Hannebery v Legal Ombudsman - [1998] VSCA 142

SUPREME COURT OF VICTORIA

COURT OF APPEAL Not Restricted
No. 7147 of 1998

PATRICK ANTHONY HANNEBERY

Appellant

v
LEGAL OMBUDSMAN

Respondent

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JUDGES: TADGELL, PHILLIPS and CHERNOV, JJ.A.
WHERE HELD: MELBOURNE
DATES OF HEARING: 7, 8 December 1998
DATE OF JUDGMENT: 17 December 1998
MEDIA NEUTRAL CITATION: [1998] VSCA 142

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LEGAL PRACTITIONERS - Misconduct - Appeal - Attempted challenge to findings of fact masquerading as appeal on question of law.
PENALTY - Relevance to penalty of practitioner's failure to acknowledge and understand significance of dereliction of duty to client.
Legal Practice Act 1996, ss.138, 139, 160, 170(1).

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APPEARANCES: Counsel Solicitors
For the Appellant Mr P.F. Tehan Q.C. and Galbally & O'Bryan
Mr P.G. Priest Q.C.
For the Respondent Mr P.G. Lacava Legal Ombudsman

TADGELL, J. A.:

The appellant, Patrick Anthony Hannebery, claims pursuant to s.170 of the Legal Practice Act 1996 to exercise a right of appeal on questions of law from orders of the Legal Profession Tribunal made against him on 27 August last pursuant to Division 5 of Part 5 of the said Act. The orders followed findings on 13 August of misconduct upon charges brought against him by the respondent. The orders, made under s.160 of the Act, were that the appellant's practising certificate be cancelled with effect from 30 September 1998; that he be entitled to apply only after 1 October 2000 for a practising certificate entitling him to practice either as a principal or as an employee of another solicitor; and that he pay the respondent's costs of the proceeding.
In summary, the facts giving rise to the charges and findings of misconduct were these. During 1989, and for some years beforehand, the appellant practised in partnership as a solicitor at premises at 85 Douglas Parade, Williamstown. He had begun to practise in Williamstown, alone, in 1971. The Douglas Parade property was owned by the appellant's family company (Justin Cameron Pty. Ltd.) and a company called Rielelan Pty. Ltd. (the family company of his partner, John Whelan) as tenants in common in equal shares. The two-man firm, which practised as Hannebery & Whelan, held a lease of the Douglas Parade property through a service company, Hannelau Nominees Pty. Ltd. Before and during 1989 the appellant, Justin Cameron, Rielelan and Hannelau had accounts at the Williamstown branch of the National Australia Bank Ltd. (which I shall call "the Bank"), of which Mr J.E. Meney was manager. Mr Kevin Joseph Booth, a long-standing Williamstown resident, had dealings, as a client, with the appellant in 1975 and again during the first half of 1989. In about August 1989 Booth asked the appellant to act for him in relation to his proposed purchase, as an investment, of a unit in Cairns, Queensland. The appellant advised Booth to retain Queensland solicitors but told him also that, if he was interested in a property investment, his partner, Whelan, was looking for a purchaser of the one-half interest of his company (Rielelan) in the Douglas Parade property. In the event Booth agreed to purchase the interest for $300,000 and signed an unconditional contract with Rielelan dated 11 September 1989 that had been prepared by the firm. Booth retained the firm to do the conveyancing work for him, and it acted also for Rielelan. He sought finance for his purchase from the Williamstown branch of the Bank but ultimately obtained it elsewhere, on more favourable terms than the Bank would offer.
At the time the contract of sale was signed the Douglas Parade property was the subject of an undischarged mortgage to the Bank securing debts of Hannelau, Justin Cameron and Rielelan of some $442,000. The mortgage had been registered in 1985, not long after the appellant and Whelan had become partners. The vendor's statement that was provided to Booth pursuant to s.32 of the Sale of Land Act 1962, also dated 11 September 1989 and prepared by the firm and nominating it as solicitors for the vendor and for the purchaser, did not refer to any mortgage affecting the subject property.
