Finlayson v Legal Practitioners Conduct Board

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application for Judicial Review)
FINLAYSON & ORS v LEGAL PRACTITIONERS CONDUCT BOARD & ANOR
[2012] SASC 77
Judgment of The Honourable Justice White
11 May 2012
PROFESSIONS AND TRADES - LAWYERS - COMPLAINTS AND DISCIPLINE - PROFESSIONAL MISCONDUCT AND UNSATISFACTORY PROFESSIONAL CONDUCT
ADMINISTRATIVE LAW - JUDICIAL REVIEW - GROUNDS OF REVIEW - RELEVANT CONSIDERATIONS
Application for judicial review of a notice issued by the Legal Practitioners Conduct Board requiring a practitioner whose conduct is being investigated by the Board to produce certain documents to it. Practitioner seeks a declaration that the notice is invalid or, in the alternative, an injunction restraining the Board from disclosing the produced documents to other persons.
Whether the Board's decision to issue the notice was valid - whether the notice required the production of documents exceeding the proper scope of the Board's investigation - whether the issuer of the notice failed to have regard to a relevant consideration - whether an injunction should be granted.
Held: (dismissing the claims that the decision to issue the notice, and the notice itself, are invalid but granting an injunction); the scope of an investigation by the Board of a practitioner's conduct extends to the conduct the subject of the complaint and conduct reasonably incidental to, or associated with, that conduct. The documents which the notice required the practiitioner to produce to the Board did not exceed the proper scope of the Board's investigation, and the notice was authorised by s76(3)(a) of the Legal Practitioners Act 1981 (SA) - the evidence did not support a conclusion that the decision-maker failed to have regard to a relevant consideration and, in any event, failure to have regard to that consideration could not have materially affected the decision - a limited injunction should be granted to protect the position of the practitioner's clients with respect to the documents which are subject to legal professional privilege.
Legal Practitioners Act 1981 (SA) s 68(1), s 73, s 74, s 76, s 77, s 95C; Legal Practitioners (Miscellaneous) Amendment Act 1996 (SA) ; Trade Practices Act 1974 (Cth) s 155; Federal Magistrates Court Rules 2001 r 2.08(4); Federal Court Rules (Cth), referred to.
George v Rockett (1990) 170 CLR 104; Hearne v Street (2008) 235 CLR 125; MF1 v National Crime Authority (1991) 33 FCR 449; Melbourne Home of Ford Pty Ltd v Trade Practices Commission (1980) 31 ALR 519; Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24; Collector of Customs v Pozzolanic (1993) 43 FCR 280; Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259; Johns v Australian Securities Commission (1993) 178 CLR 408; Goldberg v Ng (1995) 185 CLR 83; Carter v Northmore, Hale, Davy and Leake (1995) 183 CLR 121; Annetts v McCann (1990) 170 CLR 596, considered.

FINLAYSON & ORS v LEGAL PRACTITIONERS CONDUCT BOARD & ANOR
[2012] SASC 77
Civil

WHITE J. One of the functions of the Legal Practitioners Conduct Board (the Board) established under the Legal Practitioners Act 1981 (SA) (the LPA) is the investigation of suspected unprofessional or unsatisfactory conduct by legal practitioners.
The first plaintiff in these proceedings is a legal practitioner. The Board is investigating aspects of his conduct and has served on him a notice requiring him to produce specified documents to it (the Notice).
The plaintiffs seek a declaration that the Notice is invalid because it requires the production of documents going beyond the scope of the matters which the Board is entitled to investigate. They also contend that the Board failed to have regard to a relevant consideration, namely, the relevance of the documents sought to the proper subject matter of its investigation.
The plaintiffs seek, in the alternative, an injunction restraining the Board from making any disclosure to other persons of the documents which the first plaintiff (the practitioner) has produced. They are concerned in particular about the possibility that the Board may make disclosure of some or all of the documents to the persons whose complaints led to the Board’s investigation, as they are presently engaged in litigation with them.
The Board and Ms Rathbone, its director who exercised the Board’s power to issue the Notice, are the defendants to the proceedings.
Background
In the course of his employment as a practitioner by Grope Hamilton Lawyers and later by Allen Burtt Legal Services, the practitioner has acted for Alan Brewer and Alan Brewer Family Investments Pty Ltd (the second and third plaintiffs) in proceedings in the Federal Magistrates Court. The practitioner commenced the FMC proceedings on 7 October 2010. The respondents to those proceedings are Kaye Martin, Amici Corporate Pty Ltd and Amici Property Pty Ltd (collectively, the FMC Respondents). They are represented by a Melbourne firm of solicitors, Foster Nicholson Legal (FNL).
On 25 February 2011 the FMC Respondents made a complaint to the Board about the practitioner’s conduct in publishing articles relating to the FMC proceedings on an online blog site.
The Board provided a copy of the complaint to the practitioner and sought his response. By a letter dated 29 March 2011, the practitioner acknowledged his conduct, acknowledged that it was inappropriate, apologised for the anxiety and distress which his blogs may have caused, and gave what were, in effect, assurances that he now had an understanding of the nature and extent of his professional obligations in relation to the matters about which the FMC Respondents had complained.
On 5 April 2011, FNL, on behalf of the FMC Respondents, made an additional complaint regarding material which the practitioner had published on a website on 28 February 2011 and about other matters to which I will refer later. Although FNL asked that its letter be considered as a fresh complaint, the Board has treated it as an addendum to the complaint of 25 February 2011. The practitioner has provided a detailed response to this complaint.
Finally, on 29 August 2011, FNL made a third complaint to the Board. This was to the effect that the practitioner had misled the FMC at a directions hearing on 4 July 2011, at which the FMC Respondents were not present, by not informing the Court of the reasons for their absence and of the orders which the parties had agreed should be made by consent in their absence. The practitioner has provided a response to that complaint in which he denied a number of the assertions made by FNL.
