Hill v The Council of the Law Society of the Act
[2019] ACTSC 79
•27 March 2019
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Hill v The Council of the Law Society of the ACT |
Citation: | [2019] ACTSC 79 |
Hearing Date: | 1 February 2019 |
DecisionDate: | 27 March 2019 |
Before: | Burns J |
Decision: | See [51] |
Catchwords: | ADMINISTRATIVE LAW – Judicial Review – Application for judicial review of decisions to appoint a supervisor and a manager to a law practice – plaintiff seeking relief by way of declarations pursuant to s 17(c) of the Administrative Decisions (Judicial Review) Act 1989 (ACT) – plaintiff seeking relief by way of a declaration pursuant to r 2900(2) of the Court Procedure Rules 2006 (ACT) and/or the Court’s inherent jurisdiction – whether the instruments of appointments of the supervisor and the manager complied with provisions of the Legal Profession Act 2006 (ACT) – whether the amended instrument of appointment of the manager complied with provisions of the Legal Profession Act 2006 (ACT) – extension of time required to commence proceedings – whether an extension of time should be granted |
Legislation Cited: | Administrative Decisions (Judicial Review) Act 1989 (ACT) ss 5, 10, 17 Court Procedure Rules 2006 (ACT) rr 2900, 3557 Legislation Act 2001 (ACT) ss 127, 138, 142, 212; table 142 |
Cases Cited: | Legal Practitioner v Law Society of the Australian Capital Territory [2018] ACTSC 29 Project Blue Sky Inc. v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 Re Berkely [1945] 1 Ch 107 |
Texts Cited: | Macquarie Dictionary (Pan Macmillan, 6th ed, 2013) |
Parties: | Alan Richard Hill (Plaintiff) The Council of the Law Society of the ACT (Defendant) |
Representation: | Counsel Mr W Buckland (Plaintiff) Mr P Woulfe (Defendant) |
| Solicitors Nelson & Co Solicitors (Plaintiff) McInnes Wilson Lawyers (Defendant) | |
File Number: | SC 384 of 2018 |
BURNS J
The plaintiff is a legal practitioner who practises in the Australian Capital Territory. On or about 27 March 2017 he informed the defendant, the Council of the Law Society of the ACT, that a substantial amount of money had been transferred into his trust account and erroneously allocated to the wrong client’s ledger. There was no suggestion of any dishonesty in this error. The plaintiff’s law practice had a history of trust account irregularities, none suggestive of dishonesty.
On or about 18 April 2017 the defendant resolved to appoint a trust account supervisor to the plaintiff’s practice under s 481 of the Legal Profession Act 2006 (ACT) (LPA). On or about 21 April 2017 the plaintiff was given a copy of the instrument of the appointment of Mr Bruce Glanville, a chartered accountant, as the trust account supervisor (the supervisor).
On or about 26 May 2017 the supervisor reported to the defendant, identifying continuing issues related to the operation of the plaintiff’s trust account that were of concern to the defendant. As a result, the defendant resolved to appoint a manager for the defendant’s practice pursuant to s 487 of the LPA. On 30 May 2017 the plaintiff was given notice of the appointment of Mr Aunter Mussa Hijazi as the manager, and was given a copy of the manager’s instrument of appointment. The term of the appointment was stated to expire at 5 pm on 1 December 2017.
The provisions of the LPA governing the appointment of supervisors and managers are found in Chapter 5, titled “External intervention”. For the purposes of Chapter 5 of the LPA, supervisors and managers are referred to as “external interveners”. The purpose of Chapter 5, as stated in s 474 of the LPA, is to ensure that an appropriate range of options is available for intervention in the business and professional affairs of law practices for the purpose of protecting the interests of the general public, clients, and lawyers, so far as their interests are not inconsistent with the interests of the general public and clients.