On 6 October 1989, while the settlement of Booth's transaction was pending, Meney called by appointment at the appellant's office to discuss the latter's financial position and a means of reducing the total indebtedness to the Bank of himself and the partnership and Hannelau and Justin Cameron. In essence, the appellant agreed that the overall liabilities of these debtors would be reduced from $1,094,000 to $679,000, to be achieved in part by applying some of the proceeds of the forthcoming sale to Booth in reduction of the partnership debt. Meney wrote a so-called customer interview record of the discussion, which included a note to the effect that security over a remaining advance of $242,000 to Hannelau was to be provided by way of guarantee for that sum by "Justin Cameron P/L and Kevin Joseph Booth" supported by a mortgage over the Douglas Parade property. The note concluded by saying "The above is dependent on Booth signing a guarantee and mortgage, and Whelan agreeing to his property to be security".
On 27 October 1989 settlement of the transaction of sale by Rielelan to Booth occurred in the appellant's office at the subject property. Present at the settlement were the appellant, Booth and the bank manager, Meney. In order that Rielelan's interest might be transferred unencumbered to Booth, as the contract required, it was obviously necessary that the existing mortgage to the Bank be discharged. Booth, on the appellant's instruction, brought to the settlement a bank cheque, payable to the Bank, for the sum then payable by Booth to the vendor and gave it to Meney, who had brought along other documents prepared by the Bank. These included an instrument of mortgage in respect of the Douglas Parade property naming Justin Cameron and Booth as mortgagors and the Bank as mortgagee and an instrument of guarantee, guaranteeing Justin Cameron's debts to the Bank up to of $245,000, and naming Justin Cameron (curiously) and Booth as guarantors. The appellant affixed the common seal of Justin Cameron to these security documents and, as a director, attested its affixation; and in the appellant's presence Booth signed each of them respectively as a mortgagor and a guarantor. Meney signed them as attorney for the Bank. Booth swore that, as he was about to sign, the appellant said to him "You'll be my guarantor in this matter" and, when Booth asked "Why? Is it because of the dual ownership?", the appellant said "Yes". The appellant swore that this conversation did not occur.
The appellant deposed before the Tribunal that at the settlement he did not read the security documents, that he did not see Booth's name on them and that he did not then know that Booth was named in either of them as a party. He swore also that he had no discussion with Booth about the mortgage that had affected the Douglas Parade property at the time Booth signed the contract of sale or about the mortgage for which Meney produced the instrument at the settlement for execution by Justin Cameron and Booth as mortgagors. The appellant swore also that he did not see Booth sign the security documents at the settlement; and that the bank manager, Meney, "must have used some deceit and slight of hand to get that signature ... I did not observe Mr Booth signing any documentation for Mr Meney". When asked to explain why he did not see it, the appellant swore "I'm asking the Tribunal to accept that I must have been distracted ...". He was disposed during cross-examination also to assert that he "was not doing the settlement", and that he "was there to execute the documents to enable the matter to be settled". The appellant swore that he neither kept nor received any copy of the security documents; and at the settlement Booth was given none. Of the balance of purchase price paid at settlement by Booth, $200,000 was applied in reduction of the indebtedness of the partnership (through Hannelau, Justin Cameron and Rielelan) to the Bank.
There was no evidence of any relevant occurrence from the time of the settlement until May 1992. On 14 May 1992 the appellant wrote a letter in his own hand to Booth to say that Justin Cameron owed $239,000 to the Bank and that "if the Bank forces a sale, all sorts of problems could arise". By the letter the appellant invited Booth to purchase Justin Cameron's interest in the Douglas Parade property. Booth promptly declined but was, as he swore, sufficiently "bothered" to telephone Meney and ask him what the complications were to which the appellant was now alluding. It was then that Meney told Booth that he was a mortgagor of the subject property and a guarantor; and at Booth's request he sent him on 26 May a copy of the security documents that he had signed in 1989. Booth thereupon telephoned the appellant and told him of what he had learned from Meney and what the copy documents received from him disclosed. The appellant swore before the Tribunal that he did nothing about the predicament in which Booth claimed to have been placed, believing that Booth was "talking absolute twaddle". He swore further -