On 12 January 2012, the Board wrote to the practitioner saying:
To assist the Board in its ongoing investigation, I would be obliged if you would now make available to me as soon as possible your complete file in this Federal Magistrates Court matter.
The practitioner responded by letter dated 30 January 2012, in which he raised issues of legal professional privilege, a possible deferral of the Board’s investigation and a possible confinement of the scope of the documents which the Board sought. The practitioner’s letter included the following:
… I consider that this is an appropriate case for the [Board] to utilise the provisions of s 76(3) of the Legal Practitioners Act so that there can be no doubt that documents are provided by the writer under compulsion of law and my clients may then avail themselves of s 95C of the Legal Practitioners Act.
On 6 February 2012 the Board, acting under s 76(3)(a) of the LPA, issued the Notice to the practitioner. The substantive portions of the Notice are as follows:
Notice To A Legal Practitioner
Pursuant to Section 76(3)(a) of the Legal Practitioners Act, 1981 (as amended)
Date                 6 February 2012
To                   Gregory Finlayson
Investigation     Complaints by Kaye Martin and Leath Nicholson (201103051X and 201201018X)
Whereas your conduct is under investigation in relation to the above matters, you are hereby required to produce the documents listed in the attached Schedule to the Legal Practitioners Conduct Board at its offices at Level 3, 33 Franklin Street by 5.00 pm on Monday, 13 February 2012.
…
Signed
Alexandra Rathbone, Director
…
Schedule
Description of Documents to be Produced:
1.    The whole of the file(s) maintained by you as an employee of Grope Hamilton Lawyers and of Allen Burtt Legal Services in respect of the instructions of Mr Alan Brewer and Brewer Family Investments Pty Ltd regarding Kaye Martin or Amici Corporate Pty Ltd or Amici Property Holdings Pty Ltd including the Federal Magistrates Court Litigation File No (P)ADG276/2010, and including all documented instructions, correspondence and copy correspondence, pleadings, documents, searches, emails, notes, memoranda and invoices.
In effect, the Board sought the production to it of all the files which the practitioner has maintained in respect of the instructions from his clients in relation to the FMC Respondents. Those files included, but were not limited to, the file or files relating to the FMC proceedings themselves. The wide range of documents to which the Notice refers is emphasised by the specific reference to the instructions, correspondence, pleadings, searches and invoices, as well as the practitioner’s own internal notes and memoranda.
The practitioner was concerned about producing his files to the Board as they contain matters for which his clients (the second, third and fourth plaintiffs)[1] claim legal professional privilege. He sought the deferral of the Board’s investigation until after the resolution of the FMC proceedings or, as an alternative, an undertaking by the Board to maintain the confidentiality of the documents. The Board refused each of these requests.
[1] The fourth plaintiff, Ruthwill Investments Pty Ltd, is not an applicant in the Federal Magistrates Court proceedings. However, the practitioner takes the view that the terms of the Notice issued by the Board require the production by him of the whole file which he holds on behalf of Ruthwill Investments Pty Ltd.
In order that he could not be said to have failed to comply with the terms of the Notice, the practitioner provided the documents to the Board. He did so in two instalments, with the second production occurring on 13 February 2012.
On the same day, the plaintiffs sought and obtained from this Court an interim injunction restraining the Board until further notice from inspecting or otherwise dealing with the documents produced by the practitioner. That injunction remains in force.
The declaratory and injunctive relief which the plaintiffs seek raises issues about the exercise by the Board of its statutory powers.
The Statutory Context
By s 68(1) of the LPA, the committee formerly known as the Legal Practitioners Complaints Committee continues in existence as the Board. Its functions are specified in s 74(1) of the LPA:
(1)     The functions of the Board are as follows:
(a)     to investigate suspected unprofessional or unsatisfactory conduct by legal practitioners in accordance with Subdivision 2;
(b)     following an investigation, to take action authorised under Subdivision 3 or to lay charges before the Tribunal;
(c)     to receive and deal with complaints of overcharging in accordance with Subdivision 4;
(d)     to arrange for the conciliation of complaints in accordance with Subdivision 5;
(e)     to commence disciplinary proceedings against legal practitioners in the Supreme Court on the recommendation of the Tribunal.
Section 76 is the principal provision concerning investigations by the Board. A number of its provisions are pertinent in the present case:
(1)The Board may, of its own motion, make an investigation into the conduct of a legal practitioner or former legal practitioner who the Board has reasonable cause to suspect has been guilty of unprofessional or unsatisfactory conduct.
(1a)The Board must make an investigation into the conduct of a legal practitioner or former legal practitioner where—
(a)     the Board has been directed to make the inquiry by the Attorney-General or the Society; or
(b)     a complaint has been received in relation to the conduct of the legal practitioner or former legal practitioner.
(1b)Despite subsection (1a), the Board may determine not to commence or continue an investigation that would otherwise be required as a result of receipt of a complaint if it is apparent to the Board that the complaint is frivolous or vexatious or if the Board is satisfied that the subject matter of the complaint has been resolved prior to commencement or completion of an investigation.
(2)No direction may be given to the Board under this section unless the Attorney-General or the Society (as the case may require) has reasonable cause to suspect that the legal practitioner or former legal practitioner to whom the proposed investigation relates has been guilty of unprofessional or unsatisfactory conduct.
(3)For the purposes of an investigation the Board, or a person authorised by the Board to exercise the powers conferred by this subsection, may—
(a)     by notice in writing, require specified documents, or documents of a specified class, in the custody or control of a prescribed person to be produced at a time and place specified in the Notice; and
(b)     at any time during ordinary business hours, inspect any documents in the custody or control of a prescribed person; and
(c)     seize or make notes or copies of any documents produced in accordance with this subsection, or take extracts from them.