On 6 June 2017, the plaintiff commenced proceedings in this Court by way of an appeal from the defendant’s decision to appoint a manager. The appeal was lodged under s 514 of the LPA. The plaintiff pleaded that he would put evidence before the Court to establish that the appointment of the manager was “inappropriate, unnecessary, disproportionate, unjustified and inconsistent with the provisions of the [LPA]”. The grounds upon which the plaintiff relied included the following:
(a)the decision was inappropriate and unjustified under the LPA because a trust account supervisor had already been appointed;
(b)the decision was inconsistent with ss 486 and 487 of the LPA; and
(c)the decision was disproportionate and unnecessary in the circumstances.
The provisions of s 514 of the LPA permit an appeal to this Court from a decision appointing a supervisor or manager for a legal practice. Such an appeal must be filed within seven days of notice of the appointment being given. To the extent that the plaintiff may also have been entitled to seek judicial review of the decision to appoint a manager (or, indeed, a trust account supervisor) under the Administrative Decisions (Judicial Review) Act 1989 (ACT) (ADJR Act), he was obliged to do so within 28 days of receiving a copy of the decision: s 10(2), ADJR Act. Any claim for prerogative relief was required to be commenced not later than 60 days after the day when the grounds for the grant of the relief sought first arose: r 3557, Court Procedures Rules 2006 (ACT) (CPR). The time limits prescribed by both the ADJR Act and the CPR may be extended by this Court in an appropriate case.
On 11 July 2017 the defendant amended its instrument of appointment of the manager for the plaintiff’s law practice, correcting the period of appointment by stating that the term of the appointment expired at 5 pm on 30 May 2018, and advising the plaintiff of his right to appeal against the appointment of the manager under s 514 of the LPA. This amended instrument was sent to the plaintiff, through his solicitors, on 12 July 2017.
On 16 February 2018 I heard a preliminary application in the proceeding commenced by the plaintiff on 6 June 2017. This application concerned the nature of the appeal provided by s 514 of the LPA. The plaintiff submitted that it was either a rehearing based on the material before the defendant at the time it made the decision to appoint a manager, or was a strict appeal. The defendant submitted that such an appeal was by way of hearing de novo. On 23 February 2018 I decided that an appeal under s 514 was by way of hearing de novo, and I published my reasons for so determining: Legal Practitioner v Law Society of the Australian Capital Territory [2018] ACTSC 29. The practical consequence of that determination was that the defendant was entitled to call evidence on the appeal of matters that had come to its attention, or events that had occurred, after its decision to appoint the manager. On 28 February 2018 the plaintiff consented to the dismissal of his appeal from the decision to appoint the manger, with costs.
On 25 May 2018 the defendant’s solicitors wrote to the plaintiff claiming a total of $155,144.00 for fees paid to the supervisor and manager until the end of April 2018 (the disputed debt). The plaintiff has disputed his liability to pay this, or any, amount to the defendant for the fees paid to the supervisor or the manager. In claiming the right to recover fees paid to the supervisor and manager (“external interveners” for the purposes of the LPA), the defendant relies upon the provisions of s 517 of the LPA:
517 Fees, legal costs and expenses of external intervener
(1) An external intervener for a law practice is entitled to be paid, in accordance with the intervener’s appointment—
(a) fees by way of remuneration; and
(b) the legal costs and the expenses incurred in relation to the external intervention.
(2) An account of the external intervener for fees, costs and expenses may be assessed on the relevant council’s application.
(3) The fees, costs and expenses are payable by and recoverable from the law practice.
(4) Fees, costs and expenses not paid to the external intervener by the law practice are payable from the fidelity fund.
(5) The relevant council may recover any unpaid fees, costs and expenses from the law practice.
(6) Fees, costs and expenses paid by or recovered from the law practice after they have been paid from the fidelity fund are to be paid to the fund.
10. On or about 30 August 2018 the plaintiff served on the defendant an originating application for judicial review of the defendant’s decisions to appoint the supervisor and the manager. This commenced the present proceeding. That originating application was amended on or around 20 September 2018. The amended application sought review of the decisions of the defendant:
(a)of 19 April 2017 to appoint the supervisor;
(b)of 29 May 2017 to appoint the manager; and
(c)of 11 July 2017 to issue an amended instrument of appointment with regard to the appointment of the manager.