"I didn't do anything. I just thought it was an impossibility and I went about trying to find someone to - some way of extricating myself out of the debt problem."
Moreover, according to Booth's evidence, the appellant went so far as to deny to him that he (the appellant) had been at the settlement when Booth signed the documents. Booth consulted other solicitors, Minter Ellison Morris Fletcher, who wrote to the appellant on 28 August 1992 eliciting a reply from him dated 31 August which incorrectly asserted (among other things) -
"The only security existing for the repayment of the debt owed by Justin Cameron Pty. Ltd. to National Australia Bank Ltd. is a mortgage from Justin Cameron Pty. Ltd. to the bank supported by Directors guarantees."
Remarkably, the appellant gave no evidence that he referred or sought to refer to the duplicate certificate of title of the subject property, which was presumably held by the Bank. It showed that the 1985 mortgage had been discharged, and that a transfer to Justin Cameron and Booth as tenants in common in equal shares and the mortgage by them to the Bank had been registered, all on 19 February 1990.
In November 1997 Booth made a complaint to the respondent about the appellant's conduct as a solicitor. In response to correspondence from the respondent the appellant asserted (among other things) by letter dated 20 November 1997 that -
"The purported Mortgage and Guarantee which it is stated Mr Booth signed was something that I was never aware of until Minter Ellison, acting for Mr Booth, brought it to my attention. ... There was no reason for Mr Booth to be involved in any of the affairs of Justin Cameron Pty. Ltd. There was therefore no reason for me to turn my mind to the question of Mr Booth ever being advised in respect of such a Mortgage and Guarantee."
The appellant also referred in the letter to "deceit and slight of hand" by the management of the Bank "in obtaining Mr Booth's signature to the said documents".
By an undated document (which apparently came into existence in or not long after November 1997) the respondent preferred charges against the appellant pursuant to the Legal Practice Act in respect of the 1989 transaction in the course of which Booth signed the mortgage and the guarantee. The charges (allowing for some immaterial paraphrasing of mine) were formulated as follows -
1.          The appellant was guilty of misconduct in a professional capacity by acting or continuing to act as the solicitor for Booth in relation to the transaction whereby Booth acquired an interest in the subject property knowing that the interests of Booth to be affected by the signing of the security documents were in conflict with interests of the appellant and Justin Cameron.
2.          The appellant was guilty of misconduct in a professional capacity by procuring Booth, his client, to give security to support a loan knowing that he would not and did not understand the legal significance of the documents he was being asked to sign by the manager of the bank in the appellant's office.
3.          The appellant was guilty of misconduct by performing work in connection with his practice as solicitor for Booth which constituted a gross breach of the appellant's duty as the solicitor for Booth.
The Legal Profession Tribunal on 13 August 1998 found the three charges proved. In their reasons the Tribunal observed that they accepted Meney's evidence, and Booth's evidence generally, as truthful and reliable, and observed further that they found the appellant's evidence to be unconvincing and to lack credibility in relation to his meeting with Meney on 6 October 1989 which led to the preparation by the Bank of the mortgage and guarantee and in relation to the execution by Booth of the security documents on or about 27 October 1989.
The Tribunal expressed the following significant findings -

