Law Society of Tasmania v Richardson (No 2)

[2003] TASSC 71

[2003] TASSC 71

CITATION:         Law Society of Tasmania v Richardson (No 2) [2003] TASSC 71

PARTIES:  LAW SOCIETY OF TASMANIA
  v
  RICHARDSON, Scott Jason

LAW SOCIETY OF TASMANIA

v
  BETTS, Anita
  LAW SOCIETY OF TASMANIA
  v
  RICHARDSON, Gregory Arnold

TITLE OF COURT:  SUPREME COURT OF TASMANIA
JURISDICTION:  ORIGINAL
FILE NO/S:  M60/2002; M61/2002; M62/2002
DELIVERED ON:  19 August 2003
DELIVERED AT:  Hobart
HEARING DATE/S:  29 May 2003
JUDGMENT OF:  Crawford J
CATCHWORDS:

Procedure – Costs - Departing from the general rule - Order for costs on indemnity basis - Whether costs should be ordered on solicitor and client basis - Unsuccessful application by Law Society to remove practitioner from roll - Whether a special case.

Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397; Colgate Palmolive Co v Cussons Pty Ltd (1993) 118 ALR 248; connect.com.au Pty Ltd v GoConnect Australia Pty Ltd (2000) 178 ALR 348; Crockett v Roberts [2001] TASSC 106; Electrona Carbide Industries Pty Ltd v Baillieu Bowring (Tas) Pty Ltd B9/1987, applied.
Aust Dig Procedure [574]

REPRESENTATION:

Counsel:
           Applicant:  M E O'Farrell
           Respondents:  Scott Jason Richardson:  K B Procter SC
  Anita Betts:  D J Gunson SC and A R McKee
  Gregory Arnold Richardson:  P W Tree
Solicitors:
           Applicant:  Ogilvie Jennings
           Respondents:  Scott Jason Richardson:  Murdoch Clarke
  Anita Betts: Gunson Williams
  Gregory Arnold Richardson:  In person

Judgment ID Number:  [2003] TASSC 71
Number of paragraphs:  21

Serial No 71/2003
File No M60/2002

M61/2002
M62/2002

THE LAW SOCIETY OF TASMANIA v SCOTT JASON RICHARDSON
THE LAW SOCIETY OF TASMANIA v ANITA BETTS
THE LAW SOCIETY OF TASMANIA v GREGORY ARNOLD RICHARDSON

REASONS FOR JUDGMENT  CRAWFORD J

19 August 2003

1. On 14 March 2002, the Society filed originating applications seeking orders that the names of the respondents be removed from the roll of legal practitioners of the Court.  Following a hearing that extended over four days, I published reasons for judgment on 18 March 2003 and made orders that each of the applications was dismissed.  See Law Society of Tasmania v Richardson [2003] TASSC 9.

1. In each of the proceedings, the respective respondent applied for an order that the Society pay his or her costs of and incidental to the application, to be taxed as between solicitor and client.  The Society opposed each of the applications for costs.

1. The usual rule is that the successful party to litigation is entitled to an order for costs against the unsuccessful party.  The Society argued that the rule should not apply in this case because the nature of the respective proceedings was not adversarial in the ordinary sense.  It was submitted that by bringing the applications, the Society was fulfilling an obligation to bring to the attention of the Court circumstances bearing on the fitness to practise of three members of the profession and that the proceedings had as their purpose the provision of assistance to the Court to ascertain the facts and if necessary, to exercise its discretion to make disciplinary orders.  However, I am not persuaded that the role of the Society in the proceedings deserves to be categorised merely in that way.

1. Not only do the originating applications seek to remove the respondents' names from the roll, but in a written outline of submissions handed to me by counsel for the Society at the outset of the hearing of them, it was submitted that the conduct of all of the respondents demonstrated that they were not fit and proper persons to be held out by the Court as legal practitioners and more explicitly, it was stated that "the applicant seeks an order removing the respondent's name from the role [sic] of practitioners".  In the course of senior counsel's opening address, I enquired whether she was instructed to seek such an order and she said that she was.  At the end of the first day's hearing, senior counsel returned to the subject and confirmed that she was instructed to seek striking off.  At the very end of her closing address, the position of the Society appeared to have modified a little, for she emphasised that it was a matter for me to decide whether a less severe order might be more appropriate, such as suspension from practice.  Nevertheless, she maintained the line, obviously with respect to each respondent, that the conduct was such as to be "capable of attracting" a striking off order.

1. The respondents therefore had every reason to consider that the Society was seeking to terminate their membership of the legal profession.  It was not a case, as the Society's counsel has maintained, of the Society seeking simply to bring to the Court's attention possible breaches of rules of conduct applying to those who wished to continue to practise law.  The Society actively pursued what each application stated was sought.  Throughout their course, the proceedings bore all the hallmarks of adversarial litigation.