Application to review
The plaintiff sought a variety of orders. At the hearing of the proceedings on 1 February 2019 the plaintiff abandoned his claim for a number of these orders, such that his claim proceeded on the basis that he sought the following relief:
(a)a declaration pursuant to s 17(1)(c) of the ADJR Act that the plaintiff is not indebted to or otherwise obliged to pay any money to the defendant in relation to remuneration paid to the supervisor for his work in supervising the plaintiff’s trust account;
(b)a declaration pursuant to s 17(1)(c) of the ADJR Act that the plaintiff is not indebted to or otherwise obliged to pay any money to the defendant in relation to remuneration paid to the manager by the defendant for his work as a manager of the plaintiff’s law practice; and
(c)a declaration pursuant to rule 2900(2) of the CPR and/or the Court’s inherent jurisdiction that the plaintiff does not owe any, or any part of, the disputed debt to the defendant.
12. The plaintiff did not contest the validity of the instruments of appointment but submitted that the making of the decisions to appoint the supervisor and manager involved breaches of s 5(1)(c), (d), and (f) of the ADJR Act which provide:
5 Applications for review of decisions
(1)An eligible person may apply to the Supreme Court for an order of review in relation to a decision to which this Act applies on 1 or more of the following grounds:
…
(c)that the person who purported to make the decision did not have jurisdiction to make the decision;
(d)that the decision was not authorised by the enactment under which it was purported to be made;
…
(f)that the decision involved an error of law, whether or not the error appears on the record of the decision;
…
13. The grounds upon which the plaintiff sought relief, as set out in the amended originating application, raised the following issues:
(a)did the instrument of appointment of the supervisor comply with the provisions of s 481 of the LPA?
(b)did the instrument of appointment of the manager dated 30 May 2017 comply with the provisions of s 487 of the LPA?
(c)did the amended instrument of appointment of the manager dated 11 July 2017 comply with the provisions of s 487 of the LPA?
14. Other grounds were pleaded by the plaintiff, but they were not pressed at the hearing.
15. By an application in proceeding dated 28 September 2018. the defendant seeks orders that the proceeding commenced by the plaintiff be dismissed as an abuse of process. It is convenient in the first instance to consider the merits of the plaintiff’s claim.
16. The present proceedings were not commenced within the time period prescribed by the ADJR Act or the CPR so that the plaintiff is required to seek an extension of time for commencing these proceedings. Two issues central to this application for extension of time to commence these proceedings are any reason for the delay in commencing the proceeding, and the merit of the proceeding.
Did the instrument of appointment of the supervisor comply with s 481 of the LPA?
17. The provisions of s 481 of the LPA govern the appointment of a supervisor of trust money of a law practice:
481 Appointment of supervisor
(1) This section applies if the law society council decides to appoint a supervisor of trust money of a law practice.
(2) The law society council may appoint a person as supervisor of trust money.
Note 1For the making of appointments (including acting appointments), see the Legislation Act, pt 19.3.
Note 2In particular, a person may be appointed for a particular provision of a law (see Legislation Act, s 7 (3)) and an appointment may be made by naming a person or nominating the occupant of a position (see s 207).
(3) The appointee must be either—
(a) an Australian legal practitioner who holds an unrestricted practising certificate; or
(b) a person holding accounting qualifications with experience in law practice trust accounts.
(4) The appointee may (but need not) be an employee of the law society.
(5) The appointment must—
(a) identify the law practice and the supervisor; and
(b) indicate that the external intervention is by way of appointment of a supervisor of trust money; and
(c) state the term of the appointment; and
(d) state any conditions imposed by the law society council when the appointment is made; and
(e) state any fees payable by way of remuneration to the supervisor specifically for carrying out the supervisor’s duties in relation to the external intervention; and
NotePar (e) is intended to exclude remuneration payable generally, eg as an employee of the law society.
