Carson v Legal Services Commissioner and Anor.
[2000] NSWSC 64
•23 February 2000
CITATION: Carson v Legal Services Commissioner and Anor. [2000] NSWSC 64 revised - 24/02/2000 CURRENT JURISDICTION: Common Law FILE NUMBER(S): SC 12553/97 HEARING DATE(S): 25/5/98,26/5/98,27/5/98,28/5/98,29/5/98,
1/6/98,2/7/98,3/6/98,4/6/98,5/6/98,
9/6/98,10/6/98,11/6/98,12/6/98,
16/6/98,17/6/98,18/6/98JUDGMENT DATE: 23 February 2000 PARTIES :
Nicholas Roderick CARSON - Claimant
Legal Services Commissioner - First Opponent
Legal Services Tribunal - Second OponentJUDGMENT OF: Simpson J at 1
COUNSEL : Mr P Brereton SC - Claimant
Mr W Haylen QC with Mr M Marien - OpponentSOLICITORS: Atanaskovic Hartnell - Claimant
I V Knight, Crown Solicitor - OpponentLEGISLATION CITED: Legal Profession Act 1987 CASES CITED: See Appendix C DECISION: Orders deferred.
INDEX TO JUDGMENT
Paragraph No.
1. INTRODUCTORY
19 The Summons
23 The Evidence
24 The Background
55 Rajski’s Complaint to the LSC
59 The Complaint and Information in the Tribunal
60 THE GROUNDS IN THE SUMMONS
1. The first decision (s.138(2)):
Ground 1 of the Summons.61 Facts
72 (a) Do the Rules of Procedural Fairness apply to a decision under s 138(2) of the Legal Profession Act?
91 (b) Was the obligation to observe the rules of procedural fairness adequately discharged?
96 (c) Reasonableness.
113 2. The second decision: s 155:
Ground 2 of the Summons: Procedural Fairness135 OTHER PROCEDURAL MATTERS
3. Ground 3 of the Summons
138 Facts
144 4. Ground 4 of the Summons
145 Duplicity: professional misconduct and unsatisfactory professional conduct
156 Unsatisfactory professional conduct in respect of conduct occurring before 1 January 1988
159 Unsatisfactory professional conduct in respect of conduct occurring more than three years before the date of the complaint.
164 The Information is brought in respect of conduct some of which is not the subject of any complaint - not a complaint as required by s 167.
169 5. Ground 5 of the Summons
171 Delay
180 Unfair and improper investigation
183 Improperly obtained evidence
186 SUBSTANTIVE MATTERS
Ground 5.5 in the Summons:
Abuse of Process193 Ground 1 in the Information
Wood and Donaldson195 Facts
231 Ground 2 in the Information
Legal Aid234 Facts
286 Ground 3 of the Information
Carneys Defamation Proceedings287 Facts
312 Ground 4 in the Information
Yerushalmy313 Facts
318 Ground 5 in the Information
Dr Metcalf319 Facts
346 Ground 6 in the Information
The Fairfax Defamation Proceedings.350 Facts
373 Ground 7 in the Information
376 Ground 7(v) -
Costs - Defamation Proceedings before Hunt J377 Facts
383 Ground 7 (vi) -
Tutor Application384 Facts
406 Ground 7 (viii)
407 Facts
Costs in the Application before Campbell J.
SUMMARY OF CONCLUSIONS
Paragraph No.
90 The rules of procedural fairness apply to a decision under s.138(2) of Legal Profession Act 1987 to accept a complaint out of time.95 The requirements of the rules of procedural fairness were adequately met in this respect.
112 It was not unreasonable for the LSC to accept the complaint out of time.
116 The rules of procedural fairness apply to a decision under s 155 of the Act to institute proceedings in the Tribunal.
126 -7 The requirement of the rules of procedural fairness were not adequately met in relation to the decision to institute proceedings in the Tribunal.
130 Because of the manner in which this application has proceeded it would be inappropriate to declare the decision void.
142 The claimant has demonstrated error in law in that the LSC failed to record his decision to institute proceedings and failed to notify the claimant of his decision and the reason therefor.
143 For the same reasons as apply to the conclusion in para 130, the error does not result in a declaration that the decision was void.
150 It is not vexatious and embarrassing for the LSC to allege in a single Information that the same conduct may amount either to professional misconduct or unsatisfactory professional conduct.
158 It would not be open to the Tribunal to find that conduct that occurred before 1 January 1988 amounted to unsatisfactory professional conduct. The Information can be amended in the Tribunal.
161 It is open to the LSC, having accepted out of time under s 138(2)(b) a complaint of professional misconduct, to institute proceedings in the Tribunal alleging that that conduct amounts to unsatisfactory professional conduct.
168 The Tribunal does not possess jurisdiction to conduct a hearing into those grounds in the Information that were not part of the original complaint.
178-182 Although the delay in the institution of the proceedings in the Tribunal, the denial of procedural fairness in relation to the s 155 decision, in particular in relation to a planned but aborted meeting, and in the failure of the LSC to seek relevant information from others are matters of concern, they do not individually or collectively establish that the proceedings are an abuse of process, or oppressive or vexatious.
185 There is no basis for a conclusion that the evidence to found the proceedings was obtained improperly.
Individual Grounds in the Information
Ground 1: Wood and Donaldson
230 It would not be open to the Tribunal to find the claimant guilty of professional misconduct in this respect.
Ground 2 : Legal Aid
285 Commencement of proceedings on the basis of the allegations concerning the claimant’s attempts to have the grant of legal aid to Rajski and Raybos terminated are not an abuse of process.
Ground 3: Carneys Defamation Proceedings .
311 Commencement of proceedings on the basis of the allegation concerning the defamation claims against Carneys are not an abuse of process.
Ground 4: Yerushalmy
317 It would not be open to the Tribunal to find the claimant guilty of professional misconduct on the basis of the allegations in relation to Yerushalmy.
Ground 5: Dr Metcalf
345 Commencement of proceedings on the basis of the allegations concerning Dr Metcalf are not an abuse of process.
Ground 6: The Fairfax Defamation Proceedings
372 It would not be open to the Tribunal to find the claimant guilty of professional misconduct on the basis of the allegations that the claimant gave untruthful evidence in these proceedings.
Ground 7(v),(vi) and (viii)
382,405,411 It would not be open to the Tribunal to rely on any of these allegations to sustain a finding of professional misconduct.
THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISIONSIMPSON J
23 February 2000
12553/97
CARSON v LEGAL SERVICES COMMISSIONER & ANORJudgment
HER HONOUR :
INTRODUCTORY1 This is a claim for judicial review of two decisions made under the authority of the Legal Profession Act 1987 (“the Act”). It will be necessary from time to time to refer to various provisions of the Act. For ease of reference the relevant provisions (as they stood at the relevant time) are extracted and annexed as Appendix A to these reasons. Also annexed, as Appendix B, is a list of persons, natural and artificial, who figure in the proceedings, arranged alphabetically by the abbreviated titles which I shall use in the course of this judgment, together with their full titles, and, where appropriate, a short description of their role or involvement with others in the proceedings. With no disrespect to any individual, I will refer to them all uniformly by their surnames. Annexed as Appendix C is a list of relevant authorities and previously decided cases to which reference will be made during the course of these reasons. Appendix D is a list of the various proceedings that feature in this judgment.
2 The claimant is a legal practitioner and a partner in the firm of solicitors formerly known as Messrs Dawson Waldron (“DW”). The first opponent is the Legal Services Commissioner (“the LSC”) appointed pursuant to the provisions of the Act and performs the statutory functions entrusted to him thereunder. The second opponent is the Legal Services Tribunal (“the Tribunal”) constituted under the Act. The Tribunal has filed a submitting appearance.
3 The issues raised involve Part 10 of the Act which is entitled, and concerned with, “Complaints and Discipline”.
4 S 123 identifies as the general objects of Part 10 the redress of consumer complaints of users of legal services, the ensurance of compliance by individual legal practitioners with necessary standards of honesty, competence and diligence, and maintenance at a sufficiently high level of the ethical and practice standards of the legal profession as a whole.
5 Ss 124 and 125 set out, respectively, the objects of Part 10 relating to users and providers of legal services.
6 By s 129 of the Act the office of the LSC is created. The functions of the LSC are set out in s 131. These are predominantly concerned with receipt and handling of complaints about the conduct of legal practitioners. By s 162 the Tribunal is constituted. Its principal function is to hear and determine proceedings in relation to complaints about the conduct of legal practitioners.
7 By s 134 any person may make a complaint to the LSC about the conduct of a legal practitioner. Such complaint is to be dealt with in accordance with the provisions of Part 10 (subs (2)). By s 138 such a complaint may only be made within three years after the date of the conduct the subject of the complaint, but by subs (2) the LSC is empowered to extend that time, if satisfied that it would be just and fair to do so, having regard to the delay and the reason for the delay (para (a)), or if satisfied that the complaint concerns an allegation of professional misconduct and that it is necessary in the public interest to investigate it (para (b)). By s 127, a distinction is drawn between “professional misconduct” and “unsatisfactory professional conduct”, both of which are defined. The LSC is empowered to dismiss a complaint if it is not supported by appropriate particulars or verification (s 141(a)), or if it is frivolous or vexatious (s 141(b)). (The latter provision has been amended since the present complaint was made: Legal Profession Amendment Act 1996).
8 On receipt of a complaint the LSC may refer it to either the Council of the Bar Association or the Council of the Law Society for investigation (s142), or may conduct an investigation himself (s147A). For the purposes of the investigation the legal practitioner against whom the complaint is made may be required to provide information or produce documents (s152(1)).
9 After an investigation is completed a complaint is to be dealt with in accordance with s 155. Where the LSC or the relevant Council is satisfied that there is a reasonable likelihood that the legal practitioner will be found guilty by the Tribunal of unsatisfactory professional conduct or professional misconduct he or it is obliged to institute proceedings in the Tribunal. However, if the LSC or Council is satisfied that the legal practitioner will be found guilty only of unsatisfactory professional conduct and not of professional misconduct, he or it may instead either, with his/her consent, reprimand the legal practitioner (s 155(3)(a)); or, if satisfied that the legal practitioner is generally competent and diligent and has not been the subject of other material complaints, may dismiss the complaint (s 155(3)(b)).
10 If the LSC or the relevant Council is satisfied that there is no reasonable likelihood that the legal practitioner will be found guilty by the Tribunal of either unsatisfactory professional conduct or professional misconduct, he or it is obliged to dismiss the complaint (s 155(4)).
11 By s 156, in respect of each investigation, the LSC or relevant Council is required to keep a record of his or its decision with respect to a complaint, together with the reasons for the decision.
12 Where proceedings have been instituted in the Tribunal, the Tribunal is required to conduct a hearing into each complaint (s167(2)).
13 By s 168, where the Tribunal is conducting a hearing into a question of professional misconduct, it is to observe the rules of evidence (subs (1)), but for the purpose of conducting any other hearing it is not bound to observe the rules of evidence, and may inform itself of any matter in such manner as it thinks fit (subs (2)). An important distinction is thus drawn as to the procedure governing the conduct of hearings into allegations of professional misconduct and allegations of unsatisfactory professional conduct. A second such distinction is drawn in s 170 which provides by subs (1) that a hearing is to be held in the presence of the public but by subs (2) that a hearing is to be held in the absence of the public if the Tribunal so directs; by subs (3) the Tribunal is required to direct that a hearing (or part of a hearing) relating only to a question of unsatisfactory professional conduct be held in the absence of the public unless the Tribunal is of the opinion that the presence of the public is in the public interest or the interests of justice. By sub s (4) the Tribunal may direct that a hearing or part of a hearing relating to any other question (ie any question other than an allegation of unsatisfactory professional conduct) be held in the absence of the public if it is of the opinion that the presence of the public is not in the public interest or the interests of justice.
14 S 171C specifies the courses of action available to the Tribunal if satisfied that a legal practitioner is guilty of professional misconduct or unsatisfactory professional conduct. The options available range from ordering that the legal practitioner undertake and complete a specified course of further education, to ordering that his/her name be removed from the roll of legal practitioners (applicable to a finding of professional misconduct only), or ordering cancellation of the legal practitioner’s practising certificate. S171J requires the LSC to cause a decision with respect to a complaint, together with reasons therefor, to be notified to the complainant and the legal practitioner the subject of the complaint.
15 The Act came into effect on 1 January 1988. The present Part 10 was substituted for the pre-existing provisions with effect from 1 July 1994. During the course of preparation of these reasons, legislative changes were enacted. One significant change was the abolition of the Tribunal and the transfer of its jurisdiction to the Administrative Appeals Tribunal. While it seems to me that these changes ought not affect the substance of the matters necessary for me to decide, and I have continued to refer to the formal procedure, I will give the parties an opportunity to be heard in this regard.
16 On 8 July 1994 Lesjek Rajski (“Rajski”) lodged with the LSC, pursuant to s 134 of the Act, a complaint against the claimant. The complaint was extensive and was detailed in a “complaint book” that ran to 175 pages. It concerned conduct of the claimant alleged to have taken place between 1986 and 1989. A number of quite separate matters were particularised as conduct the subject of the complaint.
17 By reason of s 138(1) of the Act Rajski’s complaint was prima facie statute barred. On 30 March 1995 the LSC decided to exercise the discretion conferred by s 138(2) in favour of Rajski and accepted the complaint out of time. This is the first decision challenged by the claimant.
18 On 17 December 1996, pursuant to s 155(2) of the Act, the LSC decided to institute proceedings in the Tribunal with respect to the complaint. He did this by filing in the Tribunal an Information, alleging that, on seven separate grounds, the claimant’s conduct constituted either professional misconduct or unsatisfactory professional conduct. The precise terms of the Information are more fully set out below, at para 59. The decision to file the Information is the second decision challenged by the claimant.19 On 4 February 1997 the claimant issued a summons in the Court of Appeal seeking:
The Summons
20 The grounds upon which the decisions are challenged are set out in the summons as follows:
(i) declarations that each challenged decision is void;(ii) an order prohibiting the Tribunal from proceeding to conduct a hearing into the allegations particularised in the Information;
(iii) alternatively, a permanent stay of the proceedings in the Tribunal;
(iv) costs.
By order made on 26 August 1997 the Court of Appeal remitted the whole of the summons for hearing in this Division.
“1. The decision of [the LSC] … to accept the complaint was:
1.1 made in contravention of the rules of natural justice and/or procedural fairness;
1.2 wholly unreasonable.
2. The decision of [the LSC] … to institute proceedings in [the Tribunal] was:
2.1 made in contravention of the rules of natural justice and/or procedural fairness;
2.2 made in respect of conduct which was alleged to have occurred more than 3 years before the complaint was made without having first exercised properly or at all his discretion to accept a complaint in respect of such conduct;
2.3 wholly unreasonable. [This ground was added on the last day of the hearing.]
3. The proceedings before [the Tribunal] were instituted by [the LSC]:
4. The information is vexatious and embarrassing in that:-
3.1 without [the LSC] having first recorded his decision and the reasons for it, as required by Legal Profession Act s 156;
3.2 without [the LSC] having first notified the [claimant] of his decision to do so and the reasons for it, as required by Legal Profession Act s 171J .
5. The proceedings before [the Tribunal] are an abuse of process and vexatious and oppressive in that:
4.1 it alleges both professional misconduct and unsatisfactory professional conduct in respect of the same conduct;4.2 it alleges unsatisfactory professional conduct in respect of conduct which occurred before 1 January 1988;
4.3 it alleges unsatisfactory professional conduct in respect of conduct which occurred more than 3 years before the date on which the complaint was made.
5.1 the jurisdiction of [the Tribunal] has been invoked irregularly by reason of the matters referred to in grounds 1, 2, 3 and 4 above;
5.2 there has been gross and inexcusable delay in the making and investigation of the complaint;
5.3 the investigation of the complaint has been conducted unfairly and improperly;
5.4 the evidence upon which the complaint is based has been obtained improperly;
5.5 there are not reasonable prospects that the [claimant] will be found guilty of professional misconduct;
5.6 the subject matter of the information is substantially the same as the subject of contempt proceedings by the complainant against the [claimant] in the Court of Appeal.”
21 The grounds of challenge essentially fall into two groups which might be categorised as procedural and substantive. Those described as procedural include those which allege contravention of the rules of natural justice and/or procedural fairness (grounds 1.1, 2.1), and those that allege irregularity of procedure (grounds 3.1, 3.2, 4.1, 5.1, 5.3, 5.4). Should the claimant be successful in his challenge on any of the procedural grounds the result may well be an order that the LSC re-consider the relevant decision according to law. The second group, those I have categorised as substantive, would, if successfully argued, almost inevitably have the consequence that the decision concerned be quashed. These grounds include those that allege that the decisions are unreasonable (1.2, 2.3) or that the conduct of the claimant the subject of the complaint fell outside the applicable statutory provisions (4.2, 4.3).
22 Having regard to the manner in which the Information is framed, with seven distinct grounds, and to the bases on which the challenge is mounted, it will be necessary to treat each of the seven grounds in the Information as, in effect, a separate proceeding. For example, it may be that the decision to institute proceedings in respect of one ground of complaint has been shown to have been unreasonable but that others have not. This applies equally to the decision to accept the complaint out of time in so far as that decision is challenged on the ground of unreasonableness, since one of the claimant’s arguments is that the complaint ought not to have been accepted as there are no reasonable prospects that he will be found guilty either of professional misconduct or unsatisfactory professional conduct.23 It is convenient here to say something of the evidence before me. The claimant relied upon two affidavits sworn by him, one of which, sworn on 28 February 1997, with annexures and exhibits is contained in two large lever arch folders. The documents exhibited are identified by the numbers NRC 1-7. A second affidavit was sworn by him on 13 March 1998. In addition, tendered on his behalf were another four lever arch folders containing relevant documents arranged chronologically. These together became exhibits C1-4. During the course of the hearing, many other documents were tendered and marked as exhibits. The LSC’s material is contained in three lever arch folders, arranged by reference to the ground of complaint to which they are relevant. These were marked as exhibits 1A-C. The LSC, too, tendered many additional documents during the course of the hearing. There is a degree of duplication in that many of the documents contained in the claimant’s folders were also contained in the LSC’s bundles. Generally speaking, for ease of reference I will refer to duplicated documents by reference to the numbers given to the claimant’s exhibits. Oral evidence was given by the claimant who was extensively cross-examined, and by a number of witnesses on his behalf. Affidavit evidence was given by a number of legal practitioners some of whom also gave oral evidence. No affidavit or oral evidence was adduced by the LSC.
The Evidence
The Background
24 It is now convenient to set out a little of the background to the present application. In some respects relevant and non-contentious background facts have been drawn from the recitation of facts in earlier judgments.
25 The relevant events commenced sometime before 1980. Rajski claimed to have been the author or inventor of a computer language system named Raybol. Raybol was said to be a system that itself produced software systems. Rajski was a director and shareholder of Raybos Australia Pty Limited (“Raybos”).
26 By agreement dated 15 February 1980 Rajski and Raybos agreed to sell the rights to Raybol to the Tectran Corporation (“Tectran”) and Tectran agreed to develop and market the programme, to employ Rajski for that purpose, and to make progressive payments to Rajski and Raybos. Tectran was one of a number of companies that constituted the Arunta Group of Companies (“the Arunta Companies”).
27 By the end of 1980 Tectran executives were disenchanted with Raybol and with the progress being made towards its marketability. In December 1980 Tectran issued a statement of claim in this court (No.16938/80) against Rajski and Raybos, alleging breaches of a number of implied terms of the agreement, breach of express warranty, misrepresentation and negligence, and claiming damages and consequential orders. Central to the claim was an assertion that Raybol was ineffective for the purpose for which Tectran had purchased it.
28 The issue of the statement of claim precipitated an extraordinary saga of litigation in this Court, much of which can be traced through numerous reported and unreported judgments, to some of which it will be necessary to refer. It is this litigation and events surrounding it, and particularly the claimant’s involvement in it, that are at the heart of the present proceeding. Appendix D is a list of the relevant proceedings, identified by the short reference I shall use during the course of these reasons.
29 Rajski and Raybos filed a defence to Tectran’s claim. On 3 February 1981 Raybos (but not Rajski) filed a cross claim, naming as cross-defendants Tectran and Arunta Investments Pty Ltd (“Arunta Investments”). They alleged breach of contract and anticipated breach of contract against Tectran, and claimed damages, injunctions and other orders. The proceedings, including the cross claim, came to be known as the 1980 proceedings, terminology I will continue to use. In 1981 Rajski and Raybos issued a statement of claim in the Equity Division of this Court against Computer Manufacture and Design Pty Limited (“CMAD”), Prometheus Pty Ltd (“Prometheus”), and Tectran, alleging breach of the obligation of confidentiality in relation to Raybol, and claiming damages, injunctions and other orders. I will refer to this as “the CMAD proceeding”.
30 In each of these proceedings, Messrs Allen Allen and Hemsley, solicitors (“AAH”), represented Tectran and Arunta. In the CMAD proceeding DW represented CMAD and Prometheus. In each case Rajski and Raybos were granted legal aid pursuant to the Legal Aid Commission Act 1979 (“the LAC Act”). In July 1985 Rajski and Raybos issued another statement of claim in this Division naming as defendants Tectran, Arunta Properties (NSW) Pty Ltd (formerly known as Scitec Corporation Pty Ltd) (“Scitec”), Arunta Investments, various directors, officers and employees of one or more of the corporate defendants, and the partners, former partners and one employee of AAH. Among the Tectran/Arunta officers named were Messrs Garry Richardson (“Richardson”) and Moshe Yerushalmy (“Yerushalmy”), identified in the pleading respectively as Chairman of the Boards of Tectran, Scitec and Arunta, and Managing Director of Tectran and Scitec. The allegations contained and particularised in the statement of claim are extensive and need not here be detailed. The substance of the claim was that the defendants had conspired together to harm Rajski and Raybos and that the issue and service of the 1980 statement of claim constituted an actionable abuse of the processes of this Court. I will refer to this as “the 1985 proceeding”. Messrs Carneys, solicitors (“Carneys”), acted for Rajski and Raybos. AAH continued to represent Tectran and the Arunta Companies.
31 In October 1982 CMAD and Prometheus successfully sought a stay of the CMAD proceeding pending the payment by Rajski and Raybos of the sum of $30,000 by way of security for the costs of that proceeding (Rajski v Computer Manufacture and Design Pty Ltd [1982] 2 NSWLR 443, per Holland J.)
32 Later in 1985 Rajski and Raybos filed a notice of motion seeking to amend Raybos’ cross claim in the 1980 proceedings. Among the amendments sought was the joinder of Rajski as a cross-claimant. In substance Rajski and Raybos then sought to add a number of cross-defendants to the cross-claim, including the partners and two employed solicitors of AAH and counsel who had previously appeared for Tectran, and to plead causes of action in conspiracy, malicious prosecution and abuse of process. All allegations arose out of the issue of the 1980 statement of claim. Rajski and Raybos alleged, inter alia, that the various existing and proposed cross-defendants had conspired together to present false evidence to the court and to misuse the processes of the court, their purpose being to delay the hearing of the 1980 proceeding and thereby exhaust the financial resources of Rajski and Raybos so that they could not continue to defend the claims against them or pursue their own cross-claim, and to force them into a position of weakness in bargaining with Tectran. The proposed amended cross-claim was, in effect, a re-working and expansion of the 1985 proceeding. The motion for amendment was heard by Miles J over thirty days between November 1984 and May 1985. In a judgment delivered on 5 June 1985 his Honour identified as a principal issue for his determination whether Rajski and Raybos had shown that they had an appropriately arguable case (on the substance of their proposed amendments) on a tenable evidentiary basis (Tectran Corporation Limited and Others v Raybos Australia Pty Limited and Another, Miles J, 5 June 1985 unreported, p 10).
33 Two former employees of Tectran, Alexander Donaldson (“Donaldson”) and Adrian Wood (“Wood”), swore affidavits and gave oral evidence in support of Rajski and Raybos. Both attested to the general effectiveness of Raybol, notwithstanding their acknowledgment that the product needed enhancement and improvement.
34 Although his Honour expressly found that, in respect of some of those Rajski and Raybos sought to add as cross-defendants (including AAH), there was an appropriately arguable case on a tenable evidentiary basis, in the exercise of his discretion he dismissed the notice of motion. He left open the prospect of Rajski and Raybos pursuing their claims in a separate proceeding.
35 One consequence of his Honour’s conclusions was that AAH then ceased to act for Tectran and the Arunta Companies and their directors, executives and employees. They remained, of course, as parties to the 1985 proceeding.
36 In July 1985 DW assumed carriage of the litigation on behalf of the former clients of AAH. The claimant undertook the general oversight and responsibility of the litigation. He did not, however, have the full day to day carriage of the matters. That was entrusted principally to a then employed solicitor (later a partner), Christopher Davidson (“Davidson”), with the assistance of another employed solicitor, Raol Lake (“Lake”) and a paralegal, Catherine McCarthy (“McCarthy”).
37 There now arises a minor complication in recounting these facts. The evidence discloses a vast amount of correspondence between DW and others, some of which is of crucial importance in the allegations made against the claimant in the Information. Much of the correspondence emanating from DW was prepared by one or other of the employed solicitors, and not by the claimant. Often it was another partner who actually signed and authorised the dispatch of particular letters. Having regard to the system by which DW’s correspondence was prepared and sent, it has not always been possible to identify the claimant as the actual author or signatory of (as distinct from the partner accepting ultimate responsibility for) some of the correspondence of which complaint is made. Since, in some cases, some significance attaches to the identity of the author or signatory of particular documents, it will be convenient in the course of this outline of the background facts, to attribute the correspondence only to DW, without attempting to identify the actual author or signatory. Where necessary, that will be explored at a later point.
38 The claimant set about the preparation of the litigation on behalf of Tectran and Arunta. In the course of doing so, he approached both Wood and Donaldson with a request for their assistance. The circumstances of this request, and the manner of the approaches, are the foundation for the first ground in the Information. A detailed examination of the claimant’s conduct and the allegations against him, can be found at paragraphs 193 to 230.
39 The complainant then took steps to achieve the cancellation of the grant of legal aid to Rajski and Raybos. His efforts in this regard are the foundation for the second ground in the Information.
40 Acting on behalf of Tectran and Arunta, DW wrote to the LAC making a number of assertions about Rajski and Raybos, and requesting a review of the grant of legal aid. In February 1986, again acting on behalf of Arunta and various executives and officers of the Arunta Companies, he issued a summons in the Administrative Law Division of the Court, naming the predecessor of the LAC (then known as the Legal Services Commission of NSW) as defendant and claiming review of the decision to grant legal aid. I will refer to this as “the LAC proceeding”. The detailed allegations are set out at paragraphs 231 to 285. They are the foundation for the second ground in the Information.
41 Towards the end of 1985, it appears, the directors of Scitec were contemplating floating the company on the Stock Exchange. Carneys, who continued to act for Rajski and Raybos, wrote to the Chairman of the Stock Exchange, drawing attention to the relationship between Scitec, Arunta Investments, Richardson and Yerushalmy. They advised the Chairman that Rajski and Raybos had instituted the 1985 proceeding, and that the damages claimed by them had been quantified at $600 million, and asserted that Arunta Investments had disposed of approximately $15 million in assets in the preceding five years. As a result of the letter, two of the companies in the Arunta Group (Gavemer Pty Ltd and Arunta Investments) and Richardson and Yerushalmy commenced proceedings in defamation against the partners of Carneys. I will refer to these proceedings as “the Carneys defamation proceedings”.
42 DW acted for each of the four plaintiffs. The claimant was the partner responsible for the litigation. His conduct in commencing the proceedings, and in related respects, is the subject of the third ground in the Information. The allegation in this respect are detailed at para to 286 to 312.
43 On 28 November 1985 Rajski issued a summons in the Court of Appeal (CA452/85) alleging that the claimant was guilty of contempt. He particularised as the conduct constituting contempt the claimant’s attempts to have the grant of legal aid to himself and Raybos terminated, and the claimant’s approaches to Wood and Donaldson in relation to giving evidence on behalf of Tectran and Arunta. I will refer to this as “the first contempt proceeding”. It has never been brought on for hearing.
44 On 3 January 1986 Tectran issued a further statement of claim in this Division against Raybos and Rajski. To some extent its subject matter was repetitive of that of its 1980 statement of claim, but there was an important addition to the case now pleaded. Tectran claimed that, contrary to representations it alleged Rajski had made, and in breach of an implied term of the 1980 agreement, Raybol was not Rajski’s invention, but was a copy of another programme called “Count 11”, of which copyright was held by Lopfer and Long Inc of the USA, and that Rajski had made material false representations about Raybol prior to the agreement. It explicitly alleged fraud against Rajski. I will refer to this as “the fraud proceeding”.
45 In July 1986 Rajski and Raybos issued yet another statement of claim. They named the claimant and DW as defendants and alleged conspiracy in the conduct of the 1980 and the 1985 proceedings. I will refer to this as “the 1986 proceeding”. They alleged, inter alia, that Tectran had made false allegations in the 1980 statement of claim and that by 1985 the claimant was aware that the allegations were false; that the claimant, when he sought review of their grant of legal aid, had done so for the purpose of and in furtherance of a conspiracy to obstruct them in the pursuit of their rights against Tectran and Arunta, and to pervert the course of justice; that the claimant and others had conspired wrongfully to keep the 1980 proceeding on foot in order to exhaust their financial resources and force them to a weaker bargaining position; that the claimant and others had wrongfully conspired to assist Tectran and Arunta in abusing the processes of the court and to pervert the course of justice; that the claimant’s actions in contacting Wood and Donaldson were taken in furtherance of a conspiracy wrongfully to pursuade each of them to alter the evidence he had previously given, and to pervert the course of justice; that the claimant, acting for Tectran, Arunta and their executives, instituted the Carneys defamation proceedings for the purpose of coercing Carneys to withdraw their legal representation of Rajski and Raybos.
46 During the course of preparations for litigation, the claimant, with others, conferred with representatives of Tectran and Arunta. In the course of a discussion on 24 February 1986, he gave certain advice to Yerushalmy about his evidence and the manner of giving it. This advice is the foundation for the fourth ground in the Information. Details of the allegations can be found at paragraphs 312 to 318.
47 Despite the enormous amount of activity that is evidenced by the voluminous documentary records (and there was much more than has here been mentioned), none of the substantive litigation - the 1980, 1985, 1986 proceedings, the fraud proceeding, the Carneys defamation proceeding or the first contempt proceeding - was brought on for hearing. There were, however, numerous forays and skirmishes in this Division, the Equity Division, and in the Court of Appeal.
48 In October 1986 various matters were listed before Powell J (as he then was), in the Equity Division, although the evidence does not enable me to say for what purpose. Certainly they were not listed for final hearing. The matters listed included matters in which the claimant was personally a party. Rajski and Raybos sought adjournment of the proceedings. The basis of the application was Rajski’s mental or nervous condition of which he tendered psychiatric evidence from a psychiatrist, Dr William Metcalf (“Metcalf”). Powell J refused the adjournment application.
49 Rajski and Raybos appealed Powell J’s refusal of the adjournment in the Court of Appeal. A hearing took place over 20 - 23 October 1986. Metcalf gave additional evidence. The claimant, along with the other defendants, was represented by senior counsel. The following morning, as the Court was about to deliver judgment, the claimant announced that he now appeared for himself and wished to put some additional argument on the question of the adjournment application. The substance of his argument was that if the Court granted the adjournment sought on the basis of the psychiatric evidence, the acceptance of that evidence carried the implication that Rajski was mentally unstable and unfit to manage his own affairs, with the consequence that a tutor would have to be appointed to conduct the litigation for him. The claimant’s conduct at this time and thereafter is part of the foundation for the seventh ground in the Information. Particulars of the allegations against him in that respect are detailed at paragraphs 383 to 405.
50 In support of his application for adjournment Rajski put before the Court reports by Metcalf. In one report, as part of the history on which his opinion was based, Metcalf recounted allegations that had, it seems, been made to him about the manner in which DW had conducted the litigation. The claimant threatened to institute defamation proceedings against Metcalf. His action in this regard is the foundation for the fifth ground in the Information. This complaint is dealt with at paragraphs 318 to 345.