1.

The appellant was aware on and from 6 October 1989, as a result of his discussion on that day with Meney, that the proposed financial arrangements made by him with the Bank were dependent on Booth's signing a guarantee and a mortgage over the interest which Booth was to acquire from Rielehan.

2.

The appellant was aware that the documents produced by Meney at the settlement on or about 27 October 1989 were a mortgage and guarantee which he knew were to be executed by Booth and by Justin Cameron.

3.

The appellant saw Booth execute the mortgage and the guarantee and that at the time he said to Booth "you'll be my guarantor"; and that, even if the appellant did not use those words at or about the time when Booth executed the mortgage and guarantee, the appellant was then well aware that Booth was executing a mortgage and a guarantee.

4.

When the appellant wrote in the letter dated 14 May 1992 to Booth and used the words "if the bank forces a sale all sorts of problems could arise", he was well aware of the existence of the mortgage and guarantee which had been executed by Booth. The Tribunal added that they found it "beyond belief that the appellant, an experienced solicitor, would have executed the mortgage and guarantee as a director of Justin Cameron without looking at them and without being aware of the documents having [Booth's] name on the front of each of them as a mortgagor and a guarantor respectively ...".

5.

There was a clear conflict of interest in the appellant's acting as solicitor for Booth in the transaction in that part of the purchase price was to be applied, and was applied, in reduction of the indebtedness to the Bank of Justin Cameron and Hannelau, in both of which companies the appellant had a financial interest.

6.

The appellant should have disclosed to Booth the existence of the mortgage to the Bank given by Justin Cameron and Rielehan over the subject property and the proposed new mortgage over the property in whatever form it was to take.

7.

The appellant knowingly misled Booth by not disclosing to him the nature and purpose of the mortgage and guarantee and by allowing Booth to execute them when he knew that Booth was not aware of the contents of the documents and the liability he was assuming by executing them.

8.

The appellant concealed from Booth the true nature of the mortgage and guarantee in order to gain a financial advantage for himself, namely the provision of securities required by the bank for moneys lent by the Bank to Justin Cameron.

Each of the observations and findings above set out was very well open on the evidence before the Tribunal. In particular, a reading of the appellant's evidence, especially in cross-examination, shows the Tribunal's characterisation of it to have been eminently justified. I shall not set out any passages of his evidence. It is sufficient to say that the Tribunal was in my opinion entitled to regard it in important parts as temporising, internally inconsistent and simply fanciful.
The Tribunal was faced essentially with a fact-finding exercise in which the credit of the three central witnesses - the appellant, Booth and Meney - was paramount. The relevant documents spoke for themselves and, given the validity of the findings of fact made by the Tribunal, there could be no serious argument that the charges against the appellant were not proved. Strenuous attempts have been made on behalf of the appellant, however, to fashion questions of law which might support the appeal. Section 170(1) of the Legal Practice Act 1996, which alone provides for a relevant appeal to this Court, reads in its entirety -
"Any party may appeal to the Court of Appeal, on a question of law, from an order of the Full Tribunal under Division 1 or 5 or this Division [scil. Division 6]."
This provision is to be construed as granting a right of appeal from an order of the Tribunal on a question of law which is involved in the Tribunal's order or, perhaps more accurately, which is involved in the decision giving rise to the order: Transport Accident Commission v. Hoffman [1989] V.R. 197, at 199. An appeal on a question of law lies only from the orders themselves, made on 27 August, that I have specified in paragraph 1 above. Section 170(1) no doubt authorises also a challenge to the foundation for the orders, namely the decision on 13 August that the charges were proved. Any such challenge is limited, however, to one on a question of law that is involved in the decision.
The first ground of appeal was that - "The Tribunal erred in failing to grant a permanent stay of the charges
that the appellant faced, and in particular the Tribunal failed to take
into account sufficiently or at all -
(a) s.139 Legal Practice Act 1996;
(b) the reasons for the delay in bringing the complaint that led to the charges;
(c) the effect of the delay in complaining, including -

(i) the adverse effect upon the recollection of witnesses; and
(ii) the inability of the appellant to produce relevant documentary evidence."

