Council of the Law Society of New South Wales v Levitt

[2018] NSWCA 247

Court of Appeal

Supreme Court

New South Wales

• Summary available
• Amendment notes

Medium Neutral Citation:

Council of the Law Society of New South Wales v Levitt [2018] NSWCA 247

Hearing dates:

31 May 2018

Decision date:

26 October 2018

Before:

McColl JA at [1];
Basten JA at [91];
Macfarlan JA at [123]

Decision:

Appeal dismissed with costs, such costs to include the costs of the application for leave to appeal

Catchwords:

ADMINISTRATIVE LAW – judicial review – application for judicial review of decisions of Council of Law Society of New South Wales determining complaints against a solicitor pursuant to s 537(2) of the Legal Profession Act 2004 (NSW) – where Council resolved it was satisfied there was a reasonable likelihood of Civil and Administrative Tribunal concluding solicitor guilty of professional misconduct – whether requirement to consider s 540 as condition precedent to operation of s 537(2) of the Legal Profession Act 2004 (NSW)

 

ADMINISTRATIVE LAW – judicial review – application for judicial review of decisions of Council of Law Society of New South Wales determining complaints against a solicitor – construction of ss 537(2) and 540 of the Legal Profession Act 2004 (NSW) – whether conclusion by Council it was satisfied there was a reasonable likelihood of Civil and Administrative Tribunal concluding solicitor was guilty of professional misconduct precluded it also being satisfied of finding of reasonable likelihood of Tribunal concluding solicitor was guilty of unsatisfactory professional conduct

 

STATUTORY INTERPRETATION – where Council resolved it was satisfied there was a reasonable likelihood of Tribunal concluding solicitor was guilty of professional misconduct – whether s 537(2) of the Legal Profession Act (NSW) requires Council also to consider whether there is a reasonable likelihood of a finding of unsatisfactory professional conduct

WORDS AND PHRASES – “unless” – “reasonable likelihood” – Legal Profession Act 2004 (NSW), s 537, s 540

Legislation Cited:

Circuit Layouts Act 1989 (Cth)
Justice Legislation Amendment Act (No 2) 2018 (NSW)
Legal Profession Act 1987 (NSW)
Legal Profession Act 2004 (NSW)
Legal Profession (Amendment) Act 1987 (NSW)
Legal Profession Reform Act 1993 (NSW)
Legal Profession Uniform Law Application Act 2014 (No 16) (NSW)
Legal Profession Uniform Law (NSW)
Supreme Court Act 1970 (NSW)

Cases Cited:

Barwick v Law Society of New South Wales [2000] HCA 2; (2000) 74 ALJR 419
Carson v Legal Services Commissioner [2000] NSWCA 308
Centronics Systems Pty Ltd v Nintendo Co Ltd (1992) 24 IPR 481
Chase Oyster Bar Pty Ltd v Hamo Industries Pty Ltd (2010) 78 NSWLR 393; [2010] NSWCA 190
CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384; [1997] HCA 2
Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503; [2012] HCA 55
Council of the Law Society of New South Wales v Levitt [2017] NSWCATOD 126
Donaghy v The Council of The Law Society of New South Wales [2013] NSWCA 154
Donaghy v Council of the Law Society of NSW (No 2) [2015] NSWCA 224
Konstantinidis v Council of the Law Society of New South Wales [2018] NSWCA 59
Lo v Chief Commissioner of State Revenue (2013) 85 NSWLR 86; [2013] NSWCA 180
Menon v Council of the Law Society of New South Wales [2016] NSWSC 1322
Murray v Legal Services Commissioner (1999) 46 NSWLR 224; [1999] NSWCA 70
Nintendo Co Ltd v Centronics Systems Pty Ltd (1994) 181 CLR 134; [1994] HCA 27
Prothonotary of the Supreme Court of New South Wales v Thomson [2018] NSWCA 230
Regional Express Holdings Ltd v Australian Federation of Air Pilots [2017] HCA 55; (2017) 92 ALJR 134
Russo v Legal Services Commissioner [2016] NSWCA 306
SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; (2017) 91 ALJR 936
Walsh v Law Society of New South Wales (1999) 198 CLR 73; [1999] HCA 33
Wentworth v New South Wales Bar Association (1992) 176 CLR 239
Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43

Texts Cited:

NSW Law Reform Commission, Second Report on the Legal Profession: Complaints, Discipline and Professional Standards, (1982)
NSW Law Reform Commission, Discussion Paper No 26: Scrutiny of the Legal Profession – Complaints Against Lawyers, (May 1992)
New South Wales Law Reform Commission, Scrutiny of the Legal Profession: Complaints against Lawyers, Report 70 (1993)
New South Wales, Attorney General’s Department, Reform of the System of Complaints Against Legal Practitioners, (May 1993)
New South Wales, Attorney General’s Department, Draft Legal Profession Reform Bill and Explanatory Statement, (June 1993)
Legal Professional Reform Bill, New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 16 September 1993
Legal Profession Reform Bill, New South Wales Legislative Council, Parliamentary Debates (Hansard), 16 September 1993
Legal Profession Reform Bill (No 2), New South Wales Legislative Council, Parliamentary Debates (Hansard), 27 October 1993
New South Wales Law Reform Commission, Complaints against Lawyers: An Interim Report, Report 99 (April 2001)
Attorney General’s Department, Further Review of Complaints Against Lawyers, (November 2002)
Legal Profession Bill 2004 (NSW), Explanatory Note
Parliamentary Counsel’s Committee, Model Provisions, (28 June 2004)
New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 7 December 2004
M Aronson, M Groves and G Weeks, Judicial Review of Administrative Action and Government Liability (6th ed, Law Book Co 2017)

Category:

Principal judgment

Parties:

Council of the Law Society of NSW (Appellant)
Stewart Alan Levitt (Respondent)

Representation:

Counsel:
C Webster SC with G Johnson (Appellant)
B Walker SC with G Ng (Respondent)

  Solicitors:
Anne-Marie Foord (Appellant)
Chrystalla Georgiou (Respondent)

File Number(s):

2017/228655

Publication restriction:

No

 Decision under appeal 

Court or tribunal:

Supreme Court of NSW

Jurisdiction:

Common Law

Citation:

[2017] NSWSC 834

Date of Decision:

29 June 2017

Before:

Wilson J

File Number(s):

2016/182480

HEADNOTE

[This headnote is not to be read as part of the judgment]

After investigating two complaints made against the respondent, Stewart Alan Levitt, the Law Society of NSW (the Council) resolved pursuant to s 537(2) of the Legal Profession Act 2004 (NSW) (LPA 2004) to refer each complaint for consideration by the NSW Civil and Administrative Tribunal (Tribunal) on the basis that it was satisfied there was a reasonable likelihood that Mr Levitt would be found by the Tribunal to have engaged in professional misconduct.

Section 537(2) of the LPA 2004 provides that “unless s 540 [of the LPA 2004] applies”, after completing its investigation into complaints against legal practitioners, the Council is required to commence proceedings in the Tribunal if it is satisfied that there is a “reasonable likelihood” that the legal practitioner will be found by the Tribunal to have engaged in unsatisfactory professional conduct or professional misconduct. Section 540 applies if, amongst other factors, the Council is satisfied that there is a “reasonable likelihood” that the legal practitioner will be found by the Tribunal to have engaged in unsatisfactory professional conduct (but not professional misconduct).

Mr Levitt filed a summons in the Supreme Court of NSW seeking declaratory and other relief against the Council in respect of its resolutions. He complained in relation to each resolution that the Council failed to consider the possible summary conclusion of the complaints pursuant to s 540. He also complained that the Council failed in respect of each resolution to consider whether, on the facts as it found them to be, there was a reasonable likelihood of the Tribunal concluding that he was guilty of professional misconduct at all, as opposed to some lesser course of conduct, and also erred in failing to take into account exculpatory material he advanced and consider how such material might impact upon the conclusions the Tribunal could reach.

The primary judge, Wilson J, made orders quashing the decisions of the Council and restraining it from taking further steps in the Tribunal proceedings in respect of its resolutions. Her Honour held that consideration of the application of s 540 of the LPA 2004 was a “preliminary consideration to which the decision maker must advert before concluding that proceedings should be commenced in the Tribunal”.

The primary judge also inferred from the absence of any reference in the Council’s reasons for determining the two complaints to suggest that it considered s 540, and the possible disposal of the complaints under that section, that the Council had not turned its corporate mind to that issue, nor to exculpatory matters Mr Levitt had advanced.

The principal issues on appeal were:

(i) Whether the primary judge erred in construing ss 537 and 540 of the LPA 2004 in finding that s 540 was a “preliminary consideration to which the decision maker must advert before concluding that proceedings should be commenced in the Tribunal”.

(ii)   Whether the primary judge erred in finding that the Council failed in respect of each decision to consider whether on the facts found there was a reasonable likelihood of the Tribunal concluding that Mr Levitt was guilty of professional misconduct at all, or of some lesser course of conduct.

Held, per McColl JA and Macfarlan JA (Basten JA dissenting), dismissing the appeal:

As to issue (i)

Per McColl JA:

(1) LPA 2004, s 537 and s 540, must be construed by reference to their text whilst, at the same time, having regard to the context (including legislative history and extrinsic materials) and purpose: at [53].

SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; (2017) 91 ALJR 936; Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503; [2012] HCA 55 applied.

(2) The phrase “unless s 540 applies” in s 537(2) of the LPA 2004 means that provision has to be read with s 540. The structure of s 537(2) is that in considering what step to take in respect of a complaint following an investigation which is not to lead to the dismissal of the complaint, the relevant decision-maker must undertake a compound exercise which includes predicting the likely outcome in the Tribunal having regard to the nature of the conduct which may be referred to it, but, too, considering whether s 540 (summary conclusion of complaint) applies: at [56] – [58].

Per Macfarlan JA:

(3) If, for the purposes of s 537(2), the Council concludes that there is a reasonable likelihood of a finding of unsatisfactory professional conduct, there will clearly be room for the possible operation of s 540 as that section is essentially concerned with such conduct. It permits the complaint procedure to be brought to a summary conclusion in certain circumstances.

Per Basten JA (dissenting):

(4) Section 540 only applied if there was a reasonable likelihood of a finding of unsatisfactory professional conduct but no reasonable likelihood that the Tribunal would find professional misconduct: at [105] – [107].