51 By notice of motion filed in the Court of Appeal on 28 April 1987 Rajski again alleged contempt against the claimant. Part of the substance of the charge on this occasion lay in the claimant’s threats to sue Metcalf in defamation. I will refer to this proceeding as “the second contempt proceeding”. Like the first, it has never been brought on for hearing.
52 The various proceedings had attracted some media attention and were reported, from time to time, in a weekly law column in the Sydney Morning Herald (“SMH”), a daily newspaper circulating in NSW. The claimant sued the publishers of SMH, John Fairfax and Sons Limited (“Fairfax”), in defamation on two of the articles, and he sued the journalist who wrote the columns, John Slee (“Slee”), on one of the articles. The two claims were heard together in a trial that commenced on 6 June 1989 before Loveday J and a jury. I will refer to these as “the Fairfax defamation proceedings”. The claimant gave evidence. The LSC alleges that, in three respects, the evidence he gave was untruthful. This allegation is the foundation for the sixth ground in the Information. It is more fully particularised at paragraph 346 to 372.
53 The seventh ground in the Information is a compendium of various matters already mentioned, with two additions. These concerned attempts to recover costs awarded against Rajski, or Rajski and Raybos, in proceedings before Hunt J and Campbell J. The precise circumstances are examined in paragraphs 373 to 411.
54 There is another circumstance that need here be mentioned, which appears to be unrelated, or no more than peripherally related, to the events I have recounted, but is material to the grounds contained in the Information. In March 1988 the Director of Public Prosecutions for the Commonwealth (“the DPP”) proposed to prosecute Yerushalmy for certain offences. He was unable to locate Yerushalmy for the purpose of serving the initiating process upon him. The claimant represented Yerushalmy in relation to other proceedings, including those mentioned in this chronology, to which Yerushalmy was a party. The DPP’s officers (or police) communicated with the claimant in relation to the proposed prosecution. The claimant had no instructions to accept service on Yerushalmy’s behalf. It is in relation to the claimant’s role in this matter that LSC alleges the claimant gave false evidence in the Fairfax defamation proceedings.
Rajski’s Complaint to the LSC
55 Rajski’s complaint was made to the LSC on 8 July 1994 and bears a notation that it was received on 11 July 1994. It was made by covering letter accompanied by a 175 page “Complaint Book”. Of this, twenty-three pages consisted of an account of facts Rajski asserted, and asserted to be relevant, and some argument in support of his allegation that the claimant’s conduct was improper. The balance of the “Complaint Book” consists of documentary material that he apparently considered also supported his complaint.
56 It is important to identify with some precision the complaint made by Rajski. This is because one of the arguments advanced on behalf of the claimant is that the Information put before the Tribunal in fact goes, impermissibly, beyond the subject matter of Rajski’s complaint. Having regard to the challenge made to the first decision it is convenient here also to note the dates of the conduct of which Rajski complained.
57 Analysis of what was submitted to the LSC by Rajski shows that his complaint can be distilled into the following:58 Except for the last of these, each complaint made by Rajski forms part of the grounds of the Information filed in the Tribunal by the LSC. But the Information goes beyond the matters asserted by Rajski, and alleges impropriety in respects not the subject of Rajski’s complaint. There are included in the Information four grounds relating to conduct not mentioned in the complaint originally made by Rajski. These are Ground 1 (concerning the approaches to Wood and Donaldson); Ground 4 (concerning a conference with Yerushalmy on 24 February 1986, which is also relied upon as Ground 7 (iv)); and Grounds 7 (v) and 7 (viii) (concerning the pursuit of costs awarded against Rajski and Raybos by Hunt J and Campbell J).
(i) a complaint about the claimant’s conduct in threatening to sue Metcalf in defamation as a result of the report he wrote in support of Rajski’s application for adjournment of the hearing before Powell J (13 October 1986);(ii) a complaint about the claimant’s conduct when he appeared for himself and made submissions to the Court of Appeal in opposition to Rajski’s application for adjournment of the hearing before Powell J (23 October 1986);
(iii) a complaint about the claimant’s conduct in acting for Tectran, Arunta and their executives when they sued the partners of Carneys in defamation as a result of their letter to the Stock Exchange (December 1985);
(iv) a complaint about the claimant’s conduct in relation to the proposed prosecution of Yerushalmy by the DPP (March 1988);
(v) a complaint about the claimant’s conduct in his attempts to have the legal aid granted to Rajski and Raybos terminated (October 1985 - September 1986);
(vi) a complaint about the claimant’s conduct in correspondence with Carneys concerning the costs of an adjournment granted by the then Chief Justice on 4 March 1986 (11 March 1986);
(vii) a complaint that the claimant gave false evidence in the Fairfax proceedings (June 1989);
(viii) a complaint about the claimant’s conduct in relation to the prosecution of another person for whom he acted. (As this complaint did not find its way into the Information it is unnecessary to say more about it).
59 The Information lodged in the Tribunal complains that, in specified respects, the claimant’s conduct constituted either professional misconduct or unsatisfactory professional conduct. The particularised grounds on which the Information is based may be summarised as follows:
The Complaint and Information in the Tribunal
60 The first matter raised by the claimant concerns the decision of the LSC to accept the complaint out of time. Three questions arise:
Grounds 1(a) and (b)The claimant’s conduct in approaching Wood and Donaldson was improper, being an attempt to have those witnesses change evidence they had given in the hearing before Miles J.
Ground 2
The claimant’s attempts to achieve the termination of the legal aid grant to Rajski and Raybos were made for an improper purpose, namely to obstruct, prevent or thwart Rajski and Raybos from pursuing their rights in the litigation against the Tectran/Arunta Companies.
Ground 3
The claimant, on behalf of his client, attempted to intimidate Carneys by the commencement of the Carneys defamation proceedings, by subsequent threats to amend the claims to increase the quantum of damages claimed, and by threats to seek an order that Carneys personally pay costs of an adjournment granted by the Chief Justice, the alleged purpose of the intimidation being to cause Carneys to cease their representation of Rajski and Raybos.
Ground 4
In advising Yerushalmy about the manner in which he should give evidence the claimant improperly invited him to change his evidence and give other than his honest recollection of the events in question.
Ground 5
The claimant improperly attempted to intimidate Metcalf by threatening to sue him for defamation as a result of the report he had written supporting the application by Rajski for adjournment of proceedings before Powell J, the purpose of the intimidation being to ensure that Metcalf withdrew his professional support for Rajski and Raybos.
Ground 6
The claimant gave untruthful evidence in the Fairfax proceedings.
Ground 7
The claimant’s behaviour in eight particularised respects was such as would reasonably be regarded by reputable legal practitioners as disgraceful or dishonourable, or as failing to meet required standards of competence and diligence in that his conduct lacked due objectivity and detachment. The eight matters particularised included the matters already referred to in grounds 1 (Wood and Donaldson), 2 (legal aid), 3 (Carneys), 4 (Yerushalmy) and 5 (Metcalf). Additionally the conduct relied on to support ground 7 was identified as:
(a) a proposal by the claimant to take bankruptcy action against Rajski in relation to unpaid costs awarded against him, not withstanding that Rajski had been granted leave to appeal the substantive decision and had in fact filed a notice of appeal;
(b) the suggestion by the claimant, following the adjournment application by Rajski on the grounds of his mental and emotional condition, that Rajski was or might have been a disable person within the meaning of the Supreme Court Rules such as to render him unfit to manage his own affairs (including litigation) and require the appointment of a tutor;
(c) an attempt by the claimant to recover costs awarded against Rajski in an amount exceeding the limit imposed by s 47 of the LAC Act, notwithstanding that the proceedings in respect of which the costs had been awarded were the subject of a grant of legal aid.
Detailed particulars of the complaint were appended to the Information and will be the subject of more detailed analysis below.
THE GROUNDS IN THE SUMMONS
1. The first decision (s 138(2)(b))
Ground 1 of the Summons
(i) Was the LSC obliged to observe the rules of procedural fairness and give an opportunity to the claimant to be heard in relation to the extension of time?(ii) If so, did he adequately discharge that obligation?
(iii) Was his decision to accept the complaint unreasonable in the Wednesbury ( Associated Provincial Picture Houses Ltd v Wednesbury Corporation ) [1948] 1 KB 223) sense?
Facts
61 The complaint was received by the LSC on 11 July 1994. It related to events and conduct alleged to have occurred between six and nine years earlier. It was, therefore, as previously noted, prima facie statute barred.
62 On 22 September the LSC met Rajski. What happened at that meeting is not disclosed by the evidence, but it seems clear that one matter discussed, at least, concerned the exercise of discretion under s 138(2). On 20 January 1995 the LSC wrote to the claimant advising that the complaint had been lodged, noting the range of dates between which the conduct the subject of the complaint was alleged to have occurred, and drawing attention to the provisions of s 138, including s 138 (2), the provisions conferring upon him a discretion to accept a complaint out of time. He expressly said that he was considering exercising his discretion under s 138(2)(b). That paragraph empowers the LSC to accept a complaint outside the three year limit if:
“satisfied that the complaint concerns an allegation of professional misconduct and that it is necessary in the public interest to investigate the complaint”.
63 Although s 138(2)(a) authorises the LSC to accept a complaint out of time if it is just and fair to do so, having regard to the delay and the reason for the delay, there has never been any suggestion that the LSC might extend the time by reference to that provision and that paragraph can be put to one side.
64 In the letter the LSC went on to express the view that, if Rajski’s allegations were proved, the conduct to which they related would amount to professional misconduct. He added:65 Annexed to the letter was a document entitled “Brief Outline of the Complaints by Dr Rajski” which referred to three matters. These were:
“Further when the “public interest” is being considered my discretion to exercise the power is a wide one. In this case the allegations are very serious and their investigation would be consistent with the objects of Part 10 of the Act to ensure compliance with necessary standards of honesty as well as competence and diligence and further, to maintain at a sufficiently high level the ethical and practice standards of the legal profession as a whole. The substance of the allegations have only recently been passed upon in defamation proceedings so it can be fairly said that the truth of the allegations remain very much in the public domain at the present time. It is also a fact that there has been much publicity concerning the allegations. Therefore it is for these matters and the underlying object of the Act to create public confidence in the legal profession in this State that I am considering the exercise of the discretion in s 138(2)(b) of the Act.
Accordingly, I now wish to give you the opportunity to provide your views on the matter before I make a decision on whether to exercise the discretion.”
He allowed the claimant twenty-one days from the date of the letter to provide the views so invited.
(i) the letter to Metcalf threatening him with defamation action following the evidence he had given to the Court of Appeal in support of Rajski’s adjournment application; the LSC said that it was alleged that this was “an attempt to intimidate a witness in the proceedings … without legal basis and issued for an ulterior and improper purpose”;(ii) the attempts by the claimant to have the grant of legal aid to Rajski and Raybos terminated, and the defamation proceedings issued by the claimant, acting on behalf of the Tectran/Arunta executives; the LSC said it was alleged that the defamation proceedings had no substance, and their primary motive was to pressure Carneys to withdraw from the case and bring about the loss of the legal aid grant, and that the action was improper and an abuse of process;
(iii) an allegation that the claimant conspired during 1988 with Yerushalmy to avoid service of the summons and thereby assist in the preparation and “pursuance” of a no bill application; the LSC said it was alleged that the manner in which the claimant represented Yerushalmy amounted to misconduct by seeking to pervert the course of justice and to avoid the proper criminal process in favour of his client’s commercial interests.
66 There followed some correspondence which is immaterial for present purposes, and on 6 February 1995 the claimant provided his detailed response which ran to ten pages of typescript and was accompanied by many annexures. He acknowledged that Rajski’s allegations amounted to allegations of professional misconduct and turned his attention to whether it was necessary, in the public interest, for the LSC to investigate the complaint; he argued that it was not and urged the LSC to consider whether the complaint was frivolous and vexatious and should accordingly be dismissed under s 141(b). It is unnecessary, for the purposes of the present argument, to be more specific about the content of the response made by the claimant. Its detail, and the attention he paid to the specifically relevant parts of the legislation, are important, demonstrating that he was well aware of the nature of the opportunity being afforded to him.
67 On 17 February 1995 the LSC replied, relevantly in the following terms:68 On 28 February 1995 the LSC again wrote to the claimant, relevantly as follows:
“I note your letter contains background to the matter and your detailed submission in reply to my request for your views about the exercise of my power pursuant s 138 (2)(b) of the Legal Profession Act in relation to Dr Rajski’s complaint.
Please note that prior to me making a formal determination as to whether or not to accept the complaint, I will contact the parties for the purpose of clarifying any further matters or seek final submissions if necessary.”
69 On 13 March 1995, apparently at the request of the claimant, the LSC extended to 24 March 1995 (the time for his final submissions). On that date the claimant wrote to the LSC. Included in the letter were the following observations and comments:
“I refer to the above matter and advise that I have now received a response from Dr. Rajski to your submission dated 6 February 1995.
I enclose a copy of Dr. Rajski’s response dated 21 February 1995 and Annexures provided by Dr. Rajski for your consideration. I also enclose a copy of the original complaint booklet and our letter to Dr. Rajski of 24 January 1995 regarding Counsel’s advice which are referred to in his response.
It is apparent from your submission and Dr. Rajski’s response that much of the argument and material provided goes to the substance of the complaint and is not relevant to the exercise of my power pursuant to s 138(2)(b) of the Act. Accordingly, should you have any further submissions relating to the exercise of my power I would be pleased to receive same prior to me making a formal determination.
If you wish to make any final submissions please do so within 14 days of the date of this letter.”
As this letter makes plain, the LSC had forwarded the claimant’s letter of 6 February to Rajski for his comments. Rajski responded to that with a further bulky document headed “Complaint against N R Carson” dated 21 February 1995. This is one of the documents that was sent to the claimant on 28 February 1995.
70 On 30 March 1995 the LSC advised the complainant that, after considering the complaint and the submissions he had received, he had decided, in the exercise of the power conferred on him by s 138 (2)(b), to accept the complaint. He added:
“3. Having now seen the complaint, which was apparently made on 8 July 1994, I assume that you have formed the view that you are within the time provided by Section 142(3) of the Act.
4. Most complaints against solicitors are made by the client. In the present case, no complaint has been made against me by any client, in particular by the Arunta Group or by Mr Yerushalmy.
5. So far as I am aware, there has been no complaint by the persons or organisations concerned with the matters complained of, namely Carneys, Dr Metcalf, the Commissioner of Police, the Director of Public Prosecutions or the Legal Services Commission. Other than in relation to the application relating to the grant to him of Legal Aid (about which no complaint seems to be made; see lines 3 and 4 of paragraph 13 of the complaint dated 1 July 1994), Mr Rajski in making the complaints is no more than a common informer.
6. It is clear from Mr Rajski’s own documents that the matters presently alleged by him were within his knowledge in 1986, 1987 and 1988. Presumably he did not think, between then and 1994, that it was in the public interest that they be ventilated, other than in the Court of Appeal proceedings. (See Walton v Gill , paragraph 8.7 of my letter of 6.2.1995).
7. Bearing in mind the proceedings in the Court of Appeal, I submit that it cannot be necessary in the public interest for you to investigate the complaints.
8. I rely also on the submissions in paragraph 8 of my letter of 6.2.1995 and the material in and referred to in that letter in submitting that you should not accept the complaint.” (emphasis in original)71 Three issues arise in relation to this ground in the summons. The claimant firstly argued that a decision under s 138(2) is subject to the rules of natural justice, and these rules obliged the LSC to afford him an opportunity to be heard on the question of the exercise of his discretion, and, secondly, that the LSC had failed to comply with that obligation. His third argument was that the decision to accept the complaint was wholly unreasonable, in what has come to be called the Wednesbury sense.
“I shall be in contact with you shortly as to the next step and the procedure as to how I intend to conduct the investigation.”
(a) Do the rules of procedural fairness apply to a decision under
s 138(2)?
72 The competing positions of the parties are clear. The claimant argued that the rules of procedural fairness do apply to a s 138(2) decision; the LSC to the contrary.
73 Senior counsel for the LSC advanced two separate lines of argument in support of his proposition. Firstly, he relied upon the authority of the Court of Appeal in Commissioner of Police v Reid (1989) 16 NSWLR 453. The statutory provision there under consideration was s 341 of the Crimes Act 1900 which provided that no prosecution for perjury could be instituted without the leave of a court. The question was whether, when such leave was sought, the person the subject of the proposed prosecution was entitled to an opportunity to be heard on whether leave should be given. Meagher JA, with whom Clarke JA agreed, held that the rules of natural justice did not apply, for two reasons, of which he described one as “broad” and one as “technical”. (Priestley JA took a contrary view.) The technical reason was to do with the construction of the Act in which the section there under consideration appeared. There are no real parallels with s 138(2) and this reason need not be further pursued. The broader reason was that a grant of leave really “does nothing”; even when leave had been granted, a prosecutorial decision still had to be made by the appropriate authority. A decision to commence criminal proceedings does not require observance of the principles of natural justice (see the authorities cited at p 461); it followed that a decision in relation to an anterior step did not require observance of those rules. The LSC sought to draw an analogy with this decision based on the proposition that a decision to commence professional disciplinary proceedings, like a decision to prosecute criminally, does not require observance of the rules of natural justice, and, therefore, conformably with Reid, neither does a comparable anterior decision. For reasons that appear below, the analogy fails.
74 The decision in Reid is, in my view, distinguishable. A decision under s 138(2) to accept a complaint after the statutory time limit has elapsed cannot be described as one that “does nothing”. It has the consequence of setting in train an investigation of a legal practitioner’s conduct, of exposing the legal practitioner to the provisions of s 152, requiring provision of information and production of documents; it may be the starting point of a chain of events that, at its worst, could culminate in the removal of the legal practitioner’s name from the roll of legal practitioners. (In this respect, I appreciate that there is some correlation with the decision to grant leave to prosecute for perjury, in that that decision could be seen as the starting point of a chain that could culminate in a prosecution for perjury, and, at its worst, imprisonment.) The distinction is that the next step in a perjury prosecution decision (ie the decision to prosecute) is not subject to the rules of natural justice: the next (or a subsequent) step to a s 138 decision is a decision under s 155 to institute proceedings in the Tribunal, a decision which is subject to those rules: Murray v Legal Services Commissioner and Another [1999] NSW CA 70. (The decision in Murray was delivered after oral and written argument concluded in the present case.)
75 The decision in Reid does not persuade me that the LSC, in considering the exercise of power under s 138(2), is not obliged to observe the rules of natural justice.
76 The LSC’s second argument depended upon the structure and scheme of the Act. The opening section of Part 10 is s123, which defines the general objects of the Part as:77 Ss 124 and 125 define, respectively, the objects of the Part relating to users and providers of legal services. S 124 includes the following paragraphs:
“(a) to redress the consumer complaints of users of legal services; and
(b) to ensure compliance by individual legal practitioners with the necessary standards of honesty, competence and diligence; and
(c) to maintain at a sufficiently high level the ethical and practice standards of the legal profession as a whole.”
“(e) to provide complainants with a reasonable opportunity to rebut statements of the legal practitioner against whom the complaint is made before the complaint is disposed of; and
(f) to ensure that complainants receive adequate notice of the institution and status of disciplinary proceedings at relevant stages of the proceedings (including notice of the dismissal of complaints and the reasons for the dismissal); and
(g) to give complainants the right to seek an independent review of decisions of Councils to dismiss complaints or merely reprimand legal practitioners.” (emphasis added)78 There are in s 125 no equivalent provisions designed to ensure that legal practitioners have “a reasonable opportunity to rebut statements” of complainants, or “receive adequate notice” of the institution and status of disciplinary proceedings, or be given the right to an independent review of decisions. From this, the argument ran, it should be inferred that the legislature did not intend to afford to legal practitioners corresponding rights to those afforded to complainants.
79 Further, in s 125 there is one provision only concerned with ensuring that legal practitioners have the benefit of the rules of natural justice. That appears in paragraph (a) which is in the following terms:
“(a) to ensure that the rules of natural justice (being rules for procedural fairness) are applied to any disciplinary proceedings taken against legal practitioners;”.
80 The application of the rules of natural justice is therefore restricted, the LSC argued, to “disciplinary proceedings” and does not extend to anterior decisions. That raises a question as to the reach of the phrase “disciplinary proceedings” as used in s 125(g). The LSC argued that “disciplinary proceedings” are proceedings instituted in the Tribunal once he or a Council has reached the requisite satisfaction under s 155 (2). S 167(1), providing for the institution of “proceedings” in the Tribunal, and s 167(2), requiring the Tribunal to conduct a “hearing” were called in aid of this submission. If “disciplinary proceedings” are so confined, it may be inferred from s 125(a), and the absence of any other reference to the rules of natural justice or procedural fairness in relation to a legal practitioner, that the legislature did not intend those rules to apply at any earlier stage of proceedings. In other words, the application of the rules of natural justice is required only in relation to proceedings in the Tribunal.
81 There is much to support the proposition that the reference to “disciplinary proceedings” in s125 (a) is a reference to proceedings in the Tribunal and not to the processes that precede such proceedings. One such indicator is s 131(1), which sets out the functions of the LSC. The functions are wide and varied, extending from the receipt of complaint to the institution of proceedings in the Tribunal. The only occasion on which the word “proceedings” appears is in connection with the LSC’s function in relation to the institution of proceedings in the Tribunal. All other functions are described by different nomenclature. Senior counsel also pointed to ss 141, 142, 147A(1), 152 and 154 as sections concerned with the powers and functions of the LSC, and the processes and procedures to do with the objects and purposes of the Part, but that do not use the word, or easily come within the description, “proceedings”. On the other hand, s 167, which does use the word, is concerned with proceedings in the Tribunal.
82 There is thus a consistency in the language used in the Act; “proceedings” are proceedings in the Tribunal, for which procedures and practices are prescribed, and which, by reason of the potentially serious consequences, have a degree of formality.
83 I am prepared to accept that “disciplinary proceedings” referred to in s 125(a), and in relation to which the rules of natural justice are expressly applied, are proceedings (or hearings) in the Tribunal. The argument continued, however, that because the rules of procedural fairness are expressly applied to those proceedings by s 125(a), the legislature has evinced an intention to exclude those rules in relation to other procedures and functions of the LSC under the Act. The conclusion does not necessarily follow from the premise.
84 In recent times, the starting point for an understanding of circumstances in which the rules of procedural fairness applies is the judgment of Mason J (as he then was) in Kioa v West (1985) 159 CLR 550.
85 Commencing at p 582, his Honour wrote:
“It is a fundamental rule of the common law doctrine of natural justice expressed in traditional terms that, generally speaking, when an order is to be made which will deprive a person of some right or interest or the legitimate expectation of a benefit, he is entitled to know the case sought to be made against him and to be given an opportunity of replying to it: [authorities cited]. The reference to 'right or interest' in this formulation must be understood as relating to personal liberty, status, preservation of livelihood and reputation as well as to proprietary rights and interest.
The reference to ‘legitimate expectation’ makes it clear that the doctrine applies in circumstances where the order will not result in the deprivation of a legal right or interest. Take, for example, an application for a renewal of a licence where the applicant, though he has no legal right or interest, may nevertheless have a legitimate expectation which will attract the rules of natural justice. In Salemi [No.2] [(1977) 137 CLR at p 404] Barwick CJ expressed the view that the expression ‘legitimate expectation’ adds little, if anything, to the concept of a right. However, later decisions demonstrate that the concept of ‘legitimate expectation’ extends to expectations which go beyond enforceable legal rights provided that they are reasonably based… The expectation may be based on some statement or undertaking on the part of the authority that makes the relevant decision …
It has been said on many occasions that natural justice and fairness are to be equated … And it has been recognised that in the context of administrative decision-making it is more appropriate to speak of a duty to act fairly or to accord procedural fairness. This is because the expression ‘natural justice’ has been associated, perhaps too closely associated, with procedures followed by courts of law. The developing application of the doctrine of natural justice in the field of administrative decision making has been very largely achieved by reference to the present characteristics which have been thought to reflect important characteristics of judicial decision-making. …
The law has now developed to a point where it may be accepted that there is a common law duty to act fairly, in the sense of according procedural fairness, in the making of administrative decisions which affect rights, interests and legitimate expectations, subject only to the clear manifestation of a contrary statutory intention. … But the duty does not attach to every decision of an administrative character. Many such decisions do not affect the rights, interests, and expectations of the individual citizen in a direct and immediate way. …
Where the decision in question is one for which provision is made by statute, the application and content of the doctrine of natural justice or the duty to act fairly depends to a large extent on the construction of the statute … What is appropriate in terms of natural justice depends on the circumstances of the case and they will include, inter alia, the nature of the enquiry, the subject matter, and the rules under which the decision maker is acting …
In this respect the expression ‘procedural fairness’ more aptly conveys the notion of flexible obligation to adopt fair procedures which are appropriate and adapted to the circumstances of the particular case. The statutory power must be exercised fairly, i.e., in accordance with procedures that are fair to the individual considered in the light of the statutory requirements, the interests of the individual and the interests and purposes, whether public or private, which the statute seeks to advance or protect or permits to be taken into account as legitimate considerations. …
When the doctrine of natural justice or the duty to act fairly in its application to administrative decision-making is so understood, the need for a strong manifestation of contrary statutory intention in order for it to be excluded becomes apparent. The critical question in most cases is not whether the principles of natural justice apply. It is: what does the duty to act fairly require in the circumstances of the particular case? It will be convenient to consider at the outset whether the statute displaces the duty when the statute contains a specific provision to that effect, for then it will be pointless to enquire what the duty requires in the circumstances of the case, unless there are circumstances not contemplated by the statutory provision that may give rise to a legitimate expectation. However, in general, it will be a matter of determining what the duty to act fairly requires in the way of procedural fairness in the circumstances of the case. A resolution of that question calls for an examination of the statutory provisions and the interests which I have already mentioned.”
See also Annetts v McCann (1990) 170 CLR 596; Ainsworth v Criminal Justice Commission (1992) 175 CLR 564).
86 A decision of the LSC to accept a complaint out of time affects, at the very least, the interests of the person the subject of the complaint, and that person’s legitimate expectations. The legitimate expectation may be simply stated as an expectation that any conduct engaged in more than three years earlier will be free of official investigation under the Act. The decision to extend time under the subsection clearly affects the expectation of a legal practitioner that he or she will be able to continue to practise free of the obligation to answer for conduct that occurred prior to the cut off date. While subs (2) permits that expectation to be dislodged, it does not exclude the right the legal practitioner would otherwise have to be heard in opposition to that course being taken.
87 It has long been accepted law that, where the rules of procedural fairness would otherwise apply, Parliament may displace the presumption, but that such a legislative intention must be made unambiguously clear: Twist v Randwick Municipal Council (1976) 136 CLR 106; Kioa, p 584, p 585. The mere fact that s 125(a) specifically applies the rules of natural justice to the proceedings in the Tribunal, but the Act nowhere else provides for their application to, for example, a s 138(2) decision, does not persuade me that the Parliament intended to displace the application of the rules of natural justice to a decision under that sub section. In my opinion, the decision is the very kind of decision which Mason J had in mind in Kioa, and which one would expect would attract the rules of natural justice. I discern no contrary intention, explicit or implicit, in the Act.
88 The argument also suffers as a result of the decision of the Court of Appeal in Murray. The LSC’s argument did not differentiate between decisions under s138(2) and s 155, most of which he contended were decisions to which the rules of procedural fairness do not apply. The decision in Murray, rejecting that contention in relation to s 155, render it suspect also in relation s 138(2).
89 This view is consistent with that of the Full Court of the Federal Court of Australia in Oates v The Honourable Daryl Williams (in his capacity as the Attorney General of Australia) and Senator Amanda Vanstone (in her capacity as the Minister for Justice for the Commonwealth of Australia), (1998) 84 FLR 348 per Foster, Von Doussa and Finkelstein JJ. In that case it was held that a decision by a Minister of the Crown to permit a criminal prosecution outside the prima facie time limit was one in relation to which the person the subject of the decision is entitled to be heard. (The decision was reversed (on other grounds) by the High Court on 5 August 1999 ([1999] HCA 34)).
90 I am therefore satisfied that the first question should be answered in favour of the claimant. The rules of procedural fairness do apply to a decision under s 138(2) of the Act.
(b) Was the obligation to observe the rules of procedural fairness adequately discharged?
91 I have set out the correspondence above. On 20 January 1995 the LSC outlined (in my view, inadequately) the substance of the complaint and invited the claimant to provide his “views”. If that were all the information the claimant received, I would be of the opinion that he had not been properly informed of the nature of the case against him. However, the claimant made a detailed response on 6 February 1995. The deficiency in the original notification was remedied when, on 28 February 1995, the LSC provided him with a copy of the original complaint book, and Rajski’s 21 February response to the claimant’s letter of 6 February. He invited final submissions within a specified time and, at the request of the claimant, extended that time. The claimant again responded, in a letter (24 March 1995) which demonstrated that (as one would expect of a solicitor of his standing and experience) he was well aware of the nature of the task that confronted him.
92 The criticism that was made of the procedures adopted by the LSC concerned the fact that he had had meetings with Rajski, the content of which was not disclosed to the claimant. Counsel for the claimant sought to have inferences drawn from the nature of the cross-examination of the claimant, and from documentary material tendered into evidence on behalf of the LSC, that there had been further contact between Rajski and the LSC, during which Rajski had supplied material to the LSC additional to that contained in his original complaint and subsequent response.
93 It may well be the case that the LSC had personal meetings with Rajski. Indeed, having regard to the functions of the LSC (especially as set out in s 131 (1)(b), which requires him to assist and advise complainants, including assisting them to clarify their complaints and put them in writing) it might be surprising if he had not done so. It could hardly be expected that he would or could provide a transcript or even a summary of what transpired at any and every such meeting to the claimant, nor to disclose every document he had received, whether he considered it material or not. No authority was cited to support the proposition that the LSC’s obligation to accord procedural fairness to the claimant in respect of the s 138(2) decision extended to disclosing details of every contact and discussion with the complainant. There were, in practical terms, two issues on which the claimant was entitled, at that stage, to be heard. The first, which he did not contest, was whether the allegations amounted to allegations of professional misconduct; the second, whether it was necessary in the public interest for the LSC to investigate the complaint. (It may be said that a third issue for the LSC was whether, having reached the requisite state of satisfaction about the nature of the complaint and the necessity to investigate it, a further separate question of discretion arose, but no argument was directed to such a question and I do not propose further to consider it. So far as it was argued, it was in the context of the contention that the decision was relevantly unreasonable.)
94 The claimant based a further argument on the fact that the Information, as ultimately filed, contained grounds that did not appear in Rajski’s original complaint (see paragraphs 164 to 168). The argument was that the claimant was left in ignorance that the LSC had these matters under consideration and was thereby deprived of the opportunity to make any submission in relation to them. That may have been a powerful argument if the only grounds on which the Information was based were drawn otherwise than from Rajski’s complaint, or if the grounds that were contained in Rajski’s original complaint did not satisfy the two tests of s 138(2)(b); but it is a significantly diminished argument in relation to this question, in the light of the LSC’s conclusion that Rajski’s allegations did amount to allegations of professional misconduct and that it was necessary in the public interest to investigate them. The additional grounds have significance in another respect (see paragraph 168), but they do not assist the claimant on this issue.
95 I am satisfied that the LSC did everything reasonably practicable to afford the claimant the opportunity to seek to dissuade him from accepting the complaint out of time, and to advance such argument and material as he considered pertinent. The requirements of procedural fairness were adequately met. The claimant’s responses show that he knew precisely what was in issue at that time.
(c) Reasonableness
96 The final matter in relation to the first decision is the claimant’s argument that to accept the complaint out of time was unreasonable. The argument concerns the proper interpretation of the phrase “necessary in the public interest to investigate the complaint”.
97 Essentially, the argument was to this effect. Given the mass of litigation that the 1980 proceeding had spawned, many of the issues that were raised by the LSC in the Information were the subject of at least one judicial proceeding elsewhere. It could not, therefore, reasonably be concluded that it was necessary in the public interest that they be separately investigated by the LSC.
98 It is true that some of the matters raised in the grounds of the Information duplicate matters raised elsewhere. Ground 1 of the Information is the allegation that the claimant had, in 1985, made improper approaches to Wood and Donaldson with a view to having them change the evidence they had given in the hearing before Miles J. Ground 2 of the Information is the claim that the claimant’s attempts to have the legal aid grant terminated were made for an improper purpose, that is, to prevent or thwart Rajski and Raybos pursuing their rights in the litigation against Tectran. Ground 3 of the Information is the claim that in commencing defamation proceedings against Carneys on behalf of the Tectran executives, the claimant sought wrongfully to intimidate that firm of solicitors.