(f) provide for the legal costs and the expenses that may be incurred by the supervisor in relation to the external intervention.
(6) The appointment may state any reporting requirements to be observed by the supervisor.
18. The instrument of appointment of the supervisor states that Mr Glanville is appointed as the supervisor. Relevantly for present purposes, it provides:
The Supervisor’s remuneration for carrying out his duties in relation to the external intervention will be at the rate per hour plus GST as agreed between the Supervisor and the Law Society. The supervisor is also entitled to payment of reasonable disbursements and out-of-pocket expenses.
The Supervisor will from time to time report to the Council of the Law Society for payment of the costs and expenses that may be incurred by the Supervisor in relation to the external intervention.
19. The plaintiff submits that the instrument of appointment of the supervisor did not comply with s 481 of the LPA in that it did not:
(a)state the fees payable to the supervisor by way of remuneration and provided only that his remuneration would be at a rate agreed between himself and the defendant; and
(b)make provision for the supervisor’s legal costs.
20. The plaintiff accepted that it would be impossible, as a matter of practicality, for the instrument of appointment to state the exact amount of fees payable to the supervisor by way of remuneration, as, at the date of execution of the instrument, the defendant could not know what work on the part of the supervisor may reasonably be necessary. The plaintiff adopted a more nuanced approach, and submitted that the requirement that the appointment must state the fees payable by way of remuneration to the supervisor (s 481(5)(e)) would be satisfied were the instrument of appointment to state the mechanism by which such fees may be calculated, such as providing an hourly rate at which the supervisor would be remunerated, citing the decision Re Berkley [1945] 1 Ch 107. That case considered the meaning to be given to the word “stated” in the context of a disposition of property under a will. It involved the application of the Latin maxim “id certum est quod certum reddi potest”, which translates as “that is certain which may be made certain”. In my opinion this decision is of no assistance in determining the legislative intention in s 481(5)(e) of the LPA.
21. In any event, if the plaintiff be correct that the provisions of s 481(5)(e) require either that the fees to be payable to the supervisor must be stated in the instrument of appointment, or that an hourly rate be specified, difficulties nevertheless arise if either course is taken. As I have observed, it will generally be impossible for the defendant to quantify the fees payable to the supervisor at the time of appointment. Secondly, provision of an hourly rate does not enable the fees to be quantified (and therefore “stated”) in the absence of determination of the number of hours in which the supervisor is engaged in the execution of their function. Simply inserting an hourly rate into the instrument of appointment cannot allow for an arithmetic process to calculate the fees payable. The difficulty with both of these approaches to the interpretation of s 481(5)(e) of the LPA is that each requires knowledge of future events on the part of the defendant at the time it makes the appointment.
22. There is a note appearing in authorised versions of the LPA immediately after s 481(5)(e) which reads: “Par (e) is intended to exclude remuneration payable generally, eg as an employee of the law society”. Such a note does not form part of the Act: s 127(1), Legislation Act 2001 (ACT) (Legislation Act). Such a note may, however, be used in working out the meaning of an Act: s 142 and table 142, item 1, column 2 of the Legislation Act. In that context, “working out the meaning of an Act” includes resolving an ambiguous or obscure provision of an Act: s 138(a), Legislation Act. The note to s 481(5)(e) contemplates that there may be occasions when there will be no fees payable to a supervisor, because, for example, the person appointed may be already receiving remuneration as an employee of the law society, a course which is permitted by the LPA: s 481(4). It appears to me that the legislative purpose underpinning s 481(5)(e) is to inform the appointee whether fees are payable to them for carrying out their duties as a supervisor. This is consistent with the fact that the instrument of appointment is a document that regulates the relationship between the law society and the supervisor. The instrument of appointment does not regulate any relationship between either the law society, or the supervisor, and the practitioner to whose practice the supervisor is appointed, although the fact of appointment and the exercise by the supervisor of their statutory powers will often have implications for the practitioner.
