Law Society of New South Wales v Georgas
[2008] NSWADT 82
•17 March 2008
CITATION: Law Society of New South Wales v Georgas [2008] NSWADT 82 DIVISION: Legal Services Division PARTIES: APPLICANT
RESPONDENT
The Council of the Law Society of New South Wales
Con John GeorgasFILE NUMBER: 072015 HEARING DATES: 18 February 2008 SUBMISSIONS CLOSED: 18 February 2008
DATE OF DECISION:
17 March 2008BEFORE: Molloy GB - Judicial Member; Vass CB -Judicial Member; Costigan M - Non Judicial Member CATCHWORDS: Solicitor – disciplinary application - false witnessing MATTER FOR DECISION: Principal matter LEGISLATION CITED: Legal Profession Act 2004 CASES CITED: Allinson v General Council of Medical Education and Registration [1840] 1 QB750 REPRESENTATION: APPLICANT
RESPONDENT
L Pierotti, solicitor
J Boxsell, solicitorORDERS: 1.The solicitor is reprimanded
2.The solicitor is fined $1,000.00
3.The solicitor must pay the costs of the Law Society as agreed or as assessed.
REASONS FOR DECISION
Introduction
1 The Law Society by Application filed 27 April 2007 asserted that the solicitor “falsely attested the forged signature” of Elizabeth Lisa Dosanjh to a loan contract and to a mortgage.
2 The loan contract was an offer and acceptance document between Macquarie Mortgages Pty Limited, Perpetual Trustees Australia Limited (as the lenders) and Elizabeth Lisa Dosanjh (“the Complainant”), her then husband Harpinder Dosanjh (“(“her then husband”) and the parents of her then husband Jiwan Singh Dosanjh and Surinder Pal Dosanjh (together “the husband’s parents”) (altogether as the borrowers). The loan contract offered $600,000.00 for the purposes of the Dosanjhs “purchasing an investment property”, the property being 18A Mills Road Glenhaven (“the property”). On page 10 of the loan contract there appears four signatures purporting to be those of the Complainant, her then husband and the husband’s parents, all of which are witnessed by the solicitor and the date “18 October 2004” is inserted as the date of execution. The signatures are under the heading “Acceptance of Borrower” in which the signatories purport “to accept the offer to enter into (the) loan contract”.
3 On page 11 of the loan contract there is a box in which the borrowers are invited to each sign and which, upon signing, they certify that they had “obtained legal advice on the nature and effect of the loan contract and all securities to be granted … (from the solicitor) … (and that they) understand the nature and effect of the documents … (and that they) understand the obligations and risks involved in signing the documents … (and that they) sign the documents freely, voluntarily and without pressure from any person”. The name of the solicitor has been inserted, the date is again 18 October 2004 and there are four signatures there under which purport to be those of the Complainant, her then husband and her then husband’s parents.
4 The mortgage is dated 7 February 2005 (although on page 2 thereof it is dated (again) “18 October 2004”) and purports again to be signed as mortgagors by the Complainant, her then husband and her then husband’s parents, each of whose signatures is witnessed by the solicitor.
5 The Law Society asserts that the signature of the Complainant on the loan contract and on the mortgage was forged in that the Complainant “did not sign the acceptance certificate or the mortgage to Perpetual (and that her) purported signature on the said documents was placed there by another person”.
The Hearing
6 The hearing was conducted, not so much on the basis that the solicitor “falsely attested the forged signature” of the Complainant but rather that the solicitor appended his signature as witness when he did not, and had not in fact, witnessed her signature to those two documents. This was conceded by the solicitor. This was the gravamen of the proceedings such that both parties proceeded on the basis that it was not necessary for the Law Society to succeed for it to prove the signature of the Complainant was forged but rather it was sufficient to prove (as was conceded) that the solicitor did not in fact witness the complainant’s signatures on those two documents where he has certified that he did so witness.
7 There were clear issues between the parties on whether the signature of the Complainant was forged and whether the solicitor was so aware. These are important (from the point of view of the solicitor) and these we shall deal with in our Judgment.
The Complaint
8 The Complainant originally complained to the Legal Services Commissioner, on a form dated 11 January 2006, that the solicitor had witnessed her signature when he had never met her and that the solicitor had trusted her then husband and allowed “the legal papers out of his office” in circumstances where the Complainant should have signed the documentation in the presence of the solicitor. “The legal papers” about which the complaint was made was a contract for the purchase of the property dated 29 September 2004, in which the purchasers were all of the Dosanjhs. In her accompanying letter the Complainant referred to the first page of the contract and stated that her “signature had been falsified by my husband and had been witnessed by” the solicitor.