Section 138 of the Legal Practice Act provides that any person may make a complaint about the conduct of a legal practitioner to the legal ombudsman (the present respondent) or to a relevant Recommended Professional Association or, in certain circumstances, to the Legal Practice Board. Section 139(1) provides that, subject to s.s.(2), a complaint may not be made more than six years after the conduct complained of is alleged to have occurred; and s.s.(2) provides that -
"The Legal Ombudsman, an RPA or the Board may accept a complaint made more than six years after the conduct is alleged to have occurred if satisfied -
(a) that there was a reasonable cause for the delay in making the complaint; or
(b) that it is otherwise in the public interest to do so."

In this case the respondent accepted Booth's complaint notwithstanding that more than six years had elapsed since the appellant's relevant conduct. At the outset of the hearing before the Tribunal, on 25 May this year, counsel for the appellant sought a permanent stay of the proceeding, referring in support substantially to the considerations set out in paragraphs (a), (b) and (c) of the first ground of appeal, and submitting that a hearing of the charges by the Tribunal would be an abuse of process. The Tribunal, having heard evidence from Meney and Booth - in effect as on a voir dire - and having received not inconsiderable argument for and against the application, ruled against it. The ruling was that the material before the Tribunal did not support the submissions of counsel for the appellant that the circumstances favoured the grant of a permanent stay. The argument and the ruling seemed to assume that the Tribunal had an inherent jurisdiction to grant a stay as sought, and Herron v. McGregor (1996) 6 N.S.W.L.R. 246 was mentioned. It may be doubted whether the assumption was necessarily justified, for s.157(1) of the Legal Practice Act provides that "the Tribunal must hear and determine a charge brought against a legal practitioner or firm by the Legal Ombudsman, an RPA or the Board in accordance with this Act and the Tribunal rules". It is unnecessary, however, to investigate into the purport of that provision: if the Tribunal did have jurisdiction to entertain an application for a permanent stay, there can be no possible basis for a contention that it erred in its decision when exercising it. Section 139 had nothing at all to do with the decision and, before us, no argument was founded on that part of the first ground of appeal that referred to that section. The decision was indeed dependent only on an appreciation by the Tribunal of the fact of delay and of its factual consequences. The Tribunal made its appreciation following an assessment of mere fact. By no means can the decision be made to depend on any question of law, nor can any question of law be treated as having been involved in it. The first ground must fail.

The second ground of appeal was that -

"The Tribunal erred in the use made of the evidence of the appellant's
good character, and in particular it

(a) ought to have presumed the appellant to be incapable of the misconduct charged, and
(b) failed to take the appellant's good character into account sufficiently or at all when assessing his credibility as a witness."

This ground depends entirely on an alleged error that is said to dwell in paragraph 20 of the Tribunal's reasons for its decision of 13 August. The paragraph refers to a body of oral and written evidence of the appellant's good character and reputation, and continues -
"It is a strong body of evidence all demonstrating the practitioner's excellent professional and general reputation. Whilst we are mindful of the quality and weight of the character evidence it cannot alter our conclusions on the evidence before us as to the credibility of the practitioner on the matters in issue."

In a sentence, the submission founded on ground 2 was that evidence of the appellant's good character bore on the questions both of the improbability of his having offended as charged and of his credibility; and that by the last sentence above-quoted the Tribunal denied that the evidence could bear on his credibility. That is not a fair reading of the impugned sentence. In saying that the character evidence "cannot alter our conclusions" the Tribunal should in my opinion be understood to mean that the evidence did not alter, or outweigh, the conclusions to which the evidence as a whole led as to the appellant's credibility. Rather than indicating that the Tribunal rejected the possibility that the evidence of good character could benefit the appellant's credibility, the impugned sentence seems to me to recognise that it could, but to express an opinion that in this case it did not. This ground should also fail.

The third ground was that -
"The Tribunal erred in failing to take into account a Customer Interview Record dated 18 September 1989, provided by the appellant to the Tribunal after the hearing concluded before the Tribunal, and in particular -

(a) the Tribunal ought not to have concluded that the witness Meney was aware of the full name of the complainant as a result of having been given those details by the appellant on 6 October 1989;
(b) the Tribunal ought to have found that the witness Meney became aware of the full name of the complainant as a result of a meeting between them on 18 September 1989;
(c) the Tribunal ought not to have drawn an adverse inference against the appellant."