23. It is instructive to consider what information the law society is obliged to give to a legal practitioner upon the appointment of a supervisor. Pursuant to s 482(1) of the LPA, as soon as possible after a supervisor of trust money is appointed for a law practice, the law society council must give written notice of the appointment to, inter alia, the practice. The notice must, pursuant to s 482(2):
(a)identify the law practice and the supervisor; and
(b)indicate that the external intervention is by way of appointment of a supervisor of trust money; and
(c)state the term of appointment; and
(d)state any reporting requirements to be observed by the supervisor; and
(e)state any conditions imposed by the law society council when the appointment was made; and
(f)include a statement that the law practice may appeal against the appointment of the supervisor under section 514; and
(g)contain or be accompanied by any other information or material prescribed by regulation.
24. What is conspicuously absent from the requirements of s 482(2) is a requirement that the notice contain information about fees payable by way of remuneration to the supervisor for carrying out their duties. This is consistent with a legislative intention that the instrument of appointment primarily governs the relationship between the supervisor and the law society. When, in addition to this fact, it is acknowledged that at the time of making the appointment the law society, in circumstances where fees are to be payable to the supervisor, will not ordinarily be able to state with any degree of specificity the quantum of those fees, the interpretation of s 481(5)(e) which best achieves the purposes of the Act, and gives the provision a sensible meaning, is that it requires no more than that the instrument state whether fees are payable to the supervisor with regard to him or her undertaking their functions as a supervisor. The instrument of appointment dated 20 April 2017 clearly sets out that fees will be payable to the supervisor at a rate agreed between the supervisor and the law society. In my view, this instrument complied with the requirements of s 481(5)(e) of the LPA.
25. The second issue raised by the plaintiff concerning the instrument of appointment of the supervisor is that it did not comply with s 481(5)(f) of the LPA in that it did not provide for the legal costs and expenses that may be incurred by the supervisor in relation to the external intervention.
26. The instrument of 20 April 2017 appointing Mr Glanville as the supervisor provides that he is entitled to be paid “reasonable disbursements and out-of-pocket expenses” as well as his remuneration. The usual meaning of the word “disbursement” is “money expended”: Macquarie Dictionary (Pan Macmillan, 6th ed, 2013), 423. The instrument therefore provides for reimbursement to Mr Glanville of money reasonably expended by him in the course of executing his function as a supervisor. I see no reason why this should not include legal costs. It follows that the instrument of appointment did provide for legal costs and expenses as required by s 481(5)(f) of the LPA.
27. Even were it the case that the instrument of appointment was technically deficient in one of the ways alleged by the plaintiff, a number of other considerations need to be addressed prior to determining whether to grant the plaintiff the relief he seeks. The power for the law society to appoint a supervisor is found in s 481(2). The requirements found in s 481(5) attending such an appointment are procedural, that is, they prescribe the procedure with which the law society is to comply in making an appointment. Section 212 of the Legislation Act provides that “an appointment, or anything done under an appointment, is not invalid only because of a defect or irregularity in or in relation to the appointment”. It follows that any irregularity or defect in relation to the instrument of appointment will not necessarily invalidate the appointment, or anything done under the appointment.
28. Not every failure to comply with a condition regulating the exercise of statutory power will result in invalidity. In Project Blue Sky Inc. v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355, the plurality of the High Court (McHugh, Gummow, Kirby and Hayne JJ) at [91] expressed the principle thus:
An act done in breach of a condition regulating the exercise of a statutory power is not necessarily invalid and of no effect. Whether it is depends upon whether there can be discerned a legislative purpose to invalidate any act that fails to comply with the condition. The existence of the purpose is ascertained by reference to the language of the statute, its subject matter and objects, and the consequences for the parties of holding void every act done in breach of the condition.