9 The Complainant also wrote to the solicitor 7 December 2005 asserting that her husband had “falsified my signature on the contract for the purchase” of the property and that her “signature on the contract was witnessed by” the solicitor whom she had never met and “would not have known me if we crossed other’s path”.
10 The Law Society investigated the allegations, summarised (correctly) by the solicitor in his letter to the Law Society 9 March 2006 as in essence that he “engaged in unethical conduct by falsely representing that (the Complainant) had signed a contract in my presence”. However, it was plain, from a perusal of the first page of the contract that the signature of the solicitor does not appear anywhere, the signatures purporting to be those of the Dosanjhs had not been witnessed anyway and that the complaint was clearly not made out.
11 By letter dated 27 March 2006 the Complainant stated that she had “done further investigations” and had determined that the solicitor had purported to witness her signature on the loan contract and on the mortgage in circumstances where he had not so witnessed. She asserted that her signature was “forged”.
12 These allegations were referred to the solicitor (although not at that stage being the subject of a formal complaint to the Legal Services Commissioner) and the solicitor’s response (20 April 2006) was that on 30 November 2004, while conducting a file review, he became aware “that signed mortgage documents were on file and nothing had been done about them”. He “recalled that about six weeks earlier (he) had attended in (his) reception area upon an Indian family of two adults and two elderly parents, to sign mortgage documents”. He was “in a hurry to bring matters up to date. The Dosanjhs were long standing clients. I did not want to appear “silly” before them by telephoning them to confirm that it was they who had attended my office some six weeks earlier to sign the documents before me, which would have brought to their attention that nothing had been done in the matter for about six weeks. I relied upon my memory.” His recollection was that he “witnessed the Dosanjhs sign the mortgage documents”. He accepted that the Complainant had “advised me I did not witness her signature on the security documents. I accept that may have been so”. He denied the Complainant advised her that her signature was a forgery, noted that in her complaint to the Legal Services Commissioner the Complainant “does not claim her signature was forged” but rather that the solicitor witnessed her signature when he had never met the Complainant (thereby, presumably accepting that it was in fact her signature). The solicitor also noted (relevantly for what later follows) that in her letter 27 March 2006 to the Law Society the Complainant, although making reference to her ‘forged signature” did not allege that she told the solicitor that it was forged.
13 There was some further correspondence, the matter was referred back to the Legal Services Commissioner, then referred back again to the Law Society and ultimately the current Application was brought in its current form.
Evidence of Forgery
14 As observed above, the Complainant in a number of documents delivered to the Legal Services Commissioner and/or the Law Society asserted that her signature on the contract and later on the loan contract and the mortgage had been forged and/or “falsified by my husband”. The Complainant gave sworn evidence before the Tribunal relevantly to this issue. The Complainant said that she attended at the office of the solicitor on or about 18 January 2005 with a stamp duty cheque “for a property my husband and I are buying at 18A Mills Road Glenhaven”. She asked for a copy of the front page of the contract and that was provided to her by the receptionist.
15 On or about 24/25 January 2005 she spoke to the solicitor by telephone. She complained about the contract being in four names asserting that the names of the former husband’s parents should not be on the contract, as they had not contributed any money to the purchase of the property. No assertion was made of any forgery.
16 On 27 January 2005 she saw the solicitor at his office. Her evidence was that she showed the solicitor “a copy of the page of the letter from Macquarie Bank” and then said: “I came across this document (referring to the loan contract and/or the mortgage) at home which I did not sign but it has been witnessed by someone. Who is the person who has witnessed my signature in this document?” and the solicitor replied: “That is my signature”. Her response was: “How could you witness my signature when you’ve never met me before?” There was then a discussion about a possible Deed of Trust to evidence that her former husband’s parents had not contributed any money to the purchase of the property but rather were on the title in order to assist with the loan application.
17 The solicitor’s evidence on this issue is to the contrary. He says, and he was not cross-examined, that on no occasion did the Complainant assert to him there her signature on the documentation, or any of the documents, was not her signature but rather he asked her: “But you did sign the mortgage, didn’t you?” and she replied: “Yes, but you didn’t witness it”.
