Legal Practice Board v Lashansky
[2008] WASC 294
•17 DECEMBER 2008
LEGAL PRACTICE BOARD -v- LASHANSKY [2008] WASC 294
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2008] WASC 294 | |
| Case No: | LPD:3/2000 | 7 OCTOBER 2008 | |
| Coram: | TEMPLEMAN J | 16/12/08 | |
| 35 | Judgment Part: | 1 of 1 | |
| Result: | Application dismissed | ||
| B | |||
| PDF Version |
| Parties: | LEGAL PRACTICE BOARD ROBERT JAMES LASHANSKY |
Catchwords: | Practitioners Application to restrain firm from acting for opposing client Allegations that firm possessed confidential information of the applicant, was in conflict between duties to clients and engaged in improper conduct Evidentiary basis not established |
Legislation: | Legal Practitioners Act 1893 (WA), s 58E |
Case References: | Afkos Industries Pty Ltd v Pullinger Stewart (a firm) [2001] WASCA 372 Bennett & Co v CLC Corporation (2001) 23 WAR 344 Clay v Karlson (1997) 17 WAR 493 Commissioner for Corporate Affairs v Harvey [1980] VR 669 Esanda Finance Corporation Ltd v Alvaro (Unreported, WASC, Library No 980310, 3 June 1998) Jones v Dunkel (1959) 101 CLR 298 Lashansky v Legal Practice Board [2006] WASC 247 Lashansky v Legal Practitioners Complaints Committee [2002] WASCA 326 Lashansky v Legal Practitioners Complaints Committee [2005] WASCA 217 Legal Practitioners Complaints Committee v Lashansky [2007] WASC 211 Mansfield v Director of Public Prosecutions (WA) (2006) 226 CLR 486 McIntyre v Eastern Prosperity Investments Pte Ltd (No 4) [2002] FCA 1133 Michael v Freehill Hollingdale & Page (1990) 3 WAR 223 Naso v Danehill Nominees Pty Ltd [2006] WASC 265 Newman v Phillips Fox (a firm) (1999) 21 WAR 309 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Applicant
AND
ROBERT JAMES LASHANSKY
Respondent
Catchwords:
Practitioners - Application to restrain firm from acting for opposing client - Allegations that firm possessed confidential information of the applicant, was in conflict between duties to clients and engaged in improper conduct - Evidentiary basis not established
Legislation:
Legal Practitioners Act 1893 (WA), s 58E
Result:
Application dismissed
(Page 2)
Category: B
Representation:
Counsel:
Applicant : Mr R J Davies QC & Mr M G M Porter
Respondent : In person
Solicitors:
Applicant : Minter Ellison
Respondent : In person
Case(s) referred to in judgment(s):
Afkos Industries Pty Ltd v Pullinger Stewart (a firm) [2001] WASCA 372
Bennett & Co v CLC Corporation (2001) 23 WAR 344
Clay v Karlson (1997) 17 WAR 493
Commissioner for Corporate Affairs v Harvey [1980] VR 669
Esanda Finance Corporation Ltd v Alvaro (Unreported, WASC, Library No 980310, 3 June 1998)
Jones v Dunkel (1959) 101 CLR 298
Lashansky v Legal Practice Board [2006] WASC 247
Lashansky v Legal Practitioners Complaints Committee [2002] WASCA 326
Lashansky v Legal Practitioners Complaints Committee [2005] WASCA 217
Legal Practitioners Complaints Committee v Lashansky [2007] WASC 211
Mansfield v Director of Public Prosecutions (WA) (2006) 226 CLR 486
McIntyre v Eastern Prosperity Investments Pte Ltd (No 4) [2002] FCA 1133
Michael v Freehill Hollingdale & Page (1990) 3 WAR 223
Naso v Danehill Nominees Pty Ltd [2006] WASC 265
Newman v Phillips Fox (a firm) (1999) 21 WAR 309
(Page 3)
- TEMPLEMAN J:
Background
1 In a report dated 27 November 2000, the chairman of the Legal Practitioners Disciplinary Tribunal (the Tribunal) set out the Tribunal's determination of a number of references from the Legal Practitioners Complaints Committee (the Committee) in relation to Robert James Lashansky, the present applicant. The Tribunal proposed to make and transmit a report to the Full Court. Pending the determination of the court, the Tribunal suspended Mr Lashansky from legal practice under s 29A of the Legal Practitioners Act 1893 (WA).
2 On 29 November 2000, the Legal Practice Board (Board) applied by originating motion to McKechnie J, ex parte, and without notice to Mr Lashansky, for orders freezing his trust and general office bank accounts. McKechnie J made orders in those terms on that day.
3 Also on that day, the Board exercised its powers under s 58B of the Act and appointed Peter Joseph Bogue, a certificated practitioner, to be the supervising solicitor of Mr Lashansky's practice.