As to issue (ii), per McColl JA (Basten and Macfarlan JJA not deciding)

(1) The primary judge did not err in inferring from the absence from the Council’s reasons for each resolution of any consideration of the matters set out in s 540(1)(b) which it was required to consider, that it did not do so: at [69].

**********

Judgment

1. McCOLL JA: By a notice of appeal filed on 11 December 2017, the appellant, the Council of the Law Society of New South Wales (Council), appeals against Wilson J’s judgment quashing and setting aside proceedings commenced by the Council pursuant to s 537 of the Legal Profession Act 2004 (NSW) (LPA 2004) in the NSW Civil and Administrative Tribunal (Tribunal) against the respondent, Stewart Alan Levitt, and restraining the Council from taking further steps in the proceedings. [1] Leave to appeal was granted on 5 December 2017.

   1. Levitt v Council of the Law Society of New South Wales [2017] NSWSC 834.

2. The proceedings arise out of the decisions the Council took after investigating two complaints made against Mr Levitt. The Council resolved pursuant to s 537(2) of the LPA 2004 (which appears in Ch 4) to refer each complaint for consideration by the Tribunal on the basis that it was satisfied there was a reasonable likelihood that Mr Levitt would be found by the Tribunal to have engaged in professional misconduct.

3. Mr Levitt complained in relation to each of the decisions that the Council failed to consider the possible summary disposal of the complaints pursuant to s 540 of the LPA 2004. He also complained that the Council failed in respect of each decision to consider whether, on the facts as it found them to be, there was a reasonable likelihood of the Tribunal concluding that he was guilty of professional misconduct at all, as opposed to some lesser course of conduct, and to take into account exculpatory material he advanced and consider how such material might impact upon the conclusions the Tribunal could reach. [2]

   2. Ibid at [29].

4. Two issues arise on appeal. First, the proper construction of ss 537 and 540 of the LPA 2004, and, in particular, whether the possible application of s 540 is a “preliminary consideration to which the decision maker must advert before concluding that proceedings should be commenced in the Tribunal.”[3] Secondly, whether the primary judge erred in finding that the Council failed in respect of each decision to consider whether on the facts found there was a reasonable likelihood of the Tribunal concluding that Mr Levitt was guilty of professional misconduct at all, or of some lesser course of conduct.

   3. Ibid at [31].

5. For the reasons that follow, I would dismiss the appeal with costs.

Legislative framework

6. The LPA 2004 was repealed by s 167(a) of the Legal Profession Uniform Law Application Act 2014 (No 16) (NSW) (Application Act) with effect from 1 July 2015. [4] There was no dispute that Ch 4 of the LPA continued to apply to the complaints against Mr Levitt by virtue of the operation of cl 26, Sch 4, (Savings and transitional provisions), to the Legal Profession Uniform Law (NSW) (Uniform Law). The Uniform Law applies as a law of New South Wales by reason of the Application Act, s 4.

   4.    Despite its repeal, it is convenient to speak of the LPA 2004 in the present tense in these reasons.

7. The relevant provisions are found in Ch 4 (Complaints and discipline) of the LPA 2004. Division 1 (Preliminary) relevantly provides:

494 Purposes and objects

(1)  The purposes of this Chapter are as follows:

(a) to provide a nationally consistent scheme for the discipline of the legal profession in this jurisdiction, in the interests of the administration of justice and for the protection of clients of law practices and the public generally,

(b) to promote and enforce the professional standards, competence and honesty of the legal profession,

(c) to provide a means of redress for complaints about lawyers, …

(2)  The objects of this Chapter relating to lay persons and the clients of law practices are as follows:

(a)  to give every person the right to complain about the conduct of lawyers,

…

(h)  to give complainants the right to seek an independent review of decisions of Councils to dismiss complaints or reprimand Australian legal practitioners.

(3)  The objects of this Chapter relating to the providers of legal services are as follows:

…

(b) to ensure that the rules of natural justice (being rules for procedural fairness) are applied to any disciplinary proceedings taken against lawyers,

(c) to ensure that lawyers are aware of the standards of honesty, competence and diligence expected of them.

8. For the purposes of the LPA 2004, “unsatisfactory professional conduct” “includes conduct of an Australian legal practitioner occurring in connection with the practice of law that falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent Australian legal practitioner”: s 496. “Professional misconduct” includes: “(a) unsatisfactory professional conduct of an Australian legal practitioner, where the conduct involves a substantial or consistent failure to reach or maintain a reasonable standard of competence and diligence, and (b) conduct of an Australian legal practitioner whether occurring in connection with the practice of law or occurring otherwise than in connection with the practice of law that would, if established, justify a finding that the practitioner is not a fit and proper person to engage in legal practice”: s 497(1). Section 498 identifies a range of conduct which is capable of being unsatisfactory professional conduct or professional misconduct.

9. Part 4.2 (Complaints about Australian legal practitioners) deals with the making of complaints. It obliges either the Legal Services Commissioner (Commissioner) or the Council by which a complaint is made or to which a complaint is referred for investigation, “to ensure that as soon as practicable after the complaint is made the Australian legal practitioner about whom the complaint is made is given … a copy of the complaint” and to inform the practitioner of the “right to make submissions to the Commissioner or Council” (s 508). The Australian legal practitioner about whom a complaint is made may make submissions to the Commissioner or Council about the complaint or its subject-matter or both (s 509(1)). The Commissioner or Council must consider the submissions made before deciding what action is to be taken in relation to the complaint (s 509(3)).

10. The Commissioner, or the Council by which a complaint is made or to which a complaint is referred for investigation, may dismiss a complaint summarily in the circumstances set out in s 511. To that end, it may conduct a preliminary assessment of the complaint for the purpose of assessing its substance: s 510(1).

11. If a complaint is not dismissed summarily, or withdrawn, or referred for mediation, it must be investigated under Pt 4.4 by the relevant Council or the Commissioner: s 525 – s 527.

12. Part 4.5 (Decision of Commissioner or Council) provides:

537 Decision of Commissioner or Council after investigation

(1) After completion of an investigation of a complaint against an Australian legal practitioner, the Commissioner or a Council must:

(a) commence proceedings in the Tribunal under this Chapter, or

(b) dismiss the complaint under this Part, or

(c) take action under section 540 (Summary conclusion of complaint procedure by caution, reprimand, compensation order or imposition of conditions)).

(2) Unless section 540 (Summary conclusion of complaint procedure by caution, reprimand, compensation order or imposition of conditions) applies, the Council or the Commissioner must commence proceedings in the Tribunal with respect to a complaint against an Australian legal practitioner if satisfied that there is a reasonable likelihood that the practitioner will be found by the Tribunal to have engaged in unsatisfactory professional conduct or professional misconduct.

(3) Nothing in this section affects section 512 (Withdrawal of complaints). [Emphasis added.]

538 Decision of Commissioner or Council without investigation

(1) This section applies to a complaint against an Australian legal practitioner, where the Commissioner or relevant Council is satisfied that, having regard to the nature of the subject-matter of the complaint and the reasonable likelihood that the Tribunal will find that the practitioner has engaged in unsatisfactory professional conduct or professional misconduct, action should be taken under this section.

(2) The Commissioner or Council may commence proceedings in the Tribunal under this Chapter in relation to a complaint to which this section applies without the need to commence or complete an investigation.

(3) A Council is not to commence proceedings pursuant to this section unless the Commissioner concurs.

539 Dismissal of complaint

(1) After completion of an investigation of a complaint against an Australian legal practitioner, the Commissioner or a Council may dismiss the complaint in whole or in part if satisfied that:

(a) there is no reasonable likelihood that the practitioner will be found by the Tribunal to have engaged in either unsatisfactory professional conduct or professional misconduct, or

(b) it is in the public interest to do so.

(2) The Commissioner or Council may make a compensation order under Part 4.9 if the complaint is dismissed under this section on the ground of the public interest and the complainant requested a compensation order in respect of the complaint.

540 Summary conclusion of complaint procedure by caution, reprimand, compensation order or imposition of conditions

(1) This section applies if:

(a) either:

(i) the Commissioner or a Council completes an investigation of a complaint against an Australian legal practitioner, or

(ii) the report of an independent investigator is given to the Commissioner , and

(b) the Commissioner or Council (as the case requires):

(i) is satisfied that there is a reasonable likelihood that the practitioner would be found by the Tribunal to have engaged in unsatisfactory professional conduct (but not professional misconduct), and

(ii) is satisfied that the practitioner is generally competent and diligent, and

(iii) is satisfied that the taking of action under this section is justified having regard to all the circumstances of the case (including the seriousness of the conduct concerned) and to whether any other substantiated complaints have been made against the practitioner.

(2) The Commissioner or Council may do any or all of the following:

(a) caution the practitioner,

(b) reprimand the practitioner,

(c) make a compensation order under Part 4.9 if the complainant requested a compensation order in respect of the complaint,

(d) determine that a specified condition be imposed on the practitioner’s practising certificate.

(3) Failure to attend as required by the Commissioner or Council to receive a caution or reprimand is capable of being professional misconduct.

(4) If action is taken under subsection (2), no further action is to be taken under this Chapter with respect to the complaint.

(5) If the Commissioner or Council decides to reprimand or make a compensation order against an Australian legal practitioner under this section, or that a condition be imposed on an Australian legal practitioner’s practising certificate under this section, the practitioner may apply to the Tribunal for an administrative review under the Administrative Decisions Review Act 1997 of the decision.

(6) If the Commissioner determines that a specified condition be imposed on a practising certificate, the appropriate Council is required to impose and maintain the condition. The condition may be amended, suspended, reinstated or revoked with the concurrence of the Commissioner.

…

542 Reasons to be provided to complainant and practitioner

(1)  If a complaint has been made about an Australian legal practitioner, the complainant and the practitioner are entitled to receive a statement of reasons from the Commissioner or Council, as the case requires, in relation to:

(a) a decision to dismiss the complaint, or

(b) a decision to commence proceedings in the Tribunal with respect to the complaint, or

(c) a decision to take action under section 540 (Summary conclusion of complaint procedure by caution, reprimand, compensation order or imposition of conditions), or

(d) a decision to omit, from the allegations particularised in a disciplinary application made to the Tribunal in respect of the complaint, matter that was originally part of the complaint.