18 A finding that the signature was forged and that the solicitor knew the signature was forged prior to completion of the purchase and the consequent advance of the loan moneys would be a finding that the solicitor was party to a fraud on the mortgagee. This would be a serious finding (as it was a serious assertion to have been made against the solicitor in the Application filed in this Tribunal) and one should proceed very carefully before making such a finding. This Tribunal is not prepared to make any finding in or to the effect that the solicitor was aware that the signature of the Complainant on any of the documents was a forgery neither is it prepared to make a finding that the solicitor was told by the Complainant that her purported signature on any of those document was not hers.
19 It is significant that:
20 It is important to also recognise that if her signature on the loan contract and the mortgage were in fact forged that would have constituted a fraud by the Complainant on the lender/mortgagee. There was no evidence of any such assertion made by her to the mortgagee but rather an adoption of the signatures as hers by permitting the purchase and financing to proceed. The Complainant received the benefit of the loan advance and her interest in the property (per her letter 28 January 2005). It seems to us these factors also go towards not making any positive findings of forgery.
a) Firstly, the letter written to the solicitor by the Complainant 7 December 2005, although asserting that the Complainant’s husband “falsified my signature on the contract for the purchase” of the Glenhaven property, post-dates the completion of the purchase by about 10 months.
b) Secondly, and more importantly, the Complainant wrote to the solicitor 28 January 2005, which letter she handed to him at their conference on that day. There is nothing in that letter that asserts any forgery on any document. Rather, it asserts that the property “is owned only by Harpinder Dosanjh and Elizabeth Dosanjh”, asserts that the then husband’s parents had “only been included for the purpose of raising the necessary finance for the purchase of this property”, that they made “no contribution” to the deposit or stamp duty and “will have no claim to the abovementioned property”. This is an important letter because it is plain there from that the Complainant wished only to preserve her interest as a one-half owner of the property and asserted that she was “entitled to 50 percent of the funds derived from the sale or any future development of (the) property”.
c) In her sworn evidence before this Tribunal no assertion was made by the Complainant that the signature purporting to be hers on the first page of the contract dated 29 September 2004 was not her signature. In our view, this fact coupled with the terms of her letter 28 January 2005 and her statements (at [14] and [15] above) the Complainant confirmed her signature on the contract and adopted the purchase. The original complaint to the Legal Services Commission was misconceived and incorrect. It was incorrect to the knowledge of the Complainant simply because she had already seen the signature page of the contract on 18 January 2005, almost twelve months before the date of her complaint and it was plain there from that the solicitor had not witnessed her signature. Her only complaint (at that stage) was that her then husband’s parents appeared as purchasers with the Complainant and her then husband. Curiously, they appeared on the contract as joint tenants.
21 There is another matter to which we would make reference: in the correspondence (referred to briefly at [11] above), the Complainant asserted that, at or immediately prior to 27 March 2006, she had “done further investigations” and had determined that the solicitor had purported to witness her signature on the loan contract and on the mortgage in circumstances where he had not so witnessed. This assertion, made in March 2006, is contrary to her sworn evidence (summarised at [16] above) that she confronted the solicitor about that very issue in his office on 27 January 2007, and compare this to the solicitor’s affidavit 14 August 2007 at paragraph 19. In other words, the Complainant knew, when she made the formal complaint to the Legal Services Commission, that firstly, the substance of the complaint was false and secondly, that her letter 27 March 2006 was, at best, misleading because she knew of the false witnessing as early as 27 January 2005 and that should have been the substance of her complaint to the Commissioner.
22 Although, as it turned out, the issue of forgery was not really the issue that was placed before the Tribunal, in our view it would be quite wrong, on the evidence presented to the Tribunal, to make any finding in or to the effect that any of the signatures purporting to be those of the complainant were forgeries and that at any time prior to completion the solicitor was informed that any of those signatures was a forgery and not truly those of the Complainant.
The Issue before the Tribunal
23 The only issue was that the solicitor purported to witness the signature of the Complainant on the loan contract and the mortgage in circumstances where he did not in fact so witness her signature. The solicitor concedes, and his evidence is clear and believable, that he did not observe the Complainant sign the loan contract and/or mortgage or any other person purporting to be her sign the loan contract and/or the mortgage on any date when he appended his signature as witness on or about 30 November 2004. The solicitor did not deny that the Complainant’s signatures on those documents were forged as alleged but did not know whether the signatures were forged or not.