1. By the time the Society filed the originating applications, the determination of academic misconduct that had been made against Scott Richardson by the University's academic misconduct committee, had been set aside by the University's Discipline Appeals Committee, because of breaches of the rules of natural justice by failing to give Scott Richardson an opportunity to respond to statements and comments received by the academic misconduct committee from three major witnesses.  Thereafter no attempt was made within the University to have an academic misconduct committee conduct a fresh hearing of the allegation of academic misconduct.  Knowing of those matters, the Society nevertheless actively sought to have the names of the three practitioners removed from the roll for failing to disclose a determination that it knew had been reached by a process that was apparently unfair.

1. The prospects of success ought to have appeared slim to the Society and its advisors.  An obvious weakness in its case against the practitioners was that the determination of the academic misconduct committee was difficult to understand.  In my reasons for judgment, I pointed out that the committee did not state its findings of fact, did not explain the basis upon which Scott Richardson's conduct had amounted to academic misconduct, did not explain what it had meant when it found that he was "in error", did not identify what the expectations of the School of Law were when it held that he "did not meet the expectations of the School of Law" and did not explain why those expectations were material.  I also pointed out that the committee had made a finding that was significantly in his favour, by acknowledging that he believed that what he had done was acceptable to the School.  In my view, the Society and its advisors ought to have realised that the Court might well have experienced considerable difficulty determining what the undisclosed academic misconduct was in fact.  Further, it should have been apparent that Scott Richardson's version of how the assignment had come to be prepared by him was likely to be accepted by the Court, for the Society had no intention, so it would appear, of calling evidence that contradicted what he maintained, that much of student X's assignment must have been copied from his draft assignment, that he had not entered into an arrangement for that to occur and that he had no reason to expect that it would.

1. At a directions hearing on 9 April 2002, I made it clear to the Society that I was very much troubled about what the findings of the academic misconduct committee had been and in particular, what Scott Richardson's misconduct had in fact been found to have been.  I concluded the directions hearing by suggesting that the Society give serious consideration to that.

1. In my opinion, from the outset the Society's case against each of the respondents had little merit.  The proceedings should not have been instituted.  The decision to institute them amounted to an error of judgment on the part of the Society and its advisors.

1. I am conscious that the Society took advice from senior counsel and acted upon it by commencing the proceedings.  Nevertheless, the making of an order for costs in favour of the respondents is the only appropriate order.  In my view, it would be unjust and unfair not to make orders in their favour.

1. I next deal with the question whether the costs should be payable between solicitor and client.  It is rare for an order to that effect to be made.  There must be some special or unusual feature in a case to justify the exercise of the discretion to order costs on a solicitor and client basis.  Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397 at 400, 401; Colgate Palmolive Co v Cussons Pty Ltd (1993) 118 ALR 248 at 254-257; connect.com.au Pty Ltd v GoConnect Australia Pty Ltd (2000) 178 ALR 348 at 360, 361; Crockett v Roberts [2001] TASSC 106. In Electrona Carbide Industries Pty Ltd v Baillieu Bowring (Tas) Pty Ltd B9/1987 at 2 it was said that the case should be "very special", relying for that proposition on Bartlett v Barclays Bank Trust Co Ltd (No 2) [1980] Ch 515 at 547 and Bowen-Jones v Bowen-Jones [1986] 3 All ER 163 at 165.

1. What makes a particular case sufficiently special to justify other than the usual order has been discussed in a number of cases.  In Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (supra) at 401, Woodward J thought it would be appropriate to award "solicitor and client" or "indemnity" costs whenever it appeared that a proceeding had been commenced or continued in circumstances where the applicant, properly advised, should have known that there was no chance of success. However, his Honour appeared to modify the force of that statement by adding that "in such cases the action must be presumed to have been commenced or continued for some ulterior motive, or because of some wilful disregard of the known facts or the clearly established law". I would not make such a presumption in this case.

1. Subsequently, in Council of the Municipality of Botany v Secretary Department of the Arts, Sport, The Environment, Tourism and Territories (1992) 34 FCR 412 at 415, Gummow J rejected a requirement that an order of this character can only be made against an ethically or morally delinquent party. In J-Corp Pty Ltd v Australian Builders Labourers Federation Union of Workers - Western Australian Branch, Federal Court of Australia, 19 Feb 1993 unreported, at 5, French J said that it is not a necessary condition for the making of the order that there be established that there was a collateral purpose or some species of fraud.  His Honour considered that the discretion could be enlivened if for whatever reason, a party persisted in what should have been, on proper consideration, to be a hopeless case.