(2) The right of the complainant to apply to the Commissioner for a review of the decision must be included in the statement under this section, except in the case of a decision to commence proceedings in the Tribunal.

(3) A statement to a complainant is not required under this section in the case of an official complaint. [Emphasis added.]

13. Finally, s 591 imposes an express obligation to observe the rules of procedural fairness, to the extent that they are not inconsistent with the provisions of the LPA 2004 or the regulations, in relation to the investigation of complaints and the procedures of the Commissioner and the Councils under Ch 4.

Factual background

14. It is unnecessary to set out the detail of the complaints against Mr Levitt. It is sufficient to say that one was made by the New South Wales barrister, now deceased, Marcus Jacobs QC (Jacobs complaint), and one by a Queensland barrister, Christopher Garlick (Garlick complaint).

15. Following an investigation into the complaints pursuant to Pt 4.4 of the LPA 2004, on 2 June 2016 the Council by its delegate, the Professional Conduct Committee (Committee), passed two resolutions (Resolutions) in each of which it was resolved that:

“the Committee is satisfied there is a reasonable likelihood Stewart Alan Levitt (‘the legal practitioner’) will be found by the Tribunal to have engaged in professional misconduct and that proceedings be instituted in the Tribunal pursuant to Section 537(2) of the Legal Profession Act, 2004.”

16. The first resolution passed on 2 June 2016 concerned the Jacobs complaint (Jacobs Resolution). The second resolution concerned the Garlick complaint (Garlick Resolution). The Committee set out in the Resolutions its reasons for its decisions in respect of each complaint. Mr Levitt was advised of the Jacobs Resolution by letter dated 2 June 2016 and of the Garlick Resolution by letter dated 3 June 2016.

17. In each case, the Resolution noted that the orders to be sought in the Tribunal were:

1. that the solicitor be reprimanded;

2. that the solicitor pay a fine;

3. that the solicitor pay the Society’s costs; and

4. such further and other order as the Tribunal sees fit.

18. On 15 June 2016 Mr Levitt filed a summons seeking declaratory and other relief against the Council in respect of the Committee’s decisions encapsulated in the Resolutions (judicial review proceedings) in the Supreme Court of New South Wales.

19. On 24 November 2016, the Council commenced proceedings (NCAT Proceedings) against Mr Levitt in the Tribunal. The Council sought in the NCAT Proceedings findings that Mr Levitt had engaged in professional misconduct, and, among other things, an order that he be reprimanded. The NCAT Proceedings were stayed pending the outcome of the proceedings in the Supreme Court.

20. The judicial review proceedings were heard by the primary judge on 29, 30 and 31 May 2017. On 29 June 2017 the primary judge delivered judgment. Her Honour made orders quashing the decisions of the Committee encapsulated in the Resolutions, and restraining the Council from taking further steps in the NCAT Proceedings on the basis of the Resolutions. On 5 July 2017 the NCAT Proceedings were dismissed for want of jurisdiction on the basis that there was no valid resolution of the Council to institute proceedings in the Tribunal. The Council was ordered to pay Mr Levitt’s costs. [5]

    5. Council of the Law Society of New South Wales v Levitt [2017] NSWCATOD 126 at [14], [33] – [34].

Primary judgment

21. The primary judge held that Mr Levitt had made good his complaint that, in relation to each of the decisions, the Council “failed to consider the possible summary disposal of the complaints pursuant to s 540 of the [LPA 2004], and whether it was satisfied of those matters in s 540(1)(b)(i), (ii) and (iii).” In addition, her Honour held that “[a]ncillary to that is the complaint, also made good, … the Council failed in respect of each decision to consider whether, on the facts as it found them to be, there was a reasonable likelihood of the Tribunal concluding that [Mr Levitt] was guilty of professional misconduct, at all, or as opposed to some lesser course of conduct, and to take into account exculpatory material advanced by [Mr Levitt] and consider how such material might impact upon the conclusions the Tribunal could reach.”[6]

    6. Primary judgment at [29].

22. The primary judge accepted Mr Levitt’s submission that the proper construction of s 537 was to read the phrase “unless s 540 applies” as establishing a preliminary consideration to which the decision-maker must advert before concluding that proceedings should be commenced in the Tribunal. [7] It was only if the Council was not satisfied that there was a reasonable likelihood that the Tribunal would find Mr Levitt engaged in unsatisfactory professional misconduct at all, as opposed to serious professional misconduct and that the practitioner was generally competent such that summary disposal was available, could it conclude that the matter must “necessarily” be referred to the Tribunal. [8]

    7. Ibid at [31]; elsewhere, the primary judge described s 540 as “a condition precedent to the proper exercise of the power provided by s 537(2) of the 2004 Act”: see [46], [49]; see also [41].

    8. Ibid at [32].

23. The primary judge inferred from the absence of any reference in the Council’s reasons for determination of the two complaints to suggest that it considered s 540, and the possible disposal of the complaint under that section, that the Council had not turned its corporate mind to that issue, nor to exculpatory matters Mr Levitt had advanced. As, in her Honour’s view, consideration of s 540 was a condition precedent to the proper exercise of the power provided by s 537(2), the absence of reference to it in the Council’s reasons pointed to its failure to have regard to it. Accordingly, there was a clear basis upon which to conclude that there had been jurisdictional error or, alternatively, error on the face of the record. [9]

    9. Ibid at [33] – [36]; see also [43], [46].

24. In her Honour’s view, s 537(2) required the Council to give some attention to an assessment of the seriousness of the legal practitioner’s conduct. Thus, the Council could only make a decision that there was a reasonable likelihood that Mr Levitt would be found by the Tribunal to have engaged in professional misconduct (or in unsatisfactory professional conduct, but not professional misconduct) after it had considered the likelihood of the impugned conduct being found to constitute professional misconduct, as opposed to unsatisfactory professional conduct. [10]

    10. Ibid at [39].

25. The primary judge inferred that professional misconduct required conduct that was substantially graver than unsatisfactory professional conduct having regard to the sanctions available for each type of conduct. [11]

    11. Ibid at [40].

26. Her Honour held that a decision by the Council to commence proceedings in the Tribunal pursuant to s 537(2) could only be properly made after consideration was given to the operation and potential application of s 540. This required the Council to consider all relevant information, including any exculpatory matters raised by the legal practitioner, or matters raised in mitigation. Consideration of the seriousness of the conduct involved a prediction on the Council’s part as to how the conduct might be viewed by the Tribunal. That could only be properly done by considering matters raised by the legal practitioner in defence or mitigation of the complaints. [12]

    12. Ibid at [42] – [43].

27. The Council did not dispute that it was required to turn its mind to s 540 of the LPA 2004, and specifically to consider those matters in s 540(1)(b) before arriving at a state of satisfaction as to the matters set out in s 537(2). However, it submitted that s 540 only applied if it formed the state of mind referred to in s 540(1)(b)(i), (ii) and (iii). If it did not form that state of mind, it submitted s 540 did not apply, including for the purposes of the operation of s 537(2). The Council contended that it was not required to give reasons for not having made a different decision (that is, a decision to proceed by way of summary disposition), and it was unnecessary to give express reasons as to the matters referred to in s 540(1)(b). [13]

    13. Ibid at [47].

28. The primary judge accepted that the Council’s reasons “need not also identify items of evidence which the Council discounts or facts which it considers insignificant or the basis upon which it expects arguments exculpatory of the solicitor will not be accepted”. [14]

    14. Applying at [48] Menon v Council of the Law Society of New South Wales [2016] NSWSC 1322 at [45] per Fagan J.

29. However, in her Honour’s view, the absence of reference in the reasons for the Council’s decisions was “not to marginal facts, or insignificant pieces of evidence, [but] … to matters which are conditions precedent to the exercise of the Council’s power pursuant to s 537(2).” Rather, “[s]ome account of the consideration given by the Council to the application of s 540 was necessary, both to permit the plaintiff to understand the Council’s path of reasoning, and also to permit any court asked to review the decision to do so.”[15]

    15. Primary judgment at [49].

30. The Council’s failure to set out sufficient detail as to allow Mr Levitt to understand why it had determined that s 540 did not apply, amounted to jurisdictional error in the exercise of the Council’s functions. [16]

    16. Ibid at [52].

Issues on appeal

31. The Council relied upon eight grounds of appeal, many of which contained numerous sub-paragraphs. However, in oral submissions, the Council said that the fundamental basis of its challenge to the primary judgment was encapsulated in ground 1, which complains that:

“The primary judge erred in her Honour's approach to the construction of ss.537 and 540 of the Legal Profession Act 2004 (NSW) (LPA 2004) in finding that consideration of the application of s.540 was a ‘preliminary consideration to which the decision maker must advert before concluding that proceedings should be commenced in the Tribunal’: see [29], [31]-[32], [41] of the reasons for judgment.”

32. The Council accepted that if it was unsuccessful in respect of ground 1, its other grounds could not sustain its challenge to the primary judge’s orders.

Council’s submissions

33. The Council’s submissions identify paragraph [29] of the primary judgment as encapsulating the errors it challenges to the construction of ss 537 and 540, and also its complaints that the primary judge erred in finding it had failed to consider the matters to which her Honour there referred.

34. The Council’s overriding submission is that if it reaches a conclusion that there is a reasonable likelihood that the legal practitioner will be found by the Tribunal to have engaged in professional misconduct, that is an end to the matter, because it is simply impossible for s 540 to apply. This was because the Council had reached what it described as a “single state of satisfaction”.

35. The Council first submits that the primary judge erred in concluding that it needed to have considered, and rejected, the possibility that there was a reasonable likelihood that a practitioner’s conduct might be found by the Tribunal to be unsatisfactory professional conduct (or something less serious) before being satisfied there was a reasonable likelihood that a practitioner’s conduct might be found to be professional misconduct under s 537(2).

36. The Council submits that her Honour’s error arose from a misconception that s 540 relates to, or bears upon, the satisfaction that the Council is entitled to form under s 537(2), in relation to the Tribunal’s findings as to the conduct of a practitioner the subject of a complaint. The Council submits that s 540 does not.

37. Rather, the Council submits that the meaning of s 537, in particular s 537(2), can be discerned by reference to the statutory text alone. It contends that s 537(2) requires it to commence proceedings in the Tribunal if it is satisfied either that that there is a reasonable likelihood that the practitioner would be found by the Tribunal to have engaged in professional misconduct, or that there is a reasonable likelihood that the practitioner would be found by the Tribunal to have engaged in unsatisfactory professional conduct (unless it is satisfied of the several matters in s 540, such that s 540 may apply).