99 Each of these grounds replicates allegations made by Rajski in the first contempt proceeding, and was, therefore, already within the jurisdiction of the Court of Appeal, and could have been brought on for hearing had Rajski sought to do so. An alternative forum was thus well placed to hear and dispose of the issues raised in these grounds. Moreover, complaints of essentially the same nature were made in the 1986 proceeding in which Raybos and Rajski sued the claimant and his partners alleging conspiracy. This statement of claim was filed in the Commercial List of this Division. Thus a second forum was seized of the allegations the subject of the first three grounds in the Information.
100 Ground 5 of the Information is the allegation that the claimant improperly intended to intimidate Metcalf in relation to evidence he had given supporting Rajski’s application for adjournment before the Court of Appeal, by threatening to sue him in defamation. That was one of the issues raised by Rajski in the second contempt proceeding, filed in 1987, and, like the first, never brought on for hearing.
101 Thus, so far as grounds 1,2,3 and 5 are concerned, judicial proceedings already on foot elsewhere raised the very same issues or so it was argued Finalisation of those proceedings would ventilate and resolve the issues raised by the grounds in the Information and satisfy the public interest in seeing serious allegations of impropriety against a legal practitioner determined. It could not reasonably be held to be necessary that they be investigated by the LSC.
102 There is one minor factual premise in this argument that should be corrected. Counsel for the claimant acknowledged that the Court of Appeal had ruled that hearing of both contempt proceeding should be deferred until after the conclusion of the substantive proceeding. It was not, therefore, within Rajski’s power to bring those matters on for hearing. This represents a serious flaw in the argument. However, it is not the complete or final answer to the argument, to which I will come in due course.
103 A further argument put on behalf of the claimant was that, where the allegations are properly characterised as allegations of contempt, the preferred course is so to deal with them, rather than as disciplinary matters. In support of this proposition counsel relied upon a passage in Cordery on Solicitors, 8th ed. p 321, and the cases there cited.
104 It is sufficient to observe that, while the author does appear, in the opening words of the sentence referred to, to suggest that a solicitor will not usually be struck off for contempt, “the proper procedure being committal” that is immediately followed by an acknowledgment that “in a case where his contempt amounts to professional misconduct, he may be struck off”. It is, in my view, a question of properly assessing the conduct said to constitute contempt for the purpose of determining whether it may properly be characterised as professional misconduct, and then if it is, determining what consequences ought follow. Not every act of contempt will amount to professional misconduct but the converse, inherent in the argument - that is, that no act of contempt by a legal practitioner should be dealt with as professional misconduct - certainly does not follow.
105 Counsel for the claimant also argued that, in relation to grounds 5 and 6 of the Information (concerning the threat to sue Metcalf, and the allegedly false evidence he gave in the Fairfax proceedings) the claimant was acting in a personal, not professional, capacity. He was the litigant in the latter, the putative litigant in the former. Accordingly, relying on the authority of In the Matter of Thomas James Wallace (1866) L R 1283, counsel argued that disciplinary proceedings were inappropriate and the ordinary legal processes that would apply to any citizen who engaged in the kind of conduct alleged against the claimant should apply to him. The proper remedy in respect of the conduct alleged in ground 5, the threat to sue Metcalf, is (if anything) a prosecution for contempt; the proper remedy for giving false evidence is a prosecution for perjury. Again, I do not accept the argument. The conduct of a legal practitioner cannot be so rigidly compartmentalised, his/her behaviour in a personal capacity sealed off from his/her conduct in a professional capacity, as s 127(1)(b) recognised. It is a matter for judgment in every case. I am satisfied that an unwarranted threat to sue, and the giving of untrue evidence in a legal proceeding, may, in appropriate circumstances, constitute professional misconduct.
106 Although the remaining grounds of the Information are not specifically the subject of already existing proceedings, a similar argument was mounted, to the effect that the issues raised in these grounds could have been raised in other proceedings. For example, it was argued, such matters could have been raised in the Fairfax proceedings. In those proceedings the claimant sued the publishers of, and a journalist employed by, the SMH, in defamation arising out of the publication of articles about his conduct of the Rajski litigation. He pleaded that the matter complained of conveyed the imputation, in effect, that his conduct amounted to professional misconduct. It would, had Fairfax and Slee elected to do so, have been open to them to seek to defend the claims on the basis that the imputations were true and were published on an occasion of qualified privilege or related to matters of public interest. Fairfax and Slee opted against that course. I have not the least difficulty in rejecting this argument. What course a private organisation and individual choose to take when sued for defamation can have no possible bearing on whether it is necessary in the public interest that allegations of professional misconduct (which could have been, but were not, litigated in the defamation proceedings) be investigated by the LSC in the performance of his functions under the Act. Even if they had there been litigated, that Court was not the Tribunal to determine whether the facts now alleged amount to professional misconduct, and certainly that Court had no power to take any remedial action appropriate to an allegation of misconduct.
107 Although the argument that because grounds 1, 2 and 3 of the Information duplicate factual issues raised elsewhere, it is not necessary in the public interest to investigate them is less unmeritorious, I reject it also. I accept that the allegations made against the claimant could have been examined in a variety of ways, in a variety of fora, and that proceedings may have been initiated by a variety of individuals, organisations or bodies. The fact that alternative means exist to reach a determination of the truth of factual allegations does not bear upon the decision the LSC has to make. What he had was a series of serious allegations about the conduct of a senior and experienced legal practitioner, concerning conduct alleged to have taken place over an extended period of time, allegedly for improper purposes and by improper methods. It would not have been open to the LSC to take the view that, since some other Tribunal was seized of the same or similar factual allegations, he was relieved of his obligations under the Act. The LSC was not party to any of the other proceedings and had no control of the issues litigated or the evidence presented. He had no influence on whether the proceedings ever came to a hearing. The courts in which the various other proceedings were listed lacked power to take appropriate measures if it were found that the claimant’s conduct was improper in any way. The ultimate issue in relation to the present allegations is whether the claimant ‘s conduct amounted to professional misconduct. That was not an issue for determination in any of the other proceedings. A supplementary issue if professional misconduct is established, is the appropriate remedy for the misconduct. At worst, the Tribunal would be required to consider the claimant’s fitness to practise as a legal practitioner. That was not an issue for determination in any other proceedings. It is only necessary to look to s 123, setting out the general objects of Part 10, to recognise the fallacy in the claimant’s argument. The LSC would, in my view, have been derelict in his duty if he had refused to accept the complaint on the ground that some of the factual matters raised were also raised in other pending proceedings; even more so, had he done so on the basis that those same factual matters could have been, but had not been, raised in concluded litigation between the claimant and other parties. It was not the role of Fairfax or Slee, or their legal representatives, to conduct litigation against them with a view to discharging the LSC’s functions under the Act.
108 It may have been different had the various allegations been litigated to finality, and the claimant cleared of the kind of wrongdoing then alleged; in those circumstances the LSC may well have taken the view that the public interest did not require further investigation of what had already been thoroughly investigated with factual findings in the claimant’s favour. But that was not the case. Further, if the allegations had been litigated, and the claimant found guilty of contempt or perjury, it is almost axiomatic that the LSC or the Council of the Law Society would have been obliged to give consideration to the procedures provided for by Part 10 of the Act.
109 One additional and important reason for rejecting the argument is the very aggregation of factual matters that were before the LSC. It is one thing for an individual allegation of contempt to be disposed of. It is quite another, from the point of view of the objects of the Act, to consider the whole of the claimant’s conduct of which complaint was made.
110 Nor do I accept that the decision in Wallace is conclusive that the allegations concerning the claimant’s conduct when acting in a personal rather than professional capacity should be dealt with other than under the disciplinary provisions of the Act. It would be a surprising proposition if the LSC could not institute disciplinary action against a legal practitioner said to have lied on oath in a judicial proceeding, simply because he was giving evidence in a personal rather than professional capacity. And, in any event, the claimant’s conduct in threatening to sue Metcalf can properly be seen only in the context of the whole of the Rajski litigation. It was inextricably linked with his representation of his clients.
111 In any event, the definition of “professional misconduct” in s 127(4) makes clear, in paragraph (b), that personal conduct may amount to professional misconduct.
112 I am far from persuaded that the claimant has shown that the LSC’s decision to accept the complaint out of time was unreasonable in the relevant sense. That concludes the issues raised in relation to the decision to accept the complaint out of time.113 The second decision in question is the decision under s 155(2) to institute proceedings in the Tribunal. The claimant argued that this decision also was one that attracted the rules of procedural fairness and was made in breach of those rules in that he was not given a proper opportunity to be heard in relation to the decision. Some additional facts need to be recited.
2. The second decision (s 155) - Ground 2 of the Summons:
procedural fairness
Facts
114 Following receipt of the LSC’s letter of 30 March 1997 advising him that he had decided to accept the complaint out of time, the claimant put the matter in the hands of one of his partners, Mr John Pavlakis (“Pavlakis”). On 10 April Pavlakis wrote to the LSC notifying him that he now acted for the claimant, and requesting that future correspondence be directed to him (Pavlakis).
115 Notwithstanding the LSC’s statement in the letter of 30 March that he would contact the claimant in relation to the future conduct of the matter and the procedure to be adopted, until 10 December 1997 there was no further communication of any kind between the parties. On that date Pavlakis telephoned the LSC and arranged to meet him, together with another solicitor Mr Craig Murray (“Murray”), on the morning of 18 December. The day before the meeting was scheduled to take place, 17 December, the claimant was served with the Information together with the particulars of the complaint and a statutory declaration made by the LSC. The meeting did not take place.
116 In Murray the Court of Appeal held that a decision under s155 to institute proceedings is one to which the rules of procedural fairness apply, and that the application of the rules requires that the legal practitioner the subject of the decision be provided with a copy of the complaint and be given an opportunity to respond to the allegations made therein (para 88). In Murray, the claimant had not been given a copy of the complaint, despite a number of explicit requests, and, as a result, the decision was declared void, and the Tribunal restrained from proceeding to conduct a hearing into the Information. As a result of the decision in Murray the essential question that here arises for determination is whether the course adopted by the LSC was sufficient to discharge his obligation to afford natural justice to the claimant in relation to this decision. LSC argued that he complied with this obligation.
117 The judgments in Murray were published well after judgment in the present case was reserved. Accordingly, the parties were given an opportunity to make written submissions as to its application or non application to the present case. The Crown Solicitor, acting for the LSC, furnished a submission seeking to distinguish the two cases, and arguing that, in the present case, the duty of the LSC had been properly discharged.
118 There is one significant point of distinction between the two cases. In Murray, because the claimant, despite his express requests, had never been given a copy of the complaint, he did not know, in full, or in clear terms, what was alleged against him. Priestley JA doubted that, if that claimant had at any stage been told the whole substance of the complaint against him, he would have succeeded in his claim of procedural unfairness (paragraph 4). However, on the facts as they emerged in the evidence in that case, the claimant had not been told the entirety of what the LSC was investigating, but only part of it.
119 In the present case the LSC seized upon this point of distinction in order to argue that, as the present claimant had been given a copy both of Rajski’s complaint book and his reply to the claimant’s original response in relation to the s 138(2) question, the claimant had been given adequate information and that he had had ample opportunity to put his case.
120 There are four reasons why the LSC’s arguments cannot be accepted. First, the grounds in the Information that are additional to and go outside the matters raised by Rajski show conclusively that the LSC did not disclose to the claimant the whole substance of what he was investigating. Second, in the letter of 17 February 1997 the LSC confined his invitation to the claimant to put his case on the issues raised by s 138(2)(b). There was no invitation to the claimant then to put his case in relation to the substantive complaint, and it would have been inappropriate to have issued such an invitation at that time. This was reinforced by the LSC’s letter of 28 February, in which he effectively told the claimant to confine his submissions to matters relevant to the s138 decision. It was reasonable to infer from the terms of that letter that the LSC separated the two questions, and was , at that time, concerning himself only with the question of acceptance of the complaint out of time. There is a clear hint in the letter, that, if the s138(2) issue were resolved against the claimant, then the subsequent issue, the s155 questions, would be dealt with independently. Third, in the letter of 30 March 1997, advising the claimant that he had decided to accept the complaint out of time, the LSC explicitly told the complainant that he would “shortly” be in touch with respect to the future of the investigation and the procedure to be adopted. Again, it is reasonable to read this letter as telling the claimant that a further opportunity would be given to him to put submissions in relation to the subsequent matter. Indeed, the claimant may well have believed, from the content of this letter, that the investigation had come to a halt, either temporary or permanent. Fourth, and most damning for the LSC, arranging the meeting with the claimant’s legal representatives for 18 December, which was aborted by reason of the filing of the Information, could reasonably be construed as nothing other than the commencement of the natural justice procedure. The claimant was entitled to expect that at and following that meeting, he would be provided with full information about the stage the investigation had reached, what precise matters the LSC considered warranted attention, the procedures he proposed to adopt, and the opportunity the claimant would be given to rebut allegations against him. I would add that the very length and detail, and the discursive nature, of the Rajski documents give further support to this conclusion. The claimant could hardly be expected to discern from those documents what the LSC considered to be material warranting further investigation. It was incumbent on the LSC to refine for the claimant the issues he considered required or warranted investigation, and in relation to which the claimant was to be called upon, or given an opportunity, to respond. It is important to observe also the different considerations that arise under s138(2)(b) and s155(2). For the former, the relevant question was whether it was “necessary in the public interest to investigate the complaint”. For the latter the question was whether there was a reasonable likelihood that the claimant would be found guilty by the Tribunal of unsatisfactory professional conduct or professional misconduct. But there is more than this to a s155 decision. Even if the LSC concluded that there was such a reasonable likelihood, subs(3) obliged him to go further and consider whether there was a reasonable likelihood that the claimant would be found guilty only of unsatisfactory professional conduct and, if so, which of the two alternative courses available to him under that subsection should be adopted. As the judgment of Priestley JA in Murray makes plain, the claimant was entitled to an opportunity to be heard on these questions.
121 The LSC, advanced another argument that part of the basis of the decision in Murray is inapplicable in the circumstances of the present case. This argument was concerned with what the Court of Appeal said about subss (2) and (3) of s 155. By subs(2) the LSC is obliged, once satisfied of the reasonable likelihood that the Tribunal would find the claimant guilty either of professional misconduct or unsatisfactory professional conduct, to institute proceedings in the Tribunal. However, by sub s (3), if he was satisfied that there was a reasonable likelihood that the Tribunal would find the claimant guilty only of unsatisfactory professional conduct and not professional misconduct, then he would have been entitled to reprimand the claimant (if the claimant consented) or (if satisfied that the claimant was generally competent and diligent and that there were no other material complaints about his conduct) to dismiss the complaint.
122 The availability of this option was one reason, but, on my reading of the judgment, an independent reason, that led the Court of Appeal to hold that s 155 attracts the rules of procedural fairness. The LSC’s argument was based on the claimant’s concession that the conduct alleged against him amounted to professional misconduct, thereby rendering sub s (3) irrelevant.
123 If the obligation to consider the matters relevant to subs(3) were integral to the conclusion in Murray that the rules of natural justice apply to a s 155 decision, there would be some substance to this argument. However, that is not how I read the judgments. In paragraph 88 Sheller JA, with whom the other members of the Court generally agreed, although with additional observations, said that he found it hard to imagine that the LSC could reach the requisite satisfaction (and here his Honour was, I believe, referring to the requisite satisfaction under s 155(2)) without taking into account the legal practitioner’s response.
124 In paragraph 89 his Honour went on to refer to the provisions of sub s (3), but, as indicated above, I consider this to have been an additional and independent reason for the conclusion. On a proper analysis of the judgment, in my view, his Honour would have reached the same conclusion in relation to s 155(2)even in the absence of sub s (3).
125 Accordingly, the attempt to distinguish Murray fails.
126 The claimant received no opportunity to be heard on these questions, and instead found that the Information had been filed without the further reference to him that he had been led to expect. The LSC’s argument that he complied with the requirement of natural justice fails.
127 The claimant was entitled to, but was not given, the opportunity to respond to the complaint before a decision to institute proceedings in the Tribunal was made. He has established that, in relation to the s 155 decision he was entitled to but was not accorded the benefit of the rules of procedural fairness.
128 The LSC then argued that, in the circumstances that now exist, to follow the course taken in Murray and declare the decision void would be a futility. This is because of the different way in which the claimant in Murray conducted his challenge to the decision there in question. He did not argue that the decision to institute proceedings was unreasonable, and the Court of Appeal therefore did not have the relevant evidence to determine whether a different result might have been reached had that claimant had the opportunity to put information and material before the LSC.
129 In the present case, a great deal of the hearing time was taken with an examination of that material the claimant would have put before the LSC had he been given the opportunity. This enables an appreciation of whether the LSC might have come to a different view - or, more accurately, whether it has been shown that he could not have reached any other conclusion if he had had access to the evidentiary material and argument now put on behalf of the claimant.
130 The question which now arises is what, in the circumstances of this case, flows from the conclusion I have reached. Had the claimant limited himself, in the summons, to the contention that he had been denied procedural fairness, the appropriate course would have been to remit the matter to the LSC to be dealt with in accordance with those rules. But the claimant did not so limit himself. In arguing that the decision to institute proceedings in the Tribunal was unreasonable or an abuse of process he must be taken to have put before me the entirety of material he would, given the opportunity, have put before the LSC. I have already mentioned the volume of evidentiary material put forward by the parties. I am satisfied that it is correct that merely to declare the s 155 decision void and remit the matter to the LSC to be dealt with in accordance with my conclusion would be inappropriate. Having regard to all the material, the only reasonable and practical course is to proceed to deal with what I have called the substantive matters.
131 In reaching this conclusion I have not overlooked the alternative possibility of requiring the LSC to refer the complaint to the Council of the Law Society for independent investigation, but I have concluded that to take that course at this late stage would do no more than prolong these already protracted proceedings. The detailed examination in relation to the grounds in the claimant’s summons alleging that the filing of the Information constitutes an abuse of process renders any further preliminary investigation superfluous.
132 The circumstances are analogous with those recognised by the Privy Council in Calvin v Carr [1979] 1 NSWLR 1, in which three classes of case were identified - at one extreme, those cases in which a defective hearing at first instance may be superseded by a subsequent fair hearing; at the other extreme, those in which nothing less than a fair hearing at first instance will suffice, even though some form of review hearing may be seen to offer a cure for the original defect; and intermediate cases dependent on their own circumstances in which it is necessary to decide whether the parties should be taken to have agreed to accept the subsequent hearing and decision in place of the original.
133 In the present case the course initiated by the claimant, in putting all the issues he has before me, has placed this case in that intermediate category (if not in the first) and that it would be quite inappropriate to remit the matter to the LSC (or the Council of the Law Society) for further examination.
134 Finally, the claimant argued that the decision to institute proceedings was wholly unreasonable. As that argument raises the same issues as arise under ground 5 of the summons it will be dealt with concurrently with that ground.135 By Ground 3 it is alleged that the commencement of the proceedings in the Tribunal was flawed because the LSC had instituted the proceedings in the Tribunal:
OTHER PROCEDURAL MATTERS
3. Ground 3 of the Summons
(ii) “without … having first notified the claimant of his decision to do so and the reasons for it….”
(i) “without … having first recorded his decision and the reasons for it” and
136 S 156 obliges the LSC to cause a record of his decision with respect to a complaint, together with reasons for the decision, to be kept in respect of each investigation conducted under Division 5 of Part 10. The obligation applies to a decision under s 155(2): Murray, paragraph 93.
137 S 171J(1) obliges the LSC to cause the decision with respect to a complaint, together with reasons for the decision, to be notified in writing to the legal practitioner against whom the complaint was made. It is implicit in the reasons given by Sheller JA in Murray for concluding that a s 155(1) decision is a decision within s 156, that such a decision is also within s 171J. Accordingly, the LSC was obliged to cause a record of his decision, and the reasons therefor, to be kept, and to notify the claimant of that record and the reasons. There is nothing expressly stated in s 171J that requires the notification to be made before proceedings are instituted in the Tribunal that is the clear intention.138 On 20 January 1997 Pavlakis wrote to the LSC, drawing attention to the provisions of s156, and requesting a copy of the record and the reasons. On 23 January 1997 the LSC replied (to the claimant, care of Messrs Atanaskovic and Hartnell (“A&H”) solicitors who had in the meantime assumed conduct of the matter on behalf of the claimant) in the following terms:
Facts
“Pursuant to s171J of the Legal Profession Act, 1987 I wish to formally advise you that as a result of my intensive investigation into the complaint by Leszek Rajski that I have determined to institute proceedings against you in the Legal Services Tribunal in respect to each complaint made (attached hereto) as I am satisfied that there is a reasonable likelihood that you will be found guilty by the Legal Services Tribunal of unsatisfactory professional conduct or professional misconduct.
Should you consider that you are in any way prejudiced by not receiving this formal advice until today, would you please advise the Crown Solicitor of this fact by 5 pm on 28 January 1997 and I will arrange for the issue and service of a further Information, in identical terms to that already served on you.”139 Attached to the letter was a photocopy of that part of the Information that specified the grounds of complaint (as distinct from the more detailed particulars).
140 On the same day A & H wrote to the LSC, asserting that the letter from the LSC failed to provide reasons for the decision, and requesting compliance with s 171J. On 29 January A&H again wrote to the LSC, noting that their previous letter had received no reply, and asking that the LSC identify the material that was before him, and provide the opportunity to inspect it. On 30 January the Crown Solicitor, acting on behalf of the LSC, replied, expressing the view that the LSC had satisfactorily complied with ss 156 and 171J, and declining to identify or provide access to the material on which he had made his decision.
• • •
141 The only passages in the correspondence that could possibly be said to amount to the LSC’s satisfactory compliance with the requirement to record and provide reasons for the decision is that paragraph in the letter of 23 January extracted above, in which the LSC declared that he was satisfied that there was a reasonable likelihood that the claimant would be found guilty by the Tribunal of unsatisfactory professional conduct or professional misconduct.
142 This is no more than a recitation of the statutory test contained in s 155 (2) that the LSC was required to apply to the complaint before instituting proceedings in the Tribunal. It is, in effect, in apparently identical terms to the notification given to the claimant in Murray, which the Court of Appeal held did not satisfy the requirements of the section. The same conclusion must here be reached. As in Murray, the failure to give proper reasons is an error of law in the decision to institute the proceedings. Although there was no direct evidence (the LSC hearing given no evidence) whether the record required by s156 to be kept was ever made it is a reasonable inference from these matters set out above that it was not. This constitutes a breach of statutory duty. A separate question concerns the consequences of such an error.
143 The answer to this question is similar to that given in relation to the failure to accord procedural fairness in relation to a s 155 decision. While the claimant has succeeded in establishing procedural error on the part of the LSC, that error has been superseded by the course these proceedings have taken. At this stage no consequences flow from those errors.144 By Ground 4 of the summons it is asserted that the Information is “vexatious and embarrassing” in three different respects:-
4. Ground 4 of the Summons
145 The Information filed in the Tribunal opens with the words:
(i) in alleging both professional misconduct and unsatisfactory professional conduct in respect of the same conduct;(ii) in alleging unsatisfactory professional conduct in respect of conduct which occurred before 1 January 1988;
(iii) in alleging unsatisfactory professional conduct in respect of conduct which occurred more than three years before the date of the complaint.
In written and oral submissions a further matter was, without objection, added, and may conveniently be dealt with under this ground:-
(iv) the Information concerns conduct some of which is not the subject of any complaint, and to that extent is not “in respect of a complaint” as required by s 167.
Duplicity - Professional Misconduct and Unsatisfactory
Facts
Professional Conduct
“The [LSC] complains to the [Tribunal] that, in relation to Grounds 1-7, NICHOLAS RODERICK CARSON , a legal practitioner, is guilty of conduct which constitutes either professional misconduct or unsatisfactory professional conduct.”
146 The concepts of “professional misconduct” and unsatisfactory professional conduct” are separately defined in s 127 (1) and (2) respectively. It is unnecessary here to set out the definitions in full. Throughout Part 10, distinctions are drawn between the two concepts, showing that the legislature envisaged that they would be treated differently. For example, under s 138(2)(a), the LSC may accept a complaint out of time in respect to either professional misconduct or unsatisfactory professional conduct provided the relevant test is met; but his powers to do so under s 138 (2)(b) exist only where he is satisfied that the complaint concerns an allegation of professional misconduct and the test there stated is satisfied.
147 Of greater significance is the distinction drawn in s 155, which in subs (2) requires the LSC to institute proceedings in the Tribunal if satisfied that there is a reasonable likelihood that the legal practitioner will be found guilty by the Tribunal of unsatisfactory professional conduct or professional misconduct; but which in subs (2) permits him, if satisfied that there is a reasonable likelihood that the legal practitioner will be found guilty by the Tribunal of unsatisfactory professional conduct but not professional misconduct, to reprimand the legal practitioner (if he or she consents) or to dismiss the complaint (if satisfied of the relevant matters there set out).
148 Other distinctions are made in ss 168 and 170. Each of these sections concerns the procedures to be put in effect by the Tribunal in the conduct of a hearing. By s 168(1) the Tribunal is to observe the rules of evidence when conducting a hearing into an allegation of professional misconduct, but , by subs (2), is not bound to do so when conducting any other hearing (that is, when conducting a hearing into an allegation only of unsatisfactory professional conduct) but may inform itself of any matter in such manner as it sees fit. By s 170(1) a hearing is to be held in the presence of the public, but by subs (3) a hearing relating only to a question of unsatisfactory professional conduct is to be held in the absence of the public unless the Tribunal is of the opinion that the presence of the public is in the public interest or in the interests of justice.
149 The claimant argued that, because of the distinctions drawn in the Act between the two kinds of conduct, and, most particularly, because of the difference in the procedures governing the conduct of a hearing into the two different kinds of allegations, the LSC is obliged to elect to proceed either on an allegation of professional misconduct, or on an allegation of unsatisfactory professional conduct, but cannot proceed in the alternative, and that the Tribunal is limited to a finding of guilt or otherwise in accordance with the allegation brought by the LSC.
150 I am satisfied that this argument should not be accepted.
151 S 168(1) makes it plain that, where the Tribunal is conducting a hearing into an allegation of professional misconduct, the rules of evidence apply. Subs (2) makes it equally plain that, “for the purpose of conducting any other hearing”, the Tribunal is not bound by those rules. “Any other hearing” is a hearing that does not involve a question of professional misconduct. Thus, where the LSC files an Information concerning conduct which he asserts may amount either to professional misconduct or unsatisfactory professional misconduct, the Tribunal conducts a hearing “into a question of professional misconduct” and by s 168(1) the rules of evidence apply. Subs (2) has no application, because the Tribunal is not “conducting any other hearing”.
152 Similarly, s 170 (3) requires (prima facie), where a hearing relates “only to a question of unsatisfactory professional conduct” the hearing be held in the absence of the public unless the Tribunal is of the opinion that the presence of the public is in the public interest or in the interests of justice. Where a hearing is into the dual questions of professional misconduct and unsatisfactory professional conduct, s 170(3) has no application. The Tribunal is, nevertheless, entitled to direct that a hearing relating to a question of professional misconduct be held in the absence of the public if of the opinion that the presence of the public is not in the public interest or the interest of justice.
153 In my opinion the correct reconciliation of the sections, and their proper interpretation, involves the proposition that the LSC may institute proceedings in the Tribunal with an allegation that the conduct of the legal practitioner the subject of the allegations amounts either to professional misconduct or unsatisfactory professional conduct. He is not obliged to do so, and may allege one or the other, but if he alleges professional misconduct, whether alone or in the alternative, the Tribunal is bound by the rules of evidence.
154 It was argued on behalf of the claimant that the only reason for the LSC to take the course he did and include the alternative formulation was to gain the benefit of the more relaxed provisions as to the admissibility of evidence. There is no reason to accept that this was the reason motivating the LSC, but if it were, it was based on a mistaken premise. Where the LSC lays an Information framed in the alternative, the rules of evidence must be applied. It is only when the LSC expressly disclaims reliance upon an allegation of professional misconduct that he can obtain the benefit of the more relaxed provisions relating to evidence. In opting to proceed on the basis that the conduct amounts to professional misconduct, he is accepting that the whole of the hearing is to be conducted on the basis that the rules of evidence apply. In any event, I am not here concerned with the motivation of the LSC. What I am concerned with is simply the question whether the procedural distinctions between enquiries into allegations of professional misconduct and unsatisfactory professional conduct have the consequence that the two may not be alleged in a single Information. I am satisfied that they do not.
155 Accordingly, I do not accept the claimant’s argument that the Information is vexatious or embarrassing in this respect.
Unsatisfactory professional conduct in respect of conduct occurring before 1 January 1988
156 Except for the conduct the subject of ground 6 of the Information (evidence given in the Fairfax proceedings) all conduct on which the LSC relies took place before 1 January 1988:
157 Part 10 of the Act was inserted in 1993 by the Legal Profession Reform Act 1993. By cl 37 of Sch 8, Pt 10 applies to conduct occurring either before or after the commencement of the Act (the Act having commenced on 1 January 1988)158 Cl 37(1) precludes a finding by the Tribunal that the claimant’s conduct (other than the conduct the subject of ground 6 of the Information) amounted to unsatisfactory professional conduct. It follows that the LSC is precluded from alleging that that conduct amounted to unsatisfactory professional conduct. On behalf of the claimant it was argued that the conclusion to this effect has the consequence that the Information is bad. I do not accept that conclusion. In my view, the words in the Information alleging that the conduct the subject of grounds 1 - 5 and 7 amounts to unsatisfactory professional conduct should be deleted. That, however, is a matter for amendment in the Tribunal, and is not, at this stage, a matter for this court.
“but not including unsatisfactory professional conduct occurring before that commencement”.
This is because the law governing disciplinary procedures relating to members of the legal profession did not incorporate the concept of unsatisfactory professional conduct before that date.
That the Information alleged unsatisfactory professional conduct in respect of conduct occurring more than three years before the date of the complaint.
159 Strictly speaking, in relation to grounds 1 - 5 and 7, having regard to my conclusions immediately above, it is unnecessary to deal with this argument. However, the question remains alive in relation to ground 6 and should be disposed of.
160 In determining to accept the complaint out of time the LSC confined himself to the discretion conferred by s 138(2)(b), an essential element of which is that the complaint concerns an allegation of professional misconduct. The claimant argued that, having done so, it was not open to the LSC subsequently to allege that the conduct amounts to unsatisfactory professional conduct.
161 This argument should not be accepted. S 138(2)(b) is directed to acceptance of a complaint out of time. The LSC is empowered to accept a complaint out of time, relevantly, where satisfied that the complaint concerns an allegation of professional misconduct and that it is necessary in the public interest to investigate the complaint. The focus of the inquiry at that stage lies in an evaluation of the nature of the allegation. The LSC is necessarily confined to the allegations in the complaint.
162 Those findings, and the decision to accept the complaint, are the starting point of an investigation. It does not follow that an investigation must result either in a conclusion that the conduct is such that there is a likelihood that the legal practitioner will be found guilty of professional misconduct, or is entirely outside the disciplinary provisions of the Act. After investigation, it would be open to the LSC to reach the conclusion that the conduct does not reach the level, or come within the definition, of professional misconduct; he may nevertheless be satisfied that the conduct is capable of amounting to unsatisfactory professional conduct.
163 There is nothing in s 155 or elsewhere in the Act that prevents the LSC, once having accepted and investigated a complaint, concluding that the conduct alleged does not amount to professional misconduct, but does or might amount to unsatisfactory professional conduct. It remains open to him to exercise his powers under s 155(3) if he considers it appropriate to do so and the tests stated in the sub section are satisfied. The delay, and the policy that underlies s 138(2)(b), would be matters highly relevant to the course taken thereafter.
The Information is brought in respect of conduct some of which is not the subject of any complaint, and to that extent is not a complaint as required by s 167
164 It was common ground that the conduct the subject of grounds 1, 4, 7(i), 7(iv), 7(v) and 7(viii) of the Information was not included in the complaint made by Rajski.
