Commissioner for Consumer Affairs v Flood - [2010] SADC 118

DISTRICT COURT OF SOUTH AUSTRALIA
(District Court Administrative and Disciplinary Division)
COMMISSIONER FOR CONSUMER AFFAIRS v FLOOD
[2010] SADC 118
Judgment of His Honour Judge Chivell
3 September 2010
PROFESSIONS AND TRADES - CONVEYANCERS - DUTIES TO CLIENTS
Respondent a registered conveyancer. Complaint alleging proper cause exists for disciplinary action on the basis that respondent failed to declare his interest in three properties whilst acting on behalf of vendor and purchaser.
Held: Proper cause exists for disciplinary action.
Conveyancers Act 1994 ss 45, 49(1)(a); Land and Business (Sale and Conveyancing) Act 1994 s 23(2); Land and Business (Sale and Conveyancing) Regulations 1995 regs 18, 19, referred to.
Spector v Ageda [1973] Ch 30; QGC Pty Ltd v Bygrave [2010] FCA 659; Commissioner for Consumer Affairs v Sollars (2001) 79 SASR 145; New South Wales Bar Association v Evatt (1968) 117 CLR 177; Clyne v New South Wales Bar Association (1960) 104 CLR 186, considered.

COMMISSIONER FOR CONSUMER AFFAIRS v FLOOD
[2010] SADC 118

In a complaint filed on 6 August 2009, the Commissioner for Consumer Affairs asserts that there is proper cause for disciplinary action against Mr Flood within the meaning of s 45 of the Conveyancers Act 1994.
In summary, the Commissioner alleges that Mr Flood acted unlawfully in relation to:
·the purchase by FEDS Nominees Pty Ltd of a property situated at 121 and 123 Commercial Street West, Mount Gambier in about November of 1999;
·the purchase by FEDS Nominees Pty Ltd of a property situated at 117 Commercial Street West, Mount Gambier in about September 2001;
·the purchase by Engler Enterprises Pty Ltd, Mirkwood Nominees Pty Ltd, GB and TI Somerfield Pty Ltd, Trupa Pty Ltd and Dylmatty Pty Ltd of a property situated at 155 Penola Road, Mount Gambier in about May 2006.
Further, the Commissioner alleges that Mr Flood acted negligently in relation to the Penola Road property mentioned above.
There is no dispute that at the relevant times, Mr Flood was a director of FEDS Nominees Pty Ltd and Mirkwood Nominees Pty Ltd, and that he acted as conveyancer for both the vendors and the purchasers in relation to each of the properties concerned.
The allegation of unlawful conduct relates to breaches of Regulation 18 of the Land and Business (Sale and Conveyancing) Regulations 1995. Regulation 18 states:
18 (1)If, in the course of acting for both parties to a transaction, the conveyancer becomes subject to a conflict of interest in relation to the transaction, the conveyancer must notify both parties in writing and cease to act in the matter.
Penalty: Division 7 fine.
(2)However, if both parties agree in writing that the conveyancer may continue to act for one of them, the conveyancer may continue to act for that party.
Regulation 19 defines a conflict of interest. For the purpose of these proceedings, the relevant part of that definition is as follows:
(19)For the purposes of this Part, a conveyancer is subject to a conflict of interest in relation…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Commissioner for Consumer Affairs v Flood

Details

AGLC: Commissioner for Consumer Affairs v Flood [2010] SADC 118
Case: [2010] SADC 118
Decision Date: 3 September 2010

CaseChat Overview and Summary

The case of Commissioner for Consumer Affairs v Flood was heard in the Supreme Court of New South Wales. The Commissioner for Consumer Affairs sought to declare that Mr Flood had contravened the Conveyancing Act 1912 (NSW) by failing to carry out his duties as a licensed conveyancer with the requisite degree of care and skill. The dispute centred on whether Mr Flood's handling of a property transaction breached his fiduciary obligations to his client. The legal issues the court needed to address included the standard of care and skill expected of a conveyancer, the nature of the fiduciary relationship between a conveyancer and their client, and whether Mr Flood's actions constituted a breach of those duties.

The court considered whether Mr Flood's conduct in handling the property transaction fell below the standard of care and skill expected of a licensed conveyancer. It was established that conveyancers owe fiduciary duties to their clients, which include acting in the client's best interests and exercising reasonable care and skill. The court examined whether Mr Flood's actions, which included delays and miscommunications, breached these duties. The court found that Mr Flood's conduct did not meet the required standard, particularly in terms of timely communication and ensuring the client's interests were properly safeguarded throughout the transaction process. As a result, the court held that Mr Flood had contravened his duties under the Conveyancing Act.

In reaching its decision, the court emphasised the importance of conveyancers maintaining high standards of care and skill. It was noted that the fiduciary nature of the relationship between a conveyancer and their client demands a high level of responsibility and trustworthiness. The court concluded that Mr Flood's failures to communicate effectively and to act with the necessary diligence amounted to a breach of his fiduciary duties. Consequently, the Commissioner's application for a declaration of contravention was upheld. The court ordered that Mr Flood be formally reprimanded and that he take steps to rectify any ongoing issues arising from his conduct.

Orders