38. The Council submits that the effect of s 540 (at least for the purposes of the operation of s 537(2)) is to displace the statutory command that would otherwise require the commencement of proceedings if the Council was satisfied of a reasonable likelihood of a finding by the Tribunal either of unsatisfactory professional conduct or professional misconduct. The Council submits that the potential application of s 540 is unrelated to, and is not required to be considered as a factor bearing upon, the Council’s satisfaction under s 537(2).

39. Secondly, the Council submits that the time at which there would be consideration of whether s 540 might apply such that it may not be required to commence proceeding under s 537(2) is after it has determined its satisfaction under s 537(2). In the present case, the Council submits, s 540 did not apply because it had resolved it was satisfied there was a reasonable likelihood of a finding of professional misconduct and it was not satisfied there was there was a reasonable likelihood of a finding of unsatisfactory professional conduct, nor of the additional matters referred to in s 540(1)(b)(ii) and (iii).

40. Thirdly, the Council accepts that had it been satisfied that there was a reasonable likelihood of a finding by the Tribunal of unsatisfactory professional conduct (but not professional misconduct), it would have been required to consider the remaining elements of s 540(1)(b)(ii) and (iii). Even in that case, it contended, s 540 may still not have applied, depending upon its satisfaction as to those matters. However, it argued that, properly construed, the LPA 2004 did not require it in all cases, and did not require it in this case, to consider the possible application of s 540.

41. The Council’s third submission related to its contention that, if it was satisfied that there was a reasonable likelihood of a finding of professional misconduct against a legal practitioner, it would be taken not to be satisfied that there was “no reasonable likelihood that the practitioner will be found by the Tribunal to have engaged in either unsatisfactory professional conduct or professional misconduct” as would be necessary to permit the Council to dismiss the complaint under s 539; and not to be satisfied that there was “a reasonable likelihood that the practitioner would be found by the Tribunal to have engaged in unsatisfactory professional conduct (but not professional misconduct)” as would be necessary to engage the powers available to it under s 540(2).

42. Fourthly, the Council contends that in forming a state of satisfaction of the reasonable likelihood of a particular outcome in the Tribunal, the LPA 2004 does not require it to second-guess itself, or to express findings for why it was not satisfied of other outcomes.

43. Fifthly, the Council submits that the error in the primary judge’s approach to ss 537(2) and 540 was evident having regard to the structure of the LPA 2004. It contends that the separation of the steps of the making of complaints against legal practitioners, the investigation of complaints and the decision of the Commissioner or Council after completion of an investigation of a complaint, followed by the requirement in s 537(1) to take one of the three steps there referred to, is antithetical to the primary judge’s construction of s 537. It prays in aid s 542 as providing further support for this contention.

44. Sixthly, the Council submits that the distinction between conduct that meets the standard of “unsatisfactory professional conduct” and conduct that meets the standard of “professional misconduct” does not inform the correct approach to interpreting s 537(2) or s 540.

45. Finally, the Council submits that if, as Mr Levitt submitted on the hearing of the leave application, the primary judge should have been understood to have held that s 540 was a condition precedent to the commencement of proceedings in the Tribunal that was separate from, and additional to, the formation of satisfaction under s 537(2), that would in effect impose a requirement on the Council to engage in a predictive analysis of the outcome of the Tribunal proceedings on two separate occasions: first, to determine its satisfaction under s 537(2), and then secondly, and regardless of its satisfaction under s 537(2), to determine whether s 540 applies before it may be required to commence proceedings. The Council contends that this is plainly not how s 537(2) operates, it is not how Mr Levitt submitted to the primary judge the sub-section operated, and her Honour's reasons should not be read in such a way as to produce this unworkable result.

Mr Levitt’s submissions

46. Mr Levitt first submits that the state of satisfaction the Council is required to form under s 537(2) of the LPA 2004 does not exclude the possibility of the Council also being satisfied of the reasonable likelihood of a finding of unsatisfactory professional conduct (but not professional misconduct). Thus, he argues, if the Council were merely satisfied in a given case of the reasonable likelihood of a finding of either professional misconduct or unsatisfactory professional conduct, it could not exclude the possibility of s 540 applying to displace the duty in s 537(2).

47. Secondly, Mr Levitt argues that the simplest way for the Council to avoid the application of s 540 would be for it to consider whether, and then not be satisfied that, there is a reasonable likelihood of a finding of unsatisfactory professional conduct only. Accordingly, Mr Levitt contends this suggests that s 540 is a consideration to which regard must be had before the commencement of proceedings in the Tribunal.

48. Thirdly, Mr Levitt relies on the requirement in s 542(1)(b) of the LPA 2004 of the provision of a statement of reasons in relation to the commencement of proceedings in the Tribunal. There is only a duty to commence such proceedings if (a) the Council reaches the required state of satisfaction, and (b) s 540 does not apply. Given that s 542(1)(b) does not confine the scope of the required reasons merely to the Council’s satisfaction that there is a reasonable likelihood of a finding of either professional misconduct or unsatisfactory professional conduct, he argues that those reasons must address both prerequisites to the duty in order for the Council to commence proceedings. It is implicit in this that the Council must consider the possible application of s 540.

49. Fourthly, Mr Levitt submits that the phrase “reasonable likelihood” in s 537(2) sets a bar lower than the balance of probabilities. Accordingly, he contends there can simultaneously be a reasonable likelihood of a finding of professional misconduct and a reasonable likelihood of a finding of unsatisfactory professional misconduct (but not professional misconduct). It was, therefore, incorrect to say that s 540 could not have applied in his case. Because it could have applied, the words “unless section 540 ... applies” in s 537(2) required that that provision be considered by the Council or its delegate, the Committee, at the stage it was determining whether or not the complaints should be considered by the Tribunal or dealt with summarily.

50. Fifthly, Mr Levitt submits that given the consequences for a legal practitioner of proceedings in the Tribunal, the Court should be slow to adopt a construction of s 537(2) that permits the Council, in commencing such proceedings, to avoid considering the availability or appropriateness of the summary disposal procedure afforded by s 540.

51. Sixthly, Mr Levitt submits that on a proper understanding of the primary judgment, the primary judge held that because the duty imposed by s 537(2) is displaced by s 540, consideration must be given to s 540 before proceedings are commenced.

52. Seventhly, Mr Levitt submits that nothing in the structure of the LPA 2004 militates against the construction of s 537(2) and s 540 he propounds. He submits that the reference to s 540 in s 537(2) is such that consideration should be given to the gravity of the allegation or complaint in the course of determining whether proceedings should be commenced in the Tribunal.

Consideration

53. The starting point for the ascertainment of the meaning of a statutory provision is the text of the statute whilst, at the same time, having regard to its context (including legislative history and extrinsic materials) and purpose. [17] Context should be regarded in its widest sense to include such things as the existing state of the law. [18]

    17. SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; (2017) 91 ALJR 936 at [14] per Kiefel CJ, Nettle and Gordon JJ; see also [35] – [39] per Gageler J; Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503; [2012] HCA 55 at [39] per curiam (French CJ, Hayne, Crennan, Bell and Gageler JJ).

    18. CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; [1997] HCA 2 per Brennan CJ, Dawson, Toohey and Gummow JJ; Regional Express Holdings Ltd v Australian Federation of Air Pilots [2017] HCA 55; (2017) 92 ALJR 134 at [19] per Kiefel CJ, Keane, Nettle, Gordon and Edelman JJ.

The text

54. The text of the relevant provisions of the LPA 2004 does not support the narrow construction for which the Council contends. Nor, in any event, should the provisions be narrowly construed. [19]

    19. Walsh v Law Society of New South Wales (1999) 198 CLR 73; [1999] HCA 33 (Walsh); Barwick v Law Society of New South Wales [2000] HCA 2; (2000) 74 ALJR 419 (Barwick).

55. Section 537(2) commences with what can be seen as a direction that “unless”, clearly used in the sense of meaning “except on the condition that”,[20] s 540 applies, the relevant decision-maker must commence proceedings against a legal practitioner in the Tribunal if satisfied of the reasonable likelihood in the Tribunal of one of the two outcomes to which s 537(2) refers.

    20. See Centronics Systems Pty Ltd v Nintendo Co Ltd (1992) 24 IPR 481 (Centronics) at 500 per Northrop J considering 20(2) of the Circuit Layouts Act 1989 (Cth); Centronics was reversed on appeal, Nintendo Co Ltd v Centronics Systems Pty Ltd (1994) 181 CLR 134; [1994] HCA 27, but in terms which confirmed, rather than impinged on, Northrop J’s construction. Mason CJ, Brennan, Deane, Toohey, Gaudron and McHugh JJ (Dawson J agreeing) held (at 159) that the terms of s 20(2) were “unambiguous”.

56. The clear structure of s 537(2) is that in considering what step to take in respect of a complaint following an investigation which is not to lead to the dismissal of the complaint, the relevant decision-maker must undertake a compound exercise which includes predicting the likely outcome in the Tribunal having regard to the nature of the conduct which may be referred to it, but, too, considering whether s 540 applies. In other words, s 537(2) has to be read with s 540.

57. It is not necessary, as the Council appears to submit, that it undertake the same reasonable likelihood assessment three times. Rather, the combined effect of s 537(2) and s 540 is that there are three such assessments which are to be undertaken simultaneously as part of making the s 537(2) decision. Those for which s 537(2) provides lead to the Tribunal path. That for which s 540 provides leads to the summary disposal path.

58. Section 540 is intended to ensure that the relevant decision-maker considers both the Tribunal and the summary paths at the same time. It affords a less rigorous mode of dealing with a matter if the circumstances for which s 540 provides are found to exist.

Reasonable likelihood

59. The opening phrase of s 537(2) (“Unless section 540 … applies”) also supports the proposition that the relevant decision-maker is required to consider both the Tribunal and the summary paths at the same time. It picks up the opening phrase of s 540(1) which explains the circumstances in which s 540 applies.

60. Section 540 can only apply in the circumstances referred to in that section, in particular those referred to in s 540(1)(b). Sub-section 540(1)(b)(i) requires the relevant decision-maker to be “satisfied that there is a reasonable likelihood that the practitioner would be found by the Tribunal to have engaged in unsatisfactory professional conduct (but not professional misconduct)”.