165 The claimant argued that, on the proper construction of the relevant provisions of the Act, the jurisdiction of the Tribunal is limited to matters raised by the initial complaint, and it was not open to the LSC to refer to the Tribunal an Information containing in grounds going outside the matters raised in that complaint. Such a conclusion follows from an analysis of the various sections dealing with the initiation of a complaint (s 134), the form it is required to take (s 137), and its progress through referral and investigation (ss 142, 147A, 148, 149, 150, 151, 152, 155, 156) to final disposal (ss 155(3), 167, 171C).
166 It is unnecessary to elaborate upon the argument. In Barwick v The Law Society of NSW (unreported, 16 July 1998) the Court of Appeal held that the allegations of conduct which base an Information cannot extend beyond those the subject of the complaint (p25).
167 It should be noted that s 167A to which reference was made in Barwick, and which permits the Tribunal, on the application of the LSC or a Council, to vary an Information so as to omit allegations or include additional allegations, was enacted after the LSC’s Information in the present case was filed in the Tribunal and has no application to the present proceedings.
168 Accordingly, the Tribunal is without jurisdiction to conduct a hearing into those grounds in the Information that were not part of the original complaint. However, notwithstanding this conclusion, I have considered it appropriate to deal with the other challenges to these grounds.169 More procedural irregularities, with which it is convenient to deal with here, are alleged under Ground 5 of the summons. These are identified as:
5. Ground 5 of the Summons
170 I have already expressed my views on the last of these (paragraph 96 to 109) and do not propose to repeat those views. They are as applicable to the ground as presently raised as to the ground in relation to which they were previously expressed. The existence of the contempt proceedings raising similar factual issues does not affect the propriety of the institution of proceedings in the Tribunal.
(i) Gross and inexcusable delay in the making and investigation of the complaint;
(ii) Unfair and improper conduct in the investigation of the complaint;
(iii) Reliance upon improperly obtained evidence;
(iv) The existence of contempt proceedings raising the same issues as the Information.
Delay
171 Except for the ground made in reliance upon the evidence given by the claimant in the Fairfax proceedings (the subject of ground 6 of the Information) the conduct the subject of the Information took place between 1985 and 1988. There are two aspects to the delay. Firstly there was delay on Rajski’s part in making the complaint to the LSC. That was a delay of nine years in relation to the earlier conduct, six years in relation to the latest. That Rajski was aware of at least some of that conduct is evident because he was present when it took place, or was involved in the litigation in relation to which it occurred, and, most positively, by his commencement of the two contempt proceedings, in November 1985 and April 1987. Notwithstanding his awareness of that conduct, he made no complaint to the LSC until 8 July 1994. His delay in making a complaint remains unexplained. Thereafter, the delay lies, apparently, at the door of the LSC. It was not until 20 January 1995, more than six months after the complaint was filed, that the LSC informed the claimant of its receipt and sought his comments on whether it should be accepted out of time. His decision to do so was made and notified on 30 March 1995. It was not until almost twenty-one months later, on 17 December 1996, that he instituted proceedings in the Tribunal. He has provided no explanation for any aspect of the delay.
172 In this respect it is relevant to note s 154 of the Act which expressly requires an investigation by the LSC to be conducted “as expeditiously as possible”.
173 The claimant relied on the decision of the Court of Appeal in Herron v McGregor (1986) 6 NSWLR 246. That case concerned disciplinary proceedings brought against medical practitioners in respect of treatment of patients that had been given thirteen years earlier (and of a type which had long since ceased). The Medical Tribunal had refused an application for stay on the grounds of delay and prejudice, citing, principally, the seriousness of the allegations, the matters of public importance involved, and what it held to be the overriding public interest in the inquiry’s proceeding, even at the cost of substantial prejudice and unfairness to the doctors.
174 McHugh JA analysed the chronology of relevant events, the delay and the explanations given therefor, and the evidence of actual prejudice and presumptive prejudice. In a judgment with which Street CJ and Priestley JA concurred, he held that the issue for consideration was “present fitness” to practise and that, as no current issue of questionable practices arose, and that it was unlikely that thirteen year old conduct could establish present unfitness to practise, the proceedings in the Medical Tribunal should be stayed. It is worth making the obvious observation that that case was decided on its own facts. The judgment does not purport to lay down any guidelines (other, perhaps, than the conclusion that the focus in a disciplinary inquiry is into present fitness to practise). The issue there was the balancing of the public interest in the maintenance of professional standards, the control and supervision of medical practice and the importance of disciplining doctors guilty of professional misconduct against the prejudice occasioned by reason of the lengthy procrastination in bringing the proceedings. The balancing exercise in that case resulted in the evidence of prejudice prevailing over the public interest in pursuing the allegation.
175 There was, in Herron, considerable evidence of actual prejudice. One medical practitioner critically involved in the treatment had died. Lengthy civil proceedings had successfully been conducted against one of the doctors, exposing him to a good deal of adverse publicity. It was supposed that some relevant witnesses would be unavailable or would have had diminished recollections of the relevant events. It was also supposed that some relevant documentation may have been lost. McHugh JA considered the various explanations given for the delay and found them unconvincing. He described the delay in lodging the complaint as “appalling and without justification” (p 265). The treatment was no longer administered. There was no question of any continuation of questionable practices.
176 As I have noted above, there is, in the present case, no explanation advanced either for Rajski’s delay in filing the complaint, or the LSC’s delay in investigating it. That is a significant factor. It may be inferred that no explanation that could assist the LSC was available. I would not so readily draw a similar inference in relation to the lodging of the complaint by Rajski. He is not a party to this present proceeding.
177 The delay in the institution of proceedings, especially, and the absence of any explanation for that delay, are matters for considerable concern. Together with the procedural irregularities already identified, they raise serious questions about the conduct of the Office of the LSC.
178 However, there was no evidence of actual prejudice to the claimant. The case against him is virtually entirely documentary, and the documentation is extremely thorough. The claimant gave evidence, over six days, was subjected to searching cross-examination, and demonstrated a capacity of recall and a grasp of the subject matter that belies any prejudice by reason of failing memory.
179 Some attempt was made to draw a further parallel with Herron in respect of the finding that the practice the subject of that complaint had been discontinued many years prior to the institution of the complaint. It was put that the conduct the subject of the present complaint occurred in the context of complex, protracted, bitterly fought and diverse litigation notorious in the history of this court. That may be so, but if - and I underline if - involvement in litigation of that description caused the claimant to conduct himself in an unprofessional manner, it is appropriate that that conduct be fully investigated. Such a finding could have a bearing on the question of the claimant’s present fitness to practise. It is an argument pertinent to the issues that arise under s 171C rather than at the present stage. I would not regard the fact, if it be the fact, that the Rajski litigation was of such a nature as to give rise to extraordinary behaviour, as a reason supporting a stay of the proceedings.180 The claimant alleges that the investigation was unfair and improper because:-
Unfair and improper investigation
(a) the LSC held out that an opportunity would be afforded to the claimant to discuss the course of the investigation and no such opportunity was in fact given;
(b) the LSC gave the claimant no opportunity to provide exculpatory or mitigatory material;
(c) the LSC gave the claimant no opportunity to make submissions as to the course of action the LSC should take, or the decision he should make under s155;
(d) in December 1997 the LSC represented to the claimant’s solicitors that they would have the opportunity to discuss the complaint in the meeting scheduled to take place on 18 December, but by instituting the proceedings in the Tribunal the day before rendered the proposed meeting pointless;
(e) the LSC at no time interviewed or sought material from the claimant, or from any of the individuals named in the relevant documentation who might have been able to provide relevant information;
(f) the LSC failed to record the decision and the reasons for it, and to notify the claimant, as required by the Act.
181 Many of these factors are those which contributed to the argument that there had been a denial of procedural fairness, both in relation to the s 138(2) decision and the s 155(2) decision and the conclusion that in respect of the latter decision there had been such a denial, or have already been considered in relation to other grounds in the summons. That does not mean they are inapposite to the present question.
182 There is a great deal of validity in the criticism about the aborted meeting fixed for 18 December, and some in the failure of the LSC to interview or seek information from other individuals who may have been able to throw some light on the matters he was investigating. Alone, it is insufficient to warrant a conclusion that the proceedings in the Tribunal are an abuse of process, or even that the investigation “unfair or improper”.
Improperly obtained evidence
183 The claimant asserts that much of the evidentiary material relied upon by the LSC was obtained improperly. In order to support this assertion he pointed to the nature of the material. As noted above, there was an enormous volume of documentation produced by the parties, much of it by the LSC. Included in that material to which the LSC had access, and on which he relied in making his decision, were a number of file notes, obviously from the files of DW, made by solicitors in that firm in relation to the various proceedings in which it was engaged. Such documents are prima facie privileged, and their possession by the LSC is unexplained. On behalf of the claimant it was hypothesised that such documents would only have been released by DW in circumstances, such as, for example, producing them on discovery in relation to the Fairfax proceedings, in such a way as would attract an implied undertaking not to use them for extraneous purposes: Harman v Secretary of State for the Home Department [1983] 1 AC 280; Ainsworth v Hanrahan (1991) 25 NSWLR 155. I was therefore invited to draw the inference that the documents were improperly obtained, most probably by Rajski, or, if not by him, by somebody on his behalf, or less probably, by the LSC himself.
184 I am not prepared to draw that inference. The evidence does not disclose the source of the material that was in the possession of the LSC, and there may be a number of legitimate or illegitimate means by which those documents came into his possession. There was no direct evidence from any solicitor in DW, including the claimant, that the documents had not been provided in such a way as to be available to Rajski or the LSC, and there was no evidence from any of DW’s clients to eliminate any possibility that they had somehow disclosed the documents in such a way that they came into the hands either of Rajski or the LSC.
185 In my view there is no basis for a conclusion that the LSC relied upon improperly obtained evidence.
Ground 5.5 in the Summons: Abuse of Process
SUBSTANTIVE MATTERS
186 By Ground 5.5 it is asserted that the proceedings before the Tribunal are an abuse of process and vexatious and oppressive. In part, to support this ground the claimant relies on the alleged procedural irregularities with which I have already dealt. But the principal thrust of the argument was that there is no reasonable prospect that he will be found guilty by the Tribunal of professional misconduct; put another way, that the proceedings in the Tribunal are “foredoomed to fail”.
187 The Court may stay proceedings where they are “foredoomed to fail” (Walton v Gardiner (1993) 177 CLR 378 at 393) and reliance on this principle gave rise to the weightiest and lengthiest single aspect of the proceedings. There is, additionally, power to stay proceedings as an abuse of process in circumstances where the proposed use of the Court’s procedures would be manifestly unfair to a party or would bring the administration of justice into disrepute: Hunter v Chief Constable of the West Midlands Police [1982] AC 529 at 536, quoted with approval by Mason CJ, Deane and Dawson JJ in Walton.
188 In Jago v District Court (NSW) (1989) 168 CLR 23 at 74 Gaudron J said:
“…at least in civil proceedings, the power to grant a permanent stay should be seen as a power which is exercisable if the administration of justice so demands, and not one the exercise of which depends on any nice distinction between notions of unfairness or injustice, on the one hand, and abuse of process on the other hand.” (also quoted with approval in Walton) .
189 Separate examination is required of the merits of each of the grounds in the Information.
190 The onus of establishing that any ground in the Information is “foredoomed to fail” lies upon the claimant. In the ordinary course the test to be applied would be whether the LSC’s case, taken at its highest, and in the absence of explanatory, mitigatory or exculpatory material given by the claimant is capable of providing the foundation for a finding of professional misconduct. (For reasons already given in paragraph 158 no question of unsatisfactory professional conduct need now be considered.) In the circumstances of the present case, that approach is unrealistic and unduly restrictive. The claimant’s affidavit and documentary evidence was admitted without objection; he gave lengthy oral evidence, almost all of which was given in response to cross-examination by senior counsel for the LSC; and the argument as to the merits of the allegations took in what I might compendiously refer to as the defence evidence - that is, evidence that would be given by way of defence in the Tribunal upon a hearing.
191 Having regard to the way in which the case was conducted before me, it is inevitable that I will reach conclusions of fact, including findings in relation to the credibility of the claimant. Nevertheless, I bear in mind the limited nature of the exercise in which I am engaged. It is not for this Court to usurp the functions of the Tribunal. If, on all the evidence that is before me, I conclude that it would be open to the Tribunal charged by statute with the determination of matters of the professional conduct of legal practitioners to find the claimant guilty of professional misconduct in relation to any of the grounds of the Information, then the appropriate and proper course is to leave the decision in relation to that ground to the Tribunal. I now turn to the individual grounds in the Information.
192 In s 127 of the Act “professional misconduct” is defined to include:193 The LSC’s allegation in relation to Wood is framed in the following terms:
Ground 1 in the Information - Wood and Donaldson
“(a) unsatisfactory professional conduct, where the conduct is such that it involves a substantial or consistent failure to reach reasonable standards of competence and diligence, or
(b) conduct (whether consisting of an act or omission) occurring otherwise than in connection with the practice of law which, if established, would justify a finding that a legal practitioner is not of good fame and character or is not a fit and proper person to remain on the roll of legal practitioners, or
(c) conduct that is declared to be professional misconduct by any provision of this Act.”
194 The complaint in relation to Donaldson is in identical terms except that a single improper approach only is alleged.
“In late 1985 the [claimant] made improper approaches to Mr Wood, a witness for Raybos and Rajski in the litigation, attempting to have him change the evidence he had given in the litigation, the [claimant] knowing prior to these approaches that Mr Wood was a critical witness for Raybos and Rajski in the litigation and that he had given evidence on behalf of Raybos and Rajski before Miles J to the effect that:
(i) the product [Raybol] had been delivered and was working satisfactorily, and
(ii) the complaints made in the 1980 P[roceeding] that the product did not work were baseless,
and the [claimant] further knew that the evidence given by Mr Wood had been accepted by Miles J after he had been extensively cross-examined on behalf of the [claimant’s] clients.”
Facts
195 The background to the allegation lies in the notice of motion filed by Rajski and Raybos for leave to amend Raybos’ cross-claim in the 1980 proceeding by, inter alia, adding Rajski as a cross-claimant, adding new defendants (including AAH) and adding new claims of conspiracy.
196 The hearing of the notice of motion extended over thirty days in 1984 and early 1985 before Miles J. Both Wood and Donaldson had, at the time of the contract for the sale of Raybol, been employed by Tectran and had computer expertise. Each swore an affidavit which was read in the hearing before Miles J, and each gave oral evidence and was cross-examined. The affidavits were in evidence in the present proceedings, as was his Honour’s judgment; the transcript of oral evidence was not. The central issue in the proceeding, as expressed by Miles J, was whether Rajski and Raybos were able to show an appropriately arguable case on a tenable evidentiary basis in relation to new issues raised in by the proposed cross-claim.
197 The basis of the allegations made in the proposed amendment to the cross-claim was that Tectran and AAH had commenced the 1980 proceeding without any adequate foundation, and that its sole or predominant purpose was not to enforce Tectran’s legal rights, but to secure an advantage for Tectran in its negotiations with Raybos, or to crush Rajski and Raybos commercially. Accordingly, the inquiry by Miles J was whether Rajski and Raybos had an appropriately arguable case on a tenable evidentiary basis that the allegations made by Tectran in the 1980 proceeding were without foundation. These allegations were, in essence, that Raybol was a defective product, and that Rajski had misrepresented its quality and capacity. The very lengthy proceeding before Miles J was, therefore, intrinsically concerned with the quality of Raybol, and the circumstances that preceded the making of the contract. The effect of the evidence, documentary and oral, of Wood and Donaldson, was, as I understand it, that Raybol was effective for the purpose for which it was purchased although it required improvement and enhancement. The Arunta Companies produced no witnesses or documentation to the contrary, although, it is clear from the judgment, extensive cross-examination was directed to the evidence given by Wood and Donaldson. As well, Wood’s affidavit contained considerable detail about the stages preliminary to, and the preparation for, the signing of the contract. While it is reasonable to infer that a good deal of the lengthy cross-examination was directed to Raybol’s effectiveness, it is not so clear that the pre-contractual negotiations assumed great importance at that stage. This is a matter of some significance given the nature of the allegations now made by the LSC. Miles J delivered judgment on 5 June 1985.
198 On 9 October 1985 DW wrote to Wood and Donaldson. Each letter contained the following paragraph:199 On 24 October 1985 the claimant, with Lake, met Wood at his office at North Sydney. A file note made by Lake recording the meeting extends over six and a half typed pages and need not here be fully reproduced. It is, however, salient to extract substantial portions of it:
“Having regard to your position in the company at the relevant time and your close connection with the project, the assistance you are able to provide to our clients will be critical in both the first and second actions. Accordingly, we are instructed to request your assistance in the preparation of our client’s case. We are confident you will have no objection to assisting our client. As a former employee of Tectran we consider that you are morally obliged to support the company in these proceedings . Please contact Chris Davidson so that a mutually convenient time for a conference may be fixed.” (emphasis added)
It is not in dispute that the author of these letters was Davidson.
“[The claimant] said that a former employee (in the loose sense of ‘employee’) has an obligation to give information to his ex employer in respect of events which occurred during the time which he was employed.
…[the claimant] said that [DW] had just become involved in the litigation. The litigation had got out of control. The real issue was whether Tectran was entitled to terminate the contract, but that this had been obscured by allegations of fraud, and other allegations. [The claimant] asked for an outline of the events leading to termination.
[The claimant] said that Wood had no obligation to talk to Rajski. However, he had an obligation to inform his previous employer of what happened, provided fairly remunerated. [The claimant] put a question to Wood saying that as an employer would he not ask an ex employee to say what had happened at the relevant time.
…
Wood referred to our letter requesting Wood’s assistance. He asked why his involvement was ‘critical’ to the first and second actions and what the two actions were. [The claimant] explained what the two actions involved. Namely, a commercial action based upon the contract, including allegations of fraud, and the second action being a conspiracy action against [AAH] and the directors of Tectran.
…[The claimant] said that the litigation involved the fundamental question of whether there was a breach or not. Otherwise all the allegations are ridiculous. [The claimant] said that the first action would probably proceed before the second action, though the other side is trying to combine those actions to muddy the waters. [The claimant] said that the questions were simply whether Raybol performed, and whether it was a copy of the Lupfer and Long program.
…Wood said that he had never been asked how the whole affair had been stitched together, even in court. [The claimant] said that this is what we want to know. Wood said that the software under dispute was the second stage of Tectran moving in the direction of being involved in the computing industry.
.…[The claimant] said that a question is whether RAYBOL works. He said that Wood said that in one of his affidavits that it did work - that there was a subsidiary question of whether that was correct at the time. [The claimant] said that we need to find out the flavour/atmosphere of how it arose.
…Wood said that this is the next stage of his help. He had no desire to retract what he had earlier sworn.
…[The claimant] said that we need to know the thinking behind the contract. It may be irrelevant to the case since Wood had been sacked by then. [The claimant] said that we want to do all that we can do without trespassing on the way that Wood wants to proceed. [The claimant] said that he did not envisage taking a great deal of Wood’s time.
…[The claimant] asked why if RAYBOL was so good that Tectran did not want to continue with the contract? Wood replied: ask Yerushalmy and Richardson. [The claimant] said that they say that the product does not work for the eight months that the contact (sic) was on foot, but that Wood says that it does work. Wood replied said that you can spend time defining the boundary conditions of ‘work’. [The claimant] said that he did not understand why Tectran did not continue with the contract. [The claimant] said that he wanted to get to the real issue, the real common sense of what really happened. [The claimant] said that we need Wood to give us the background.
[The claimant] said that we want the factual basis and chronological history. Beyond that, [the claimant] said that he could not see much further involvement. [The claimant] said that he has the client’s interest at heart - he does not want to spend large amounts per hour. However, it is proper that witnesses be paid for their time.”
…200 There is no evidence of any personal meeting with Donaldson.
201 In his affidavit of 28 February 1997, the claimant gave an account of the circumstances in which the letters to Wod and Donaldson came to be written. He deposed that, in preparation for the anticipated hearing of the substantive proceedings, he had discussed the matters with Davidson, that he had sought information about who had negotiated the contract on behalf of Tectran and that Davidson had told him that it was Wood and Donaldson, but that Davidson did not expect that they would be helpful or prepared to provide a statement for Tectran, as both had given evidence supporting Rajski and Raybos in the proceedings before Miles J. The claimant deposed that, in this context, he then said:202 He said that he directed Davidson to write to Wood and Donaldson “pointing out this obligation” and asking them to confer with DW but said that, contrary to his expectation, Davidson had not shown him the letters prior to sending them and that he learned of their contents only after asking if they had been prepared, and being told that they had in fact been sent. Of the content of the letters he said that when he read the copies he realised that the obligation had been expressed in terms different to those which he had used and in terms different to those which he regarded as appropriate. He restated his opinion, which had not changed, that there was a clear obligation (whether legal or moral) on a former employee to tell his employer what he did and what he saw during the employment, but did not consider there was any obligation to do more than that such as attending conferences or court or reviewing material or the evidence of other witnesses. He said that while he noted that in the letters Davidson put the obligation more highly than he would have done, he perceived no problem as all he had in mind was to seek from Wood and Donaldson a statement as to what took place while each of them was in Tectran’s employ. He spelled out the distinction he perceived. He said:
“In my opinion an ex-employee has, if not a legal, at least a moral obligation to inform his employer of what took place and what he did while he was an employee.”
203 He added, however, that he discerned no difficulty with what Davidson had written as all he had in mind was to seek from Wood and Donaldson a statement “as to what took place while each of them was in the client’s employ.” He said it did not occur to him that the letters could be read as attempting to influence the recipients to give false evidence or to refrain from giving evidence adverse to the Arunta interests. He denied that the approaches to Wood and Donaldson were made for the purpose of attempting to influence them to give false evidence or to refrain from giving evidence adverse to his clients. He deposed:
“…there is a clear obligation (whether legal or moral) on a former employee to tell his employer what he did and what he saw during the employment. I do not consider that to do more than that, for example to attend conferences or court or review material or the evidence of other witnesses, can be put the clear obligation.”
204 The claimant’s account of the meeting with Wood is to be found in his February 1997 affidavit. He deposed that Wood said:
“57. It is my practice, when taking instructions in a matter, to find out as soon as possible the basic facts, the factual issues and thus the legal issues. Invariably, I seek to create or cause to be created a chronology of the relevant events. While the papers which [DW] inherited from [AAH] when we assumed responsibility for the 1980 proceedings were voluminous, there was no statement from any executive of Tectran or other witness and no chronology.
58. Initially, I formed the view that the crucial factual issue which would ultimately determine the litigation was whether, and to what extent, Raybol worked. As more information became available about the relevance of the Count 11 program, a more crucial issue emerged, namely whether Rajski had, as he claimed, invented Raybol or whether it was a copy of Count 11. Even then, there remained the issue of whether Raybol worked.
59. I considered that another important matter was to find out why Tectran had entered into the contract with Rajski in the first place and what it thought it was getting from it. The information I sought was the sequence of the negotiations, who said what to whom, what documents there were and, in effect, the specifications. Our efforts were hindered by the absence of those who had direct knowledge of two important areas, namely the formation of the contract and the working of Raybol. It was in this context that I initiated the contact with Messrs Wood and Donaldson.
60. I had read the judgment of Miles J delivered on 5 June 1985 in the 1980 Proceedings. I understood that his Honour to have been considering an application by Mr Rajski to amend the cross-claim to join additional parties. I read his Honour’s statement at page 10 of his judgment to the effect that it was not his function to make findings of fact and that if in his judgment he appears to be stating findings as to fact that was not his intention. I understood that his Honour also refused Tectran’s application to adduce evidence in relation to that application. I did not and do not now regard his Honour as having determined any issue of fact nor make any findings as to the credit of witness(sic).”
“I received your letter in which you say I have an obligation to support Tectran. I do not consider I have any such obligation. … I have had to spend a great deal of time on this case and have not been paid for my time. The lawyers are paid professional fees and I don’t see why I should not be paid similar fees.”
to which the claimant replied:
“The obligation was not expressed with precision. I take the view that any employer must be entitled to know from a former employee what that employee said or did on his behalf.”
“Put yourself in the position of being sued for something done by an employee. Wouldn’t you expect him to tell you what happened?”
“We do not expect to take much of your time. All we want is to know how Tectran came to enter into the contract and what happened.”
“It is perfectly proper that you should be paid for your time and we can reach agreement on an hourly rate. I would have to obtain instructions on the amount but I am sure there will be no problem with a reasonable rate.””
205 It was not suggested that there exists any basis for disbelieving the claimant’s assertion that he did not draft the 9 October letters, and was unaware of their contents until after they had been sent. The LSC maintained, however, that his failure to correct the erroneous impression they created, when he became aware of their content, itself constitute misconduct.
206 The claimant’s evidence that he was motivated only to obtain a history of the pre-contract negotiations was subject to vigorous challenge in cross-examination.
207 It was pointed out that that section of his February 1997 affidavit concerned with this issue was very largely a reproduction, word for word, of an affidavit he had sworn on 9 April 1986 by way of defence to the first contempt proceeding, from which there was, however, one allegedly significant omission in the transposition. The omitted paragraph reads:
“11 [the number 11 is in fact a misnumbering. The paragraph should be, and was in the hearing, renumbered as 10].
As I came to know more of the matter, I became increasingly puzzled as to why the client had entered into a contract with Rajski at all. I recall mentioning my concern about this to Davidson and saying to him:
‘What information do we have explaining the client’s reasons for entering into the contract? Who on behalf of the client had the conduct of the negotiations leading up to the execution of a contract?’
or words to that effect.
He replied:
‘Two former employees of the client, namely, Wood and Donaldson who both gave evidence on behalf of Rajski in the proceedings before Miles J.’
or words to that effect .”
208 It was suggested to the claimant that at the time he had sworn his affidavit he was aware, because of what had been said to him by Davidson, that Wood and Donaldson had given evidence in the proceeding before Miles J, including evidence about why the contract was entered into and the conduct of the negotiations leading up to the execution of the contract. The claimant denied the suggestion contained in the question and said that he thought their evidence had been as to whether or not Raybol worked. He disagreed with the proposition that he had understood that what had been said to him by Davidson was that Wood and Donaldson had given evidence on the pre-contractual negotiations as distinct from the effectiveness of Raybol.
209 By reference to Lake’s notes of the meeting with Wood the claimant was challenged on his evidence that he had corrected the erroneous impression given by the letters of 9 October by saying that the obligation was not expressed with precision, and stating, accurately, his own view about the employee’s obligation.
210 It was put to the claimant and argued before me that no such statement appeared in the notes made by Lake, and that it ought therefore be inferred that no such statement was made. The claimant neither conceded nor denied that such a reference was absent from the file note. In fact, in my view, the file note substantiates the claimant’s evidence in this regard. On its first page it records Wood as saying that he did not feel morally obliged to Tectran or that he had any other residual obligation to Tectran, and the claimant as saying, in the terms now familiar, that a former employee has an obligation to give information to his ex-employer in respect of events which occurred during the time in which he was employed. That, in my view, having regard to the circumstances in which notes of conversations such as this are taken, is substantial corroboration of the claimant’s account of what he said to Wood. So thoroughly was this issue explored that copies of Lake’s hand-written contemporaneous notes of the conference, as well as the later typewritten version, found their way into evidence as exhibit H.
211 On 24 February 1986 the claimant, Davidson, Lake and McCarthy conferred with representatives of Tectran and the Arunta Companies in relation to the litigation. Conference notes taken at the time record the following:
212 It was also suggested that the claimant had sought, in effect, to poison Wood against Rajski, and thus have him withdraw his support for Rajski and Raybos. That suggestion arose in the following way. Lake’s file note records that the claimant told Wood that the litigation had got out of control, and the real issue (that is, whether Tectran was entitled to terminate the contract) had been obscured by allegations of fraud and other allegations. This was misleading, it was suggested, because, until January 1986 - that is, after the date of the meeting with Wood - no proceedings alleging fraud had been commenced by the Arunta companies. The allegation of fraud was that Rajski had not invented Raybol, but that it was a fraudulent copy of Count 11. The claimant agreed that, even by 3 January 1986, when the fraud proceeding was filed, the Arunta Companies were in possession of insufficient evidence to justify the necessary verification of a statement of claim alleging fraud (SCR Part 15 R 26). Indeed, it appears, it was necessary to obtain leave to file the statement of claim unverified at that time. It was put to the claimant that he had suggested to Wood that his support for Rajski was not really worthwhile or worthy of him because there was an allegation of fraud about the programme. The claimant said that he did not understand that the reference could be interpreted as putting pressure on Wood by denigrating Rajski. He was asked about the passage in the conference notes of 24 February 1986 in which he was recorded as having said that it was unlikely that they would “get a dramatic confession from Wood”. His answer was that if he had said that he thought it would have been in an ironic fashion. Such a comment was made in the context of a suggestion made by others that there was some relationship between Wood and Rajski. He explained the following two sentences, including that in which he is recorded as having said that they:
“[The claimant] mentioned that Wood was a friend of a partner at [AAH]. [The claimant] thought that it was unlikely that we would get a dramatic confession from Wood. [The claimant] said that we would need to spend some time on Donaldson. Donaldson said that Raybol did not work.”
“…would need to spend more time on Donaldson. Donaldson said that Raybol did not work”
as being a reference to Donaldson’s position that Raybol did not work.
213 The claimant was being asked to explain a file note made by somebody else and said that he had no real recollection of the discussion there recorded.
214 In an affidavit sworn on 9 April 1986 for the purpose of defending the first contempt proceeding the claimant deposed:
“31(d) In the course of the conversation with Wood, … I said ‘My client says that ‘Raybol’ did not work’. I do not recall whether I said that CMAD said that ‘Raybol’ did not work, but I may have as I then understood that the action brought by the present plaintiff against CMAD arose because CMAD had entered into negotiations to purchase ‘Raybol’ but had not proceeded to purchase it.”
• • •
215 It is the LSC’s case that, on examination of the whole of the circumstances concerning DW’s approaches to Wood and Donaldson, it would be open to the Tribunal to conclude that the purpose of the approaches was improperly to have them change their evidence. This, he asserts, is to be read into the letters of 9 October and into what was said in the conference with Wood as revealed by the file note. The LSC places particular reliance upon the clear suggestion in the letters that a former employee has an obligation to “assist” a former employer. The claimant’s position is that the letters do not accurately reflect his direction to Davidson, or the views he held as to the obligations of former employees, and that, even if they are properly to be read as overstating that obligation, the circumstances in which they were written relieve him of the responsibility for their precise content.
216 The LSC’s initial argument in relation to the approaches to Wood and Donaldson had, essentially, three planks. The first was that the claimant’s evidence as to his motivation for seeking to speak to them should not be accepted, as it is contradicted by the objective documentary evidence. In considering the argument it is necessary to bear in mind that my task is not to determine the facts, but merely to assess what conclusions would be open to the Tribunal. The LSC’s second argument was that, even if the letters as originally framed and sent could not, for the purposes of the disciplinary provisions of the Act, be laid at the claimant’s door, his failure to take any remedial action in relation to the contents once he had read them was itself misconduct of the relevant kind. This second argument depends upon an anterior proposition, that is that the letters themselves were framed in such a way as to convey an improper suggestion that Wood and Donaldson should give untruthful evidence on behalf of Tectran or at least refrain from giving truthful evidence on behalf of Rajski and Raybos and that the claimant recognised that suggestion. In the particulars of complaint appended to the Information the LSC relied, particularly on the following two extracts:217 The third plank of the LSC’s argument is that the evidence as to what was said by the claimant in the meeting with Wood is a sufficient basis on which the Tribunal could properly conclude that the claimant placed undue pressure on Wood.
and
“ the assistance you are able to provide to our clients will be critical in both the first and second actions”
“As a former employee of Tectran we consider that you are morally obliged to support the company in these proceedings.”
