (NSW) (1989) 168 CLR 23, ought apply here (see also Carson v Legal Services Commissioner & Anor [2000] NSWCA 308). In Re a Medical Practitioner (1993) 2 Tas R 90, Green CJ applied Walton, although on the facts of the case concluded that the efluxion of some 20 years simpliciter did not warrant a remedy of stay which, in his view, ought "only be made in exceptional circumstances".

The time elapsed between the matter of complaint and the commencement of proceedings, some 18 years, might not, of itself, constitute a basis for stay. The delay in making the first complaint until 1992 and the second in 1999 might create unfairness which could be met with allowance made for the absence of accurate recall or scant documentation. But the interconnection of voluminous complaints, their complexity and repetition, even when distilled into two identified events, remove these proceedings from those consisting of a discrete and readily identified event (New South Wales Bar Association v Evatt (1968) 117 CLR 177) or a consistent course of general conduct clearly shown (Law Society of New South Wales v Moulton [1981] 2 NSWLR 736). Even at this stage of proceedings it remains difficult to discern the precise nature of the grievance, except by reference to the other matters said to have caused bankruptcy and the collapse of corporate entities. While professional misconduct need not involve economic loss (Moulton), it is difficult to discern the basis for complaint other than a general statement of financial hardship due to other matters. Adams did sell land to Spaulding, but did so at a price less than valuation. He had referred the client to an independent valuer whose report disclosed the status of the land, the form of title and the proposed boundaries. The sale to Knight was for a higher price and any economic detriment was a consequence, not of the absence of independent legal advice, but of a need to hasten the payment of instalment money. That is not to conclude that the test of improbability of outcome as stated in Walton applies here. It may be that a determination on the merits would result in a finding that, according to acceptable standards applicable in 1984 - 1985, the failure to suggest independent legal advice alone would constitute unprofessional conduct. But a finding of economic detriment or advantage might warrant a sanction of suspension or removal.

The complaints have been comprehensively examined by independent counsel. The appellant has been formally advised on two occasions that the complaints had been dismissed and the matter closed. Spaulding has requested that the matter no longer be pursued by the Society and sought referral to a different authority. These proceedings were commenced after continued representations, involvement by the Attorney-General and the Legal Ombudsman and an apparent visit by police officers. Files had been produced and kept, either by the Society or referred to retained counsel. That in itself does not constitute a basis of previous disposition as stated in Walton.

However, the course of the proceedings resulted in the loss or destruction of files kept by Adams and Page Seager which inhibited his capacity to meet the allegations, especially the components of economic detriment and advantage. Disavowal of a claim for compensation does not negate that claimed characterisation of the professional misconduct. The Society has chosen not to deal with the complaint in accordance with the Legal Profession Act 1993, Div1A.

The combination of the above renders continuation of these proceedings "unfair to a party to litigation" in the sense stated in Walton and by Lord Diplock in Hunter v Chief Constable of the West Midlands Police [1982] AC 529. In that sense it can be regarded as oppressive and thus constitute an abuse of process.

I would uphold the appeal in relation to ground 2 and set aside the order dismissing the application for stay. I would substitute in lieu an order granting the interlocutory application filed on 8 October 2001.