29. In the present case, the terms of s 212 of the Legislation Act may be added to the material cited by the plurality as relevant to determining the legislative intention; s 212 is a clear statement of a legislative intention that defects or irregularities such as those alleged by the plaintiff with regard to the appointment of Mr Glanville should not render his appointment, or any acts done by him in the execution of his functions as a supervisor, invalid. I reiterate that the purposes of Chapter 5 of the LPA, which governs external intervention (including the appointment of supervisors and managers), as set out in s 474 of the LPA, includes the purpose of protecting the general public and clients of legal practitioners. If failure to comply with the requirements of paragraphs 481(5)(e) or (f) was sufficient to invalidate an appointment, and the action taken by the purported appointee under it, there would be a real prospect that the purposes of the LPA expressed in s 474 would be nullified on purely technical grounds. In addition, in determining whether it was the intention of the legislature to render invalid an appointment, and the acts done under it, by reason of the type of defect in the appointment alleged in the present case, it is relevant to consider that the legislature has provided a widely framed right of appeal to legal practitioners from a decision appointing a supervisor or manager: s 514 LPA. All of these circumstances strongly suggest that it was not the intention of the legislature that any defect in the appointment of a supervisor or manager of the nature alleged here should result in invalidity of the appointment, or acts done under the appointment.
30. In the present case, as noted at [12] above, the plaintiff does not rely upon establishing invalidity of the appointment as the basis of the relief he seeks, rather, he submits that it is sufficient to establish that the decision to appoint the supervisor was made in circumstances that are set out in s 5(1)(c), (d) or (f) of the ADJR Act so as to give this Court jurisdiction to provide relief. A determination that a decision was made in such circumstances does not, however, entitle an applicant for review under the ADJR Act to any form of relief. The provisions of s 17 of the ADJR Act make it clear that the granting of relief is discretionary. It is also without doubt that the granting of declaratory relief under the CPR or the inherent power of the Court is also discretionary.
31. I am satisfied that no error as alleged by the plaintiff was involved in the defendant’s decision to appoint the supervisor. It follows that there is no basis, either under the ADJR Act or otherwise, for making the orders sought by the plaintiff regarding the appointment of the supervisor.
32. For an abundance of caution, I will state that even if I am wrong in my principal conclusion that no error was involved in the appointment of the supervisor, I would nevertheless have rejected the plaintiff’s claim for relief on discretionary grounds. For the reasons I have given, any such error did not invalidate the appointment of the supervisor, or any actions taken by the supervisor pursuant to the appointment. I can see no reason why it would be appropriate to relieve the plaintiff of his obligation to reimburse the law society for the costs it incurred in validly appointing a supervisor simply because an error which did not affect the validity of the appointment may have occurred.
Did the instrument of appointment of the manager dated 30 May 2017 comply with the provisions of s 487 of the LPA?
33. The plaintiff submitted that the instrument dated 30 May 2017 appointing Mr Hijazi as manager of the plaintiff’s practice did not comply with s 487 of the LPA in that it failed to state the fees payable to the manager by way of remuneration for carrying out his duties as a manager.
34. The provisions of s 487 of the LPA govern the appointment of a manager:
487 Appointment of manager
(1) This section applies if the relevant council decides to appoint a manager for a law practice.
(2) The relevant council may appoint a person as manager.
Note 1 For the making of appointments (including acting appointments), see the Legislation Act, pt 19.3.
Note 2 In particular, a person may be appointed for a particular provision of a law (see Legislation Act, s 7 (3)) and an appointment may be made by naming a person or nominating the occupant of a position (see s 207).
(3) The appointee must be an Australian legal practitioner who holds an unrestricted practising certificate, and may (but need not) be an employee of the law society.
(4) However, for the appointment of a manager for the law practice of a barrister, the appointee may (but need not) be an employee of the bar association and need not be an Australian lawyer or the holder of an Australian practising certificate.