• • •
218 The claimant was correct in drawing the distinction that he made between the proposition he put to Davidson, and the proposition put by Davidson to Wood and Donaldson in the letters. There can be no quarrel with his assertion that an ex-employee has a moral obligation to inform his employer of what took place and what he did whilst an employee. That, however, is a far cry from an obligation to assist or support one party to litigation as was suggested in the Davidson letter. There is an ambiguity in the obligation so expressed. The latter has the capacity to imply that, regardless of the genuinely held opinions of the employee, the employee is obliged, morally, to side with the employer. This is plainly not correct and dangerously overstates any obligation an employee, or former employee, might have. Nevertheless, the question is whether the Tribunal, acting reasonably, could hold those passages to amount to an improper approach to the witnesses or an improper invitation to them to change their evidence already given. It is trite but apposite to observe that there is no property in a witness. That is as true of a witness who has already given evidence on a particular subject matter as it is of a witness who is still to give evidence. Any legal practitioner, acting for a client involved in litigation, is not only entitled, but may, in appropriate circumstances, have a positive obligation to seek to interview witnesses or potential witnesses. Whether those witnesses have already given evidence and committed themselves to a particular position or not, the legal practitioner is bound to abide by the ethical rules governing the collection of evidence. It would be improper to attempt to persuade a witness in evidence to depart from his or her genuinely held recollection or observation of factual matters, or, where the witness’s opinion is relevant, to depart from his or her genuinely held view. It is not necessarily improper to invite a witness to change evidence already given. It is quite legitimate for a party or a legal practitioner to invite a witness, whether expert or lay, to reconsider evidence already given, a statement already made, or an opinion already expressed, or to do so in the light of additional information or argument that might quite properly be put to the witness. A legal practitioner doing so, however, must exercise the utmost care to give no suggestion that he or she is seeking or proposing to have the witness untruthfully change his or her evidence. For the letters to constitute impropriety, it would be necessary for the Tribunal to hold that the passages complained of amounted either to an invitation to Wood and Donaldson to change their evidence, contrary to their genuinely held opinions and/or recollections, or amounted to improper pressure upon them to do so. I have grave doubts whether it would be open to the Tribunal so to conclude. Having regard, however, to the conclusion I have reached in relation to the authorship of the letters, it is not necessary to reach a firm view on this question.
219 The authorship of the letters in the next question. For reasons I have already given, I accept that the claimant was not the author of the letters, and did not see them until some time after they had been sent. For disciplinary purposes, he cannot be held accountable for their contents.
220 The next basis on which it is suggested that the claimant behaved improperly in relation to Wood and Donaldson concerns his failure to make any attempt to correct what is said to be:
“the imputation contained in the letters that the witnesses should change their evidence given and tested in the litigation…”
Instead, the LSC alleges, the claimant:
“improperly allowed the imputation to continue.”
221 It is true that there was, so far as the evidence goes, no follow-up or correcting letter written by the claimant or on his instructions once he became aware of the manner in which the letters had been phrased. When on 24 October the claimant met Wood at his office he spoke to him in the terms set out in the first paragraph extracted from the file note. The opening sentence contains a correct statement of the claimant’s earlier expressed views, and is unexceptional. It should have corrected any lingering misapprehension conveyed by the letter. There having been no further meeting with Donaldson, it seems there was no equivalent correction of any false impression he may have drawn from the letter directed to him.
222 The LSC’s contention in this regard depends essentially not only upon there being the imputation in the letters that the witnesses should change their evidence, but recognition by the claimant of its presence. Although, taking the most adverse view to the claimant possible, it might be possible to discern such an imputation in the letter, it is not the imputation which most obviously emerges and not one which I would expect would have presented itself to the claimant when he read the copy letters. I am not satisfied that the imputation is so obvious that he must have read it into the letters, and indeed, I am doubtful whether it is one reasonably open to an ordinary careful reader. He was aware that the obligation was overstated, but reasonably perceived no real or immediate problem with that overstatement.
223 It is next suggested by the LSC that, in the conversation with Wood on 24 October the claimant:
“attempted to place blame for the litigation on Mr Wood in particular by inferring that it was because of him that Tectran was being sued by Raybos and Rajski.”
224 This, it seems, is said to be drawn from the invitation to Wood to put himself in the position of being sued “for something done by an employee.”
225 Again, it seems to me that, stretching the language used by the claimant to its outer limits, it might be possible to read such pressure into what he said to Wood. However, the task of the Tribunal is not to place the very worst, no matter how tortured, construction on what is said, but to determine, firstly the true intent with which the words were spoken, and, secondly, if necessary, what the words would have meant to a reasonable listener in the position, in this case, of Wood. I do not think casting blame upon Wood can reasonably be read into what the claimant said on that occasion. A similar approach must be taken to the contention that the claimant improperly pressured Wood by telling him that Tectran and CMAD had said Raybol did not work. In the circumstances, it was quite open to the claimant to tell Wood of the position adopted by his client (s) and to obtain Wood’s response to that.
226 One final aspect of this ground must be put to rest. As part of the ground as framed the LSC asserts that the claimant made the approaches, knowing that Wood and Donaldson were critical witnesses for Rajski and Raybos, that they had given evidence on behalf of Rajski and Raybos before Miles J, and that the claimant knew that the evidence given by them had been accepted by Miles J after they had been extensively cross-examined on behalf of the claimant’s clients.
227 The assertion contained in the closing clause of the ground does not accurately reflect the proceeding before Miles J or his Honour’s judgment. He was at pains to point out the limited scope of his fact finding role, having regard to the nature of the application before him that is, an application to amend a cross-claim. He said:228 It is quite wrong and misleading to say that the evidence of Wood and Donaldson had been accepted by Miles J.
“…I have adopted the approach that the applicants must show an appropriately arguable case on a tenable evidentiary basis. It is not my function to make findings of fact. If in this judgment I appear to be stating findings as to facts, that is not my intention. What I intend to state are the facts as they are open to be found by a tribunal of fact at a trial, on the evidence as it now exists .” (p10) (emphasis added)
Later he said:
“The evidence in support of the application must in my view for the purposes of the application be accepted at its face value unless reason to the contrary can be shown.
… Despite the extensive cross-examination of most of the deponents, I have no hesitation in saying that the ultimate tribunal of fact at a trial would be entitled to accept their evidence insofar as it supports the allegations made on behalf of the applicants. Cross-examination of the expert witnesses on their conclusions that Mr Cowper did not examine the Raybol process elicited nothing more than a slight modification of opinion.” (p39)229 (i) The claimant was not the author of the letters and was unaware of their contents at the time they were sent. For disciplinary purposes he is not accountable for their contents at that time.
In Summary:-
230 I am satisfied that it would not be open to the Tribunal to find any impropriety in the conduct of the claimant in relation to this issue. This ground should be deleted from the Information.
(ii) It is doubtful that the letters can properly be construed as conveying an improper invitation or placing improper pressure on the recipients to give untruthful evidence. There was, therefore no impropriety in the claimant’s failure to correct any erroneous impression they may have conveyed.(iii) It would not be reasonably open to the Tribunal to conclude that the claimant sought, in the meeting with Wood, to cast upon him blame for the Tectran/Rajski litigation, and accordingly it would not be open to it to find impropriety in this respect.
(iv) the assertion that Miles J had accepted the evidence of Wood and Donaldson is incorrect as is the consequential assertion that the claimant knew that Miles J had accepted their evidence.
231 The second ground in the Information concerns the grant of legal aid to Rajski and Raybos, and the claimant’s efforts, on behalf of his clients, to have the grant terminated. The ground is framed as follows:
Ground 2 in the Information - Legal Aid
“Between late 1985 and early 1987 the [claimant] sought to procure the termination of the grant of legal aid for an improper purpose, namely, to obstruct, prevent or thwart Raybos and Rajski from pursuing their rights in the litigation against the [claimant’s] clients by the following means:
(i) by corresponding with the LAC (Legal Aid Commission), such correspondence containing false and/or misleading information and imputations,
(ii) by wrongfully intimidating Carneys in order to have Carneys cease to act for Raybos and Rajski in the litigation, and
(iii) by commencing and continuing proceedings against the LAC.”232 A preliminary question emerges. The first is whether it is necessarily improper for a solicitor to seek, on behalf of a client, the termination of a grant of legal aid to the opposing party. If it is, then there can be no quarrel with the LSC’s decision to refer this matter to the Tribunal.
233 Of great significance in the answer to this question is the existence of s 47 of the LAC Act. That section has the effect of limiting, to a relatively low amount, the quantum of costs that can be recovered by a successful opponent against a legally aided party. In any litigation, that section necessarily creates in the non-legally aided party a very real interest in the existence and consequences of the grant of legal aid. That interest becomes more intense according to the complexity, anticipated duration, and consequent cost, of the proceedings. The non legally aided party, even if successful, may be very substantially out of pocket at the end of the proceedings. This is consistent with the views expressed by Moffitt P in Rajski v CMAD [1983] 2 NSWLR 122 at 127, with which Samuels JA agreed; see also Tectran Corporation Pty Limited v Legal Aid Commission of NSW (1986) 7 NSWLR 340; Wentworth v Rogers (No.12) (1987) 9 NSWLR 400. I am satisfied that there is no necessary impropriety in a legal practitioner, acting for litigation opponents of a legally aided party, seeking review or termination of the grant of legal aid. Whether the course adopted is improper depends upon analysis of all the relevant facts and circumstances.
Facts
234 Unless otherwise stated the documents to which reference is made are to be found in chronological order in Exhibit C.
235 Having assumed conduct of the litigation on behalf of Tectran and the Arunta Companies, the claimant was advised by Carneys on 2 September 1985 that legal aid had been granted to their clients. Carneys drew attention to s 47 of the LAC Act.
236 On 23 September 1985 a conference, attended by the claimant, other employees of DW, and officers and employees of the Arunta Companies, took place. Two file notes of the conference, taken respectively by Davidson and Lake, were in evidence as Ex J. While, as might be expected, there are some differences between the two, these appear to be attributable to no more than ordinary selectivity and the two documents coincide on material points. Lake’s file note relevantly is in the following terms:237 The file note concludes with the following:
3. Legal Aid
[The claimant] said that we are going to write to the [LAC] requesting a review of the grant of legal aid to Rajski and Raybos. As the basis for the review, we would direct the [LAC] to the judgment of Holland J where he discusses the transfer of assets by Rajski out of the jurisdiction and the fact that Rajski had not made full disclosure to the [LAC] in his second legal aid application, to the transcript of those proceedings, and to any material which is obtained by the private investigator.
If the [LAC] does not review the grant of legal aid or does not withdraw legal aid, then we shall apply to the Supreme Court on the basis that the meaning of the word ‘protect’ in the [LAC Act] does not extend to Raybos acting as plaintiff, and that the [LAC] has not properly directed its mind to the relevant circumstances in granting and reviewing the grant of legal aid. If legal aid was withdrawn from either Rajski or Raybos or both, then the person from whom it was withdrawn would have to put up security for costs and thereby the actions may die .” (emphasis added)238 On 14 October 1985 DW wrote to the Director of the LAC. The purpose of the letter was stated in the penultimate paragraph unambiguously as a request to the LAC to review and terminate the grant of legal aid. Part of the letter reads as follows:
“[The claimant] concluded by saying that at this stage the important points are:
1. Access of confidential documents;
2. Withdrawal of legal aid ;
3. Rajski’s involvement leading up to the contract.” (emphasis added)
“We are instructed that the cross-claim [to the 1980 proceeding] and the second action [the 1985 proceeding] are without substance and will fail. In that event, because Raybos and Rajski are legally assisted our client’s (sic) entitlement to costs will be limited to the amount provided by section 47 of the [LAC Act]. In addition, if the actions proceed, our clients will incur substantial costs, expenses and loss of time which will not in the ordinary course be recoverable.
The matter is exacerbated by the manner in which the cross-claimant/plaintiffs have chosen to conduct their litigation. Rather than bring the main claim to a hearing, they have sought to engage in a series of interlocutory and other procedures each of which must be defended or otherwise dealt with by our client (sic).
Our clients request that the grant of legal aid to Raybos and Rajski be reviewed on the following grounds:
1. That Rajski has not made complete disclosure of his assets and financial affairs in his application to the [LAC] for legal aid and that if he did, he would not satisfy the means test requirements of section 35 of the Act.
2. That Raybos has not made complete disclosure of its assets and financial position in its application to the [LAC] for legal aid and that if it did, it would not satisfy the means test requirements of section 35 of the Act. In particular, we are instructed to draw the [LAC’s] attention to the fact that Raybos received $222,800 from Tectran Corporation Pty. Limited and Scitec Corporation Pty Limited in the period February to November 1980. There is no acceptable explanation as to the diminution of these funds in the hands of Raybos. In February 1982 accounts for Raybos for the year ending 30 June, 1980 and 30 June, 1981 had not been prepared.
3. The power of the [LAC] to grant legal aid to a corporation is limited by paragraph 37(1)(b) of the Act to protecting, that is, defending, the interests of persons themselves eligible for legal aid (Rajski, and/or members of his family assuming for the purpose of this ground of review that any such relevant person is entitled to receive legal aid). Legal aid is not available to a corporation to pursue an alleged entitlement to damages.”239 Reference was then made to the judgment of Holland J in Rajski and Ors v Computer Manufacture and Design Pty Limited and Ors (unreported, Holland J, Equity Division, 25 October 1982). A copy of the judgment and the transcript of proceedings before Holland J was enclosed. Many extracts from the judgment were reproduced within the body of the letter. All were passages in which Holland J was highly critical of Rajski and the evidence he had given in the proceedings. Copies of Raybos’ 1980 and 1981 annual returns were also enclosed which, DW said, had not been prepared until 1985 and were the only annual returns currently on the Corporate Affairs Office public file held in relation to Raybos. A copy of the letter was sent to Carneys.
240 This letter brought a response in the form of a 13 page letter from Carneys dated 22 October 1985 addressed to DW and, in turn, copied to the LAC. Carneys denied the substance of the allegations made and presented a significantly different version of the relevant circumstances. The bulk of the letter was devoted to analysis of factual matters in contention between the two firms’ respective clients and findings made by judges in the various interlocutory judgments. Relevantly, Carneys wrote as follows:241 Carneys concluded by repeating that the assertions in paragraphs 1-3 of DW’s letter were false. In relation to the lengthy extracts from the judgment of Holland J, quoted by DW in the letter to the LAC, Carneys referred to a letter dated 3 February 1983 written by the Referrals Director of the LAC to Messrs Tribe Conway, solicitors who had at that date represented Rajski and Raybos and of which, Carneys said, a copy had been provided to DW under cover of a letter dated 30 June 1983. (Why this letter had been copied to DW in 1983 is not explained.) In this letter the Referrals Director wrote:
“A. … The assertions contained in paragraphs 1 and 2 on page 2 are on our instructions false. [These were the assertions that Rajski and Raybos had not made complete disclosure of their assets.]
We are instructed that the action commenced by Tectran Corporation Pty Limited [the 1980 proceeding] was and is without any substance what-so-ever (sic) and was in furtherance of a conspiracy to abuse the process of the Court and to defraud our clients. No doubt you are aware that the basis of that assertion has been thoroughly tested before the Supreme Court.”
“The facts concerning the grant of aid to Mr Rajski are that following receipt of a copy of the judgment of his Honour Mr Justice Holland given on 25 October, 1982, a letter was written by me to Messrs Abbott Tout Creer and Wilkinson, solicitors, on 5 November, 1982 and a copy of this letter is attached.
Prior to 15th November, 1982, Mr Rajski furnished me with detailed submissions dealing with the criticism made of him by Mr Justice Holland as a result of which I made a determination that legal aid would continue to be made available to Mr Rajski in respect of the proceedings instituted against him by Tectran Corporation Pty Limited but that I was not prepared to grant aid to Mr Rajski in respect to any application by him to the Court of Appeal for leave to appeal against the decision of his Honour Mr Justice Holland.
…
At its meeting on 8th December, 1982, the Legal Aid Review Committee had before it the submissions by Mr Rajski, a letter from his solicitors, an opinion from Mr Mason of Queens Counsel and a copy of the judgment of his Honour, Mr Justice Holland. The decision of the Legal Aid Review Committee was that aid should be granted to Mr Rajski for the purpose of his application to the Court of Appeal and for the appeal if leave were granted.
I subsequently received further correspondence from Messrs Abbott Tout Creer and Wilkinson following the proceedings before the Court of Appeal on Monday, 6th December, 1982, and in view of the comments of the Court I again directed that such comments be brought to the attention of the Legal Aid Review Committee.
On Tuesday, 1 February, 1983, I received a telephone call from the Chairman of the Legal Aid Review Committee indicating that in its view, aid should continue to be granted to Mr Rajski and his Solicitors have been so informed.
I also confirm that legal aid will continue to Mr Rajski in respect of the issues between himself and Tectran Corporation Pty Limited.” (This letter is to be found as annexure 16 to Rajski’s letter to the LSC of 21 February 1985, exhibited (NRC2) to the claimant’s affidavit 1997)242 This letter was written in relation to the CMAD proceeding which was the subject of the judgment of by Holland J on 25 October 1982 which has been referred to in these reasons for other purposes.
243 On 25 October DW replied to Carneys’ letter of 22 October, saying:244 Also on 25 October 1985 DW wrote again to the Director of the LAC advising that an application by their clients in the 1985 proceedings for security for costs against Rajski and Raybos was fixed for hearing during the week commencing 2 December, and asking the LAC to complete the review previously sought and inform DW of the result in good time before that date. The letter went on:
“We do not propose to respond in detail other than to say:-
1. Your letter contains a number of factual errors, some of which cannot be accidental. You may take it that there is no admission in respect of any factual allegation.
2. The author of the letter does not appear to understand:-
(a) The difference between evidence of a fact and a finding of fact.
(b) The difference between ‘consistent with’ and ‘evidence of’.
3. The threats in your letter are rejected. The making of them does you no credit.”
I interpolate that I discern no “threats” in the letter written by Carneys.
245 On 7 November 1985 the LAC responded that it was satisfied that the grants of legal aid should not be terminated. On 15 November DW wrote to the LAC in the following terms:
“In passing, the court was informed by Mr Rajski’s solicitor that Mr Rajski will be travelling to the United States of America in December. Presumably the [LAC] is aware of the source of the funds for that trip.”
“Our clients have instructed us to advise them whether they may apply to the Supreme Court of New South Wales for a review of the [LAC’s] decision to continue the grants of legal aid to Raybos Australia Pty Limited and Mr Rajski in these proceedings.
So that we may so advise our clients, please let us know:-
1. The reasons which satisfy the [LAC] that the grants of legal aid should be continued.
2. The [LAC’s] construction of the word ‘protect’ in s 37(1)(b) of the [LAC Act].
3. The factual basis which brings the grant of aid to Raybos Australia Pty Limited within that section.
Please provide these particulars before 2 December 1985 when these proceedings will next come before Mr Justice Enderby.”
246 On 28 November the LAC responded that it was not prepared to elaborate on the contents of its earlier letter. On 17 December 1985 DW wrote yet again to the LAC, enclosing a copy of a draft summons proposed to be filed in the Administrative Law Division of this court seeking review of the decision to continue the grant of legal aid to Rajski and Raybos. They stated that they were instructed, before filing the summons, again to request the LAC to reconsider and terminate the grant of legal aid, and again requested that the review be completed as a matter of urgency.
247 On 24 February 1986 a conference took place attended by the claimant, Davidson, other employees of DW and executives of the Arunta Companies. A file note of the conference was in evidence. An agenda was circulated and the grant of legal aid and the efforts to have it terminated were among the various matters discussed. The file note records that one of the Arunta executives, Wilkinson, asked about priorities between various proceedings and described the legal aid question as one which “goes to the jugular”.
248 The following extracts from the file note are salient:249 On 21 March 1986 Carneys served notices of ceasing to act in the litigation. The circumstances in which this occurred are considered in more detail under Ground 3 of the Information. Following receipt of these notices DW, on 26 March 1986, wrote again to the LAC, noting that Carneys had ceased to act, and added:
“The grounds for the action against the [LAC] was that it had not exercised its discretion properly in relation to Rajski and Raybos. [The claimant] said that it is a stronger ground in relation to the company since the company had not explained the $250,000 which it had received (from Tectran) and it was unusual to grant legal aid to a company.
[The claimant] said that we proposed to seek access to all Legal Aid files in relation to Rajski and Raybos. We should at least get the files in relation to Rajski’s and Raybos’ assets. If there is no mention of the $250,000 which Raybos received, then the [LAC] had not exercised its discretion properly. Also, the same applies in relation to the moneys supposedly held by the Argentine aunt. [The claimant] said that this was not really a fishing expedition; we are finding out more as we go along.
…
In the context against the [LAC], NRC stated that we may subpoena the Department of Social Security and other relevant Government departments. These documents relating to Rajski’s means may be revalent (sic). Also, a person within the relevant department upon receiving the subpoena, may question whether they should continue aid to Rajski.
…”
“We presume that, in accordance with usual practice, the grants of legal aid to Raybos and Rajski were made on terms and conditions specifying the legally aided person’s solicitor, namely Mr Arthur Carney. The breach of that term and condition presumably terminates the grants or requires a variation of the terms and conditions.”
250 The letter concluded by requesting that, if any further application for legal aid were made by Rajski or Raybos, including any application for variation of the terms and conditions, Tectran be informed of the application and given the opportunity of being heard in relation to it, and that the LAC take into account the changes in legal representation of Rajski and Raybos, the reasons for the changes and the additional costs thereby incurred both to the LAC and to DW’s clients.
251 The LAC proceeding itself spawned side issues. As had been foreshadowed in the conference of 24 February, DW, acting on behalf of Tectran, issued a subpoena to the LAC for production of material in the possession of the LAC relating to Rajski and Raybos. By notice of motion the LAC sought to set aside the summons, or alternatively, to set aside the subpoena. When the matter came on for hearing before Lee J, Rajski was, for the first time, joined as a party to the proceedings. The LAC was unsuccessful in its first claim, but succeeded in setting aside the subpoena. Tectran sought leave to appeal to the Court of Appeal on the subpoena issue, unsuccessfully, and, on 2 December, sought special leave to appeal to the High Court.
252 On 30 October 1986 the Crown Solicitor, who acted for the LAC, advised DW that the grants of legal aid in relation to the 1980 and 1985 proceedings had been terminated, but that a grant of legal aid to Rajski for the LAC proceeding remained on foot (Ex 39). However, on 23 February 1987 the matter was listed for mention in the Court of Appeal. The transcript of what occurred that day indicates that Rajski had sought review of the decision to terminate the grant of legal aid and a decision was anticipated during March of that year. Subsequent correspondence between DW and the LAC (Ex Q) tends to confirm that further consideration was being given by the LAC to that question.
253 Notwithstanding the Crown Solicitor’s letter of 30 October, both the application for special leave to appeal to the High Court in relation to the subpoena issue in the LAC proceeding, and the substantive LAC proceeding, were, by 12 March 1987, still extant. On that date DW wrote to the Crown Solicitor with reference to the High Court application. The letter contains the following:254 On 28 April 1987 the claimant wrote again to the Crown Solicitor on the same subject. He referred to a letter of 19 March (which is not in evidence) and to telephone conversations, and wrote:
“If the grants have, for whatever reason, been terminated absolutely, our client’s purpose in the litigation has been achieved and the prosecution of it (including the present application) becomes unnecessary.
Accordingly, please let us know by Monday 16 March whether or not the grants have been terminated absolutely. If they have, we would expect to receive instructions to withdraw the application. If no decision has been reached, we propose to ask the High Court to adjourn the hearing of the application until a decision is made.”
255 On 29 April 1987 the application for special leave was discontinued.
“The termination of the grants of legal aid to Rajski and Raybos Australia Pty Limited makes the prosecution of these proceedings unnecessary … We confirm the agreement between Tectran Corporation Pty Limited and the [LAC] that Tectran and the [LAC] will pay their own cost (sic) of these proceedings.”
• • •
256 The activity outlined above was unequivocally and admittedly a direct attempt to secure the cessation of funding to Rajski and Raybos in the Tectran litigation. The LSC alleges that the claimant also employed a less direct means to achieve the same object. This concerned the commencement of the Carneys’ defamation proceedings in which the partners of the legal firm representing Rajski and Raybos were sued for defamation by Arunta Companies and executives arising out of Carneys’ letter to the Stock Exchange. Something of this has been said above. The circumstances surrounding the commencement of the Carneys’ defamation proceeding constitute a separate ground in the Information and will be examined in detail in the consideration of ground 3 of the Information below. The LSC alleges that the commencement of those proceedings was a devious and improper ploy to ensure that Carneys would cease to represent Rajski and Raybos. This may have more significance than would initially appear. There was evidence that, at the time, it was the practice of the LAC to require, as a condition of a grant of legal aid, that the legally aided person’s solicitor be a solicitor nominated in the grant. Thus, should that solicitor cease to represent the legally aided person(s) the grant would automatically come to an end, or at least require review and variation of the terms and conditions. This explains the letter written by DW to the LAC on 26 March 1986 (para 249).
257 The LSC asserts that, by reason of the facts set out above, and inferences properly to be drawn from them, there is a reasonable likelihood that the claimant would be found guilty by the Tribunal of unsatisfactory professional conduct or professional misconduct.
258 In particularising the Information in the Tribunal the LSC claims:-259 The LSC argued that the true purpose of the claimant’s actions and its impropriety emerges unequivocally from a variety of documents to which I have already referred. These include:
(i) that the claimant attempted to coerce the LAC by the threat to commence legal proceedings against it; and that the threat should not have been made as the purpose of the threatened proceedings was the improper purpose of securing the termination of the grant of legal aid, in order to assist his clients to early victory in the Tectran litigation;
(ii) that the initiation of the Carneys’ defamation proceedings was designed to intimidate the partners of that firm and cause them to cease acting for Rajski and Raybos with the consequent effect on the grant of legal aid;(iii) that, in the letter of 26 March 1986, following Carneys’ withdrawal, the claimant wrote to the LAC, suggesting, misleadingly, that it was Rajski and Raybos who were the cause of Carneys’ withdrawal whereas, in truth, it was the claimant’s own action (on behalf of his clients) in commencing proceedings against Carneys that had caused their withdrawal;
(iv) that the claimant wrongfully maintained pressure on the LAC by persisting in the application for special leave to appeal to the High Court in relation to the subpoena question, persisting in that application until satisfied that the grants of legal aid had been terminated absolutely;
(v) that the agreement with the LAC that on discontinuance of the High Court application each party would pay its own costs both retrospectively confirmed and demonstrated that the application was pursued for an improper purpose, and itself was improper as, properly construed, an offer of financial advantage to the LAC to terminate the legal aid grant;
(vi) that all these steps were taken by the claimant to “obstruct, prevent or thwart Rajski and Raybos from pursuing their rights in the litigation” and were “an improper interference in the litigation and … were steps which could amount to contempt and/or an abuse of process of the Court”, and were, accordingly, improper.
(i) the file note of the conference of 23 September 1985 (paragraph 236), especially these passages:
“If legal aid was withdrawn from either Rajski or Raybos or both, then the person from whom it was withdrawn would have to put up security for costs and thereby the actions may die”
and
“… the important points are:
…
(2) withdrawal of legal aid.”
(ii) the letter to the LAC of 26 March 1986 (paragraph 249), which the LSC alleges misleadingly attributed blame for Carneys’ withdrawal to Rajski and Raybos;
(iii) the letter to the Crown Solicitor of 12 March 1987, especially the passage:
“Our client’s purpose in the litigation has been achieved and the prosecution of it … becomes unnecessary.”;
(iv) (the letter to the Crown Solicitor of 28 April 1987 (paragraph (254) recording the agreement of the parties to pay their own costs.
260 In addition, the LSC points to evidence that emerges from other documentation produced.
261 On 14 November 1985 the claimant, with Davidson and Lake, met representatives of the Arunta Companies. On the agenda for the meeting eleven matters were listed for discussion. Amongst these was the question of the legal aid grant. A file note (Ex M) of the meeting shows that there was an initial lengthy discussion of that matter, and that, from time to time, those present returned to the subject. It is worth reproducing some extracts from the file note:262 Some time later in the conference during the discussion identified in the notes as on the subject of “interlocutory applications” the following is recorded as having been said:
“Discussion as to whether Rajski would appear himself if deprived of legal aid. It was noted that his lawyers, in particular [counsel then appearing for him] would probably not act for nothing. It is illegal in Australia to act for contingency fees.
…
It was pointed out that the [LAC] follows certain guidelines in deciding whether legal aid should be granted. It could be argued that in regard to Rajski the [LAC] must use the same criteria as for others. We do not know at this stage whether the Commission has done this but are exploring it. Any application to review the grant of legal aid may fail because the Court may see that it has no jurisdiction under the Supreme Court Act…”
263 Finally, in the record of a discussion about the defamation proceedings brought by Rajski against the claimant and DW, the following appears:
“[Davidson] mentioned that Raybos did not receive legal aid until July, 1985. We may be able to wind Raybos up. [The Claimant] mentioned that it was for us to keep the pressure on Rajski by making positive moves, not just responding to him .” (emphasis added)
“[The claimant] said that tactically there are two thrusts. Firstly, the primary issue was whether Raybol worked or not. Secondly, [DW] and the clients are not to be put off by peripheral issues but should add to them to stretch Rajski. We must keep the pressure on Rajski . [The claimant] said that although he does not wish to squander the resources of the client, it is worth it to push Rajski and his legal advisers .” (emphasis added)
264 On 12 February 1986, acting on behalf of Tectran (and other Arunta Companies and individuals), DW filed the summons challenging the grant of legal aid commencing the LAC proceeding. The sole defendant was the LAC. Neither Rajski nor Raybos was named as a party despite their obvious interest in the subject matter of the litigation.
265 The file note then recorded some discussion about the possibility of obtaining an injunction restraining Rajski from writing letters of the kind he had written in relation to the Scitec float and which was allegedly defamatory. It goes on:266 The claimant swore an affidavit on 9 April 1986, to be filed in the first contempt proceeding. He deposed:
“[The claimant] agreed that we should sue Rajski for an injunction. Even if we do not get the injunction it will show that we are serious about the defamation. [The claimant] said that he would double check with Hughes [Hughes QC] in case he thinks that we are being silly by seeking an injunction.
…
[The claimant] said that… the next possibility was that without legal aid, Rajski will flounder . We will begin to get judgments in our favour. If Rajski brings further proceedings, then he will be declared a vexatious litigant.” (emphasis added)267 A further meeting between representatives of DW and the Arunta Group took place on 19 June 1986. In relation to the question of legal aid, the file note records:
“6. My approach to the litigation in the light of my client’s instructions was to seek to bring it to a resolution as early and as cheaply as possible. In October 1985 I believe that an impediment to such an early resolution was that Rajski and his company had legal aid. I believed that the grant of legal aid increased the prospect that he would be able, without penalty, to engage in unlimited diversionary litigation and avoid a final hearing on the merits.”
“[The claimant] then proceeded to discuss the two proceedings which we have initiated. Firstly the legal aid proceedings, which he thought was only proper for us to initiate, and secondly the defamation proceedings, again only proper in that genuine loss had been suffered. The outcome of the defamation proceedings being that Carneys no longer act for Rajski so that he has been deprived of legal representation. Gary Richardson then asked [the claimant] whether he still thought it was appropriate for us to pursue the legal aid issue. [The claimant] felt that it definitely was, and that if we lose before Lee J we may choose to appeal, (which could be heard and over by August) or wait and leave the matter in limbo.”
268 The reference to the proceedings before Lee J was a reference, not to the substantive LAC proceeding, but to the two interlocutory matters which had arisen, concerning the subpoena issued to the LAC by Tectran in the LAC’s notice of motion for dismissal of Tectran’s summons.
269 In an affidavit sworn on 16 July 1986 in support of the application for leave to appeal to the Court of Appeal Davidson deposed:270 As a result of an application made by Rajski for adjournment of matters then pending in the Court of Appeal DW arranged for his psychiatric examination by Dr John Shand (“Shand”), who reported to DW on 2 February 1987. In the course of his report Shand wrote:
“Without the material which [Tectran] seeks to have the [LAC] produce on subpoena, [Tectran] would have no reasonable prospect of succeeding were it to continue with the proceedings to review the decision of the [LAC]”
“However, there is no doubt in my mind that for the primary case to have any chance of completion, let alone the other ones, he must have adequate legal representation in court, whatever the source may be.” (Ex 1C/95)
• • •
271 I have said above, and I repeat, that a litigant has a legitimate interest in the existence of a grant of legal aid to the opposing party. A grant of legal aid is, potentially, an instrument of oppression to the opposing litigant. Equally, however, the termination of a grant of legal aid may operate to kill off any prospect of success in the legally aided party by being able to mount an effective claim or defence. Both the existence and the non existence of the legal aid grant may, in certain circumstances, operate adversely and unfairly to one or other party.