The appellant denied in his evidence-in-chief that Meney's record of 6 October 1989 accurately reflected their discussion on that date, and in particular he denied "categorically" that he had told Meney that a guarantee was to be provided by "Kevin Joseph Booth", as Meney's record stated. In cross-examination of the appellant counsel for the respondent sought to impugn his credit by inviting him in effect to explain how Booth's full name could have been inserted in the record in the context of his providing a guarantee if the appellant had not stated it on 6 October in that context. The Tribunal stated in their reasons, and accurately, that the appellant was unable to give any explanation. Following the hearing before the Tribunal, and before the delivery of their reasons on 13 August, the customer interview record dated 18 September 1989 that is referred to in the third ground of appeal became available from the Bank and was forwarded to the Tribunal by the solicitors for the appellant, with the consent of counsel for the respondent. That document, being a statement of Booth's assets and liabilities, contained his full name and was signed by him. It had presumably been prepared when he sought financial accommodation from the Bank in the month preceding Meney's interview with the appellant of 6 October. The document offered, clearly enough, a possible source, other than the appellant, of Meney's knowledge of Booth's full name for insertion in the document of 6 October. The Tribunal in their reasons did not refer to the document dated 18 September. The submission to us was that the Tribunal must be taken to have impermissibly founded an unfavourable view of the appellant's credibility substantially on the cross-examination with respect to Meney's source of knowledge of Booth's full name, an innocent explanation of Meney's knowledge having later been provided to the Tribunal and evidently ignored.

The appellant's inability to explain in cross-examination how Booth's full name appeared in the context it did in the document of 6 October seems to me to be no more than a red herring. It was common ground that Booth had approached Meney at the Bank for finance, and it would be a fair assumption that he learned of Booth's full name from Booth himself. It was always possible to conclude that Meney had made a false note of his conversation with the appellant on 6 October and that the appellant's denial of its accuracy was valid, but the Tribunal did not draw that conclusion. There was ample evidence, apart from the note of that conversation, upon which to condemn the appellant's credibility and to accept that of Meney and Booth. Having regard to the nature and bulk of the other evidence, the Tribunal was entitled to treat the document dated 18 September as neither here nor there. I should not be prepared to accept that the Tribunal's failure to refer to the document indicates error or that it shows that any question of law was involved in its decision referable to the appellant's credit. Ground 3 should also fail.
The other grounds of appeal, numbered 4, 5 and 6, call into question the penalty imposed on the appellant. The grounds were these -

"4. In fixing the penalty for misconduct, the Tribunal erred in that it wrongly took into account the manner in which the Appellant had responded to the complaint and the charges.
5. In fixing the penalty for misconduct, the Tribunal failed to take the delay in making the complaint into account sufficiently or at all, and in particular -

(a) the Tribunal gave insufficient weight to the good conduct of the Appellant since the misconduct complained of;
(b) the Tribunal erred in concluding that the public required protection from the Appellant.
6. In fixing the penalty for misconduct, the Tribunal failed to take into account sufficiently or at all the steps that the Appellant had taken to free the complainant from the guarantee and mortgage that led to the complaint and charges."

Of these three grounds, 5 and 6 were not the subject of oral argument, and understandably so. It was for the Tribunal to assess the matters referred to in grounds 5 and 6 and to take them into account as it thought fit in assessing penalty. Neither ground could possibly expose a question of law that was involved in the decision. Each is in my opinion unarguable and should fail.