(5) The appointment must—
(a) identify the law practice and the manager; and
(b) indicate that the external intervention is by way of appointment of a manager; and
(c) state the term of the appointment; and
(d) state any conditions imposed by the relevant council when the appointment is made; and
(e) state any fees payable by way of remuneration to the manager specifically for carrying out his or her duties in relation to the external intervention; and
Note Par (e) is intended to exclude remuneration payable generally, eg as an employee of the law society or bar association.
(f) provide for the legal costs and expenses that may be incurred by the manager in relation to the external intervention.
(6) The appointment may state any reporting requirements to be observed by the manager.
35. It will be observed that the provisions of s 487 regarding the procedures for appointing a manager are effectively identical to the provisions of s 481 regarding the appointment of supervisors.
36. The instrument of 30 May 2017 relevantly provided:
The Manager’s remuneration for carrying out his duties in relation to the external intervention will be at the rate agreed between the Law Society and the Manager. The Manager is also entitled to payment of reasonable disbursements and out of pocket expenses.
37. As soon as possible after a manager is appointed, the law society must give notice of the appointment to the practice: s 488, LPA. In common with the requirements for notice of appointment of a supervisor, there is no requirement that a notice under s 488 contain information about fees payable by way of remuneration to a manager for carrying out their duties. There is no reason to interpret the requirement in s 487 of the LPA that the instrument of appointment “state” fees payable to a manager any differently to the interpretation of the same requirement in s 481 regarding the appointment of a supervisor. For the reasons that I gave regarding s 481, I am satisfied that no error as alleged by the plaintiff attended the appointment of Mr Hijazi as manager of the plaintiff’s practice on 30 May 2017.
38. Even if I am wrong in this conclusion, I would nevertheless have rejected the plaintiff’s claim for relief on discretionary grounds, for the same reasons I gave with regard to the instrument of appointment of Mr Glanville as supervisor: see [32] above.
Did the amended instrument of appointment of the manager dated 11 July 2017 comply with the provisions of s 487 of the LPA?
39. The plaintiff’s submission with regard to the amended instrument of appointment of Mr Hijazi as manager of the plaintiff’s practice dated 11 July 2017 is identical to that which he made regarding the instrument of appointment made on 30 May 2017: it did not state the remuneration payable to Mr Hijazi for carrying out his duties as the manager. The amended instrument of appointment contained the following relevant statement:
The Manager’s remuneration for carrying out his duties in relation to the external intervention will be at the rate agreed between the Law Society and the Manager particulars of which can be obtained by request.
(amending material underlined)
40. For the same reasons that I gave with regard to the plaintiff’s submission with regard to the instrument of appointment dated 30 May 2017, I am satisfied that no error of law as alleged by the plaintiff attended the making of this instrument. Even if I were wrong in that regard, I would decline relief on discretionary grounds for the reasons found in [32] above.
Conclusion – merits of the application to review
41. I am satisfied that the plaintiff’s application for judicial review is without legal merit. In any event, even if it were to have legal merit, I would decline relief on discretionary grounds.
Extension of time
The plaintiff became aware of the appointment of Mr Glanville as supervisor on or about 19 April 2017. Mr Glanville gave him a copy of the instrument of appointment on 21 April 2017. The plaintiff therefore had a right of appeal under s 514 of the LPA which expired no later than seven days after 21 April 2017. Any right he possessed to seek judicial review of the decision to appoint Mr Glanville pursuant to the ADJR Act required such an application to be made within 28 days after him receiving a copy of the instrument of appointment on 21 April 2017: s 10(2), ADJR Act. Any right on the part of the plaintiff to seek prerogative relief required him to seek such relief within 60 days of the making of the decision: r 3557, CPR.
43. The plaintiff received a copy of the instrument dated 30 May 2017 appointing Mr Hijazi as manager of the practice on the day it was made. The same time limitations referred to in the preceding paragraphs applied to any appeal from an application to review the appointment of Mr Hijazi.