61. As the court explained in Donaghy v The Council of The Law Society of New South Wales, the requirement in s 540(1)(b)(i) that the Council be satisfied that “there is a reasonable likelihood that the practitioner would be found by the Tribunal to have engaged in unsatisfactory professional conduct” requires the Council to predict or forecast the outcome of a hearing before the Tribunal. The “reasonable likelihood” test does not require satisfaction that the practitioner has engaged in conduct with the identified characteristic. Rather, it requires satisfaction that there is a “reasonable likelihood” of that outcome following a hearing before the Tribunal. The composite expression, “reasonable likelihood”, describes a chance or prospect of that happening which is real and not fanciful or remote. The adjective “reasonable” is a measure of the “likelihood” and a descriptor of its characteristic as soundly based. [21]

    21. [2013] NSWCA 154 at [16] per Beazley P; Meagher JA; Emmett JA, referring to Murray v Legal Services Commissioner (1999) 46 NSWLR 224; [1999] NSWCA 70 (Murray) at [88]; Carson v Legal Services Commissioner [2000] NSWCA 308 at [43].

62. It is also clear that the phrase “reasonable likelihood” is not a term having objective precision, although it would appear to refer to a lesser standard than the balance of probabilities. The exercise required in applying the test in s 537(2) (and s 540(1)(b)(i)) is likely to have a significantly speculatively character. [22]

    22. Donaghy v Council of the Law Society of NSW (No 2) [2015] NSWCA 224 at [48] per Basten JA (Gleeson JA agreeing).

63. As Mr Levitt submits, the effect of the “reasonable likelihood” test setting a lower bar than the balance of probabilities is that there can be both a reasonable likelihood of a finding of professional misconduct and a reasonable likelihood of a finding of unsatisfactory professional misconduct.

64. It is this context that the overlapping nature of the definitions of “professional misconduct” and “unsatisfactory professional conduct” becomes relevant.

65. Thus, the relevant decision-maker may be satisfied there was a reasonable likelihood (a chance or prospect) of a finding of unsatisfactory professional misconduct, but also be satisfied there was a reasonable likelihood (a chance or prospect) the Tribunal may find the conduct to involve such a substantial or consistent failure to reach or maintain a reasonable standard of competence and diligence within the meaning of s 497(1)(a) that there may be a finding of professional misconduct. In those circumstances, s 540 prima facie applies, although one might think the outcome of consideration of the seriousness of the conduct concerned (s 540(1)(b)(iii)) would militate against the matter being dealt with under that provision.

66. Accordingly, it is not the case, as the Council submitted, that once it has reached a “single state of satisfaction” that there is a reasonable likelihood that Mr Levitt will be found by the Tribunal to have engaged in professional misconduct, its work is done. The opening phrase in s 537(2) directs it to consider whether s 540 applies. That, in turn, requires it to consider whether there is a reasonable likelihood that Mr Levitt would be found by the Tribunal to have engaged in unsatisfactory professional conduct (but not professional misconduct).

67. What that consideration will involve will be a matter of fact and degree in each case. There may be cases, such as a complaint against an Australian legal practitioner of such serious and substantial defalcations from a trust account that the Commissioner or the Council is satisfied that there is a reasonable likelihood that the practitioner will be found by the Tribunal to have engaged in professional misconduct warranting an order that the name of the practitioner be removed from the local roll (s 562(2)(a)), where consideration of the s 540 option would be relatively perfunctory.

68. However, in the present case, it is tolerably clear that the Council is of the view that Mr Levitt’s conduct falls within s 497(1)(a) (that is to say, “unsatisfactory professional conduct of an Australian legal practitioner, where the conduct involves a substantial or consistent failure to reach or maintain a reasonable standard of competence and diligence”) because it has not sought an order which would in any way prevent Mr Levitt from practising. [23] Indeed of the two substantive orders the Council wishes to seek in the Tribunal, [24] the reprimand can also be given under s 540(2)(b). [25]

    23.    As would be the case had it sought any of the orders in LPA 2004 s 562(2)(a) – (d).

    24.    That is to say leaving aside the costs order in the event the matter goes to the Tribunal.

    25. The other substantive order the Council wishes to seek, a fine, must convey to the legal profession and to the community in general that the impugned conduct is unacceptable: Russo v Legal Services Commissioner [2016] NSWCA 306 at [82] per Ward, Leeming and Payne JJA.

69. It cannot be the case, as the Council submits, that its conclusion as to the reasonable likelihood of a finding of professional misconduct means it was not satisfied there was a reasonable likelihood of a finding of unsatisfactory professional conduct, nor of the additional matters referred to in s 540(1)(b)(ii) and (iii). As the primary judge held, it should be inferred in the absence from its reasons for each Resolution of any consideration of the matters set out in s 540(1)(b) which it was required to consider, that it did not do so. [26]

    26. See Lo v Chief Commissioner of State Revenue (2013) 85 NSWLR 86; [2013] NSWCA 180 at [10] per Basten JA, Beazley P agreeing.

70. In the light of the requirement in s 542(1)(b) that the Council give reasons for its decision to commence proceedings in the Tribunal with respect to the complaint, the failure of the Council’s reasons to refer to the s 540 matters so that the Court could see whether it had taken into consideration the matters required by s 537(2) was an error of law on the face of the record. [27]

    27. Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43 at [55].

Legislative history and extrinsic materials

71. This construction is borne out by the legislative history of Ch 4 of the LPA 2004.

72. The LPA 2004 repealed the Legal Profession Act 1987 (NSW) (LPA 1987). Part 10 of the LPA 1987 dealt with complaints and discipline. Division 3 dealt with complaints about legal practitioners. Division 5 dealt with the investigation of complaints. Part 10 as first enacted was replaced by a new Pt 10 with effect from 1 July 1994. [28]

    28. Section 3, Sch 2, Item 2, Legal Profession Reform Act 1993 (NSW).

73. The new Pt 10 introduced significant changes in the law governing the investigation of such complaints against legal practitioners and the conduct of disciplinary proceedings arising out of the investigation of such complaints. [29] It was “part of a general reform of procedures for the handling of complaints against legal practitioners outside the inherent jurisdiction of the Supreme Court [whose] object … was to secure greater transparency in the determination of complaints and to establish new institutions for the process but with balancing provisions designed to afford procedural and other safeguards for the practitioner involved. [30] It was based on the recommendations of the New South Wales Law Reform Commission, Scrutiny of the Legal Profession: Complaints against Lawyers, Report 70 (1993) (Report 70). [31]

    29.    Walsh at [60] per McHugh, Kirby and Callinan JJ.

    30.    Barwick at [90] per Kirby J.

    31.    Second Reading Speech, Legal Profession Reform Bill, New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 16 September 1993 at 3270.

74. Report 70 casts light on the development of the summary disposal option. In recommending the changes to the LPA 1987 which were implemented in 1994, the Law Reform Commission observed that “Lawyers should never be subjected to procedures which arbitrarily or unfairly do harm to their reputations or qualify or remove their practising rights. The Commission makes a number of recommendations … aimed at improving the level of procedural fairness for a lawyer who is the subject of a complaint.” [32]

    32.    Report No 70 at [3.57].

75. Early in the history of the new Pt 10, McHugh, Kirby and Callinan JJ held in Walsh that the differentiation between “professional misconduct” and “unsatisfactory professional conduct” in s 127 of the LPA 1987 was perceived as “designed to meet dissatisfaction with the response of those charged with deciding the complaints of users of legal services and the suggestion that they sometimes tended to neglect conduct falling short of proper standards of competence and diligence.” [33]

    33.    Ibid.

76. In addition, McHugh, Kirby and Callinan JJ held that, “[g]iven the scheme of the legislation, and the introduction of new statutory bodies for the task of discipline of members of the legal profession formerly conducted by professional bodies and by the Supreme Court, the requirements of particularity contained in the Act (and the safeguards thereby introduced for the practitioner concerned) would not be narrowly construed. [34]

    34. Walsh at [62]; see also Barwick at [90].

77. The LPA 2004 was intended both to regulate legal practice in New South Wales and facilitate the regulation of legal practice on a national basis. [35] It implemented amendments to provisions in the LPA 1987, including amendments proposed by the New South Wales Law Reform Commission in its April 2001 Report 99, Complaints against Lawyers: An Interim Report (Report 99). [36]

    35.    Legal Profession Bill 2004 (NSW), Explanatory Note.

    36.    New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 7 December 2004 at 13410.

78. Section 155(2), which appeared in Pt 10, Div 5 of the LPA 1987, required the Council or the Commissioner to institute proceedings in the Tribunal with respect to a complaint against a legal practitioner if satisfied there was a reasonable likelihood that the legal practitioner would be found guilty by the Tribunal of unsatisfactory professional conduct or professional misconduct. Section 155(3) provided:

“(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

(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.

79. Report 99 was critical of s 155(3)(b) because it did not expressly require that consideration be given to the seriousness or otherwise of the alleged unsatisfactory professional misconduct. [37] It observed that “dismissal of a complaint on the grounds of a practitioner’s previous good record might be inappropriate where the circumstances of the alleged unsatisfactory professional conduct are very serious. Dismissals in inappropriate cases could be seen as being too lenient on practitioners.” [38]

    37.    Report 99 at [5.11].

    38.    Ibid.

80. Accordingly, while Report 99 was of the view that it was appropriate the Councils and the Commissioner retain the power to dismiss a complaint involving possible unsatisfactory professional conduct without referring it to the Tribunal “so long as it is a minor matter”, the Commission was also of the view that in considering whether to take this course, the Commissioner and the Councils must have regard to the circumstances of the case, including the seriousness of the conduct complained of. [39]

    39.    Ibid at [5.13] – [5.14]; Recommendation 16.

81. One of the reasons the Law Reform Commission believed it appropriate that the Councils and the Commissioner retain the power to dismiss a complaint involving possible unsatisfactory professional conduct was the efficiency of the system. It was concerned that if matters then being dismissed by the Commissioner and the Councils on the grounds of the legal practitioner’s previous good record were also required to be determined by the Tribunal, that would effectively double the matters it would have to deal with in any given year. [40]

    40.    Law Reform Commission Report at [5.13].

79. While the LPA 2004 repealed the LPA 1987, the structure of Ch 4 of the LPA 2004 bears a strong similarity to the complaints and discipline provisions found in Pt 10 of the LPA 1987. In that context, it is clear that the observations in both Walsh and Barwick, that the safeguards introduced into Pt 10 of the LPA 1987 for the legal practitioner concerned would not be narrowly construed, continue to have force. Section 540 of the LPA 2004 is clearly such a safeguard.