24 The circumstances leading to the solicitor signing the documentation we have referred to briefly above. In short, the contract is dated 29 September 2004. Completion was set at 31 January 2005. Instructions were received from the Complainant’s then husband, in accordance with a practice that had developed over a number of years in which the Complainant and her then husband brought and sold a number of properties. The Complainant’s evidence was that she left all of these business dealings in the care of her then husband even to the extent of not opening envelopes addressed to her and him.
25 The solicitor’s recollection is that in or about mid-October 2004 all of the Dosanjhs attended at his office in the reception area and signed the documents in his presence. He said that he did not sign as witness at that time because he was engaged with other clients or carrying out some other activity and left his office to speak to the Dosanjh family in the reception area. By the time he signed the loan contract and the mortgage some six weeks had passed since the documents had actually been signed by the Dosanjh family and the solicitor “was relying on my memory that the Indian family whom I did attend in the reception area in October 2004 was the Dosanjh family and the documents I witnessed were the (loan contract and mortgage) they signed at that time”. But, significantly, he could not be certain that the Dosanjh family “was the family I recall seeking in October 2004 in the reception area” because from October to November 2004 “I carried out many similar and generic activities involving conveyancing in a large number of matters with a large number of clients as I was almost exclusively working in the conveyancing field at that time”. The solicitor said that it is still his recollection of what happened in October 2004 but conceded that “it is possible my recollection may be incorrect now as may have been incorrect as at 30 November 2004”. If, he asserts, that his recollection was incorrect then in his opinion the documents “must have been returned to my office signed, dated but not witnessed on or about 18 October 2004 and delivered to my staff by a person who I cannot identify” and that the date “18-10-2004” inserted on those documents is not his writing. In those circumstances the documents would have been placed in the file and, as a consequence, then dealt with by the solicitor signing as witness on or about 30 November 2004.
26 It is plain from the documentation that the purchase was to be financed by Macquarie Mortgages via Perpetual Trustees Australia Limited. The solicitor asserts that it was his “genuine belief that the Dosanjh family had signed the documents in my reception area”; that at the time he signed the documents as witnessed he recalled “thinking about whether I would ring the clients to have them come back into the office but I did not do so as I would have been embarrassed to contact them to explain that I could not be sure whether it was them or not who signed in my office”; that as at 30 November 2004 there was “little doubt in my mind that it was the Dosanjh family” and that he did not “recall having any significant doubt at all” on that issue.
27 He conceded that “the proper course of action would have been, at least, to have telephoned the parties at the time but it simply did not enter my mind at the time that this was necessary. I was not under any pressure to return the documents or settle the matter. Settlement was not due for a further two months. It was not a circumstance where another problem would have been created if I had not signed the documents as witness on the spot as I had more than adequate time to have the documents re-executed if I had considered that necessary. I was not in any way motivated by any other factor. As far as I was concerned, it would have been a simple matter to have had the documents re-executed if I had determined it was necessary. It simply did not occur to me that it was so necessary. I did not want to unnecessarily inconvenience my clients and it did not occur to me that the mortgage execution was anything other than the routine execution of loan documents in early preparation of a routine conveyancing settlement of the type I had conducted hundreds of times before and since”.
28 The solicitor regretted not taking a different course of action when the Complainant came to see him on 27 January 2005 and advised him that he did not witness her signature on the mortgage. However, he “took the view she was affirming her execution of the mortgage as she left me in no doubt that she wanted the matter to proceed to settlement and it was due to settle about ten days after that conference”. The only issue and concern was the presence on the contract and title of her then husband’s parents. The solicitor accepted that “he should have arranged for the mortgage to be re-executed but (he) did not see how (he) could do this without prejudicing the position of the purchasers and without rejecting their instructions to proceed to settlement”.
29 The solicitor has stated that to the best of his recollection he has “never witnessed documents of a nature of a transfer or mortgage other than if they are executed in my presence. I have been asked many times to do so and I have refused. I have incurred the ire of many clients who consider me to have inconvenienced them by refusing to execute a document for a husband or a wife who found it inconvenient to come to my office to sign and who otherwise ignored a letter of advice to have a transfer or mortgage appropriately witnessed and who simply signed it and sent it back to me expecting me to witness the signing. I have lost clients over such issues. I am well aware it is a practice which should not take place and I am well aware the Tribunal considers transgressions of such matters as matters of professional misconduct and I agree with that interpretation.”