272 The ordinary rule that costs follow the event, including in relation to interlocutory proceedings, and the power of a court to limit or vary costs orders where the successful party has, for example, unnecessarily protracted proceedings, or pursued false issues, ordinarily operate to deter a party from pursuing unmeritorious claims or defences or side issues. The brake on unbridled enthusiasm so created may be deprived of its potency when a party is in receipt of a grant of legal aid. There is then no costs disincentive against the pursuit of frivolous issues, or in favour of rational decision making in the selection of issues to pursue. While the LAC may be expected to act as some kind of restraining influence on over-enthusiastic litigation of peripheral or false issues, it will not always have the relevant information or be in a position to control the proceedings it funds. Thus s 47 could have the added effect of causing the burgeoning of proceedings where a legal aid certificate is in force. In such cases, the opposing party would have an even greater interest in the continuation or otherwise of the grant.
273 There is, however, another side to this coin. To deprive an impecunious party of legal aid may be the death of that party’s legitimate and proper claim or defence. In any litigation, but particularly complex commercial litigation, legal representation is virtually essential if the issues and evidence are to be properly, fully and effectively presented and litigated. A party which is able to provide its own legal representation, but whose opponent is deprived of legal aid, and therefore of legal representation, is placed in a position of immeasurable relative strength. For that reason, it is legitimate to look with scepticism, if not suspicion, on a party that is able to provide for its own legal representation, but which seeks to place its opponent in the disadvantaged position of litigating without representation.
274 It is for these reasons that the claimant’s motivation and conduct in what can fairly be described as his strenuous attempts to bring about the termination of the legal aid grant to Rajski and Raybos must be scrutinised with great care. In his February 1997 affidavit the claimant referred to senior and junior counsel who had been briefed in relation to the LAC proceedings, and said that none of them had ever suggested any impropriety in the bringing of the proceedings. He said that he was aware of evidence that had been given in the proceedings before Holland J as to transfer of funds by Rajski to his mother or an alleged aunt in South America, and said he had available objective material to warrant his claim that Rajski and Raybos had not made complete disclosure of their assets and financial position. He explained the letter to the LAC by saying that it was his view that it was proper to write a letter before action.
275 There may be a fine distinction between the adoption of tactics designed to squeeze an opponent into a position of weakness, of which unfair advantage might be taken to secure resolution of the outstanding litigation in favour of one party, and the adoption of tactics designed to prevent oppression coming from the opposing party. That, as I see it, encapsulates the present issue. The LSC’s position is that the evidence leaves open the interpretation that the claimant’s tactics were of the former kind; he relies on the evidence I have referred to above. If that is correct, then the appropriate order is one that will leave this question (subject to the other matters already dealt with) in the hands of the Tribunal.
276 There is, however, some evidence that the latter was, if not the dominant, at least one of the claimant’s motives. This is principally to be found in the transcript of the claimant’s oral evidence. He accepted the proposition that, in late 1985 he had taken the view that one difficulty facing his client was the ability that Rajski and Raybos had to continue with what was described as “a multitude of litigation” because they were legally aided, and he seemed to assent to the proposition that one way to overcome that problem was to attack “the fundamental issue, that is the propriety of the legal aid”. He added:277 A little later, when asked about tactics adopted to “stretch” Rajski and his legal advisers, the claimant said:
“And there was also, the client was very upset that it had spent nearly a million dollars by the time they got to us and that was in 1985 on costs and their opponents were funded by the public purse and they were very upset about that.” (T 227)
“There was certainly the intention to put pressure on them to stop the peripheral things and get the main action on … It was to try and get the case on and in that context the interlocutory application we wanted to pursue was the application for the tapes. …” (T231)
278 And Shand’s advice, that the proceedings would not come to an end unless Rajski and Raybos had adequate representation should not be overlooked.
279 There is also some material to found a conclusion that the claimant did not intend to attempt settlement negotiations with Rajski and Raybos while the legal aid grant was in force. The file note of the meeting of 23 September 1985 (Ex J) records:
“[the claimant] re-iterated that [DW] are not yet in a position to look at settlement. He advised the clients not to talk to Carney’s (sic) in relation to settlement at this stage. These circumstances may change if the other side are able to get a QC who is willing to take the case at the legal aid rate ($600.00).”
280 This file note was not made by the claimant, and in his oral evidence he doubted that the file note accurately reflected the context in which he had made the statement, observing that the following passages in the file note showed that his view was that settlement discussions could not really be commenced until an expert report was available as to the effectiveness of Raybol.
281 A file note made by another solicitor during the course of what was obviously a rather lengthy and wide ranging conference involving a number of individuals, particularly when the maker of the file note is not called to give evidence, is a fairly fragile basis for a finding of improper motives. The qualification placed by the claimant on the context in which the remark is recorded has a good deal of validity. Alone, this piece of evidence would be quite insufficient to justify any adverse conclusions being drawn against the claimant. However, it does not exist in isolation. Together with the other matters to which senior counsel for the LSC has pointed, it is a factor available in an enquiry into whether the claimant, in acting as he did in relation to the grant of legal aid, acted improperly and went beyond the legitimate protection of his clients’ interests. If such a conclusion were drawn, I am of the view that the Tribunal could then find that the claimant was guilty of professional misconduct.
282 On behalf of the claimant it was argued that the LAC proceeding was commenced by Tectran, and not by the claimant, and that he, therefore, cannot be held accountable for it. This argument, in my opinion, is disingenuous. A legal practitioner has an obligation to act responsibly in the conduct of litigation and this may include taking steps to restrain an over-eager client from embarking on an action that constitutes an abuse of process: White Industries (Qld) Pty Ltd v Flower and Hart (a firm) per Goldberg J, Federal Court of Australia, 14 July 1998, unreported; on appeal Flower and Hart (a firm) v White Industries (Qld) Pty Ltd [1999] FCA 773. The extent to which a legal practitioner is obliged to apply the brake to a client is not really here relevant. There is no evidence before me that it was Tectran, or its executives, who conceived the idea of the LAC proceeding. So far as the evidence goes, that idea came from the claimant during the first conference of which there is evidence, after he took over conduct of the Tectran/Arunta litigation. The principle that a legal practitioner ought not participate in unmeritorious litigation will not always be easy to apply. The principle is capable of conflicting with its corollary, enshrined most formally in the rule of ethics applicable to barristers, and known colloquially as “the cab rank rule”, that even an unpopular litigant, a litigant whose cause is unpopular, or whose prospects of success do not appeal to the legal practitioner, is entitled to representation. The distinction between a claim or defence with some, but slim prospects of success (pursuit of which would not be an abuse of process) and one without any prospects of success (persistence in which would or might be an abuse of process) is not clear cut, and will in many cases depend upon individual perception and judgment. But the point here is not a claim that the claimant persisted in an untenable claim. The inquiry is whether, on behalf of his client Tectran, he initiated the LAC proceeding for the improper purpose of depriving Rajski and Raybos of legal aid and forcing them into negotiation in which they would be disadvantaged.
283 It is necessary here to emphasis that it is not my function to reach a conclusion about whether or the not the claimant’s conduct did cross the line between legitimate attention to his clients’ cause and improper conduct. My function is limited to determining whether, in the light of the whole of the evidence before me, it would be open to the Tribunal to conclude that it did so. The Tribunal is the body charged by statute with such a determination. If the evidence is capable of establishing that he did so then it would be wrong for me to trespass on the Tribunal’s function.
284 Because of my conclusion in regard to the claimant’s dealings with the LAC it is unnecessary further to consider, in relation to this ground, the allegations in relation to the proceedings against Carneys. Those facts would, however, be available in the Tribunal’s deliberations.
285 I do not find that the commencement of proceedings in this respect constituted an abuse of process.
Ground 3 of the Information - the Carneys defamation proceedings.
286 Ground 3 of the Information is framed as follows:287 The starting point in relation to this ground of the Information is to be found in the letter of 25 November 1985 written by Carneys to the Chairman of the Stock Exchange in relation to the proposed float of Scitec. Carneys referred to the 1986 proceeding and asserted that the damage suffered by Rajski and Raybos was quantified at in excess of $600,000,000. They referred to, and extracted passages from, the judgment of Miles J. The passages which were quoted were those in which his Honour expressed the views, firstly, that an inference was available that the dominant purpose of Richardson and Yerushalmy in commencing the 1980 proceeding was either to force Raybos to the bargaining table where its position would be substantially weakened, or alternatively to put Raybos out of business by protracted and lengthy litigation, and secondly, that there was an arguable case against Yerushalmy for abuse of process or conspiracy at the time of filing the 1980 proceeding. Carneys stated that Arunta Investments had disposed of approximately $15,000,000 worth of assets during the preceding five years thereby reducing its capacity to satisfy any future judgment, and gave some details of the asserted dispositions. An important paragraph in the letter reads as follows:
Facts
“Between late 1985 and early 1986 the [claimant] took a number of actions against Carneys designed to wrongfully intimidate Carneys, to cause that firm of solicitors to cease to act for Raybos and Rajski in the litigation. The actions referred to are:
(i) commencing and continuing defamation proceedings on behalf of his clients against Carneys;
(ii) writing a letter dated 11 March, 1986 to Carneys’ solicitors, Phillips Fox, and in such letter:
(a) threatening to amend the statement of claim in the defamation proceedings to Carneys detriment if Mr Carney had given certain advice in relation to a letter written by Rajski to the Stock Exchange;
(b) offering Carneys the opportunity to avoid further action in the defamation proceedings if Mr Carney would provide the [claimant’s] clients with a statutory declaration denying giving Rajski such advice, thereby effectively making Mr Carney a witness against his client Rajski.(iv) writing a letter dated 20 March, 1986 addressed to Carneys and in such letter threatening that the [claimant] would seek an order that Carneys pay the costs of his clients and of his firm, in relation to the adjournment of the litigation which had been granted by the Chief Justice on 12 March, 1986.”
(iii) making a false claim, in the same letter dated 11 March, 1986, that Carneys was liable for $25,000 per week in special damages;
“(f) the matters set out … above appear to be analoguous (sic) to the bottom of the harbour schemes in which the Taxation Commissioner was left with worthless companies unable to pay tax. In this case our clients could be left with a worthless defendant.”
In the letter Carneys went on to say that Rajski and Raybos had recently filed an application for Mareva injunctions in relation to Scitec, Arunta Investments, Richardson and Yerushalmy. They sent a copy of the letter to Scitec.
288 On 9 December 1985 DW wrote to the Manager of Companies of the Stock Exchange in response to Carneys’ letter. They pointed out that, although in the 1986 proceedings Rajski and Raybos claimed damages of $600,000,000 the proceedings had not been determined by the Court, the damages had not been quantified at that amount, and that if the issue of damages did fall for determination the claim would be defended; similarly, that the application for Mareva injunctions had not been heard, no injunction had been granted, and they were instructed that the application was without substance and would fail.
289 They quoted the passage in the judgment of Miles J in which his Honour said it was not his function to make findings of fact, that if in the judgment he appeared to be doing so, that was not his intention. They said that on legal advice the respondents to that application, who included Richardson and Yerushalmy, had not adduced any evidence in reply to that presented by Rajski and Raybos and that Richardson and Yerushalmy denied the allegations made against them. They noted that the Carneys letter failed to take account of the purchase of assets or the financial position of Arunta Investments during the preceding five years. This last was clearly intended as a response to Carneys’ assertion that the companies had disposed of substantial assets.
290 On 10 December 1985 Arunta Investments, Gavemer, Richardson and Yerushalmy commenced separate proceedings for defamation against Carneys on the basis of the letter. Each corporate plaintiff alleged that the letter carried the following imputations:
“(a) That the plaintiff had abused the process of the court.
(b) That the plaintiff had attempted to pervert the course of justice.
(c) That the plaintiff had participated in a conspiracy to pervert the course of justice.
(d) That the plaintiff had participated in a conspiracy to commit fraud.
(e) That the plaintiff had unlawfully disposed of its assets in order to defeat the ends of justice.”
The imputations alleged to have been conveyed concerning the individual plaintiffs were in substantially parallel terms.
291 Each plaintiff claimed aggravated damages alleging that Carneys had knowingly or recklessly misrepresented the effect of the judgment of Miles J by omitting to mention that his Honour was not making findings of fact.
292 The claimant acted for all plaintiffs in these proceedings.
293 The next letter of significance is a letter of 12 December 1985 written by the claimant to the Director of Lawcover, the insurance company that provides professional indemnity insurance to solicitors in New South Wales. As, on at least one view, the Carneys letter was written in the course of, and as part of, their legal representation of Rajski and Raybos, it might have been expected that they would look to their insurance cover for representation in relation to the defamation claim. The claimant was in 1985 a director of Lawcover (or a member of its Management Committee). Anticipating that Carneys might make a claim on Lawcover for indemnity and for legal representation in the defamation proceedings, the claimant wrote to Lawcover to draw attention to a potential conflict of interest consequent upon his role in acting for the Arunta Companies and individuals, and his position in Lawcover. The letter reads:294 On 18 December 1985, having filed and served the statements of claim, DW wrote to Carneys separately (but in identical terms) in relation to each statement of claim. In part, the letters read:
“The defamation alleged is the publication by Carneys of a letter to the Chairman of the Sydney Stock Exchange. On the face of the letter, it is written by Carneys themselves rather than on behalf of their client in which case their liability would not arise from practise(sic) as a solicitor and they would not be entitled to indemnity under the policy. On the other hand, it may be that they will say that they were instructed to write the letter and that they were acting as solicitors and they may seek indemnity under the policy.
As I have become very much entwined in the various proceedings between my clients and the clients of Carneys, in the event that a claim is made by Carneys under the policy, would you please ensure that I am kept isolated from any material relating to it.”
“On our instructions, one of the consequences of your letter, if steps are not taken to correct it, is that our client will suffer significant financial damage. Indeed, it appears that this was the purpose of the letter. There is nothing on the face of the letter to indicate any other reason why you regarded it as appropriate to draw the attention of the Chairman of the Stock Exchange to the matters set out in your letter.”
295 The letter went on to allege that the Carneys letter contained a number of statements which were either false, or, by being put out of context, would give a false impression to a reader, and invited Carneys to write to the Chairman of the Stock Exchange, before further damage was done, correcting the errors. A draft suggested letter was attached.
296 Messrs Phillips Fox, Solicitors were retained by Carneys to represent them in the defamation litigation. On 6 January 1986, on behalf of Carneys, Phillips Fox wrote to the Chairman of the Stock Exchange, essentially confirming that the claim of losses of $600,000,000 had not been determined and that the claim would be defended, that Miles J had not made findings of fact in relation to the claims made in the 1980 proceeding, that no reference had been made in the original letter to acquisition of assets by the Arunta Companies (this presumably being intended to provide a balance to the inference to be drawn from the assertion that assets had been disposed of) and that the injunction application had not been heard by a court.
297 On 9 January 1986 DW wrote to Phillips Fox in the following terms:298 On 4 February 1986 Rajski himself wrote to the Stock Exchange in terms largely similar to, but more expansive than, those of Carneys’ letter. He began by saying that he had been advised by Mr Arthur Carney to write the letter, and to request that it be tabled at a Board meeting scheduled for 7 February. As a result DW wrote to Phillips Fox on 11 March 1986, the terms of which include the following:
“We note that at the directions hearing on 20 December, 1985 Counsel instructed by your clients’ former solicitors informed the Court that he was instructed to file a Notice of Motion to strike out the Statement of Claim as an abuse of process. He stated that on his instructions the dominant purpose of the proceedings was improper.
We are instructed that there is no basis for any assertion that the purpose of bringing the proceedings was improper or that the proceedings are an abuse of process. Our client will claim aggravated damages in respect of the statements made by counsel on behalf of your clients.”
The letter was signed by the claimant.
“2 We attach a copy of a letter from L. Rajski to the Stock Exchange dated 4 February, 1986 and direct your attention to the advice attributed to your client, Mr A Carney, in the second paragraph. We are instructed to enquire:
(b) If Mr Carney denies giving that advice, did he have any relevant communication with Rajski and, if so, what was the date, form and content of that communication?
(a) Did Mr Carney give that advice? If so, the plaintiff will seek to amend the Statement of Claim accordingly.
In the circumstances of this case, we are instructed to require any denial to be provided by the statutory declaration of Mr Carney accompanied by his authority to our client to make such use of that declaration as it sees fit and that such declaration to be available by 4 pm tomorrow, Wednesday, 12 March.
3. We are instructed that the damage to our client caused by the delay to the flotation of Scitec Corporation Pty Limited is running at the rate of approximately $25,000 per week. You will be furnished with more detailed particulars in due course.”299 Arthur Carney did not ever deny giving the advice but the statements of claim were never amended in the fashion suggested in the letter.
300 The clear implication of the letter, particularly the final paragraph claiming that damage to Scitec arising from the delay in the float was running at $25,000 per week, was that Carneys would be held liable for the alleged defamation in Rajski’s letter, and consequently for losses in that amount, and that special damages would accordingly be claimed in the defamation actions already commenced. This was contrary to DW’s earlier statement that the plaintiffs were not seeking special damages. Phillips Fox, acting for Carneys, on a number of occasions requested particulars of the foreshadowed claim. No particulars were ever supplied. Insofar as answers were given to the request, DW reiterated the original position that special damages were not claimed. After 26 September 1986 the Carneys defamation proceedings were not pursued.
301 On 12 March 1986 certain of the proceedings were listed before the then Chief Justice. Carneys applied for an adjournment of the proceedings, on the basis that McAlary QC, who was briefed to appear for Rajski and Raybos, was unavailable. The Chief Justice granted the adjournment.
302 On 20 March 1986 DW wrote to Carneys, relevantly in the following terms:303 There is other evidence on which the LSC relies to establish that the Carneys defamation proceedings were commenced for an improper purpose. Reference was made to the file note of the conference of 19 June 1986 which contains the following:
“On 12 March the actions came before the Chief Justice. Mr McAlary appeared for your clients and informed the court:-
(a) That he was first informed the matter was in the list at 9.30 that morning.
(b) That he had not read any material (other than newspaper reports) regarding the matter.
(c) That he had not spoken to your client.
(d) That he could not consider the material until after Easter.
Solely because of Mr McAlary’s lack of instruction, the Chief Justice adjourned the proceedings to 7 April. As a result, our clients, and our firm, have thrown away the costs of the hearing of 12 March and otherwise incurred costs and suffered loss.
You are hereby given notice that on 7 April or at the earliest date convenient to the Court thereafter, our clients and this firm will seek orders: -
1. That our client’s costs occasioned by the adjournment be paid by your clients.
2. That this firm’s costs occasioned by the adjournment in respect of your clients’ notice of motion of 3 March and our notice of motion of 7 March (in respect of which there is no grant of legal aid) be paid by your clients.
3. That the court require such costs to be paid forthwith (Part 52 Rule 5(2)).
4. That such costs be paid by your firm (Part 52 rule 66, Myers v Elman (1940) AC 282).”304 In the file note of the conference of 14 November 1985 (Ex M) the following is recorded:
“[The claimant] then proceeded to discuss the two proceedings which we have initiated. Firstly the legal aid proceedings, which he felt was only proper for us to initiate, and secondly the defamation proceedings, again only proper in that genuine loss had been suffered. The outcome of the defamation proceedings being that Carneys no longer act for Rajski so that he has been deprived of legal representation” (emphasis added).
305 A file note of a conference of 26 February 1986 (Ex N) contains the following:
“The clients [ie DW’s clients] are not to be put off by peripheral issues but should add to them to stretch Rajski. We must keep the pressure on Rajski . [The claimant] said that although he does not wish to squander the resources of the client, it is worth it to push Rajski and his legal advisers ”. (emphasis added)
306 The LSC argues that the last sentence quoted from the file note of 19 June should be interpreted as an acknowledgment that this was the original intention when the proceedings were commenced, and that the stated intentions to “stretch”, “push” and “keep the pressure on” Rajski support that conclusion.
“[The claimant] noted the other proceedings - the Court of Appeal contempt proceedings against Jones, the defamation proceedings by Arunta against Carneys and the defamation proceedings by Rajski against Dawsons. Carneys are not acting in the contempt proceedings, though they still act in the first and second action.”
• • •
Essentially the LSC’s allegation is that the pattern of conduct, rather than each or any individual action, gives rise to an inference that the claimant set out to apply improper pressure to Carneys for the purpose of forcing them out of the litigation and leaving Rajski and Raybos without representation. However, a great deal of time and effort was devoted to the various acts of the claimant and to an attempt to show that the acts taken individually could not be sustained as having been taken for their apparent purposes, but were, rather, for the ulterior and improper purpose already identified. For example, the LSC sought to show that the Carneys defamation proceedings had no prospects of success because the allegations contained in the letter to the Stock Exchange were true; that the threat to amend the statements of claim by seeking to make Carneys liable for the subsequent Rajski letter to the Stock Exchange could retrospectively be seen to have been empty and intimidatory because the amendment was never made; that the threat to seek special damages quantified at $25,000 per week, again from Carneys personally, was untenable because, the documentation showed, the claimant was well aware that his clients would not be in a position to establish that any such losses (even if proved) were causally related to the publication of the Carneys letter; and that the threat to seek costs against Carneys personally in relation to the adjournment granted by the Chief Justice was based upon falsely stated premises.
• • •
307 In relation to the first of these matters, the claim that it should or could be inferred that the Carneys defamation proceedings were commenced for an improper purpose because, the facts asserted in the Carneys letter being true, the claim could not succeed, it is sufficient to say that that approach denotes an over-simplification of the law of defamation. I am satisfied that Carneys letter was, on its face, defamatory, and, had the matter proceeded to trial, the issues would have been whether Carneys could have established any defences which they might have pleaded. Proof of the truth of the imputations conveyed in the letter would be one significant step towards establishing relevant defences under the Defamation Act 1974, but it is not possible in these proceedings to reach a conclusion that the claims as framed were so untenable as to permit an inference, from that fact alone, that their purpose was other than the purpose that appears on the face of the claims. That is, it would not be open to the Tribunal to conclude solely from the material relating to the Carneys defamation proceedings that they had been commenced for an improper purpose.
308 However, what does emerge is that, almost from the time the claimant took over the litigation on behalf of the Tectran/Arunta Companies, the steps adopted by and on behalf of his clients drew Rajski’s and Raybos’ legal representatives personally into the litigation in a way that is almost certainly unprecedented and which must inevitably have created a conflict between the lawyers and their clients. A single action, taken in isolation, might be insufficient to demonstrate an improper purpose; a pattern of conduct, however, may do so.
309 On particular concern is the letter to Lawcover. The last paragraph, drawing attention to the claimant’s involvement in the litigation and the need therefore to quarantine him from Lawcover decisions in relation to any claim made on their policy by Carneys, is quite unexceptionable and indeed very proper. The preceding paragraph, however, is inexplicable in terms other than an attempt to draw to the attention of the directors of Lawcover a basis on which they might refuse indemnity (and representation) to Carneys and further to enmesh Carneys personally in the dispute between Rajski on the one hand and the Tectran/Arunta Companies on the other. The claimant’s oral evidence in this respect I found unsatisfactory. He was asked directly about the purpose of that paragraph, and it was put to him that his stated purpose could have been achieved without the inclusion of that paragraph. His reply was:
“No. I mean, it may be that no claim would be made, the first thing. The second thing is that my clients had a substantial claim for damages at that stage against Carneys. They were suffering considerable loss by reason of the delay of the prospectus and if Carneys had insurance, there was a fund to pay it. If they didn’t have insurance, there wasn’t. So that I didn’t want to be saying to Lawcover: ‘Look, this is a claim which you have got to meet’. I just put that on its face, they have done it personally, but they may well say they were acting as solicitors.”
310 The answer does not address the proposition that was put in the question, nor the obvious inference to be drawn from the paragraph. I accept that the letter provides some evidence on which a conclusion may be drawn that the claimant’s conduct overall was directed to the purpose alleged. That is, of course, far from the only conclusion that could be drawn, but, as it is an available inference, it is a matter for the Tribunal.
311 I have come to the view that, on the whole of the evidence, it would be open to the Tribunal to conclude that the claimant’s conduct was for the purpose alleged. I do not think it would be appropriate, therefore, to embark upon a complete analysis of the evidence, which could only result in the expression of a conclusion that could usurp the function of the Tribunal.312 Ground 4 is framed in the following terms:
Ground 4 in the Information- Yerushalmy
“That on 24 February 1986 the [claimant], in the course of a conference with a potential witness, Yerushalmy, was told by the witness that he had no recollection of an important event about which the [claimant] believed the witness would be required to give evidence in Court. The [claimant] said to the witness, words to the effect that the witness should not only say (in evidence), “I can’t remember” but that he had to be absolutely sure, otherwise he would be tripped up in cross examination by his qualification of what he said. The words used to the witness were an improper invitation by the [claimant] to the witness to change the evidence he might give in court to something other than his honest recollection and as such amounted to an interference with the administration of justice.”
313 The facts giving rise to this ground of Information may be relatively briefly stated. The ground arises out of the conference of 24 February 1986 to which reference has already been made. The discussion had turned to the 1980, 1985 and the fraud proceedings. The file note records the following:
Facts
314 The complainant gave his account, or his recollection, of the conference in his affidavit of 28 February 1997. In order to do so he refreshed his recollection from the file note from which I have quoted. He deposed:
“[The claimant] referred to the $3,000,000 disposal price in the RAYBOL Agreement. Yerushalmy said that he had no idea how that price was arrived at. He said that a couple of days prior to signing the contract, substantial amendments were made to the disposal provisions, including inserting the $3,000,000 figure. This was not done on Yerushalmy’s or Richardson’s instructions but only on Woods’ instruction.
[The claimant] said that we have asked to interview Neil Cameron of [AAH]. He would not see us. We have to submit written questions.
Wilkinson referred to Sid Clarke’s handwritten notes. Wilkinson said that Clarke makes meticulous notes, in particular, of the terms of contract. Clarke did not refer to the $3,000,000 figure in his notes, and so by inference the $3,000,000 was not originally there. A few days prior to signing the contract, the figure was $1,000,000.
[Davidson] said that he was putting together a list of how the RAYBOL Agreement changed from the first draft in December, 1979 to the executed contract. We have Neil Cameron’s file to assist in this.
[The claimant] said that the client could have alleged fraud if they did not read the contract and were tricked into signing something which was different. Then the contract could be set aside. Otherwise, the clients will be stuck with the contract. Wood may have been acting within his authority.
[Davidson] referred to an affidavit by Adrian Wood sworn in August, 1984 which related to the disposal of RAYBOL to Tectran. In that affidavit, Wood said that Yerushalmy agreed to the $3,000,000 amendment. Yerushalmy said that he could not remember that at all . [Davidson] confirmed that the period referred to in Wood’s affidavit when he alleged agreement to the alteration was given was on 11 February,, 1980.
…
[The claimant] said to Yerushalmy that he should not only say ‘I can’t remember’. He has to be absolutely sure, otherwise he will be tripped up in cross-examination by his qualification of what he says.” (underlining in original; italics added.)
“82 …my present recollection is that the relevant course of the discussion complained of was as follows:
1. Mr Yerushalmy had previously said that he had not given instructions to change the disposal price to $3,000,000.
2. There was an occasion, as I recall it when Chris Davidson referred to Wood’s affidavit, when Mr Yerushalmy said ‘ I don’t remember ’ or something very similar.
3. I had a continuing concern as to how Mr Yerushalmy would present in the witness box. Too often, he said something, then immediately retracted it or said something inconsistent.
4. I said to Mr Yerushalmy words to the effect of:
5. Yerushalmy replied:
‘There is a difference between I have no recollection of that happening and I do not remember whether or not that happened. You must make clear which it is that you mean.’
‘I do not remember that at all.’
or words to that effect .
6. During this discussion, I also made mention of at least one other example of loose evidence.
7. I do remember warning him generally in words to the effect:
“You must be careful, otherwise you will be tripped up in cross-examination by a clever QC.”
8. The purpose of my comments to Mr Yerushalmy was two-fold. First, he had said that he had not given instruction to Mr Wood. I wanted to be sure that he was clear that he had not done so. If he had done so, I wanted to know why. Secondly I used the occasion to demonstrate the need for accuracy.
83. I did not intend to convey to Mr Yerushalmy that he should give false evidence on this or any other issue; on the contrary I sought to stress the need for him to give accurate evidence. I deny the allegation that I improperly invited Mr Yerushalmy to change the evidence he might give.
84. There was no benefit to the client in Mr Yerushalmy saying, truly or falsely, that he did not instruct Mr Wood.” (italics in original)
315 In oral evidence the claimant expressed the view that the file note was not exhaustive of what was said but that he had no doubt that a conversation took place broadly in the sequence that appeared in the file note. He said that he had a reasonable recollection of the conference.
316 The claimant in cross-examination cleared up one matter that otherwise might seem mysterious. That concerns the distinction he drew between “I have no recollection of that happening” and “I do not remember whether or not that happened”. There is, of course, on the face of these words, no difference at all. However, the claimant made it clear that he put a gloss upon the words317 I accept the claimant’s submission that it would not be open to the Tribunal on the evidence, to find that the advice he gave to Yerushalmy amounted to an improper invitation to give false evidence, or any other impropriety. This ground should be deleted from the Information.
“I don’t remember something happening” - that, he interpreted to mean, “I have no recollection of it happening, so far as I am concerned it did not happen, because if it had happened I would remember it.”(T321)
• • •
318 Ground 5 of the Information is framed in the following terms:
Ground 5 in the Information - Dr Metcalf
319 Certain of the proceedings to which Rajski was a party were listed for hearing before Powell J. Precisely which were so listed is not clear from the evidence but they included one or more in which the claimant and his partners personally were parties. Rajski sought adjournment of those proceedings, citing his emotional condition as the reason. Metcalf, who, it seems, had first seen Rajski on 17 October 1986, supported his application. In a letter written on that day Metcalf said that he agreed that Rajski was on the verge of a nervous breakdown, was acutely anxious and depressed and may well have become totally unable to cope in a rational way, and was in need of rest and treatment. In a letter addressed to the Court on 7 April 1987, Metcalf said:
“In early 1987 the [claimant] improperly attempted to intimidate Dr Metcalf, a witness for Rajski in the litigation, by threatening him with the institution of defamation proceedings in respect of a medical report that Dr Metcalf had prepared for and which was addressed to the Supreme Court of New South Wales.”
Facts
320 On 8 April the claimant drafted a letter which he proposed be sent to Metcalf on behalf of DW. The substance of the draft contained a threat to commence defamation proceedings against Metcalf as a result of the quoted passages in his letter to the Court. He retained Messrs Murphy and Moloney, solicitors, to act on behalf of DW. After some discussion and negotiation, presently immaterial, about the content of the letter, on 13 April 1987 Murphy and Moloney wrote to Metcalf, claiming that his letter contained two statements that were false and defamatory of DW. They stated that DW required:
“Besides the volume of work which he has to prepare in order to conduct his litigation, he is also rendered more anxious due to his perception of [DW’s] conduct of their litigation. I was shown on 30 March various documents and transcripts concerning continuous attempts by [DW], Solicitors, which clearly indicated an attempt on their part to present facts erroneously to the Court, in the form of misquoting Justice Miles’ judgment and deleting information from an affidavit.I also noted that Dr Rajski had been accused by [DW] that he had falsely put to the court that I myself was not able to appear in Court on 8th and 9th April, I cannot understand this conclusion…
As a result of [DW’s] tactics, Dr Rajski is forced to continually counter their false allegations which denies him any opportunity to rest so that he can conduct his litigation. In my opinion, Dr Rajski can only gradually get back to the conduct of his litigation and would need at least two months before he could return to any lengthy and complex litigation.”
“… that by 4.00 pm on Wednesday, 15 April, 1987, you:
(a) Inform us of the names and addresses of each person or institution to whom you published the letter.
(b) Withdraw the allegations against our clients, apologise to them and send a copy of that withdrawal and apology to each person to whom the letter was published.
(c) Undertake that you will publish no further matter defamatory of our clients.”321 Murphy and Moloney advised Metcalf that in the absence of a satisfactory response by the time stipulated, DW would take such action as they were advised without further notice to him.
322 Metcalf instructed Mark O’Brien (“O’Brien”), of Messrs Turnbull McWillliam, solicitors, to act on his behalf. There followed some negotiations between the solicitors, evidenced by file notes of 14, 15 and 16 April, and eventually, senior and junior counsel were briefed to advise whether actionable defamation existed in Metcalf’s letter, and if so, to draw a statement of claim.