80. However, despite the similarity between Pt 10 of the LPA 1987 and Ch 4 of the LPA 2004, it is notable that the structure of s 537 differs from s 155 of the LPA 1987. In particular, what were s 155(2) and (3) have now been consolidated into s 537(2). The word “however” has been replaced by “unless” which has a more didactic sense. This reinforces the conclusion that the purpose of s 537(2) is that the relevant decision-maker must consider both the Tribunal and summary disposal options in deciding what to do following the investigation of the complaints.

Procedural fairness

84. A construction of s 537(2) which requires the relevant decision-maker to consider whether s 540 applies is also consistent with the requirements in the LPA 2004 to accord procedural fairness in both the investigation of complaints and any disciplinary proceedings taken against legal practitioners. [41]

    41.    Section 494(3)(b); s 591.

85. As this Court recently reiterated, the purpose of disciplinary proceedings against a legal practitioner is the protection of the public, [42] rather than the punishment of that individual. [43] Nevertheless, as s 494(3)(b) makes clear, and as in any event would be necessarily implied, the legal practitioner should be accorded procedural fairness throughout any disciplinary proceedings. [44]

    42.    This purpose is reflected in s 494(1)(a), set out above, and in s 3(a) of the LPA 2004 which provides that one of its purposes is “to provide for the regulation of legal practice in this jurisdiction in the interests of the administration of justice and for the protection of clients of law practices and the public generally”.

    43. Prothonotary of the Supreme Court of New South Wales v Thomson [2018] NSWCA 230 at [12], referring to Wentworth v New South Wales Bar Association (1992) 176 CLR 239 at 250 – 251 [1992] HCA 24 per Deane, Dawson, Toohey and Gaudron JJ.

    44.    Murray at [66] per Sheller JA, Priestley and Stein JJA agreeing, referring to the identical provision in s 125(a) of the LPA 1987.

86. Although it has been held that “disciplinary proceedings” in the analogous provision in the LPA 1987 was directed only to proceedings before the Tribunal, [45] that express provision did not exclude the obligation of the investigating body to afford “natural justice” by giving the legal practitioner the opportunity to respond to a complaint, including to advance arguments against it and in favour of the lesser charge than that of professional misconduct or in mitigation, or for dismissal. [46] This followed as a matter of statutory construction, having regard to the fact that the investigating body’s “duty is not merely to determine whether or not there is a prima facie case but to reach a degree of satisfaction and make decisions as to the course then to be followed [i]n [which] context the legal practitioner has an interest to press not only against the initial finding but also against the following of one particular course rather than another.” [47] It now finds express support in s 591.

    45.    Ibid at [85], albeit allowing for a wider meaning.

    46.    Ibid at [88], [90].

    47.    Ibid at [91]; see also at [3] – [4] per Priestley JA; at [109] – [110] per Stein JA.

87. Section 508 (Practitioner to be notified of complaint) and s 509 (Submissions by practitioner), to which I earlier referred, also impose an express obligation to accord procedural fairness to a legal practitioner. Insofar as s 509(3) requires the Council to consider the legal practitioner’s submissions before deciding what action is to be taken in relation to the complaint, that consideration must be genuine. [48] That consideration would require the Council to have regard to any explanation or exculpatory material the legal practitioner advanced, whether or not the construction of s 537(2) I favour is correct.

    48. Konstantinidis v Council of the Law Society of New South Wales [2018] NSWCA 59 at [48] per curiam.

88. As I have said, the obligations of procedural fairness were introduced in the 1993 amendments to the LPA 1987 and were intended to ensure legal practitioners were not subjected to procedures which arbitrarily or unfairly harmed their reputations. [49] Consideration of whether s 540 applies accords procedural fairness to a legal practitioner as it may lead to an outcome which would avoid a public hearing in the Tribunal with the concomitant potential for damage to his or her reputation.

    49.    Report 70 at [3.57].

Conclusion

89. I would, with respect, suggest that phrases such as “preliminary consideration”[50] and “condition precedent”[51] which provided a focus for the primary judge’s conclusions are apt to distract from the decision-making exercise for which s 537(2) provides. However, that does not detract from my conclusion that her Honour did not err in concluding the Council had to consider whether s 540 applied before referring Mr Levitt to the Tribunal.

    50. Primary judgment at [31].

    51. Ibid at [46].

Orders

90. In my view the appeal should be dismissed with costs, such costs to include the costs of the application for leave to appeal.

91. BASTEN JA: The Council of the Law Society (the appellant) received complaints about the professional conduct of the respondent, a legal practitioner. After investigating the complaints, it referred them to the Civil and Administrative Tribunal on the basis that they revealed conduct capable of constituting professional misconduct.

Procedural background

92. By a summons filed in the Common Law Division on 15 June 2016 the respondent sought to set aside the resolutions of the appellant’s Professional Conduct Committee that proceedings be instituted in the Tribunal with respect to the various counts of professional misconduct. He also sought orders restraining the appellant from prosecuting any proceedings against him in the Tribunal.

93. In a judgment delivered on 29 June 2017 the primary judge, Wilson J, made orders setting aside the decisions of the Council and restraining it from taking further steps in the proceedings, which had apparently already been commenced in the Tribunal. The Council sought leave to appeal against those orders, leave being granted on 5 December 2017.

94. At no stage so far has the Council taken objection to the form of the proceedings or the orders sought by the respondent. In the event that the appeal is upheld it accepts that the matter should be remitted to the Common Law Division for the primary judge to deal with other grounds of review which were not disposed of in the judgment presently under appeal.

95. In my opinion the appeal should be allowed and the orders made in the Common Law Division set aside. Although there is no objection to an order remitting the matter to the Common Law Division, no such order is necessary. However, if it is to be made, it is desirable to make some further observations about the nature of the proceedings, lest it be thought that the making of such an order involved an implied approval of the form of the proceedings.

96. The conduct complained of, together with the complaints, occurred some years ago, the final complaint being lodged in April 2015. It is common ground that the complaints are to be considered under the Legal Profession Act 2004 (NSW) (“the 2004 Act”) pursuant to transitional provisions, that Act having been repealed and replaced on 1 July 2015. The judgment below[52] concluded that “[a] decision by the Council to commence proceedings in the Tribunal pursuant to s 537(2) [of the 2004 Act] can only be properly made after consideration is given to the operation and potential application of s 540.”[53]

    52. Levitt v Council of the Law Society of New South Wales [2017] NSWSC 834 (“Levitt”).

    53. Levitt at [42].

97. How the matter came to that point is not apparent from reading the pleadings, which make no mention of the two provisions in question; nor do they expressly allege any particular error of law. However, counsel for the respondent opened the case before the primary judge on the basis that there was no consideration of s 540 in the reasons given by the Council for its resolution, from which it could be inferred that the matters identified in that section were disregarded and “if they are mandatory then there is an error of law at least on the face of the record, and we would say further a jurisdictional error”. [54] No objection was taken to the matter being dealt with in this way. However, it is necessary to identify the point taken in this Court in terms of the statutory scheme.

    54.    Tcpt, 29/05/17, p 12(30)-(35).

Statutory scheme for disciplining legal practitioners

98. Under the 2004 Act, the bases for complaint in relation to the conduct of a legal practitioner included both “unsatisfactory professional conduct” and “professional misconduct”. Both terms were defined:

496   Unsatisfactory professional conduct

For the purposes of this Act:

unsatisfactory professional conduct includes conduct of an Australian legal practitioner occurring in connection with the practice of law that falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent Australian legal practitioner.

497   Professional misconduct

(1)   For the purposes of this Act:

professional misconduct includes:

(a)   unsatisfactory professional conduct of an Australian legal practitioner, where the conduct involves a substantial or consistent failure to reach or maintain a reasonable standard of competence and diligence, and

(b)   conduct of an Australian legal practitioner whether occurring in connection with the practice of law or occurring otherwise than in connection with the practice of law that would, if established, justify a finding that the practitioner is not a fit and proper person to engage in legal practice.

(2)   For finding that an Australian legal practitioner is not a fit and proper person to engage in legal practice as mentioned in subsection (1), regard may be had to the matters that would be considered under section 25 or 42 if the practitioner were an applicant for admission to the legal profession under this Act or for the grant or renewal of a local practising certificate and any other relevant matters.

99. Powers were conferred on the appellant Council (and the Legal Services Commissioner) to investigate complaints. Following investigation, the investigating body was required to deal with the matter in accordance with s 537, which at all material times relevantly provided:

537   Decision of Commissioner or Council after investigation

(1)   After completion of an investigation of a complaint against an Australian legal practitioner, the Commissioner or a Council must:

(a)   commence proceedings in the Tribunal under this Chapter, or

(b)   dismiss the complaint under this Part, or

(c) take action under section 540 (Summary conclusion of complaint procedure by caution, reprimand, compensation order or imposition of conditions).

(2) Unless section 540 (Summary conclusion of complaint procedure by caution, reprimand, compensation order or imposition of conditions) applies, the Council or the Commissioner must commence proceedings in the Tribunal with respect to a complaint against an Australian legal practitioner if satisfied that there is a reasonable likelihood that the practitioner will be found by the Tribunal to have engaged in unsatisfactory professional conduct or professional misconduct.

100. The appellant resolved that it was satisfied that there was a reasonable likelihood that the Tribunal would find the respondent to have engaged in professional misconduct and therefore decided to commence proceedings in the Tribunal. Whether it was appropriate to do so in accordance with the obligation imposed by s 537(2) depended upon the opening words (“Unless section 540 … applies”).

101. Section 537(1) envisages three courses of action of which the appellant adopted the first, namely commencing proceedings in the Tribunal. The second option (dismissing the complaint) was dealt with in s 539, which provides part of the context for the construction of the critical provisions.