Ground 4 complained that, in fixing the penalty, the majority of the Tribunal impermissibly took into account the applicant's response to the charges, error allegedly being revealed in the following passage of their reasons delivered when pronouncing sentence on 27 August -
"We are conscious of the fact that approximately 9 years have passed since the practitioner's misconduct occurred and that, as pointed out by Mr Thomas in his submissions to us, the practitioner has lived over that period with distress and a high level of anxiety associated with his actions. Over that period he has maintained a good reputation in the legal profession. However we observe that at least since August 1992 or thereabouts when the practitioner became aware of the complainant knowing of the existence of the mortgage and guarantee which he had signed in October 1989, the practitioner has maintained false denials of any misconduct by him. Furthermore as recently as December 1997 the practitioner sought to place blame on the Bank Manager, Mr Meney, alleging in a letter to the Legal Ombudsman that if the complainant's signature did appear on a mortgage and guarantee the complainant had been duped by the Bank and not by the practitioner (see paragraph 9 of Reasons for Decision). We consider that those matters, together with the lack of remorse demonstrated by them, are relevant in determining whether the practitioner's right to practise should now be taken away by reason of his serious misconduct in 1989.
We are also aware from Mr Thomas' submissions that since 1993 the practitioner has practised exclusively in criminal law, in which area of practice he has specialised.
... The Tribunal considers that having regard to the seriousness of the practitioner's misconduct and the need to protect the public and the legal profession from persons who engage in such misconduct the appropriate course is to cancel the practitioner's practising certificate and to direct that he not be permitted to hold another practising certificate for a significant period of time."
The burden of the criticism of this passage by counsel for the appellant was that there was no evidence of false denials or a want of remorse by the appellant; and that in any event false denials or a want of remorse could not be treated as compounding or aggravating features which should lead to a more severe penalty than that which could otherwise be awarded.
If the Tribunal were shown to have approached the task of imposing a penalty by reference to impermissible criteria a question of law might be shown to have been involved in their decision and the order that gave effect to it. Some store was set by counsel for the appellant on the attribution to the appellant in the majority's reasons of his maintenance of "false denials" of misconduct. It was submitted that in doing so the majority misdirected themselves in allowing the concept of false denials to affect their determination of penalty; for a "false denial", as it is commonly understood in the parlance of the criminal law, is a deliberate untruth told in the course of evidence or out of court by an accused who would be likely to tell it only if guilty and would not tell it if innocent, thus amounting by implication to an admission of guilt: Edwards v. The Queen (1993) 178 C.L.R. 193, at 208-9. A false denial in that sense can scarcely be relevant to a determination of penalty: it is axiomatic that neither a refusal by an accused person to admit an alleged offence, nor a plea of not guilty, nor even the telling of a deliberate lie by way of the maintenance of a claim of innocence, can properly be treated as aggravatory, for the purpose of penalty, in the event that a finding of guilt is ultimately made. The rule is that an accused person who gives evidence when contesting the alleged criminal liability should be in the same position as any other witness, and subject to no greater fears or liabilities than any other witness. "It would certainly act as a deterrent even to an innocent man giving evidence, especially where there is a strong case against him, if he knew that if the jury does not accept his evidence he may receive a heavier sentence than otherwise would be imposed": R. v. Richmond [1920] V.L.R. 9, at 12, per Cussen, J. So too -
"It is impermissible to increase what is a proper sentence for the offence committed in order to mark the Court's disapproval of the accused's having put the issues to proof or having presented a time-wasting or even scurrilous defence": R. v. Gray [1977] V.R. 225, at 231.
See also R. v. Yam [1991] 55 A.Crim.R. 116, at 117-8.