323 On 23 April 1987 the claimant attended a conference with his solicitors, Murphy and Moloney, and Nicholas QC. Notes of the conference were taken by John Ward (“Ward”), the Murphy and Moloney solicitor handling the matter on behalf of DW. The notes taken are brief, but include the following:324 In a typewritten note of the same conference, made by John Hewett (“Hewett”), also of Murphy and Moloney, the following appears:
“Must stop this rot.
Alternatively - undertaking from Metcalf not to publish further material to the court without our approval.
Commence proceedings forthwith -
carry on in conventional way.
15 June X-exam Metcalf - would assist in assessing prospects of success of defamation action.
D Waldron must expect criticism that the action has been taken to stifle a witness.
AA&H have turned the other cheek. Merit of suing Metcalf is a matter of policy - maybe not sue - wait to attack M when he comes to court again.
…
S 13 - publication
to M and M no publication
to Rajski - no damage
to Court - probably no damage
DW gives Metcalf a fright but what else.
DW would have problems in giving particulars of publication in S of claim.
Query whether proper proceedings were against Rajski - with a further publication or to Slee
…
minimal prospects of success against M.”325 On 29 April 1987 DW wrote to Murphy and Moloney acknowledging receipt of copies of the correspondence that had passed between that firm and Turnbull McWilliam. They enclosed a draft letter for Murphy and Moloney’s approval and in the event of approval being given, for forwarding to Metcalf. In the draft letter DW proposed to maintain the suggestion that defamation proceedings against Metcalf would be taken by DW. The draft contained the following:
“[the claimant] said he wanted to be a representative Plaintiff for the firm.
After consideration we all came to the view that chances of establishing prima facie case against Metcalf were very slim because he probably had not published it to anybody relevant. Publication to Murphy and Moloney is no good because it is [DW’s] alter ego.”
…
“We also note that your client claims that he simply wrote what he was told by Mr Rajski. This can surely not be put forward as a justification for your client to make statements defamatory of our clients.
“We are instructed by our clients to require of your client:
(a) That he apologise to our clients for the making of the defamatory statements.
(b) That he use his best endeavours to prevent further publication of the letter and, in particular, the defamatory parts of it.
(c) That he undertake in the future not to make or publish any matter defamatory of our clients.
If these requirements are met, our clients do not intend to take any action against your client.”
326 There were also in evidence a series of file notes made by Hewett, on 15 April apparently recording telephone conversations. These cannot all be put in their correct chronological sequence. However, in two of the notes Hewett has recorded himself as having told Metcalf’s solicitor, O’Brien, that, the deadline imposed having expired without receipt of the response sought, he was instructed to proceed to issue a statement of claim. In oral evidence the claimant said that this was incorrect and that Murphy and Moloney did not have instructions to issue a statement of claim, and indeed, that such instructions could not have been given without a decision of DW’s Management Committee. The file notes are relied upon by the LSC as further evidence of pressure being applied by the claimant to Metcalf. As I have earlier noted, I generally accept the claimant’s evidence, and I do so on this occasion. In any event, there is no direct evidence that Murphy and Moloney in fact had the instructions referred to; all that is in evidence is the file notes, which prove only that O’Brien had made the statements he attributed to himself. Ordinarily, of course, a statement by a solicitor that he had instructions to undertake a stated course of action would be accepted as evidence that he did in fact have those instructions. However, misunderstandings can arise, and, in the face of directly conflicting evidence from the claimant, it could not be concluded that such instructions had been given. The rationale given by the claimant, that issue of the statement of claim would require a decision of DW’s Management Committee, is compelling.
327 On 1 May Murphy and Moloney forwarded a letter, substantially in terms as drafted by the claimant, to Metcalf. Of particular relevance, the demands with which DW’s draft had concluded were incorporated in the letter.
• • •
328 The submission of the LSC in relation to this ground can be stated succinctly. It is that there was never any proper basis for suing Metcalf in defamation, and the threats to do so were taken for the purpose of intimidating him and persuading him to withdraw his support for Rajski. It really matters very little whether instructions had been given to issue the statement of claim. What matters is that the threat was made to Metcalf, and the purpose for which it was made.
329 A number of submissions were made on behalf of the claimant. Firstly, it was observed that the claimant was, on this occasion, acting not as a legal practitioner but as a client. Accordingly, the conduct could amount to professional misconduct only if it came within the description in s 127(1)(b) - that is, conduct occurring otherwise than in connection with the practice of law which, if established, would justify a finding that he was not of good fame and character or was not a fit and proper person to remain on the roll of legal practitioners.
330 I do not accept that the distinction between conduct by the claimant as an individual and conduct by the claimant as a legal practitioner can be so rigidly drawn. In these proceedings the claimant was predominantly acting as the solicitor for the Arunta Companies and their various directors and executives. He, it is true, became caught up in the litigation, to the extent of being made a defendant to various proceedings brought by Rajski and/or Raybos, but this was always as a result of, and entwined with, his role as a legal practitioner. Moreover, if the LSC’s claims are established, it would be legitimate to conclude that the claimant, in seeking to remove Rajski’s various forms of professional support, was acting not only on his own behalf, but on behalf of his clients. In any event, I am of the opinion that on no view of it could the conduct be said to have occurred “otherwise than in connection with the practice of law.” However the conduct is examined, it was in connection with the practice of law.
331 A second submission made on behalf of the claimant is that, in relation to the proposed proceedings against Metcalf, he acted at all times:
“with the benefit of the advice of independent solicitors and Mr Nicholas QC, senior counsel very experienced in the field.”
332 It is interesting to note that it was not submitted that the claimant acted on or in accordance with the advice of independent solicitors and counsel. The documentation to which I have referred makes it reasonably plain that the claimant himself took a very substantial role in the preparation of correspondence. The file notes show a great deal of caution and reservation on the part of his counsel.
333 A further submission was that the proceedings were not ultimately instituted:
“because it later became apparent that Dr Metcalf would give evidence that he had released the report in circumstances which would involve no liability on his part.”
334 The claimant’s argument went on that, notwithstanding those circumstances, DW were entitled to request an apology “for the serious and baseless allegations” they considered had been made against them.
335 The fact that proceedings were not ultimately instituted does not assist the claimant. It is the threat of proceedings, and the context in which the threat was made, that is significant. It must always have been apparent that a report, written by a medical practitioner for a court would, other than in exceptional circumstances showing some form of mala fides on the part of the practitioner, be privileged.
336 Another argument was that:
“No impropriety is involved in a lawyer acting for a client in proceedings even if they are known by the lawyer to be hopeless, and a fortiori if he does not know them to be hopeless.”
337 Authority was cited to support the first of these two propositions: Rondel v Worsley [1969] 1 AC 191, 275; Rajski v Bainton (1990) 22 NSWLR 125, 146A; S v M (The Times, 26 March 1988); Szerdahelyi v Bailey (SC NSW, Badgery-Parker J, 28 August 1997, unreported).
338 The submission, as I understand it, was that a lawyer may, without impropriety, act for a client pursuing a cause that the lawyer knows to be hopeless. It follows logically that a lawyer may, without impropriety, act for a client pursing a cause not known by the lawyer to be hopeless. The claimant sought to build on these propositions by pointing out that he was not acting as a lawyer but as a client and that he sought expert legal advice.
339 The composite submission provides no answer to the LSC’s claim. Firstly, the authorities cited do not support the first of the general propositions, that there is no impropriety in a lawyer acting for a client in a cause known to be hopeless. By way of example, the passage cited in Rajski v Bainton at p 146A merely records an argument advanced in that case on which the court did not finally rule.
340 Secondly, a letter was sent to Metcalf containing demands of withdrawal and apology and a threat of legal action. This was sent well before the conference with senior counsel. Thirdly, the question is not whether the claimant, either as litigant or lawyer, wrongly pursued a hopeless cause. The question is whether, in making the threat to sue Metcalf, his purpose was to attempt to intimidate the doctor and circumvent his support for Rajski.
341 A further argument for the claimant was that, in so far as it is alleged that he sought to intimidate Metcalf, it is not contended that he was in fact intimidated, and no complaint to that effect was made at the time by Metcalf or his lawyers. I do not consider this a relevant consideration. If, successfully or unsuccessfully, a legal practitioner set out to intimidate a witness in any proceeding, that is capable of amounting to professional misconduct.
342 The final argument was that the correspondence directed to Metcalf and his lawyers distinguished between use of the report in evidence before the court and any other publication of the letter, such that it could not reasonably be concluded that whatever the claimant was seeking to do, it included preventing Metcalf giving evidence in court in accordance with his report. In my view that submission is inconsistent with the clear words of the correspondence. In the first letter Metcalf was required to
“withdraw the allegations … and send a copy of that withdrawal and apology to each person to whom the letter was published”
and undertake not to publish any further matter defamatory to DW. In the second he was required to use his best endeavours to prevent further publication of his letter, and undertake in the future not to make or publish any matter defamatory of DW.
343 The letters contain no clear or implied exclusion of publication to the court and, in my view, the clear tone of the letters is to require Metcalf to abandon those parts of his report which the claimant asserted defamed DW.
344 It is important not to lose sight of the quite extraordinary action that was threatened, or contemplated by the claimant. This was to sue a medical practitioner for statements made in a report to a court, essentially detailing a history of a patient relevant to the formation of the medical practitioner’s opinion. The extraordinary nature of the contemplated action is relevant in an assessment of its bona fides.
345 It would be open to the Tribunal to conclude that the steps taken by the claimant in relation to Metcalf were taken for an improper purpose and amounted to professional misconduct.346 Ground 6 of the Information is in three parts. Each concerns evidence given by the claimant in the Fairfax proceedings on 6 June 1989 which the LSC alleges was, to the claimant’s knowledge, false or misleading. By Ground 6(a) it is alleged that the claimant:
Ground 6 in the Information: The Fairfax Defamation Proceedings
347 By Ground 6(b) it is alleged that the claimant gave evidence that:
“gave evidence to the effect that he had never been asked to accept service of criminal process on behalf of Yerushalmy [and that this evidence] was false or misleading to his knowledge in that he knew in truth that a solicitor in the employ of the Office of the Solicitor for Public Prosecutions had asked [him], through his junior solicitor Mr Davidson, whether they would accept service of the summons on Yerushalmy’s behalf.”
“in a meeting with a Detective Inspector Parsons (“Parsons”), Parsons had patted a file on his desk and said, “I have also got another file about Yerushalmy where we have issued a summons.” Parsons was asked by the [claimant] “What is that about” and Parsons said, “You will have to go to the DPP to find out”.”
348 It is alleged that this evidence was false or misleading to the claimant’s knowledge in that he knew that, at a meeting on 17 March, 1988 at which Davidson had been present, Parsons had said that proceedings had been commenced against Yerushalmy for perjury.
349 By Ground 6(c) it is alleged that the claimant gave evidence:350 In the Fairfax defamation proceedings, the claimant gave evidence about his perception of what the article written by Slee imputed of him. The following appears in the transcript of the proceedings:
“to the effect that he did not know that a summons issued against Yerushalmy alleged the indictable offence of Perjury until after [DW] had written to the Director of Public Prosecutions trying to find out the nature of the charge.”
Facts
“Q. What was that perception?A. That the article said that I had conspired with Yerushalmy to help him evade service of process and evade justice and that was a criminal act.
Q. Had you done any such thing?
A. No.
Q. Had you ever been asked to accept service of criminal process on behalf of Yerushalmy?
* A. No.** A. He patted a file on his desk and said, ‘I have also got anothe r file about Yerushalmy where we have issued a summons’.
Q. Were you ever asked by anyone on the prosecuting side, the Director of Public Prosecutions when(sic) you could get instructions to accept service?A. No.
Q. Do you recall visiting in connection with a case of Mr Cowper, who is mentioned in that second article, that is Ex E, attending at the office of the Director of Public Prosecutions in Sydney?
A. Yes.
Q. Did you speak to anyone there?
A. I spoke to Detective Inspector Parsons.
Q. Did you speak to him about Cowper?
A. Yes.
Q. In the course of the conversation about Cowper was another name mentioned?
A. Yes.
Q. What was said?
. . .
Q. Was anything more said than that about Yerushalmy?A. Yes. I said. I said, ‘What is that about?’ and he said, ‘You will have to go to the DPP to find out’.
Q. And did you?
A. Yes. Well, I discussed it with Chris Davidson and he wrote to the DPP or spoke to him, I am not sure which, to find out what was happening.
*** A. First of all, we didn’t know what summons it was at that stage. That is what we were trying to find out.”
[Transcript of Fairfax proceedings p 33]
Q To your knowledge did Mr Davidson ever inform the Director of Public Prosecutions Office that your firm had no instructions to accept service of the summons issued against Mr Yerushalmy?
A. Yes. I think he did, because that was the fact.
Q. There is no obligation on a solicitor to accept service of such a summons at all, is there? (objected to; allowed)
Q. It would be your understanding that there is no obligation on a solicitor to accept service of such a summons?
[Transcript of Fairfax proceedings, p 57]351 The LSC alleges that the answers marked with asterisks, to the effect that the claimant had never been asked to accept service of criminal process on behalf of Yerushalmy, that Detective Parsons patted the file on his desk, and told the claimant he would have to go to the DPP to find out what it was about and that he did not know the nature of the summons against Yerushalmy, were all false and misleading.
352 To sustain the allegations the LSC relies upon a series of documents, consisting of file notes and correspondence. It is convenient to set these out in chronological sequence, before identifying those passages on which the LSC relies to support each of the three individual assertions that the claimant’s evidence was false and misleading. The first consists of a bundle of notes made by Davidson during a conference on 17 March 1988 (these notes are pp 23-24 of Ex NRC 5 to the claimant’s affidavit of 28 February 1997.) It is not clear from these documents for what purpose the conference was called, or who was present. The information to be derived from them is supplemented by p 25 of the same exhibit, which is a file note relating to the same conference prepared by Davidson on 11 May 1988 by reference to the notes originally taken at the conference. The later file note records that the conference was convened:353 The file note is headed “Perjury”. The persons present were Parsons, Davidson and the claimant. Relevantly, the file note contains the following assertions:
“at the request of [DW] re Parsons request that Cowper attend an interview concerning his evidence in 1981 as to his qualifications, experience and his report of October 1980”.
354 The last two words are important. They do not appear in the notes taken contemporaneously. There the corresponding note is only:
“During discussion re Cowper, Parsons stated proceedings had been commenced against Yerushalmy for Perjury.”
355 Another file note, bearing Davidson’s initials, is dated 31 March. (It can be found in NRC 7, p 38). Its significance is that it is headed “Arunta Investments Pty Limited. Re. Yerushalmy - Perjury.” Yet another, also bearing Davidson’s initials, dated 5 April 1988, is headed “Arunta Investments Pty Limited. Re Rajski. Re Yerushalmy - Perjury.” (NRC 7, p 39) It records an enquiry made by Davidson of Phil Dart:
“Proceedings against Yerushalmy.”
This note does not identify the nature of the proceedings brought against Yerushalmy and this is of some, obvious, significance.
356 On 29 April 1988 DW wrote to the Solicitor for Public Prosecutions, in the following terms:
“Whether we might obtain a copy of the summons issued and to be served on Yerushalmy. I noted that we had no instructions to accept service of that summons.”
357 On 2 May 1988 the Solicitor for Public Prosecutions wrote to DW, conforming that an information alleging perjury against Yerushalmy had been laid and that difficulties were being experienced in serving the summons. The letter concluded:
“We understand that process has issued against Mr Yerushalmy by the Director of Public Prosecutions but has not been served. We are instructed to make representations in the nature of a “No Bill” application that the summons be withdrawn. Before we do we need to know the nature of the charge and the particulars relied upon.” (NRC 1 annexure 60).
358 DW replied on 10 May 1988 same day, saying:
“I note that you decline to accept service of the summons on Mr Yerushalmy’s behalf”
359 On 6 May 1988 the claimant wrote to the SMH concerning the article that had been written by Slee. The letter included the following paragraph:
“3. In your letter you say that we declined to accept service of the summons on behalf of our client. Mr Davidson did inform Mr Dart that we did not have instructions to accept service of the summons. You did not ask us to seek such instructions.”
360 The LSC argues that the documents, viewed as a whole, invite the inference that, despite his claim that DW had never been asked to accept service of the summons on Yerushalmy’s behalf, the firm was in fact asked to do so. He relied on the following passages in the documentation:
“Since 17 March 1988 we, as Mr Yerushalmy’s solicitors, have been seeking particulars of the charge apparently made against him (as the letter which you quote correctly records.)” (Ex 18)
• • •
361 In the particulars of complaint the LSC asserts that:
Davidson’s file note (5 April 1988) which records that:
“I noted that we had no instructions to accept service of that summons”;
The letter (2 May 1988) of the Solicitor for Public Prosecutions:
“I note that you decline to accept service of the summons on Mr Yerushalmy’s behalf.”
“such a refusal must have followed an inquiry to the same effect”
and that:
“it is clear from the correspondence that the [claimant] through … Davidson, was asked to accept service of the summons on behalf of Yerushalmy”.
• • •
362 The LSC’s claim in this regard depends entirely upon the inferences he seeks to have drawn from these documents. They are incapable of legitimately giving rise to such inferences. It would not be open to the Tribunal to reach a conclusion, on this material, that a request to accept service was made. In this respect some answers given by the claimant in cross-examination strengthened the view that I would, in any event, have reached. He said, as he had said in the Fairfax proceedings, that a summons for perjury, perjury being an indictable offence, could not properly be served through solicitors. No argument having been put to the contrary, either in the Fairfax proceedings or in the present proceeding, I am prepared to work on the assumption that it is a correct statement of law. That fact alone renders it less likely - indeed unlikely - that such a request would have been made.
363 The Information in this respect cannot succeed. Ground 6 (a) must be deleted from the Information.
364 The remaining two passages in the evidence given by the claimant in the Fairfax proceedings are, so far as I can see, to the same effect: that is, that, at the time to which he was referring in his evidence, the claimant was not aware of the nature of any charge the Director of Public Prosecutions proposed to lay against Yerushalmy.
365 The LSC’s argument, again, depends upon inferences to be drawn from the various documents which have been extracted above.
366 He relies upon the file note of the conference of 17 March 1988 prepared by Davidson. It is to be remembered that this file note was prepared on 11 May 1988 - almost two months later - from contemporaneous notes made at the conference. There is a significant discrepancy between the two. The later file note states that Parsons had referred to proceedings commenced against Yerushalmy for perjury; in the contemporaneous note, although it is noted that proceedings had been commenced against Yerushalmy, the charge was not identified. Further, the later file note is headed “Yerushalmy - Perjury”; the contemporaneous note has no such heading. There is nothing in the contemporaneous note to show that, at the time of the conference, those present were aware specifically of the nature of the charge. The two file notes of 31 March and 5 April are also each headed “Perjury”, and there is no suggestion that they were not made on the dates they bear. Certainly, by those dates, it may be taken that Davidson was aware, in general terms, of the charge that would be laid against Yerushalmy.
367 While Davidson’s knowledge does not necessarily imply that the claimant was aware of the general nature of the charge, given the close supervision which the claimant gave to all matters concerning Arunta, Tectran and their associated companies and individuals, I think it is a reasonable inference that he had substantially the same information and knowledge as Davidson had.
368 There is, therefore, a basis on which the Tribunal could conclude that the evidence he gave in these two respects was inaccurate.
369 Giving inaccurate evidence could not, of itself, amount to professional misconduct, and this is recognised by the LSC in the formulation of the Information, which alleges that the evidence went beyond inaccuracy, and was false or misleading - implying, at least, knowledge of its inaccuracy, and an intention to mislead the court. Merely to give mistaken evidence could not amount to professional misconduct.
370 There is no evidence capable of supporting a finding of professional misconduct in respect of the evidence given in the Fairfax proceedings. This ground must be deleted from the Information.
371 I should add that senior counsel for the LSC put a final submission, to the effect that this court had not had the benefit of the potential evidence of Parsons or Davidson, an advantage which may be available to the Tribunal: s 171(1).
372 I do not accept that the present decision should be made by speculating about evidence that might become available. Firstly, although he may not have had powers of compulsion, there was nothing to stop the LSC seeking information from either Parsons or Davidson in the course of his investigation; there was no evidence that he sought to take this course. There was no reason why either or both of those gentlemen should not have been required, by subpoena if necessary, to attend at this Court for the purpose of giving any relevant evidence they may have been able to give. It would be quite wrong to determine that there is adequate evidence to go to the Tribunal on the basis that some additional information may be forthcoming. I reject the submission.
373 By Ground 7 in the Information the LSC alleges that the claimant:
Ground 7 in the Information
374 Eight separate matters were identified as particularising this assertion. Five of them were:
“conducted the litigation in such a way that his behaviour would be reasonably regarded as disgraceful or dishonourable by other members of the profession of good repute and standing or did not meet the required standards of competence and diligence in that he … acted without the due objectivity and detachment expected of a member of the profession in his conduct of the litigation and in his dealings with the Court and other members of the profession …”
375 These were identified as:
(i) the allegations concerning Wood and Donaldson;
(ii) the allegation concerning the attempts to secure the termination of the grant of legal aid;
(iii) the matters relating to Carneys;
(iv) the matters relating to the conference with Yerushalmy;
(v) the matters related to Metcalf;
already the subject of grounds 1,2,3, 4 and 5 respectively. The allegation that the conduct relied upon meets one or more of the descriptions contained in the opening words of ground 7 is not materially different, for present purposes, from an allegation that the conduct amounted to professional misconduct or unsatisfactory professional conduct. Indeed, the LSC asserts, as he must in bringing the Information, that the conduct was either professional misconduct or unsatisfactory professional conduct. These matters have been dealt with and need not be re-considered. There remain three aspects of the claimant’s conduct to be considered under this ground.
376 It is necessary, firstly, to state with more particularity the manner in which this aspect of Ground 7(v) is framed. It is as follows:
Ground 7(v): Costs in the defamation proceedings before Hunt J,
Ground 7(vi): the “tutor application”,
Ground 7(viii): Costs in the application before Campbell J.”I will outline each additional matter in turn.
Ground 7 Costs in the Defamation Proceedings Before Hunt J.
“From June, 1986 to August, 1986 the [claimant], as a defendant in the defamation proceedings and as a partner of the other defendants in the case sought to have bankruptcy proceedings commenced against Rajski in relation to $8,861.83 costs ordered to be paid by Justice Hunt in the case. The [claimant] sought to issue the bankruptcy proceedings knowing that Rajski had filed an application for leave to appeal against the decision of Justice Hunt. The [claimant] continued the attempt to bankrupt Rajski knowing that Rajski had obtained leave to file and had filed a Notice of Appeal from the decision of Justice Hunt. The purpose of the attempt to make Rajski bankrupt was not to obtain payment of the costs but to impede Rajski in his conduct of the litigation.”
Facts
377 In 1985 Rajski sued the partners of DW for defamation. DW applied, successfully in the first instance, for summary dismissal of the claim. On 16 May 1986 Hunt J directed entry of judgment in favour of DW and ordered Rajski to pay their costs. On 7 July 1986 Rajski was granted leave to appeal that decision in the Court of Appeal. In accordance with the leave granted, on 21 July 1986 he filed a notice of appeal.
378 Notwithstanding the grant of leave and the filing of the notice of appeal, on 30 July 1986 DW’s solicitors, Murphy and Moloney, served Rajski with a certificate of taxation of costs quantified at $8,861.83. On 11 August 1986 DW’s solicitors demanded payment of the costs by 18 August, with a threat of legal action in the event of non payment. On the same day Rajski wrote to DW’s solicitors seeking consent to orders setting aside the certificate of taxation of costs and staying Hunt J’s order for costs pending the hearing of the appeal. On 18 August the Court of Appeal stayed the costs order pending the hearing of the appeal.
379 There is no evidence that either the claimant or DW on their clients took any formal steps towards commencing bankruptcy proceedings against Rajski. The sole evidence concerning any consideration of bankruptcy proceedings is to be found in a file note of the conference of 19 June 1986, to which reference has been made in relation to ground 3. The file note discloses that the claimant reported on the status of the defamation proceeding, that Rajski had sought leave to appeal, and that, in the claimant’s view, Rajski would ultimately lodge an appeal. It was following that report that the question of bankruptcy arose. The file note records the following:
“[The claimant] also mentioned that when we get a certificate as to costs we will then move to send Rajski bankrupt. Gary Richardson asked whether there would be any advantages re the main proceedings if Rajski is bankrupt. [The claimant] replied that only so far as asking the question where Rajski’s money has gone and what assets he does have….
[The claimant] was hopeful that within a couple of weeks we would have a certificate on which we could base the bankruptcy notice. [The claimant] then noted that he would need to get the [DW] general committee to approve issuing a bankruptcy notice.”
380 The LSC also relied on the evidence, earlier referred to, of the claimant’s intention to maintain pressure on Rajski, to “push” him, or to “stretch” him: (see paragraph 263.)
381 Later, from a file note recording a conference of 27 October 1986, (Ex Z) it is clear that further consideration was being given to the same action. Under the sub heading “Re Items to Action” appears the following:382 Senior counsel appearing for the LSC observed that, while there did not appear to be any formal move towards bankruptcy proceedings, there was a contradiction in the way in which the claimant and the employed solicitors from DW were thinking. He contrasted the consideration being given to bankruptcy and liquidation proceedings, necessarily based upon the impecuniosity of Rajski and Raybos, with the letter to the LAC suggesting that neither had disclosed his or its true financial position, and that each was in possession of substantially more assets than those which they had disclosed to the LAC. I find this immaterial. The simple fact is that, whatever discussions took place during the numerous conferences concerning the litigation, no bankruptcy action was taken against Rajski. It is misleading to allege, as LSC does, that the claimant “sought to have bankruptcy proceedings taken against Rajski”. The most he did, so far as the evidence goes, was to give consideration to and to discuss such a course of action, and to consider the possible foundation for such action. There is no basis on which ground 7(v) could found a finding of professional misconduct or unsatisfactory professional conduct. It should be deleted from the Information.
“So far as orders for costs were concerned Bainton QC had advised it was worthwhile bankrupting Rajski. [The claimant] said that we should get the orders for costs before the High Court taxed and noted that the orders for costs in the defamation matter against [DW] had been taxed but the Court of Appeal had stayed that order…
Gary Richardson then enquired re the effect of bankrupting Rajski and Raybos? [The claimant] explained that if the company is wound up the court appointed liquidator would stand in for Rajski and presumably that the liquidator would need to be funded; but legal aid may cover this action.”
• • •
383 The Ground of the Information is framed as follows:
Ground 7(vi) in the Information - Tutor Application
“Between late 1986 and early 1987 the [claimant] attempted to have Rajski declared mentally disabled and to have a tutor appointed to conduct his litigation for the improper purpose of using such appointment as a means to hinder, obstruct or thwart Rajski in the further conduct of the litigation, by taking the following actions:
(a) On 23 October, 1986, despite that until that day in the application for leave to appeal in the Court of Appeal the [claimant] and his partners having been represented by senior counsel, and as the Court of Appeal was about to announce its orders, the [claimant] announced to the Court that he would thenceforth appear for himself in the proceedings and wished to make a submission additional to that put to the Court by senior counsel previously appearing for him. He then improperly submitted to the Court, without having previously moved under Part 63 rule 7 of the Supreme Court Rules and without any evidence to support the submission, that should the Court of Appeal grant an adjournment of the application for leave to appeal and order a stay of the litigation before Powell J then the Court also ‘must find that the plaintiff (Rajski) is mentally disabled within the meaning of Part 63 Rule 5(2) and the consequence of that is that the Court would then be bound to appoint a tutor’. The reason for the above application was said by the [claimant] to be that it would enable the litigation to be conducted in ‘a more reasonable way’ and
Facts
(b) between 15 December, 1986 and 23 March 1987 the [claimant], on behalf of his client and himself and his partners foreshadowed a possible motion that the Court of Appeal appoint a tutor for Rajski.”
384 On 13 October 1986 a number of proceedings were listed before Powell J then in the Equity Division. These were the 1980, the 1985 and the 1986 proceedings. The last of these was the proceeding commenced by Rajski and Raybos alleging conspiracy against, inter alia, the partners of DW. The claimant was personally a party to this action.
385 The evidence does not clearly disclose for what purpose or purposes these proceedings were listed, other than that they involved interlocutory applications (Ex1C, document no. 141). Rajski and Raybos sought adjournment. Powell J refused. Rajski and Raybos sought leave to appeal the refusal to the Court of Appeal. The application came before the Court of Appeal (Kirby P, Glass and Priestley JJA) on 22 October 1986. Rajski appeared for himself and also represented Raybos. All defendant/respondent parties, including the claimant, were represented by Bainton QC. The transcript of proceedings of that day is not in evidence. The Court reserved its decision overnight, and re-convened the following morning for, it seems, the purpose of delivering judgment, or at least announcing its orders. The extracts from the transcript of that day suggest that also before that Court was the second contempt proceeding, (which had been filed in the Court of Appeal) and in which, again, the claimant was personally a party.
386 The precise manner in which Rajski advanced his application for adjournment before Powell J is not in evidence before me. In the Court of Appeal he supplemented whatever material he had put before his Honour with a report by Metcalf of 17 October 1986. According to the particulars subscribed to the Information, Metcalf also gave oral evidence in the Court of Appeal. That evidence is not before me. In the report Metcalf expressed the opinion that Rajski had been:387 When the Court convened on the morning of 23 October 1986 the claimant appeared in person. He sought and was granted leave to make further submissions in relation to the adjournment application.
“becoming increasingly anxious over a period since August this year … is on the verge of a nervous breakdown … is acutely anxious and depressed and may well become totally unable to cope in a rational way. He needs rest and treatment.”
His oral evidence is summarised in the judgment of Kirby P: Raybos Australia Pty Ltd v Tectran Corporation (1986) 6 NSWLR 674 at p 681.
The transcript records the claimant as saying:
“My submission is that the application should be allowed to proceed and not be adjourned, for two reasons which were not mentioned before your Honours yesterday. The first is that there is a benefit to me in either event, whether the application succeeds fails. If, as I understood the Court to indicate, you were minded to reject the application, then of course the case can proceed, which is in my interest, both because of a resolution of the civil charge which lies against me and because that would then enable the criminal charge under which I suffer to be resolved more speedily.
…
Secondly, if the application succeeds it is my submission that the Court must find that the plaintiff [Rajski] is mentally disabled within the meaning of Part 63 Rule 5(2) and the consequence of that is that the Court would then be bound to appoint a tutor. That would then enable the litigation to be conducted in what, in my submission, would be a more reasonable way.”
In answer to a question put to him by the then President, the claimant said that such a finding would be necessary because:
“The claimant’s case is that he is mentally disabled from conducting his case.”
In answer to a question put by Glass JA, the claimant said:
“I do not wish to embark on a long discussion because I wish to make these submissions short, but I am not able to accept what your Honour Glass JA puts. I would have thought it follows if this Court finds this claimant [Rajski] is unable because of his mental state to conduct the litigation then he must be a mentally disabled person. It may change in the future and the tutor can be removed, but at the moment, for the purpose of this litigation, that is what he is and that is his claim.”
388 The consequence of a finding that a litigant is “a disable person” within the meaning of SCR Part 57 Rule 7 as it then stood, was that the litigant was not permitted to make decisions about his or her own litigation; such decisions were entrusted to a court appointed tutor. Obviously, such a finding is of considerable significance.
389 There was no formal application to the Court for any declaration that Rajski was a disable person within the meaning of the Rule, or for any other orders to similar effect.
390 The Court of Appeal granted the adjournment and ordered a stay of the proceedings before Powell J. In giving reasons for that decision on 29 October, Kirby P described the suggestion that a tutor might be appointed as “misconceived on the present state of the evidence.” (Raybos Australia Pty Ltd v Tectran Corporation Pty Ltd (1986)391 It is clear that active consideration was subsequently given to the possibility of seeking such a declaration. On 27 October 1986 the claimant attended a conference with representatives of the Tectran/Arunta Companies. A file note of the conference records:
6 NSWLR 674)
“The following more general issues were then discussed.
1. Psychiatric Evidence : [the claimant] pointed out that if Dr Metcalf comes to the conclusion that Rajski is disable, Tectran may then apply to have a tutor appointed to conduct his litigation.”