(4)     A person who—
(a)     wilfully delays or obstructs the Board or an authorised person in the exercise of powers conferred by subsection (3); or
(b)     being a prescribed person, refuses without reasonable excuse to produce a document when required to do so in accordance with subsection (3),
is guilty of an offence.
Maximum penalty: $10 000 or imprisonment for one year.
(4a)The Board may, by notice in writing, require a legal practitioner or former legal practitioner whose conduct is under investigation to make a detailed report to the Board, within the time specified in the Notice, in relation to any matters relevant to the investigation.
(4b)A legal practitioner or former legal practitioner must comply with a requirement under subsection (4a).
Maximum penalty: $10 000 or imprisonment for one year.
It can be seen that under s 76, the Board is empowered to make an investigation of a practitioner’s conduct of its own motion (subs (1)), and that in two circumstances it is obliged to make an investigation (subs (1a)): when it is directed to do so by the Attorney‑General or by the Law Society; or when, subject to issues of frivolity, vexation and necessity (subs (1b)), it receives a complaint about a practitioner’s conduct.
The inter‑relationship between practitioners’ obligations to protect the legal professional privilege attaching to their client’s communications and documents, on the one hand, and their obligation to produce documents and to provide information to the Board under s 76(3), on the other, is addressed in s 95C of the LPA. Section 95C provides:
(1)It is not an excuse for a person to refuse or fail to answer a question or to produce a document as required under this Act on the ground that to do so might tend to incriminate the person, or make the person liable to a penalty, or on the ground of legal professional privilege.
…
(3)If a person objects to answering a question or to producing a document on the ground of legal professional privilege, the answer or document will not be admissible in civil or criminal proceedings against the person who would, but for this section, have the benefit of the legal professional privilege.
In short, legal professional privilege does not provide a ground upon which a practitioner may refuse to answer a question or to produce documents to the Board, when required to do so under s 76(3).
The Scope of an Investigation by the Board
In the present case, the Board was exercising the power vested in it by s 76(1a)(b), ie, it was making the investigation which it was required to make by virtue of the receipt of complaints about the practitioner’s conduct. The Board’s letter to the practitioner of 22 March 2011 indicated expressly that it regarded itself as “required” to investigate the complaint of the FMC Respondents; the correspondence from the Board to the practitioner refers to the complaints;[2] and the Notice itself recites in its preamble that the practitioner is under investigation in relation to the identified complaints.
[2] I note that Ms Rathbone’s report to the Board of her decision to issue the Notice refers only to the first complaint of the FMC complainants, but nothing turns on that presently.
Accordingly, this is not a case in which the Board relies on a suspicion which it has itself formed that the practitioner has been guilty of unprofessional or unsatisfactory conduct (subs (1)), and there was no suggestion that it had received a direction from the Attorney‑General or the Law Society under s 76(1a)(a).
One submission of the Board (which ultimately it did not press) was that s 76(1a) should be understood as indicating that the receipt by the Board of a direction or a complaint is an event which triggers an obligation for it to make an investigation, but that neither a direction nor a complaint confines the scope of that investigation, it being left to the Board to determine the aspects of a practitioner’s conduct which it will investigate. That is to say, when the Board receives a direction or complaint, it may investigate such aspects of a practitioner’s conduct as it chooses, although it is to be expected that it will take into account the matters referred to in the direction or complaint.
In my opinion, that is not a proper understanding of subs (1a). When the Board receives a complaint, it is the content of the complaint which, in the first instance, identifies the conduct the Board is to investigate in order to assess whether the practitioner has engaged in any unprofessional or unsatisfactory conduct, and in turn, the scope of the investigation which s 76 authorises. That scope may also include conduct reasonably incidental to, or associated with, the conduct about which the complaint is made, even if the complaint does not make express reference to it. The scope may also be enlarged or confined by the response, explanation or justifications which practitioners give to the Board when the complaint is published to them.
Likewise, the scope of an investigation which the Board undertakes on receipt of a direction from the Attorney-General or the Law Society is limited to the conduct or omissions of the practitioner which is reasonably suspected to be unprofessional or unsatisfactory. The requirement under subs (2) that the Attorney and the Society must have reasonable cause to suspect that the practitioner to whom the proposed investigation relates has been guilty of unprofessional or unsatisfactory conduct before they can give a direction to the Board indicates that this is so. Such a state of mind “requires the existence of facts which are sufficient to induce that state of mind in a reasonable person”.[3] It is reasonable to conclude that the Attorney and the Society could have a suspicion of this kind only in relation to particular alleged, or apparent, conduct or omissions. It will be that conduct or those omissions which may be the subject of the direction and, accordingly, of the investigation subs (1a)(a). That is to say, it is the conduct which is the subject of the reasonable suspicion, together with other conduct which is reasonably incidental or ancillary to that conduct, which will be the proper subject of the Board’s investigation.
[3] George v Rockett (1990) 170 CLR 104 at 112.

The scope of the investigation which the Board may undertake of its own motion under s 76(1) is also limited to that conduct (which includes omissions) of a practitioner which the Board reasonably suspects may amount to unprofessional or unsatisfactory conduct.
The legislative history of s 76 also supports the view that it is the subject matter of the complaint received by the Board which defines the scope of the investigation which it is to undertake under subs (1a)(b). When s 76 was first enacted in 1981, subss (1) and (2) provided as follows:
(1)The [Board] may of its own motion, and shall at the direction of the Attorney‑General or the Society, make an investigation into the conduct of a legal practitioner.