I should very much doubt that the majority of the Tribunal used the expression "false denials" in the sense in which it was explained in Edwards v. The Queen, supra. Be that as it may, the principle exemplified in R. v. Gray, supra, does not in my opinion find the same place in the context of the imposition of all penalties for misconduct under the Legal Practice Act 1996 as it does in the context of the imposition by a criminal court of penalties for criminal offences. There are two principal reasons. The first is that disciplinary proceedings under the Act are not criminal proceedings but are proceedings sui generis: cf. Weaver v. Law Society of New South Wales (1979) 142 C.L.R. 201, at 207, per Mason, J.; Wentworth v. New South Wales Bar Association (1992) 176 C.L.R. 239, at 250-1, and the authorities there cited. This proposition is reflected in the circumstance that unfitness to practise based on misconduct need be proved only according to the civil standard, subject of course to the necessity to bear in mind the seriousness of the conduct charged: McCarthy v. Law Society of New South Wales (1997) 43 N.S.W.L.R. 42, at 59, and the cases there cited. The second reason, associated with the first, is that the jurisdiction of the Tribunal to deal with - that is to discipline - a practitioner for misconduct, while it includes a power to punish, is to be regarded as very largely protective. Hence, although the Full Tribunal may impose a fine of up to $50,000, its concern should ordinarily be not so much to punish as to protect members of the public against professional misconduct: cf. Wentworth v. New South Wales Bar Association, supra, at 251; Mellifont v. The Queensland Law Society Inc. [1981] Qd.R. 17, at 28; Law Society of New South Wales v. Walsh, unreported, C.A. (N.S.W.), 15 December 1997. For that reason disciplinary proceedings cannot necessarily be determined on the same basis as adversarial proceedings: Walter v. Council of Queensland Law Society Inc. (1988) 62 A.L.J.R. 153, at 157. The nature and purpose of disciplinary proceedings before the Tribunal being as they are it follows that, in deciding on the appropriate penalty to award following a finding of misconduct, the Tribunal is not only entitled but obliged to take into account any failure by the practitioner "to understand the error of his ways": New South Wales Bar Association v. Evatt (1968) 117 C.L.R. 177, at 184. Reasoning of that kind was applied to a practitioner's failure to appreciate that his impugned conduct was wrong when he claimed to be ignorant of his duty when using a client's money: Law Society of New South Wales v. Moulton [1981] 2 N.S.W.L.R. 736. As Beazley, J.A. observed in Law Society of New South Wales v. Walsh, supra, "Whilst a practitioner's expressed intention not to re-offend is relevant to mitigation, it will have little weight unless accompanied by an understanding of the wrongfulness of the conduct which was the subject of the disciplinary charge".
The passage of the reasons of the majority of the Tribunal last above-quoted is to be understood in the light of considerations such as those I have just been discussing. The reasons indicate to my mind no more than that, in fixing the penalty of cancellation of the appellant's practising certificate, and specifying the period during which he should be disentitled to apply for another, the majority took account of his failure to acknowledge and understand the significance of his dereliction of professional duty. This, in the circumstances, was an entirely appropriate consideration, disclosing no error of principle. The fourth ground of appeal should fail.
I would dismiss the appeal. I have no need, therefore, by seeking to elaborate upon the laconic s.170(1) of the Legal Practice Act, to divine what the powers of this Court might be in the event of a successful appeal brought under that provision. The contrast between it on the one hand and, for example, the usefully explicit provisions of s.52(5) of the Administrative Appeals Tribunal Act 1984 (now repealed) and s.148(7) of the Victorian Civil and Administrative Tribunal Act 1998 on the other, is stark and merits, I suggest, legislative attention.

PHILLIPS, J. A.:

I agree with all that the learned presiding judge has said. I too would dismiss
the appeal.

CHERNOV, J.A.

For the reasons given by Tadgell, J.A., I would also dismiss the appeal.

JUDGES:	TADGELL, PHILLIPS and CHERNOV, JJ.A.
WHERE HELD:	MELBOURNE
DATES OF HEARING:	7, 8 December 1998
DATE OF JUDGMENT:	17 December 1998
MEDIA NEUTRAL CITATION:	[1998] VSCA 142

APPEARANCES:	Counsel	Solicitors
For the Appellant	Mr P.F. Tehan Q.C. and	Galbally & O'Bryan
Mr P.G. Priest Q.C.
For the Respondent	Mr P.G. Lacava	Legal Ombudsman