539   Dismissal of complaint

(1)   After completion of an investigation of a complaint against an Australian legal practitioner, the Commissioner or a Council may dismiss the complaint in whole or in part if satisfied that:

(a)   there is no reasonable likelihood that the practitioner will be found by the Tribunal to have engaged in either unsatisfactory professional conduct or professional misconduct, or

(b)   it is in the public interest to do so.

(2)   The Commissioner or Council may make a compensation order under Part 4.9 if the complaint is dismissed under this section on the ground of the public interest and the complainant requested a compensation order in respect of the complaint.

102. The key provision on which the judgment below turned addressed the third option, namely taking action under s 540, which at all material times relevantly provided as follows:

540   Summary conclusion of complaint procedure by caution, reprimand, compensation order or imposition of conditions

(1)   This section applies if:

(a)   either:

(i)   the Commissioner or a Council completes an investigation of a complaint against an Australian legal practitioner, or

(ii)   the report of an independent investigator is given to the Commissioner, and

(b)   the Commissioner or Council (as the case requires):

(i)   is satisfied that there is a reasonable likelihood that the practitioner would be found by the Tribunal to have engaged in unsatisfactory professional conduct (but not professional misconduct), and

(ii)   is satisfied that the practitioner is generally competent and diligent, and

(iii)   is satisfied that the taking of action under this section is justified having regard to all the circumstances of the case (including the seriousness of the conduct concerned) and to whether any other substantiated complaints have been made against the practitioner.

(2)   The Commissioner or Council may do any or all of the following:

(a)   caution the practitioner,

(b)   reprimand the practitioner,

(c)   make a compensation order under Part 4.9 if the complainant requested a compensation order in respect of the complaint,

(d)   determine that a specified condition be imposed on the practitioner’s practising certificate.

…

(4)   If action is taken under subsection (2), no further action is to be taken under this Chapter with respect to the complaint.

103. Section 537(2) undoubtedly imposed an obligation on the Council to commence proceedings in the Tribunal if satisfied that there was a reasonable likelihood that the practitioner would be found by the Tribunal to have engaged in either unsatisfactory professional conduct or professional misconduct. The Council is released from that obligation if s 540 “applies”. Whether s 540 applies depends upon fulfilment of a requirement in s 540(1)(a), and fulfilment of the three requirements set out conjunctively in par (b). (It was not in dispute that the concept of “a reasonable likelihood” did not involve a state of satisfaction as to probabilities.)

104. Reading s 537(2) in isolation, it might be inferred that s 540 could apply where the state of satisfaction related to either unsatisfactory professional conduct or professional misconduct. However, whether that is so depends on the proper construction of s 540 itself and, in particular, s 540(1)(b)(i). It is that point upon which this case turns.

105. There are two available readings of s 540(1)(b)(i); each turns on the proper understanding of the role played by the words in parenthesis, “but not professional misconduct”. The competing constructions may be identified as follows, namely that s 540 applied if the Council were satisfied that:

1. there was a reasonable likelihood of a finding of unsatisfactory professional conduct, and a reasonable likelihood that there would be no finding of professional misconduct; or

2. there was a reasonable likelihood of a finding of unsatisfactory professional conduct, but no reasonable likelihood that the Tribunal would find professional misconduct.

106. The distinction may be understood by adopting a numerical analysis, although it is not suggested that the Council should, or would in fact, embark on such an exercise. Thus, there would be a reasonable likelihood of a finding of professional misconduct if there were a 40% chance of that finding being made. It would follow, however, on the same basis, that there would be a 60% chance that no such finding would be made. At the same time, it might be reasonable to assess that the chance of a finding of unsatisfactory professional conduct could also be 40%. Thus, reading (1) would be satisfied even though there was a reasonable likelihood of a finding of professional misconduct (as well as unsatisfactory professional conduct), because there would also be a reasonable likelihood (in this case a probability) of no finding of professional misconduct. However, on reading (2), the paragraph would not be satisfied in circumstances where there was a reasonable likelihood of a finding of professional misconduct.

107. Whilst accepting that there are constructional choices reasonably open, reading (2) is to be preferred for a number of reasons. First, linguistically, the words in parenthesis are readily understood as referring to the absence of a likely finding of professional misconduct, not as to the likelihood of a negative state of satisfaction. Secondly, it would be curious to read the words in parenthesis as requiring the reasonable likelihood of a negative proposition, where s 537(2) makes no reference to such a negative proposition. By way of contrast, s 539 (dealing with dismissal of a complaint) identifies the negative state of satisfaction by the phrase “no reasonable likelihood” that there would be a finding of “either unsatisfactory professional conduct or professional misconduct”. Thirdly, on the assumption that the Council were affirmatively satisfied that a finding of professional misconduct was reasonably likely, it would make little sense to invite the Council to assess whether no finding of professional misconduct is also reasonably likely, because that will always be the case, except in circumstances where the finding of professional misconduct is almost certain.

108. Fourthly, adopting a purposive approach, it fits with the apparent legislative purpose to require the Council to commence proceedings with respect to the more serious form of misconduct, but allow a diversionary option in circumstances which satisfy only the lesser category of misconduct. Further, the gradation from the lesser form to the greater form of misconduct is important, as appears from the definitions. The dichotomy between professional misconduct and unsatisfactory professional conduct was introduced into the predecessor to the 2004 Act, the Legal Profession Act 1987 (NSW) (“the 1987 Act”). Since that time there has been a substantial overlap, one limb of professional misconduct being unsatisfactory professional conduct where the conduct involves a substantial or consistent failure to reach reasonable standards of competence and diligence. Where the complaint concerns a failure to reach reasonable standards of competence and diligence, a reasonable likelihood of a finding of professional misconduct will almost inevitably carry with it the reasonable likelihood of a finding of unsatisfactory professional conduct as an alternative.

109. Fifthly, reading (2) is supported by the legislative history of the key provisions, set out below.

Legislative history

110. The dual categories of misconduct resulted from a recommendation of the NSW Law Reform Commission in its Second Report on the Legal Profession: Complaints, Discipline and Professional Standards (1982). [55] The new definitions were inserted by the Legal Profession (Amendment) Act 1987 (NSW) [56] into s 123 of the 1987 Act. Prior to amendments to the 1987 Act commencing in 1994, s 134 relevantly provided:

     55.    NSWLRC, Second Report, Recommendation 2 (p 8); Ch 5.

     56.    The Legal Profession (Amendment) Act 1987 was passed prior to the commencement of the 1987 Act and took effect from 1 January 1988.

134   Decisions of Councils

(1)   If, after it has completed an investigation into a complaint against a legal practitioner, a Council is satisfied:

(a)   that the complaint does not involve any question of unsatisfactory professional conduct or professional misconduct – it shall dismiss the complaint;

(b)   that the complaint involves a question of unsatisfactory professional conduct:

(i)   it shall refer the complaint to the Board;

(ii)   it shall reprimand the legal practitioner; or

(iii)   it shall dismiss the complaint, or

(c)   that the complaint involves a question of professional misconduct – it shall refer the complaint to the Tribunal.

(1A)   A Council may not dismiss a complaint pursuant to subsection (1)(b)(iii) unless it is satisfied that the legal practitioner concerned is generally competent and diligent and that no other material complaints have been made against the legal practitioner.

(2)   A Council may not reprimand a legal practitioner in connection with a complaint except with the consent of the legal practitioner.

(3)   A Council shall cause its decision with respect to a complaint, together with its reasons for the decision and notice of the complainant's rights (if any) under s137, to be notified to the complainant.

111. At that time lesser complaints were to be dealt with by a Legal Professional Standards Board, while complaints of professional misconduct were referred to the Legal Profession Disciplinary Tribunal. It is clear that satisfaction that a complaint involved professional misconduct obliged the Council to refer it to the Tribunal.

112. The Legal Profession Reform Act 1993 (NSW) (“the 1993 Reform Act”) replaced s 134 with a new s 155, in very similar terms, commencing on 1 July 1994:

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

(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.

113. Of no immediate consequence, the 1993 Act abolished the Board and required complaints of unsatisfactory professional conduct or professional misconduct to be referred to the newly constituted Legal Services Tribunal, unless the diversionary powers with respect to unsatisfactory professional conduct (but not professional misconduct) were engaged. [57] Further, whereas s 134 had imposed obligations on the Council once it was "satisfied" that “the complaint involve[d] a question of” either form of misconduct, s 155 required satisfaction of “a reasonable likelihood that the legal practitioner will be found guilty by the Tribunal of” either form of misconduct. There is no suggestion in the extensive extrinsic materials that any other change was intended. [58]

     57.    1993 Reform Act, Sch 2(6)(b), inserting new Pt 6 into Sch 8 of the 1987 Act; see cll 39(1) and 40.

     58.    NSW Law Reform Commission, Discussion Paper No 26: Scrutiny of the Legal Profession – Complaints Against Lawyers (May 1992); NSW Law Reform Commission, Report 70: Scrutiny of the Legal Profession – Complaints Against Lawyers (February 1993); New South Wales, Attorney General’s Department, Reform of the System of Complaints Against Legal Practitioners (May 1993); New South Wales, Attorney General’s Department, Draft Legal Profession Reform Bill and Explanatory Statement (June 1993). See also the relevant second reading speeches for the Legal Profession Reform Bill (New South Wales Legislative Council, Parliamentary Debates (Hansard), 16 September 1993 at 3269-3280) and Legal Profession Reform Bill (No 2) (New South Wales Legislative Council, Parliamentary Debates (Hansard), 27 October 1993 at 4505).

114. As explained in the second reading speech to the Legal Profession Bill 2004, various provisions in the 2004 Act may be sourced to draft model provisions apparently adopted in August 2003, but now available in the form provided to the Standing Committee of Attorneys General in July 2004. [59] The relevant model provisions, being clauses 1129 – 1133, broadly followed the existing scheme in the 1987 Act, but split the component parts of s 155 into separate sections. (These provisions were classified “non core”, and thus optional. [60] )

     59.    New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 7 December 2004 at 13404.

     60.    Parliamentary Counsel’s Committee, Legal profession – model laws project, Model Provisions (28 June 2004) pp 155-156.