(2)No direction shall be given to the [Board] under this section unless the Attorney‑General or the Society (as the case may require) has reasonable cause to suspect that the legal practitioner to whom the proposed investigation relates has been guilty of unprofessional conduct.
It can be seen that, while the Attorney and the Society could give a direction only when they had the requisite suspicion of unprofessional conduct, the Board’s power to make an investigation of its own motion was not so confined.
Section 76 was amended by the Legal Practitioners (Miscellaneous) Amendment Act 1996 (SA). The current form of subss (1) and (2) reflects the amendments which were then made. The amendment had two principal effects: first, to introduce the requirement for the Board to have reasonable cause to suspect unprofessional conduct before acting on its own motion; and, secondly, to oblige the Board (again subject to considerations of frivolity, vexation or necessity) to conduct an investigation if it received a complaint in relation to the conduct of a practitioner.
It is not readily to be supposed that the legislature intended by the one amendment to confine the powers of the Board (by the requirement for it to have a reasonable suspicion before acting on its own motion), whilst making the receipt of a complaint about the practitioner’s conduct the occasion for an unconfined investigation. That is particularly so given that the complaint may concern only a limited aspect of a practitioner’s conduct. It is reasonable to conclude instead that the legislature intended s 76(1a)(b) to have the effect that the Board would investigate only the conduct of a legal practitioner which was the subject of the complaint to it.
This is not to suggest that a complaint made to the Board will constitute some form of immutable definition of the investigation which the Board may undertake. As I have already indicated, that investigation may extend to matters which are reasonably incidental to, or associated with, the conduct which is the subject of the complaint, and may include matters arising from a practitioner’s response to a complaint. Further, as an incident of its investigation, the Board may become aware of additional matters. Those matters may give rise to a reasonable suspicion by the Board that a practitioner has engaged in unprofessional or unsatisfactory conduct, so that it may consider it appropriate, acting under s 76(1), to broaden the scope of its investigation.
There is no reason to suppose that the Board is not entitled to act on such a suspicion. It is not appropriate for the Board’s powers to be construed narrowly. The Board acts in the public interest for the protection of the public and not for the purposes of punishment of practitioners. It exercises an important role in the maintenance of public confidence in the integrity of the legal profession by providing a means of accountability. The maintenance of proper standards of professional conduct by lawyers is an important adjunct to the administration of justice. The Board’s powers, although in some respects intrusive, are to be construed in the context of this important role.
The Scope of the Complaints
As already noted, the Board’s notice indicated that the subject matter of its investigation was the complaints made by the FMC Respondents and FNL.
The first complaint of the FMC Respondents related only to the articles posted by the practitioner on an online blog site on 8 October 2010, 25 October 2010 and 4 November 2010 concerning the FMC proceedings. They complained both of the initial publication of the three articles and of the practitioner’s omission to remove the articles from the blog site following an order made in the Federal Magistrates Court on 24 November 2010 striking out the applicants’ statement of claim.
The FMC Respondents referred to Professional Conduct Rules 19.1 and 19.2, to Order 46, r 6 of the Federal Court Rules then in force,[4] and to the implied undertaking not to use documents or information filed in a court for purposes unrelated to the conduct of the proceedings.[5]
[4] By r 2.08(4) of the Federal Magistrates Court Rules 2001, r 6 of Order 6 of the Federal Court Rules applies to the searching of certain records in the Federal Magistrates Court.
[5] Hearne v Street [2008] HCA 36; (2008) 235 CLR 125.
Rule 19.1 of the Professional Conduct Rules as in force in 2010 precluded practitioners from publishing, other than in limited circumstances, any material concerning current proceedings in which they were is engaged. The FMC Respondents contended that none of the circumstances constituting an exception to this general rule were applicable, with the effect that the practitioner was in breach of that rule.
Rule 19.2 precluded a practitioner from publishing material concerning current proceedings which (relevantly) “is inaccurate or coloured in comment or unnecessary description” or which “identifies the practitioner as a practitioner and appears to express the practitioner’s own opinion on matters relevant to the case”. The FMC Respondents referred to aspects of the blogs which they submitted infringed those prohibitions.
The FMC Respondents submitted that the practitioner had breached the implied undertaking by publishing extracts from an affidavit of their solicitor, Mr Nicholson, before that affidavit had been read in open court or admitted into evidence. They also contended that the publication of extracts from the affidavit compromised the effect of Order 46, r 6(3) of the then Federal Court Rules, which made public access to affidavits filed in that Court subject to a grant of leave by the Court.
The complaint made by the FMC Respondents on 5 April 2011 raised two principal matters. First, the FMC Respondents complained that material which the practitioner had published on the website at Grope Hamilton Lawyers on 28 February 2011 was dishonest and infringed Professional Conduct Rule 30. They referred to an entry in the practitioner’s portion of the website at Grope Hamilton Lawyers under the heading “View the judgments I have worked on”. That entry listed some matters in which Mr Nicholson and another principal of FNL (Ms Ryan) had been involved, as well as companies for which they had acted. The complaint pointed out that these matters had occurred before the practitioner had been admitted as a legal practitioner and so were not matters on which he had worked as a lawyer. The complaint continued:
The obvious inference arising from the timing of the email chain passing between Mr Finlayson and Foster Nicholson Legal between 3 February 2011 and 28 February 2011 is that from 28 February 2011, Mr Finlayson has sought to disparage Mr Nicholson and Ms Ryan by posting historical documents relating to Bill Express Ltd and OnQ Group Ltd on the Grope Hamilton Lawyer website under the heading of “Judgments I have worked on”.