44. The plaintiff’s nominated lawyers were given a copy of the amended instrument of appointment of Mr Hijazi as manager by email dated 12 July 2017. The same time limitations referred to at [42] above applied to any appeal from an application to review the amended instrument of appointment of Mr Hijazi.
From the above it is apparent that the present proceeding was commenced many months after the expiration of the various times prescribed by statute for the plaintiff to appeal from or seek review of the various decisions. This delay is a significant factor in determining whether the grant an extension of time. In written submissions, the plaintiff suggested that he was not on notice that the defendant would seek to recover fees paid to the external intervenors from him until March 2018, such that any consideration of delay should commence from that date and not the date of the various instruments. I reject that submission. The plaintiff received copies of each of the instruments either on the day it was executed or within a few days thereafter. Each instrument clearly made provision for payment to the external intervener. In his affidavit sworn 24 August 2018 and read in this proceeding the plaintiff did not suggest that he was unaware of the statutory right, found in s 517 of the LPA, allowing the defendant to recover these fees from him. In any event, the notice pursuant to s 482 of the LPA from the law society to the plaintiff advised him:
You should also note that the [LPA] directs the Law Society to pay the fees, costs and expenses of the Supervisor from the Fidelity Fund. All fees, costs and expenses paid to the Supervisor by the Law Society are recoverable from the law practice. In other words, the Law Society is empowered to recover the fees, costs and expenses of the Supervisor from Hill & Rummery. In due course we will advise you of those costs.
46. A similar statement is made in the notice under s 488 of the LPA advising the plaintiff of the appointment of Mr Hijazi as manager.
47. It is apparent that from the earliest time, both with regard to the appointment of the supervisor and the manager, the plaintiff was on notice that fees were payable to the external intervener and that the law society proposed recovering any fees it paid to the external interveners from the plaintiff’s practice. The only relevant change in circumstances that occurred after the expiration of the relevant limitation periods and before the plaintiff commenced the present proceeding is that the defendant quantified the claim for fees and demanded payment from the plaintiff. Having taken no action to challenge the appointment of Mr Glanville, having withdrawn his appeal against the appointment of Mr Hijazi (in which his present arguments concerning that appointment could have been raised), the plaintiff allowed the law society to incur expenses which had to be paid by it from its Fidelity Fund, but now, after receiving the “bill”, seeks to argue that he should not have to pay anything. This conduct on the part of the plaintiff is simply unconscionable. The plaintiff should not be aided by an extension of time to bring these proceedings.
48. The plaintiff submitted that part of the reason for his delay in commencing proceedings was that he was involved in a dispute with the law society about the renewal of his practicing certificate. That may well have been the case for the latter part of the period of the delay, but it does not adequately explain the delay. The plaintiff had lawyers acting for him who were able to commence an appeal against the appointment of Mr Hijazi pursuant to s 514 of the LPA on 6 June 2017, and to thereafter present reasoned submissions to the Court on the question of the nature of such an appeal. No material has been put before me to explain why the plaintiff’s lawyers could not have been instructed to commence proceedings, either by way of appeal or application for judicial review, at a time proximate to the making of the impugned decisions.
49. I am not satisfied that the delay in commencing the present proceeding has been adequately addressed. I am also satisfied that the defendant has suffered prejudice by reason of the delay, being its continued accrual of fees payable to the external interveners. Finally, I am satisfied that the proceeding is without legal merit. I decline to grant the plaintiff the necessary extensions of time to commence the proceeding.
50. In the circumstances, I do not find it necessary to address the submissions made by the parties with regard to the defendant’s application to strike out the proceeding.
51. The formal orders I make are:
(a)the application for an extension of time to commence this proceeding is refused;
(b)the defendant’s application is dismissed, with no order as to costs;
(c)the present proceeding is dismissed; and
(d)unless either party seeks a different order within 14 days of publication of these reasons, the plaintiff is to pay the costs of the proceeding as agreed or assessed.
| I certify that the preceding fifty-one [51] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Justice Burns. Associate: Date: 27 March 2019 |
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