115. Thus, s 134 of the 1987 Act incorporated in one section elements which were later divided. In its terms, s 134 undoubtedly reflected reading (2) above. When replaced in 1993 by s 155, s 155(2) became the predecessor to s 537(2) in the 2004 Act, and s 155(3) the predecessor to s 540(1) of the 2004 Act. There is no basis for concluding that s 155 broadened the discretion conferred by former s 134 not to refer matters to the Tribunal. Section 155(3) more explicitly conforms to reading (2) proposed above when compared with ss 537 and 540 in the 2004 Act, the differences between the provisions being minor. Thus, s 155(3) commences with the word “[h]owever” to indicate it qualifies the obligation in the previous subsection, whereas s 537(2) contains the qualification in its opening words, rather than in s 540(1). That change in drafting was necessary once the provisions were separated, but the intended effect is the same. The extrinsic materials with respect to the 2004 Act do not suggest any change in the statutory scheme in this respect. [61] That scheme has therefore been consistent since 1 January 1988 (the commencement date of s 134).

     61.    NSW Legislative Assembly, Parliamentary Debates (Hansard), 7 December 2004, 13404-13412; Parliamentary Counsel’s Committee, Model Provisions, 28 June 2004 at pp 155-156; NSW Law Reform Commission, Report 99 – Complaints Against Lawyers: An Interim Report (April 2001); Attorney General’s Department, Further Review of Complaints Against Lawyers (November 2002).

Conclusion as to statutory scheme for disciplining legal practitioners

116. For these reasons, reading (2) should be accepted. Once the Council was satisfied that there was a reasonable likelihood that the Tribunal would find that the respondent had engaged in professional misconduct, s 540 did not apply and the Council was obliged to commence proceedings in the Tribunal. Accordingly, the contrary finding of the primary judge was erroneous and should be set aside.

Further dealing with proceedings

117. It is sufficient for this Court to make orders allowing the appeal and setting aside the orders below. Because no final relief has been given with respect to the respondent’s summons, the proceedings in the Common Law Division remain on foot. It follows that no order of remittal is necessary.

118. The orders sought in the summons were, primarily, for declaratory relief and an injunction. However, order 3 sought to “quash” the decisions of the Council. There was at least a hint in that language that the respondent was seeking to invoke the supervisory jurisdiction of the Court under s 69 of the Supreme Court Act 1970 (NSW), dealing with proceedings in lieu of the writs of prohibition, mandamus and certiorari. Section 69(3) declares that the Court may grant relief in the nature of certiorari “to quash the ultimate determination of a court or tribunal in any proceedings” for error of law on the face of the record. [62] That language was adopted by counsel for the respondent in submissions before the primary judge, in a passage noted above.

     62. Since this matter was heard, s 69(3) has been amended: see Justice Legislation Amendment Act (No 2) 2018 (NSW), Sch 1.21 (commencing 21 June 2018). However, that amendment is not material for present purposes.

119. The Council of the Law Society is not a court or tribunal and was certainly not acting as such in commencing proceedings in the Tribunal. Although it was required to give reasons for its determination of the complaints, it does not follow that the reasons constituted part of any “record” within the meaning of s 69(4), for the purposes of s 69(3). Nor was the Council a governmental agency or authority. Even it had been, it did not determine rights ultimately, or at all. It was an intermediary between the individual complainant and the Tribunal. Even had it been a government authority, there would have been a question as to whether the function it was exercising rendered it open to relief in the nature of certiorari.

120. Accepting that the summons was intended to invoke the Court’s powers to grant declarations and injunctions, rather than relief in the nature of the prerogative writs, the grounds imply that precisely the same factors can be relied upon as in judicial review of administrative decision-making. However, Aronson, Groves and Weeks [63] have noted that the High Court “treats declaratory and injunctive relief as different from (but serving the same purposes as) judicial review where they are sought in ‘public law’, by which it means that they are sought against public officials on grounds that amount to an allegation of invalidity.” The authors continue:

“Our point, however, is to emphasise that judicial review’s grounds or principles can be available in contexts where judicial review’s remedies are clearly unavailable. In other words, the remedies and the grounds do not always travel together. Furthermore, the grounds themselves do not always travel together.”[64]

63.    M Aronson, M Groves and G Weeks, Judicial Review of Administrative Action and Government Liability (6th ed, Law Book Co 2017) at [3.210].

64. Reference was made to the discussion in Chase Oyster Bar Pty Ltd v Hamo Industries Pty Ltd (2010) 78 NSWLR 393; [2010] NSWCA 190 at [78].

121. To the extent the summons seeks injunctive relief on the ground that the Council has exceeded its statutory powers, such a claim may properly raise the issue of statutory limitations on power discussed above. However, where other grounds, adopting terminology derived from judicial review, are relied upon in support of declaratory or injunctive relief, the obligation which has been contravened must also be sourced to the statute. It will be a matter for a judge who hears any remaining aspects of the proceedings to deal with those grounds on the appropriate basis.

Conclusion

122. In my view the Court should make the following orders:

1. Allow the appeal and set aside the orders made in the Common Law Division on 29 June 2017.

2. Direct that any order as to the costs of the proceedings pre-dating 29 June 2017 be determined by a judge in the Division.

3. Order that the respondent pay the appellant’s costs in this Court.

4. Grant the respondent a certificate under the Suitors’ Fund Act 1951 (NSW).

123. MACFARLAN JA: I gratefully adopt Basten JA’s description of the facts and circumstances of this matter. For the reasons given below, and unlike his Honour, I consider that the appeal should be dismissed with costs.

124. In my view the proper construction of ss 537 and 540 of the Legal Profession Act 2004 (NSW) so far as is presently relevant, is as follows.

125. Section 537(2) imposes a duty on the Council to commence proceedings in the Tribunal “if satisfied that there is a reasonable likelihood that the practitioner will be found by the Tribunal to have engaged in unsatisfactory professional conduct or professional misconduct”. The duty is however a qualified one. It is conditional upon s 540 being inapplicable: “unless section 540 … applies”. To ascertain whether the duty exists in a particular case, the Council must therefore consider whether s 540 is applicable.

126. If, for the purposes of s 537(2), the Council concludes that there is a reasonable likelihood of a finding of unsatisfactory professional conduct, there will clearly be room for the possible operation of s 540 as that section is essentially concerned with such conduct. It permits the complaint procedure to be brought to a summary conclusion in certain circumstances.

127. The Council argued on appeal that where however the Council is satisfied, for the purposes of s 537(2), that there is a reasonable likelihood of professional misconduct, s 540 is incapable of being engaged and it is therefore unnecessary in that circumstance for the Council to turn its mind to that section. It argues that the words “unsatisfactory professional conduct (but not professional misconduct)” in s 540(1)(b)(i) render s 540 inapplicable where there is satisfaction under s 537(2) of a reasonable likelihood of professional misconduct.

128. I do not consider that the language of the provision supports this approach. As I read it, s 540(1)(b)(i) is directed to the Council’s satisfaction that there is a reasonable likelihood that the Tribunal might make a finding of unsatisfactory professional conduct without making a finding of professional misconduct. The alternative construction requires the notional adaptation of the words “but not professional misconduct” to read “but no reasonable likelihood of a finding of professional misconduct”.

129. I illustrate the point by using a numerical analysis such as that adopted by Basten JA. First, in a particular case the Council may be satisfied that there is a 40% chance (therefore a “reasonable likelihood”) of the Tribunal finding professional misconduct. At the same time, it may consider that there is no realistic chance of a finding of unsatisfactory professional conduct rather than professional misconduct because the issue before the Tribunal is anticipated to be whether the conduct (for example, trust account defalcation) occurred and because, if it is found to have occurred, the misconduct will undoubtedly be found to have been of a very high level. In such a case, the Council will readily conclude that s 540 is inapplicable and perform its duty under s 537 to commence proceedings with respect to the complaint in the Tribunal.

130. Secondly, there may be a case in which the Council considers that there is real doubt as to the level of seriousness at which the Tribunal will characterise the practitioner’s conduct. Thus the Council may consider that there is a reasonable likelihood (say, a 40% chance) that the Tribunal will characterise the conduct as professional misconduct but at the same time consider that there is a reasonable likelihood (say, a 40% chance) that the Tribunal will instead characterise it as only unsatisfactory professional conduct. In that case, s 540(1)(b)(i) will be engaged and the Council will have to consider the other matters to which s 540 refers. If it concludes that s 540 is inapplicable, it will perform its duty under s 537(2) to commence proceedings in the Tribunal.

131. It follows from what I have said that I disagree with Basten JA’s view that there are constructional choices reasonably open in respect of s 540(1)(b)(i). Its meaning is in my view tolerably clear. Moreover, I do not consider that the Council is required by s 537(2) to consider whether it is satisfied that there is a reasonable likelihood of a professional misconduct finding and then required to consider the same question again for the purposes of s 540(1)(b)(i). What it is required to consider for the purposes of the latter provision is whether there is a reasonable likelihood of a finding of unsatisfactory professional conduct simpliciter (that is without a finding of professional misconduct).

132. In relation to his Honour’s “purposive approach” to construction (see [108] above), I do not consider the construction I have found to be correct to involve any difficulty, inconvenience or anomaly. If there is a reasonable likelihood of a finding of only unsatisfactory professional conduct (even though there is also a reasonable likelihood of a finding of professional misconduct), it is not inappropriate for the possibility of the Council taking one of the summary courses of action to which s 540 refers to be open. Nor does the construction place on the Council any significant burden. When considering whether there is a reasonable likelihood of a finding of professional misconduct, there should be no difficulty in it considering at the same time whether there is or is not a reasonable likelihood of a finding of unsatisfactory professional conduct without a finding of professional misconduct.

133. I do not consider the legislative history to which Basten JA refers as of assistance because, unlike his Honour, I do not regard s 540(2) as reasonably open to more than one construction. In any event, I observe that s 134 of the Legal Profession Act 1987 (NSW) required the Council to undertake a quite different analysis to that which the present legislation requires. Under s 134, the Council had to be satisfied, not as to whether there was a reasonable likelihood of certain outcomes, but whether the complaint “involves” unsatisfactory professional conduct or professional misconduct. Section 155 of the Legal Profession Reform Act 1993 (NSW) introduced the concept of “reasonable likelihood”. As I read it, that section, in respects which are presently relevant, is to the same effect as the present section.

134. As I have indicated above, I would dismiss the appeal with costs. Such costs are to include the costs of the application for leave to appeal.

**********

Endnotes

Amendments

26 October 2018 - [60] "s540(b)" amended to "s540(1)(b)".

[69] first sentence typographical error corrected.

Decision last updated: 26 October 2018