In our view this posting and the use of historical information going back some seven years is clearly unrelated to any “judgment Mr Finlayson has worked on”. There is no connection between Mr Finlayson’s role as a lawyer and OnQ Group Ltd and Bill Express Ltd companies. The creation of a “Bill Express scrapbook” is an attempt to disparage Mr Nicholson and Ms Ryan in their capacity as solicitors for Amici.
The complaint went on to suggest that the practitioner’s conduct infringed Professional Conduct Rules 21, 28 and 30.
The second aspect of the complaint made on 5 April 2011 concerned the adequacy of the steps taken by the practitioner to disable the blogs of 8 October, 25 October and 4 November 2010. The practitioner had informed FNL, in an email of 23 December 2010, that the “articles have been disabled and will remain so until further notice”. In their complaint of 5 April 2011, FNL asserted:
[O]ur client has today discovered that contrary to Mr Finlayson’s previous assertions … that he has disabled the offensive references on his site, it now appears that part of the offensive material has been reconfigured so as to be visible to searchers via Google.
The letter then went on to give an example.
FNL also submitted that the additional conduct of which the FMC Respondents complained in that letter should be taken into account in the consideration of Mr Finlayson’s response to the first complaint:
Please consider the above matters as a fresh complaint on the one hand, and also a response to the assertion by Mr Finlayson, in his letter to the Legal Practitioners’ Conduct Board on 29 March 2011, that he appreciates the nature and extent of his professional obligations. In our clients’ view the purported contrition of Mr Finlayson could not be further from the reality. Mr Finlayson’s contrition is disingenuous and designed merely to extricate himself from a professionally embarrassing situation that he bought upon himself [by] engaging in unsatisfactory conduct.
Thus, the FMC Respondents complained about the practitioner’s further conduct and also commented adversely on the genuineness of the practitioner’s expressions of contrition and understanding of his professional responsibilities.
I note that the FMC Respondents also made an assertion in the letter of 5 April 2011 about the adequacy of a letter which the practitioner had sent to the Federal Magistrate in relation to his breach of the implied undertaking. However, as I understand it, the FMC Respondents did not make this assertion the subject of a complaint. It does not seem to have been treated as a complaint by the Board.
On 12 May 2011, the practitioner provided a lengthy response to the FMC Respondents’ second complaint. It traversed a number of matters, not all of which are relevant for present purposes. However, the practitioner did assert that some of the entries on the website formed part of, or were linked to, investigations which he had undertaken in relation to his conduct of the FMC proceedings. In particular, he asserted that some of the matters about which the FMC Respondents had complained were the result of investigations which he had considered appropriate to make in order to determine whether there were potential further respondents to the FMC proceedings, and for the purpose of obtaining evidence for use in those proceedings. In this way, he claimed that there was a proper forensic purpose for his conduct.
The practitioner also asserted that the access via Google to the Grope Hamilton Lawyers’ website about which complaint was made was to the heading only of the article to which he had previously blocked access and that he had not understood that his previous action would still allow that to occur.
I summarised earlier the terms of the complaint which FNL made to the Board on 29 August 2011. The circumstances of this complaint are confined to the practitioner’s conduct at a directions hearing in the FMC proceedings on 4 July 2011, having regard to communications which he had had with members of FNL commencing on 29 June 2011. On any view, the subject matter of this complaint is quite discrete.
Does the Scope of the Notice Exceed the Proper Scope of the Board’s Investigation?
The practitioner’s submission was that the requirement in the Notice that he produce all of his files relating to the instructions which he has received from the plaintiffs, including those relating to the FMC proceedings, went beyond the proper scope of the Board’s investigation, having regard to the terms of the complaints. For this reason he submitted that s 76(3)(a) did not authorise the issue of the Notice.
Counsel for the Board submitted that when the Board is required to investigate a practitioner’s conduct, it is for the Board itself to determine the relevance of the documents it seeks, and that the practitioner’s challenge to the validity of the Notice should be determined (and dismissed) on that basis. He referred to the statement of Jenkinson J in MF1 v National Crime Authority that “the evaluation of probabilities concerning the usefulness of information is, within limits, for the investigator, and certainly not for the person from whom disclosure is sought”.[6] Later, counsel submitted that the Board may never know whether the documents which it requires to be produced to it by a notice under s 76(3)(a) are relevant to its investigation until it has had an opportunity to examine them. The submission seemed to be that the Board could determine for itself the documents which it required to be produced to it, even though it would not be able to determine the relevance or otherwise of those documents to its investigation until after it had examined the documents.
[6] (1991) 33 FCR 449 at 461.
The power invested in the Board by s 76(3)(a) is of course to be exercised only for the purposes of an investigation which the Board is authorised or directed to undertake under subs (1) or (1a). In Melbourne Home of Ford Pty Ltd v Trade Practices Commission,[7] Brennan, Keely and Fisher JJ said:
An excess of power may appear if the requirement for information or documents is couched in such wide and general terms that a proper exercise of the investigatory power could not support the requirement in question. This is but a particular application of the general principle that the exercise of a discretionary power must be reasonably capable of being regarded as related to the purpose for which the power is conferred … If the requirement expressed in a particular notice is reasonably capable of being so regarded, that ground for alleging an excess of power fails.[8]
[7] (1980) 31 ALR 519.
[8] Ibid at 531.