1. The exercise of the discretion is of course, an unfettered one, although I have received  guidance from a number of reported cases, including some to which I have not referred.  The conclusion I have come to is that Mrs Betts should have her costs on a solicitor and client basis but Scott and Gregory Richardson should have them only on a party and party basis.  Her case, which I consider to be a special one, can be distinguished from their cases.

1. The Society's case against Mrs Betts was that at the time she appeared as junior counsel for Scott Richardson, at the hearing of his application for admission as a legal practitioner on 18 August 2000, she knew of the finding of academic misconduct that had been made against him but failed to draw the attention of the Judge to the finding.  The Society alleged that her failure to do so amounted to professional misconduct because it was advertent, reckless or made with wilful blindness.  It had no evidence available to it that her failure could be categorised in any of those ways.  In the course of the Society's investigations, prior to its decision to make the applications to the Court, it was explained by Mrs Betts that she had no intention or expectation of appearing as junior counsel for her son until she received a telephone call from Gregory Richardson a few minutes before she was intending to leave to collect her mother to take them both to the Court to witness the hearing as spectators.  While discussing what drinks they would provide at a celebratory function after the hearing, Gregory Richardson invited her to sit at the Bar table with him while he moved their son's admission.  Mrs Betts informed the Society that understandably, she accepted that invitation, took up her robes, collected her mother and arrived at the Court, where the hearing commenced within minutes of her arrival.  She explained that at no time prior to the admission being moved did she see the papers filed in support of the application or discuss their contents with either Gregory or Scott Richardson, and she did not turn her mind to the question whether the finding of academic misconduct should be disclosed to the Court.  She pointed out that her role as junior counsel was very much a formal one and that she only accepted it because of the last minute invitation.  She said: "I was very proud to appear as junior counsel on my son's admission.  It was a day of such pride and joy for me as Scott's mother."

1. The Society called no evidence contradicting any of Mrs Betts' pre-application assertions, which she has since continued to maintain.  In the course of cross-examining her, the Society's counsel did not challenge them.  It relied on no evidence to establish that at any time she had advised her son to withhold disclosure of the finding of academic misconduct.

1. It was particularly because of the matters to which I have referred, that I expressed in my reasons for judgment that it had shocked me that the Society had determined to have Anita Betts' name removed from the roll.  Assuming that the Society had no evidence available to it that was not put before me, the Society's case against her was doomed to fail from the outset and in my judgment, the Society and its advisors ought to have realised that.  There was absolutely no basis upon which she could be criticised for what she did on the relevant afternoon.  Once the Society had completed its investigations, the only decision reasonably open to it was to decide not to take proceedings against Mrs Betts.

2. The position of Scott and Gregory Richardson is different for the following reasons.  The finding of academic misconduct had been made against Scott Richardson personally.  He was aware that the academic misconduct committee had expressed its expectation that he would disclose the determination to the Court when he applied for admission in order to fulfil an obligation of complete candour at that time.  He was aware that the committee had cited a High Court decision, The New South Wales Bar Association v Davis (1963) 109 CLR 428, as the basis for the expression of its expectation. Of course, it cited the wrong authority, but there were other authorities that it could more correctly have cited. Scott Richardson did not research the law on the point. He decided, albeit on the advice of others, particularly his father, not to make the disclosure. Subsequently he prepared the papers in support of his application for admission without referring to the determination.

3. Gregory Richardson was also aware of the determination and of the expression by the committee of its expectation that there should be disclosure to the Court.  He conducted no research concerning whether the expectation was correct.  He advised Scott Richardson that he did not have to make the disclosure.  He swore an affidavit in support of the application for admission, attesting that Scott Richardson was of good fame and character and a fit and proper person to be admitted as a practitioner.  He made no mention in his affidavit of the finding of academic misconduct.

4. There is no evidence to suggest that the Society commenced or continued the proceedings for some ulterior motive.  It was advised by senior counsel to take the course it did and it believed that it had a duty to the profession and to the public to do so.  It believed that it was in fact appropriate in all three cases.  Although I regard its case against Mrs Betts as baseless and for that reason have determined to award her costs on a solicitor and client basis, the Society nevertheless had some reason for believing that its cases against Scott Richardson and Gregory Richardson might succeed.  In all the circumstances, I am unpersuaded that it should be condemned to pay their costs on a solicitor and client basis.

5. Accordingly, in each application there will be an order that the applicant pay the respondent's costs to be taxed.  In the proceedings against Anita Betts it is ordered that the costs be taxed on a solicitor and client basis.  In the proceedings against Scott Richardson and Gregory Richardson, such an order will not be made.  In each proceeding there will be a certificate for counsel.