392 As a consequence of the orders made, the matters were again before the Court of Appeal on 15 December 1986. During the course of the discussion that then took place, Bainton QC, who continued to appear for the Arunta and DW parties other than the claimant, sought and was granted an order that Rajski submit himself to psychiatric examination on behalf of those parties he represented. As page 15 of the transcript makes clear (and page 1 does not) the claimant was separately represented.
393 On 18 December 1986 DW wrote to Shand. They provided him with a much abbreviated history and outline of all proceedings and, in particular, the events of 23 October 1986 in the Court of Appeal. They outlined the reasons for the orders the Court had made in the following way:
“Based on the evidence of Rajski as to his symptoms and the psychiatric opinion of Dr Metcalf, the Court was of the opinion that Rajski was not presently fit to represent himself and granted him an adjournment to allow him to recuperate.”394 Shand was asked specifically to report upon his findings on examination, any mental or emotional condition from which Rajski suffered, whether any such condition did then or would in the future affect his capacity either to instruct lawyers or conduct litigation himself, his prognosis and generally and to make any other comment he felt might be helpful. (Ex 21)
395 Shand duly reported on 2 February 1987 (Ex 1C/95).396 On 2 February 1987 the second contempt proceeding was again listed in the Court of Appeal. It may well be that the other matters were also listed, although the transcript (Ex 1C/144) does not suggest that this is so. In any event, the question of the purpose of the examination by Shand was raised, and Davidson, who is recorded as appearing for the DW parties, assented to the proposition that the dual purpose to the hearing was to respond to Metcalf’s evidence, and:
“He showed no signs of any clinical symptoms. This does not contradict the assertion that since May 1986 he has had symptoms suggestive of and consistent with a stress reaction which he described colourfully and dramatically as ‘physical and mental exhaustion.’… In view of his vigorous performance during assessment, I think he exaggerates his disorder. It is plausible that he will find court work considerably more stressful and therefore needs to be in good mental shape for it.
The diagnosis which needs serious consideration is whether Rajski is paranoid in the sense that he is delusional about the alleged conspiracy between directors and Tectran, a solicitor of [AAH], and Bainton, Barrister, for Tectran briefed by [AAH]. The same applies to his allegations about [the claimant] of [DW]. He claims to have documents including letters, memoranda, and an Affidavit as proof of his allegations. However, he used inference not infrequently to support his contentions and beliefs and I have not seen any documented support although he claims to have such. Apart from the possibility that he has delusions of conspiracy and persecution by some members of the opposition, I did not detect any other signs of significant psychiatric disorder.
…
Unless he has convincing documented support for the allegations of conspiracy, fraud etc by Jones of [AAH], Baynton (sic) [the claimant] and, which I have to doubt on the basis of common sense, his allegations should be regarded as delusions, and therefore paranoid. If this is true, he may have great difficulty instructing counsel. However, there is no doubt in my mind that for the primary case to have any chance of completion, let alone the other ones, he must have adequate legal representation in court, whatever the source may be.”
“in relation to the appointment of a tutor.”
397 In oral evidence the claimant said that either Davidson was wrong about this or, if he were correct, the listing for that purpose had been arranged without the claimant’s knowledge.
398 Metcalf reported again on 15 February 1987 (Ex 1C/93) He wrote:
“In my opinion Dr Rajski is not deranged and needs no tutor but he does need the assistance of legal representation that any sane person in our society would require under similar circumstances.”
399 The matter was in the Court of Appeal again on 23 February 1987. The transcript records that Bainton QC appeared for the DW parties, including on this occasion, it seems clear, the claimant. There was considerable discussion about the medical reports, and it was accepted that by Bainton QC one reason for obtaining the Shand report was to consider a foreshadowed possible motion that a tutor be appointed for Rajski on the basis that he was a disable person. Kirby P raised the question whether that “application” would be pursued. No final answer was given and the matter was left, to some extent, in abeyance.
400 On 11 March DW wrote to Shand, again setting out a number of asserted facts, and enclosing a number of documents, and asking a number of specific questions about Rajski and the psychiatric examination that had taken place. Importantly, he was asked this question:401 On 23 March 1987 the matter was yet again listed in the Court of Appeal. On this occasion the claimant appeared for all DW defendants, including himself. He stated that the matter was in the list that day for two purposes, one of which was the determination of whether or not any of the opponents wished to make any application to have a tutor appointed. He subsequently reiterated this. He then said:
“…is Mr Rajski suffering from any mental or emotional condition which does now or will in the future affect his capacity to either instruct lawyers or conduct litigation himself? If so, what is that mental or emotional condition and what treatment is necessary to deal with it?”
402 No application for appointment of a tutor was ever made. The LSC’s case in this respect is, again, that “the application … for appointment of a tutor” was made for an improper purpose. It is for this reason that I have emphasised no formal application was ever made. The LSC overstates the case in referring to “an application”.
“I think the question of appointment of a tutor is perhaps a red herring. It arose in these circumstances; about last October or November evidence was being put forward by Mr Rajski that he was incapable of conducting this case. It seemed to us either he was capable of running the case or he was incapable. If he was incapable, the Court was bound to appoint a tutor. It is not a question of our application to appoint a tutor. If the court finds he is incapable of conducting litigation, then by the rules it is bound to appoint a tutor.”
• • •
403 A legal practitioner - or a party to litigation - is entitled to explore the possibilities of causes of action which mature consideration reveals to be untenable. It is not, and cannot be, professional misconduct or unsatisfactory professional conduct merely to consider a course of action, or even to take active steps to ascertain whether it is practicable or viable. The nearest the claimant ever came to making an application for the appointment of a tutor occurred on 23 October when he raised with the Court of Appeal as a matter relevant to Rajski’s adjournment application a possible consequence of acceptance of Metcalf’s opinion about Rajski’s emotional or mental condition. While Kirby P considered the suggestion “misconceived” - at least on the evidence as it then stood - Priestley JA considered, having observed the proceedings to that point, that the claimant’s submission was “a weighty one”.
404 It is necessary to distinguish what the claimant in fact did from what he contemplated or discussed doing or even planned to do. When that is thrown properly into relief it can be seen that all the claimant actually did was to make what was, in my view, a misguided submission to the court of Appeal. He made no application for appointment of a tutor. An essential element of the LSC’s allegation is that the claimant applied for a tutor to be appointed. Proof of the allegation in the Tribunal would depend upon proof of a fact the negative of which is clearly, on the evidence, established. That is, the essential fact cannot be proved. This allegation is therefore doomed to failure. To pursue it would constitute an abuse of the processes of the Tribunal.
405 I am satisfied that there is no basis, in relation to the matters here set out, for a finding of professional misconduct or unsatisfactory professional conduct. This ground must be deleted from the Information.406 The ground is framed as follows:
Ground 7(viii) in the information - Costs in the Application before Campbell J
Facts
“In September, 1988 the [claimant] on behalf of new Scitec improperly sought to obtain from Raybos and Rajski a total of $12,509.92 in respect of the costs order made by Justice Campbell in the judgment delivered on 18 March, 1986 in relation to an application by Raybos and Rajski to join new Scitec as a defendant in the 1985 P[roceedings], the [claimant] knowing prior to seeking such costs from Raybos and Rajski that the LAC had acknowledged legal aid was granted to Raybos and Rajski in respect of the application heard by Justice Campbell and knowing as such that no costs could be sought from Raybos and Rajski in accordance with s 47 of the Legal Aid Commission Act”.
407 What is alleged in this respect can be stated briefly. On 18 March 1986 Campbell J delivered judgment unfavourable to Rajski and Raybos in one of the many interlocutory applications that have come before the Court. He accordingly ordered costs against them. On 3 November 1986, by letter to the LAC, DW sought information in relation to which of the various proceedings and applications were covered by a grant of legal aid. Having regard to the provisions of s 47 of the LAC Act, it was relevant and necessary to DW to have this information in order to ascertain the entitlement of the parties they represented to recover any costs awarded in their favour. In the letter DW identified eighteen separate applications or proceedings the subject of their enquiry. In each of the eighteen matters identified, an order for costs in favour of DW’s clients had been made. One of these was the application decided by Campbell J on 18 March 1986.
408 On 23 June 1987 the LAC replied to the enquiry. The application the subject of Campbell J’s judgment was one of seven matters identified as subject to a grant of legal aid and accordingly within the limitations imposed by s 47.
409 Notwithstanding this, on 15 September 1988 DW wrote to Rajski, enclosing a bill of costs in relation to that judgment and seeking payment of the costs assessed in the amount of $12,509.92.
410 The LSC alleges that, having been told that the proceedings were the subject of a legal aid grant, and accordingly the recoverable costs were limited by s 47 of the LAC Act, the approach was improper.
• • •
411 Even without the benefit of the claimant’s oral evidence I would be satisfied that the only reasonable explanation for this having occurred is mistake, understandable in the light of the web of litigation surrounding this case, and that, accordingly, the approach is incapable of amounting to professional misconduct or unsatisfactory professional conduct. That view is only strengthened by the unchallenged evidence the claimant gave, that he was away from Sydney and his practice at the time, and matters were left in Davidson’s hands. An attempt - wholly unsuccessful - was made in cross- examination to establish that Davidson was doing no more than acting on the claimant’s express instructions, and in continuation of the route that he had set. There is no foundation in this material for any adverse finding. It will be deleted from the Information.
412 Before proceeding to make final orders, I will give the parties an opportunity to be heard on the form those orders should take.
******Legal Profession Act 1987
APPENDIX A
Part 10---Complaints and disciplineDivision 1---Preliminary
123. Objects of Part generally
The general objects of this Part are:(a) to redress the consumer complaints of users of legal services; and
(b) to ensure compliance by individual legal practitioners with the necessary standards of honesty, competence and diligence, and
(c) to maintain at a sufficiently high level the ethical and practice standards of the legal profession as a whole.
124. Objects of Part relating to users of legal services
The objects of this Part relating to the users of legal services are:(a) to give every person the right to complain about the conduct of legal practitioners; and
(b) to give users of legal services access to sufficient advice and assistance in order to make and pursue complaints in accordance with this Part and to understand their rights and responsibilities under this Part; and
(c) to provide an opportunity for mediation of consumer disputes relating to legal services; and
(d) to give complainants immunity from civil liability for communications made by them in connection with the official complaints and disciplinary system; and
(e) to provide complainants with a reasonable opportunity to rebut statements of the legal practitioner or against whom the complaint is made before the complaint is disposed of; and
(f) to ensure that complainants receive adequate notice of the institution and status of disciplinary proceedings at relevant stages of the proceedings (including notice of the dismissal; of complaints and the reasons for the dismissal), and
(g) to give complainants the right to seek an independent review of decisions of Councils to dismiss complaints or merely reprimand legal practitioners.
125. Objects of Part relating to providers of legal services
The objects of this Part relating to the providers of legal services are:(a) to ensure that the rules of natural justice (being rules for procedural fairness) are applied to any disciplinary proceedings taken against legal practitioners; and
(b) to give legal practitioners immunity from civil liability for communications made by them in connection with the official complaints and disciplinary system; and
(c) to ensure that legal practitioners are aware of the standards of honesty, competence and diligence expected of them.
127. Professional misconduct and unsatisfactory professional conduct
(1) For the purposes of this Part, "professional misconduct" includes:(a) unsatisfactory professional conduct, where the conduct is such that it involves a substantial or consistent failure to reach reasonable standards of competence and diligence; or
(b) conduct (whether consisting of an act or omission) occurring otherwise than in connection with the practice of law which, if established, would justify a finding that a legal practitioner is not of good fame and character or is not a fit and proper person to remain on the roll of legal practitioners; or
(c) conduct that is declared to be professional misconduct by any provision of this Act.
(2) For the purposes of this Part:
"unsatisfactory professional conduct" includes conduct (whether consisting of an act or omission) occurring in connection with the practice of law that falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent legal practitioner.(3) Maintenance or champerty by a legal practitioner or interstate legal practitioner (except in connection with a conditional costs agreement under Part 11) may constitute professional misconduct despite the Maintenance and Champerty Abolition Act 1993.
Division 2 Legal Services Commissioner
129. Appointment of Commissioner(1) The Governor may, on the recommendation of the Attorney General, appoint a person to be Legal Services Commissioner.
(2) The person so appointed is to be a person who, in the opinion of the Attorney General:(a) is familiar with the nature of the legal system and legal practice (but need not be a legal practitioner), and
(b) possesses sufficient qualities of independence, fairness and integrity.
(3) The employment of the Commissioner is subject to Part 2A of the Public Sector Management Act 1988, but is not subject to Part 2 or 8 of that Act.
(4) The Commissioner may be appointed for a period of up to 7 years, despite anything to the contrary in section 42F of that Act.
(5) The Governor may remove the Commissioner from office only for misbehaviour, incapacity or incompetence, despite anything to the contrary in section 42Q of that Act
131. Functions of Commissioner
(1) The Commissioner has, in accordance with this Act, the following functions:(a) to receive complaints about professional misconduct or unsatisfactory professional conduct of legal practitioners;
(b) to assist and advise complainants and potential complainants in making and pursuing complaints (including assisting complainants to clarify their complaints and to put their complaints in writing);
(c) to initiate a complaint against a legal practitioner;
(d) to investigate, or take over the investigation of, a complaint if the Commissioner considers it appropriate;
(e) to refer complaints to the appropriate Council for investigation or mediation in appropriate cases;
(f) to monitor investigations and give directions and assistance to Councils in connection with the investigation of complaints;
(g) to review the decisions of Councils to dismiss complaints or to reprimand legal practitioners in connection with complaints;
(h) to take over investigations or to institute proceedings in the Tribunal against legal practitioners; following a review by the Commissioner;
(i) to assist the Councils to promote community education about the regulation and discipline of the legal profession;
(j) to assist the Councils in the enhancement of professional ethics and standards, for example, through liaison with legal educators or directly through research, publications or educational seminars;
(k) to conduct regular surveys of, and report on, the views and levels of satisfaction of complainants and respondent legal practitioners with the complaints handling and disciplinary system;
(l) to report on the Commissioner's activities under this Act.
(2) The Commissioner has such other functions as are conferred or imposed on the Commissioner by or under this or any other Act.Note.
The Conveyancers Licensing Act 1995 confers on the Commissioner the function of dealing with complaints against licensed conveyancers.
Division 3---Complaints about legal practitioners
134. Right to make complaint to Commissioner
(1) Any person may make a complaint to the Commissioner about the conduct of a legal practitioner.
(2) Any such complaint that is duly made is to be dealt with in accordance with this Part.
(3) This section does not affect any other right of a person to complain about the conduct of a legal practitioner.
138. When complaint made
(1) A complaint may only be made within 3 years after the conduct is alleged to have occurred.
(2) However, the Commissioner may accept a complaint made after that time if:(a) the Commissioner is satisfied that it is just and fair to do so having regard to the delay and the reason for the delay; or
(b) the Commissioner is satisfied that the complaint concerns an allegation of professional misconduct and that it is necessary in the public interest to investigate the complaint;
141. Summary dismissal of complaints
The Commissioner may dismiss a complaint without referring it to the appropriate Council:(a) if further particulars of the complaint are not given, or the complaint or the further particulars are not verified, as required by the Commissioner; or
(b) if the complaint is frivolous or vexatious.
142. Referral of complaints to Council for investigation or mediation, or both
(1) The Commissioner may refer a complaint to the appropriate Council if the complaint is not to be investigated by the Commissioner under Division 5.
(2) When referring a complaint to a Council, the Commissioner may recommend that the Council investigate the complaint or refer it to mediation, or both.
(3) The complaint is to be referred within 21 days after it is made. If the Commissioner requires the complainant to provide further particulars or to do any other thing under section 140, the complaint is to be referred within 21 days after the further particulars are provided or the other thing is done.
(4) This section does not apply to a complaint which is dismissed by the Commissioner under this Division.
Division 5---Investigation of complaints
147A. Investigation of complaints by Commissioner
(1) The Commissioner may conduct an investigation into a complaint instead of referring it to a Council for investigation, or may take over the investigation of a complaint from a Council, if the Commissioner considers it appropriate.
(2) A Council is to provide any assistance required by the Commissioner to conduct an investigation into a complaint (including copies of or access to all documents held by the Council that relate to the complaint or are required for the purpose of investigating the complaint).
148. Investigation of complaints by Council
(1) A Council must, subject to this section, conduct an investigation into each complaint referred to it by the Commissioner or initiated by the Council.
(2) A Council may dismiss a complaint without investigation if further particulars of the complaint are not given, or the complaint or the further particulars are not verified, as required by the Council.
(3) This section does not apply to a complaint which is taken over by the Commissioner under section 147A, a complaint which is referred to an independent investigator under section 151 or a complaint which is referred only to mediation.
149. Monitoring by Commissioner of conduct of investigation
(1) The Commissioner is to monitor investigations by a Council into complaints.
(2) A Council investigating a complaint is to report to the Commissioner on the progress of the investigation if required to do so by the Commissioner.
(3) A Council is required to provide any assistance required by the Commissioner to monitor investigations by the Council (including access to or a copy of all documents held by the Council that relate to the complaint or are required for the purpose of monitoring the investigation).
150. Directions by Commissioner about conduct of investigation
(1) The Commissioner may give the Council directions on the handling of a complaint being investigated by the Council if the Commissioner considers that it is in the public interest to do so having regard to the seriousness of the complaint.
(2) The directions may include, for example, directions to pursue a particular line of inquiry or directions concerning the time for completing the investigation.
(3) Directions may not be given on the decision to be taken by a Council following the investigation.
(4) If the directions of the Commissioner about the investigation of a complaint are not complied with, the Commissioner may, under section 147A, take over the investigation of the complaint.
(5) The Commissioner may also issue general guidelines to a Council about the investigation of complaints.
151. Independent investigation of certain complaints
(1) The Commissioner is to arrange for a complaint to be investigated by an independent investigator if requested to do so by the appropriate Council and if the Commissioner decides not to conduct the investigation into the complaint under section 147A.
(2) The independent investigator is to report to the Council on his or her investigation of the complaint.
(3) This Part applies to any such investigation as if it were conducted by the Council (except that the decision on the complaint is to be made by the Council after consideration of the report of the independent investigator).
(4) A complaint is to be referred for an independent investigation if the Council is satisfied that it is in the interests of justice or in the public interest to do so.
(5) A Council is to provide any assistance required by the independent investigator to conduct an investigation into a complaint (including copies of or access to all documents held by the Council that relate to the complaint or are required for the purpose of investigating the complaint).
(6) The independent investigator is to provide a copy of his or her report on the investigation to the Commissioner.
152. Powers of Council or Commissioner when investigating complaint
(1) For the purpose of investigating a complaint, a Council or the Commissioner may require the legal practitioner against whom the complaint is made to provide information or to produce documents, and to verify any such information by statutory declaration.
(2) If a legal practitioner against whom a complaint is made claims a lien over documents relating to the matter the subject of the complaint, the Council or the Commissioner may require the legal practitioner to waive the lien if satisfied it is necessary for the orderly transaction of the client’s business.
(3) A requirement under this section is to be notified in writing to the legal practitioner and is to specify a reasonable time for compliance.
(4) A legal practitioner who, without reasonable excuse, fails to comply with such a requirement is guilty of professional misconduct.
154. Investigation to be conducted expeditiously
An investigation by a Council or the Commissioner is to be conducted as expeditiously as possible.
155. Decision after investigation of complaint
(1) After a Council or the Commissioner has completed an investigation into a complaint against a legal practitioner, the complaint is to be dealt with in accordance with this section.
(2) The Council or the Commissioner must institute proceedings in the Tribunal with respect to the complaint against the legal practitioner if satisfied that there is a reasonable likelihood that the legal practitioner will be found guilty by the Tribunal of unsatisfactory professional conduct or professional misconduct.
(3) However, if the Council or the Commissioner is satisfied that there is a reasonable likelihood that the legal practitioner will be found guilty by the Tribunal of unsatisfactory professional conduct (but not professional misconduct), the Council or the Commissioner may instead:(a) reprimand the legal practitioner or interstate legal practitioner if the legal practitioner consents to the reprimand; or
(b) dismiss the complaint if satisfied that the legal practitioner is generally competent and diligent and that no other material complaints have been made against the legal practitioner.
(4) The Council or the Commissioner is to dismiss the complaint against the legal practitioner if satisfied that there is no reasonable likelihood that the legal practitioner will be found guilty by the Tribunal of either unsatisfactory professional conduct or professional misconduct.
(5) If a Council or the Commissioner decides to dismiss a complaint or to reprimand a legal practitioner under subsection (3) and the complainant requested a compensation order in connection with the complaint, the Council or the Commissioner may require the payment of compensation by the legal practitioner or interstate legal practitioner or the successful mediation of the consumer dispute before the decision takes effect.
156. Record of decision after investigation of complaint
A Council or the Commissioner must cause a record of its decision with respect to a complaint, together with the reasons for the decision, to be kept in respect of each investigation conducted under this Division.
Division 7 Constitution of the Legal Services Tribunal
162. The Legal Services Tribunal(1) There is constituted by this Act a Legal Services Tribunal.
(2) The Tribunal is to consist of
(a) at least 2 barristers appointed by the Attorney General after consultation with the Bar Council; and
(b) at least 2 solicitors appointed by the Attorney General after consultation with the Law Society Council; and
(c) at least 2 lay members appointed by the Attorney General after consultation with lay members of the Legal Aid Commission, the Law Foundation and such other bodies as the Attorney General considers appropriate.
(3) The Attorney General, after consultation with the Bar Council and the Law Society Council, may appoint a barrister member or a solicitor member to be the President of the Tribunal.
(4) The Tribunal is to have a seal of which all courts and persons acting judicially are to take judicial notice.
(5) Every document requiring authentication by the Tribunal may be sufficiently authenticated without the seal of the Tribunal if signed by the President of the Tribunal or by a member of the Tribunal authorised to do so by the President.
(6) A Registrar of the Tribunal is to be appointed under Part 2 of the Public Sector Management Act 1988
(7) Schedule 6 has effect with respect to the Tribunal.
Division 7---Applications to the Tribunal
167. Institution of proceedings and hearings
(1) Proceedings may be instituted in the Tribunal with respect to a complaint against a legal practitioner by an information laid by the appropriate Council or the Commissioner in accordance with this Part.
(2) The Tribunal is to conduct a hearing into each such complaint.
(3) Before the commencement of the hearing, the legal practitioner must file a reply to the allegations in the information in accordance with the rules of the Tribunal and the directions of the Registrar of the Tribunal.
(4) The Tribunal may, subject to its rules and the rules of procedural fairness, order the joinder of any 2 informations against the same or different legal practitioners.
167A. Tribunal may vary an information
(1) The Tribunal may, on the application of a Council or the Commissioner who laid an information, vary the information laid so as to omit allegations or to include additional allegations if the Tribunal is satisfied, having regard to all the circumstances, that it is reasonable to do so.
(2) Without limiting subsection (1), when considering whether or not it is reasonable to vary an information, the Tribunal is to have regard to whether varying the information will affect the fairness of the proceedings.
168. Rules of evidence
(1) For the purpose of conducting a hearing into a question of professional misconduct, the Tribunal is to observe the rules of law governing the admission of evidence.
(2) For the purpose of conducting any other hearing, the Tribunal is not bound to observe the rules of law governing the admission of evidence, but may inform itself of any matter in such manner as it thinks fit.
171C. Determinations of Tribunal
(1) If, after it has completed a hearing relating to a complaint against a legal practitioner, the Tribunal is satisfied that the legal practitioner is guilty of professional misconduct or unsatisfactory professional conduct, the Tribunal may do any one or more of the following:(a) order that the name of the legal practitioner be removed from the roll of legal practitioners if the legal practitioner is guilty of professional misconduct;
(b) order that the legal practitioner's practising certificate be cancelled;
(c) order that a practising certificate not be issued to the legal practitioner until the end of the period specified in the order;
(d) order that the legal practitioner pay a fine specified in the order, not exceeding $50,000 if the legal practitioner is guilty of professional misconduct or not exceeding $5,000 if the legal practitioner is guilty of unsatisfactory professional conduct;
(g) in the case of a solicitor, make any one or more of the orders referred to in subsection (2);
(e) publicly reprimand the legal practitioner or, if there are special circumstances, privately reprimand the legal practitioner;
(f) order that the legal practitioner undertake and complete a course of further legal education specified in the order;
(h) if applicable, make a compensation order;(i) make ancillary orders.
(2) In the case of a solicitor, the Tribunal may do any one or more of the following:(a) order that the practising certificate of any associated solicitor corporation be cancelled or that a practising certificate not be issued to any associated solicitor corporation until the end of the period specified in the order;
(b) order that the solicitor's practice, or the practice of any associated solicitor corporation, be subject to periodic inspection by the person, and for the period, specified in the order;
(c) order that the solicitor seek advice in relation to the management of the solicitor's practice, or the practice of any associated solicitor corporation, from the person specified in the order;
(d) order that the solicitor, or any associated solicitor corporation, cease to employ in the solicitor's practice or the solicitor corporation's practice the person specified in the order;
(e) order that the solicitor, or any associated solicitor corporation, employ in the solicitor's practice or the solicitor corporation's practice a person belonging to the class of persons specified in the order;
(f) order that the solicitor, or any associated solicitor corporation, cease to accept instructions in relation to the class of legal services specified in the order;
(g) order that the solicitor's practising certificate be endorsed with a condition restricting the solicitor from acting as a solicitor otherwise than in the course of employment by a solicitor holding an unrestricted practising certificate.
Division 9---Notifications to complainant and legal practitioner
171J. Notification of decisions of Council or Commissioner
(1) A Council or the Commissioner must cause the decision with respect to a complaint, together with the reasons for the decision, to be notified in writing to the complainant and to the legal practitioner against whom the complaint was made.
(2) In the case of a decision of a Council to dismiss the complaint or reprimand the legal practitioner, the right of the complainant to apply to the Commissioner for a review of the decision must also be included in the notice to the complainant.
(3) A notice to a complainant is not required under this section if the complaint was made by the Commissioner or a Council.
APPENDIX BArunta Investments - Arunta Investments Pty Ltd
AAH - Messrs Allen Allen & Hemsley, solicitorsA & H - Atanaskovic Hartnell, solicitors
the Arunta Companies - various companies constituting the Arunta Group of Companies.
Carneys - Solicitors representing Rajski and Raybos in 1985the Claimant - Mr Nicholas Roderick Carson
CMAD - Computer Manufacture and Design Pty Ltd
Davidson - Mr Christopher Davidson - DW employed solicitor and later a partner
Donaldson - Mr Alexander Donaldson - former Tectran Engineer
DPP - Commonwealth Director of Public Prosecutions
DW - Dawson Waldron
Fairfax - John Fairfax and Sons Ltd, publishers of the SMH
Gavemer - Gavemer Properties Pty Ltd - company in the Arunta Group.
Hewett - Mr John Hewett - Murphy & Moloney Solicitors
LAC - Legal Aid Commission - formerly known as Legal Services Commission of NSW
LSC - Legal Services Commissioner, appointed under the Legal Profession Act 1987
Lake - Mr Raol Lake - DW employed solicitor
McCarthy - Catherine McCarthy - paralegal at DW
Metcalf - Dr William Metcalf - psychiatrist
Murray - Craig Murray, solicitor of DW
O’Brien - Mr Mark O’Brien - Solicitor with Messrs Turnbull McWilliam instructed by Metcalf in defamation proceedings brought by DW
Parsons - Detective Inspector Parsons.
Pavlakis - John Pavlakis, partner in DW
Prometheus - Prometheus Pty Ltd
Rajski - Leszek Rajski
Raybos - Raybos Australia Pty Ltd
Richardson - Mr Garry Richardson - Chairman of Board of Tectran, Scitec and Arunta
Scitec - Arunta Properties (NSW) Pty Ltd - formerly known as Scitec Corporation Pty Ltd
Shand - Dr John Shand - psychiatrist retained by DW in relation
to RajskiSlee - Mr John Slee,- journalist the author of columns in SMH the subject of defamation proceedings.
the SMH - Sydney Morning Herald
Tectra n - Tectran Corporation Pty Ltd
the Tribunal - Legal Services Tribunal, constituted by the Legal Profession Act 1987
Ward - Mr John Ward - Murphy & Molony - solicitor handling Metcalf defamation matter on behalf of DW
Wilkinson - Mr Verne Wilkinson - Arunta executive
Wood - Mr Adrian Wood - former Tectran Engineer
Yerushalmy - Mr Moshe Yerushalmy - Managing Director of Tectran and Scitec
APPENDIX C
Relevant Authorities
Ainsworth v Criminal Justice Commission (1992) 175 CLR 564)Ainsworth v Hanrahan (1991) 25 NSWLR 155
Annetts v McCann (1990) 170 CLR 596
Associated Provincial Picture Houses v Wednesbury Corporation [1948] 1 KB 223.
Barwick v The Law Society of NSW (Court of Appeal, unreported, 16 July 1998)
Calvin v Carr [1979] 1 NSWLR 1
Commissioner of Police v Reid (1989) 16 NSWLR 453
Flower and Hart (a firm) v White Industries (Qld) Pty Ltd [1999] FCA 773
Harman v Secretary of State for the Home Department [1983] 1 AC 280
Herron v McGregor (1986) 6 NSWLR 246
Hunter v Chief Constable of the West Midlands Police [1982] AC 529 at 536
In the Matter of Thomas James Wallace (1866) L R 1283
Jago v District Court (NSW) (1989) 168 CLR 23
Kioa v West (1985) 159 CLR 550
Murray v Legal Services Commissioner and Another [1999] NSW CA 70
Oates v The Honourable Daryl Williams (in his capacity as the Attorney General of Australia) and Senator Amanda Vanstone (in her capacity as the Minister for Justice for the Commonwealth of Australia) , (1998) 84 FLR 348
Rajski v Bainton (1990) 22 NSWLR 125, 146A
Rajski v Computer Manufacture and Design Pty Ltd [1982] 2 NSWLR 443
Rajski v CMAD [1983] 2 NSWLR 122 at 127
Raybos Australia Pty Ltd v Tectran Corporation Pty Ltd (1986) 6 NSWLR 674
Rondel v Worsley [1969] 1 AC 191, 275
S v M (The Times, 26 March 1988)
Szerdahelyi v Bailey (unreported, 28 August 1997)
Tectran Corporation Limited and Others v Raybos Australia Pty Limited and Another (unreported, 5 June 1985)
Tectran Corporation Pty Limited v Legal Aid Commission of NSW (1986) 7 NSWLR 340
Twist v Randwick Municipal Council (1976) 136 CLR 106
Walton v Gardiner (1993) 177 CLR 378 at 393
Wentworth v Rogers (No.12) (1987) 9 NSWLR 400
White Industries (Qld) Pty Ltd v Flower and Hart (a firm) (unreported, 14 July 1998)
APPENDIX D
The 1980 proceedings :
The statement of claim issued by Tectran in December 1980 claiming damages from Rajski and Raybos for alleged breaches of contract in relation to the effectiveness of Raybol; together with a cross claim filed by Raybos in February 1981.The CMAD proceedings :
The statement of claim issued by Rajski and Raybos in 1981 against CMAD, Prometheus, and Tectran alleging breach of confidentiality in relation to Raybol.The 1985 proceeding :
Statement of claim issued by Rajski and Raybos against Tectran, Scitec, Arunta Investments, some individuals, the partners of AAH, alleging conspiracy and abuse of process.The LAC proceeding :
Summons issued in the Administrative Law Division of the Supreme Court on behalf of the Arunta Companies and Executives against the LAC concerning the grant of legal aid to Rajski and Raybos.The Carneys defamation proceedings :
Action in defamation against the partners of Carneys by Gavemer, Arunta Investments, Richardson and Yerushalmy.The first contempt proceeding :
Summons issued by Rajski in the Court of Appeal in November 1985 alleging contempt against the claimant.The fraud proceeding :
Statement of claim issued by Tectran in January 1986 alleging fraud against Rajski in relation to the agreement to sell Raybol.The 1986 proceeding :
Statement of claim issued by Rajski and Raybos in July 1986 alleging conspiracy against the claimant and the partners of DW.The second contempt proceeding:
Notice of motion filed in the Court of Appeal by Rajski in April 1987 alleging contempt against the claimant.The Fairfax defamation proceedings :
Actions in defamation brought by the claimant against Fairfax and Slee, heard in June 1989.**********
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