I referred earlier to a number of considerations which indicate that the Board’s powers of investigation should not be construed narrowly. The reasoning of the Full Federal Court in Melbourne Home of Ford provides additional support for that approach. In that case, the Court considered s 155 of the Trade Practices Act 1974 (Cth) which empowered the Chairman of the Trade Practices Commission, by notice in writing, to require a person to furnish to the Commission specified information and to produce specified documents. In relation to that power, the Court said:
In the present case, the investigative power of the Chairman is being exercised in an investigation into a matter that may constitute a contravention of s 45. Proof of a contravention of that section often depends upon circumstantial evidence. Section 45 is itself expressed in general terms, and when an investigation into such a matter commences with little information, the range of enquiries may need to be broad rather than specific. … The investigative power may properly be exercised by inquiring into the existence of facts which do not themselves constitute a contravention or deny the possibility of a contravention. The power may properly be exercised to ascertain facts which may merely indicate a further line of inquiry, or which may tend to prove circumstances from which an inference can be drawn as to the existence of other facts which have a more immediate and proximate relationship to the matter under investigation.[9]
That reasoning is equally applicable in the present circumstances. It indicates that the documents of which the Board may seek production in relation to an investigation may be of a general kind.
[9] Ibid at 530. See also MF1 v National Crime Authority (1991) 33 FCR 449 at 471 (Ryan J).
However, in my respectful opinion, the Board’s submissions on this topic tended to conflate the authorised purposes for which the Board may exercise its powers under s 76(3)(a), on the one hand, with the relevance which the documents required to be produced may have to an authorised investigation, on the other. These are distinct concepts. To say that it is for the Board to determine the relevance of the documents which it seeks to an investigation which it is authorised to undertake says very little about the antecedent question of whether that investigation was authorised.
The true position is that in every case, it must be able to be said that, considered objectively, the Board has exercised the power under s 76(3)(a) to require the production of documents for a purpose which is reasonably related to that for which that power is granted, ie, an investigation authorised by s 76. The Board’s own subjective view of the position is not decisive of that question. Further, the compliance or otherwise by the Board with the requirement that its exercise of power be reasonably related to the purposes for which the power is conferred must be capable of assessment at the time of its exercise, and not only after that exercise.
For these reasons, it is inappropriate to assess the validity of the Notice in the manner for which the Board contended in this submission.
If the scope of the Board’s investigation was confined to the matters raised by the complaints of 25 February and 29 August 2011, there would, in my opinion, be real doubts as to whether the Notice was sufficiently related to that scope. These two complaints raised matters of a reasonably discrete kind: the publication of articles on a blog site on three identified dates; and the practitioner’s conduct in relation to a single directions hearing. It is not easy to see that production of the whole of the practitioner’s files relating to the FMC proceedings, let alone documents on any wider basis, could be reasonably related to an investigation of the practitioner’s conduct in those respects.
However, it is not necessary to express a final conclusion about that. That is because of the investigation required in relation to the FMC Respondents’ complaint of 5 April 2011 and, in particular, the practitioner’s response to that complaint. Those documents suggest at least that the following matters warrant investigation by the Board:
(a)whether the matters published by the practitioner on the website on 28 February 2011 amounted to further breaches of the Professional Conduct Rules;
(b)whether the practitioner’s conduct could be explained by reference to legitimate forensic purposes in connection with the FMC proceedings. The resolution of this issue would seem to require an understanding by the Board of the issues arising in the FMC proceedings and of the practitioner’s instructions in relation to those issues;
(c)whether, alternatively, the practitioner was prompted by some personal animus towards the principals of FNL. This relates to the alleged breaches of the Professional Conduct Rules and, in the event that the Board considered that such breaches had occurred, to the seriousness with which they should be regarded;
(d) whether there were grounds for regarding the matters published by the practitioner on the website as dishonest. This would require, at the least, some examination of the materials known to the practitioner at the time of each publication and, in turn, of the instructions given to the practitioner and of the investigations which he had made;
(e)the genuineness of the practitioner’s expressions of contrition.
These aspects of the second complaint, and of the practitioner’s response to that complaint, indicate, by themselves, that many of the documents sought by the Board are reasonably related to the proper subject matter of its investigation. I accept that it could be said that, with the exception of matters relating to the third complaint, that relevance is not so apparent in respect of events occurring after 29 March 2012 (the date of the practitioner’s first response to the Board). However, the subsequent course of events in the practitioner’s conduct of the FMC proceedings may cast some light on the practitioner’s state of mind, knowledge and purpose at earlier times. This suggests that some form of compartmentalisation of the documents which the Board may seek is inappropriate. In any event, I did not understand the practitioner to contend that some kind of division of the documents is appropriate.

For these reasons, the practitioner’s challenge to the Notice on the basis that it required production of the documents going beyond the scope of the matters which the Board is entitled to investigate must fail, and I so hold.
Failure to have Regard to a Relevant Consideration
The practitioner submitted, in the alternative, that when Ms Rathbone made the decision as to the range of documents which the Board should require him to produce, she had failed to have regard to a relevant consideration, namely, the relevance of the documents described in the Notice to the subject matter of the Board’s investigation.
It is not readily apparent that this submission could provide, independently, a ground on which the Board’s Notice could be declared invalid.
An administrative decision may be set aside on judicial review if the decision‑maker fails to have regard to considerations to which, on a proper reading of the statute by which the decision is authorised, the decision‑maker was bound to consider.[10] That is the principle which the practitioner sought to invoke in the present case.
[10] Minister for Aboriginal Affairs v Peko‑Wallsend Ltd (1986) 162 CLR 24 at 39.
However, the submission faces a number of difficulties.
In the first place, the evidence does not support a conclusion that Ms Rathbone did fail to have regard to the relevance of the documents sought to the Board’s investigation. The evidence upon which the practitioner relied for this submission was Ms Rathbone’s report to the Board of 6 February 2012 concerning her decision to issue the Notice. That report appears to have been prepared contemporaneously with the Notice itself. In her report, Ms Rathbone referred to the first complaint of the FMC Respondents and to the request of the Board’s employed solicitor that the practitioner produce his file “as part of the Board’s ongoing investigation”. She did not attempt any articulation of the relevance which she perceived the documents sought by the Notice may have to that investigation.