30 In our opinion there is no need to refer to further evidence. There was evidence of difficulties that arose between the Complainant and her then husband, evidence of Family Court proceedings and no doubt other material, which is not relevant to the issue we are called upon to decide.
Conclusion
31 The Tribunal has reached a very clear conclusion. The solicitor purported to witness the signature of the Complainant on the loan contract and on the mortgage in circumstances where he did not see and was not a witness to the Complainant appending her signature to those documents.
32 The solicitor concedes that he did so and his explanation, accepted by this Tribunal, is as set out above.
33 We agree with the submissions by his counsel to the effect that this is not a case where the solicitor was “placed in a position of conflict where another problem would have arisen if the solicitor had not signed the loan documents as witness”; similarly, it “is not a matter of a solicitor being faced with a decision to sign as a witness in circumstances wherein he knows that signing to be improper to ensure another problem does not occur”; similarly, it “is not a matter of a solicitor electing to act improperly to solve another problem which would have occurred had he not done so”.
34 The solicitor acknowledges that he acted improperly and we accept that he fully understands his error. He has no prior history of any other improper conduct, is unlikely to offend again, the acts complained of arise from one single transaction, without intent to do anybody any ill or harm but rather through carelessness.
35 The solicitor was admitted to practice on 20 December 1989 and has been in practice since 1990. He is 46 years of age. Since being admitted as a partner he has conducted a busy conveyancing and general practice in partnership and his record as a solicitor is unblemished to date.
36 Legal Profession Act 2004 Section 497(1) relevantly provides that for the purposes of that Act “professional misconduct” includes:
37 We agree with the submissions of the Law Society to the effect that the conduct in questions falls within the oft-quoted description of professional misconduct at common law which is to be found in the Judgment of Lopes LJ in Allinson v General Council of Medical Education and Registration [1840] 1 QB750, being conduct “which would be reasonably regarded as disgraceful and dishonourable by his professional brethren of good repute and competency”.
“unsatisfactory professional conduct of an Australian legal practitioner, where the conduct involves a substantial or consistent failure to reach or maintain a reasonable standard of competence and diligence”.
38 There is not the slightest suggestion that this solicitor is not a person of repute and is not unfit to practice. We agree entirely with the Law Society’s submission:
39 The Tribunal is satisfied that the solicitor is guilty of professional misconduct in that he purported to witness the signature of the Complainant on the loan contract and the mortgage in circumstances where the Complainant had not signed those documents in his presence.
“Although one may differentiate the circumstances surrounding false witnessing – for example, where the solicitor does not see the signatory sign; where the solicitor does not make enquiry of the signatory; where the solicitor relies on a false representation as to the source of the signature etc – it is an inescapable conclusion that failing some fraud on the solicitor allowing him to hold an honest belief that the signatory was who the signatory purported to be, any solicitor who purports to witness a signature of a person in circumstances where the solicitor does not see the person whom the signature purports to represent sign a document and, at the same time has satisfied himself as to the identity of the signatory, must be prima facie guilty of conduct which, on any definition, can only be described as professional misconduct”.
40 However, in all the circumstances (set out above) the conduct of the solicitor falls at the lowest end of the scale of professional misconduct. Although it is true that there are numerous cases, in this Tribunal and in the Court of Appeal, going back now for about 17 years, in which this Tribunal and the Court of Appeal have made it plain that solicitors should not engage in this type of conduct and should be alert to ensure that when they append their signature as witness they have in fact witnessed the signature of the particular person, this is a case where, in our view, the solicitor has recognised the error of his ways, is unlikely to offend again and the orders of this Tribunal should properly reflect the whole of the circumstances.
Orders
Claim for Compensation
1. The solicitor is reprimanded.
2. The solicitor is fined $1,000.00.
3. The solicitor must pay the costs of the Law Society as agreed or as assessed.
41 The Complainant has filed a Claim for Compensation, the determination of which awaits the outcome of this hearing. This Claim should be the subject of a separate hearing if the Claimant seeks to further agitate it. The Claim will be subject to formal Directions before G.B. Molloy JM on Thursday 10 April 2008 at 2:00pm; thereafter, and subject to compliance with the Directions, listed for Hearing on a date suitable to the Complainant, the solicitor and the Tribunal. The Law Society, if so advised, need not attend.
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