The practitioner’s submission was founded on the absence of such an articulation. However, it does not follow from this absence that Ms Rathbone did fail to consider that issue. Ms Rathbone was not bound to discuss that issue in her report. Further, the report does not purport to be a comprehensive statement of the circumstances of the complaints, or of the actions which the Board had taken in relation to them, nor does it contain any analysis or assessment of them. It is in the nature of a report of the fact that Ms Rathbone had exercised the power delegated to her and perhaps a report on the present status of the investigation. The absence of any discussion of relevance in a report of this kind does not support the inference for which the practitioner contended. The report should not be read with “an eye keenly attuned to the perception of error”.[11]
[11] Collector of Customs v Pozzolanic (1993) 43 FCR 280 at 287, approved in Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 272.
The practitioner’s submission faces an even more fundamental difficulty. On the findings which I have made, the documents sought by the Notice are relevant to the Board’s investigation of the complaints, in particular the complaint of 5 April 2011 and of the matters raised by the practitioner by way of explanation and justification for his conduct, and have been sought for a proper purpose. Accordingly, even if Ms Rathbone did fail to have regard to the relevance of the documents, it would not avail the practitioner presently. It does not assist him to establish that Ms Rathbone failed to have regard to a consideration which, had it been considered, could only have confirmed the appropriateness of her decision. The practitioner’s submissions overlooked that a failure to have regard to a matter which a decision‑maker is bound to consider will not give rise to an entitlement to relief unless that matter could have materially affected the decision.
Accordingly, this ground of the practitioner’s application fails.
The Application for a Injunction
The plaintiffs assert that the files of the practitioner contain material for which claims of legal professional privilege may properly be made. I accept that that is likely to be so. The Board did not contend to the contrary.
The plaintiffs are concerned about the use which the Board may make of the documents which are the subject of the claim of privilege. They are particularly concerned that those documents, and their contents, should not be disclosed to the FMC Respondents or to FNL. That concern is understandable bearing in mind that the FMC proceedings are ongoing.
By letter dated 10 February 2012, the practitioners sought an undertaking from the Board that it would maintain the confidentiality of the documents. The Board has declined to give any such undertaking, saying:
The Board has determined to continue its investigation at the present time. In doing so it will be mindful of the ongoing litigation between your clients and the complainants, but will give no undertakings to you or your clients.
Each of the Board, its members and its employees are subject to obligations of confidentiality in relation to information acquired in the course of the exercise of the Board’s functions. However, those obligations are qualified in a number of respects. Section 73 of the LPA provides:
(1)Subject to this section, a member of the Board or a person employed or engaged on work related to the affairs of the Board must not divulge information that comes to his or her knowledge by virtue of that office or position except—
(a)     in the course of carrying out the duties of that office or position; or
(b)     as may be authorised by or under this Act; or
(ba)   as may be authorised by or under an agreement or arrangement that has been approved by the Attorney-General under section 73A; or
(c)     in evidence before a court in which criminal proceedings arising from matters subject to a report of the Board have been brought.
Maximum penalty: $10 000.
(2)A person referred to in subsection (1) may divulge information referred to in that subsection to—
(a)     the Council; and
(ab)   the Attorney-General; and
(ac)   a member of a law enforcement or prosecution authority of a State, or of the Commonwealth, relating to a matter referred to the authority by the Attorney-General or reported to the authority by the Board, to which the information is relevant; and
(ad)   a regulatory authority of a participating State who has requested the information in connection with actual or possible disciplinary action against a legal practitioner; and
(b)     a committee or person to whom the Council has delegated its power to appoint an inspector pursuant to Division 5 of Part 3; and
(c)     an inspector appointed pursuant to that Division.
(3)Nothing in this section prevents the disclosure of information relating to a complaint to the complainant or a person acting on behalf of the complainant.
It can be seen that the effect of subss (1) and (2) is that information obtained by the Board can be disclosed for specified purposes to a number of specified persons. The effect of subs (3) is that despite the obligations of confidentiality imposed by subs (1), disclosure of information obtained by the Board can be made to a complainant or a person acting on behalf of the complainant. It is that latter possibility in particular which gives rise to the plaintiffs’ present concerns.
At the hearing, counsel for the Board confirmed that the Board would not provide any formal undertaking to the plaintiff in relation to the possible disclosure of the contents of the practitioner’s files and, indeed, contended that the express reservation of a power in the Board to disclose matters to a complainant made it inappropriate to do so.
In addition to the circumstances contemplated by s 73, the LPA also provides for one circumstance in which the Board is bound to make disclosure of material in its possession. Section 77(1) obliges the Board to make a report to the Attorney-General and the Law Society following an investigation in which it is satisfied that there is evidence of unprofessional conduct by a legal practitioner. By subs (4), the Board must report any suspected unprofessional conduct which may constitute an offence to all relevant law enforcement prosecution authorities. In such cases, s 77(5) provides that the Board must, at the request of the Attorney-General, furnish the Attorney with any material in its possession relevant to the investigation or prosecution of the suspected offence.
There is nothing in the materials presently before the Court which suggests that s 77(4) and (5) may be attracted in the present case. The significance of s 77 for present purposes, however, is that it indicates that the Board could not give an undertaking which would preclude it from acting in accordance with the obligations imposed on it by that section, and may not be enjoined from doing so.
Counsel for the Board submitted that the plaintiffs could rely upon the “good sense” of the Board. However, he also maintained that the Board could, if it thought it appropriate to do so, disclose matters in the practitioner’s file to the FMC Respondents for their comment, and further, could do so without notice to the plaintiffs.
Counsel for the Board also submitted that the plaintiffs’ concerns with respect to the compulsory disclosure of the privileged document were met by s 95C(3). The effect of that subsection is that if a person objects to producing a document on the ground of legal professional privilege but is nevertheless obliged to produce the document by virtue of subs (1), the document will not be admissible in civil or criminal proceedings against the person who would otherwise have had the benefit of the privilege.
I agree that s 95C(3) provides some protection to the practitioner’s clients. However, contrary to the Board’s submissions, that protection is of a limited kind. Section 95C(3) relates only to the use of documents in civil or criminal proceedings, and not to any other uses. As Brennan J observed in Johns v Australian Securities Commission, information is intangible and, once obtained, can be disseminated or used in a variety of ways.[12] The mere knowledge of aspects of the practitioner’s file, or of lines of investigation which he was pursuing, or of the persons whom he regarded as potential respondents in the FMC proceedings, may be very useful to the FMC Respondents in that litigation. It is for that reason that, earlier in these reasons, I endeavoured to be circumspect when summarising the practitioner’s response to the complaint of 5 April 2011.
[12] (1993) 178 CLR 408 at 423.
It is reasonable for the Court to proceed on the basis that the Board will be sensitive to the issues of legal profession privilege and that it will act with some care in relation to the privileged documents produced to it. It is also reasonable to suppose that the Board would not lightly disclose to the FMC Respondents any of the contents of the file to which privilege attaches. That provides some measure of protection to the practitioner’s clients, to whom the privilege belongs. However, it is not a complete protection and, as already noted, counsel for the Board asserted the entitlement of the Board, if it considered it appropriate to do so, to disclose aspects of the files to the FMC Respondents without any prior notice to the plaintiffs. There remains a risk therefore that a complete loss of privilege will occur, without the practitioner’s clients knowing that it has occurred, or will occur, and for purposes which are unrelated to their interests in the FMC proceedings.
Legal professional privilege is a substantive general principle of the common law, playing an important role in the effective and efficient administration of justice by the courts.[13] It has been described as “a practical guarantee of fundamental constitutional or human rights” and “a natural, if not necessary, corollary of the rule of law and a potent force for ensuring that the equal protection of the law is a reality”.[14]
[13] Goldberg v Ng (1995) 185 CLR 83 at 93-4.
[14] Carter v Northmore, Hale, Davy and Leake (1995) 183 CLR 121 at 161.
Section 95C(1) of the LPA abrogates the principle for limited purposes, but the production of documents under a process of coercion does not destroy the privilege, nor amount to a waiver. In the present case, the practitioner’s clients have a legitimate interest in the use which the Board may make of their privileged communication, particularly by disclosure to the FMC Respondents.
There is no suggestion that the practitioner’s clients have in some way been complicit in the conduct which is being investigated by the Board. On the materials presently available, the confidentiality of their communications has been put at risk by circumstances over which they have no control. They would be innocent victims if the Board did make disclosure of privileged material under s 73(3).
In Johns v Australian Securities Commission,[15] the High Court considered the disclosure by a delegate of the Australian Securities Commission to a Royal Commissioner of the transcripts of evidence given before the delegate by a witness who was compelled to attend for examination. A majority of the Court (Brennan, Dawson, Gaudron and McHugh JJ) held that before authorising the Royal Commission to use the transcripts in public hearings, the delegate should have given the witness an opportunity to oppose that course. Her failure to do so meant that the decisions to release the transcripts were invalid. This was an application of the principle that when a statute infers power upon a public official to destroy, defeat or prejudice a person’s rights, interests or legitimate expectations, the rules of natural justice regulate the exercise of that power unless they are excluded by plain words of necessary intendment.[16]
[15] (1993) 178 CLR 408.
[16] Annetts v McCann (1990) 170 CLR 596 at 598.
That principle should be applied in the present circumstances. The disclosure by the Board to the FMC Respondents of the privileged documents of the practitioner’s clients would defeat a substantive common law right of those clients. That is particularly so because the privilege is an important adjunct to the prosecution by those clients of their claims in the Federal Magistrates Court.
I cannot detect in the LPA any exclusion by necessary intendment of the rules of procedural fairness in this context. In particular, I do not regard s 73(3) as precluding some limited qualification on the Board’s ability to provide documents to the FMC Respondents. Accordingly, I conclude that it would be inappropriate for the Board to make a disclosure of that kind without giving the plaintiffs an opportunity to be heard in relation to their intention to do so. As the Board declines to proffer any undertaking, an injunction should be granted to protect the position of the practitioner’s clients. The practitioner has not shown a proper basis for any wider injunction.
Summary
For the reasons given above, I reject the plaintiffs’ claims that the Board’s decision to issue the Notice and the Notice itself, are invalid. I will, however, issue an injunction restraining the Board, its members and persons employed or engaged on work relating to the affairs of the Board from divulging any of the contents of documents, or the documents themselves, produced to the Board by the practitioner in response to the Board’s Notice of 6 February 2012, without first giving to each of the plaintiffs 14 days notice in writing of the intention to do so. Any such notice is to identify the matters or documents of which the Board proposes making disclosure. The plaintiffs will thereby be enabled to make such submissions to the Board as they wish, and to take any other action which they consider appropriate.
I decline to issue any injunction in relation to disclosure of the documents or their contents to the persons and entities referred to in s 73(2) of the LPA. The injunction issued by the Court on 13 February 2012 should be discharged.
The plaintiffs are to prepare minutes to give effect to these orders. I will hear from the parties as to costs.

[2012] SASC 77

11 May 2012

Key Legal Topics

Areas of Law

Administrative Law

Legal Concepts

Judicial Review

Grounds of Review

Professional Misconduct and Unsatisfactory Professional Conduct