4 On 13 December 2000, Mr Bogue and Ms Diane Howell, the Board's law complaints officer, effected a forcible entry into Mr Lashansky's premises in his absence. They removed Mr Lashansky's client files and personal papers.
5 On 25 May 2001, McKechnie J varied his original order so as to permit the balance of Mr Lashansky's trust account to be paid to Mr Bogue, as the supervising solicitor.
6 On 20 December 2001, Hasluck J made an order by consent, discharging the order made by McKechnie J and granting the parties liberty to apply.
7 Mr Lashansky appealed against the Tribunal's decision. However, on 4 December 2002, the Full Court dismissed his appeal for want of prosecution: Lashansky v Legal Practitioners Complaints Committee [2002] WASCA 326.
8 On 5 September 2007, on an application by the Committee, the Full Bench struck Mr Lashansky's name from the roll of practitioners, pursuant to s 30(2) of the Act: Legal Practitioners Complaints Committee v Lashansky [2007] WASC 211.
(Page 4)
9 Throughout these proceedings, and various associated interlocutory proceedings, the firm of Minter Ellison have acted as solicitors for the Board and the Committee.
The present application
10 By chamber summons filed on 27 October 2006, Mr Lashansky brought an application under the liberty to apply included in the consent order made by Hasluck J on 20 December 2001.
11 In the chamber summons, Mr Lashansky claims a declaration that the order made by McKechnie J on 29 November 2000 was obtained 'irregularly and illegally and unlawfully and wrongfully'. Mr Lashansky seeks a declaration in the same terms as to the appointment of Mr Bogue as the supervising solicitor of his practice.
12 Mr Lashansky claims further, a declaration that the forcible entry to his premises on 13 December 2000 and the seizure of his property was illegal: and similarly, the seizure of property from his former employer's premises on 28 November 2002.
13 Mr Lashansky then claims the return of the property seized, or damages in lieu. There is a claim for special damages arising from Mr Lashansky's inability to fund his appeal or to obtain legal representation, and to compensate him for the loss of approximately $500,000 said to have been due to his practice as at the date of his suspension.
14 Mr Lashansky then seeks an order restraining Minter Ellison from continuing to represent the Board or the Committee. He seeks also, an order lifting his suspension: but this relief is, of course, no longer available.
15 The present application is concerned only with the question whether Minter Ellison should be restrained from acting for the Board and the Committee.
The legal basis for the application
16 Mr Lashansky relies on the principles expounded in Newman v Phillips Fox (a firm) (1999) 21 WAR 309 and Afkos Industries Pty Ltd v Pullinger Stewart (a firm) [2001] WASCA 372.
17 In Newman, Steytler J (as his Honour then was) identified three bases which traditionally justified the intervention of the court in
(Page 5)
- restraining a solicitor from acting for an opposing party. In essence, they are:
1. where the solicitor is in possession of information which is confidential to a former client but which is, or might be, relevant to a matter on which the solicitor is instructed by a second client;
2. where there is a conflict of interest between the solicitor and his client; and
3. where the solicitor's conduct has been improper and the order is made 'to ensure that the administration of justice is not brought into disrepute by the conduct of those members [of the legal profession]'. See Newman [18] - [24].
18 In Afkos, the court's intervention was justified because there was a conflict of interest between the opposing party and its solicitors such that 'the solicitor's independence from the interests of their client was clearly compromised' [31] (Murray J, with whom Anderson and Steytler JJ agreed).
The evidentiary basis for the application
19 In his chamber summons, Mr Lashansky says he will rely on his affidavit of 5 October 2006 in matter CIV 1768 of 2004, Lashansky v The Legal Practice Board, 'with various other affidavits' filed in related litigation.
20 Although the chamber summons was filed on 27 October 2006, it was not then given a return date. Following an enquiry made by Mr Lashansky on 11 September 2007, the summons was listed for a directions hearing on 13 November. Directions were then given which permitted Mr Lashansky to file and serve any further affidavit on which he intended to rely by 27 November: and by the same date, to identify by letter to the Board's solicitors the affidavits filed in these or other proceedings, or other material, on which he wished to rely. Mr Lashansky was also directed to identify separately, any such material on which he wished to rely in support of his application to restrain Minter Ellison from acting for the Board.
21 On 27 November, Mr Lashansky wrote to my associate and Minter Ellison enclosing an affidavit sworn by Natalie Anne Ridout on 24 September and explaining that due to technical difficulties, he would be unable to complete a further affidavit of his own in compliance with the direction.
(Page 6)
22 On 3 December, Mr Lashansky filed the affidavit he had foreshadowed. It was a substantial document extending to 738 pages, including exhibits.
23 On 10 December, Minter Ellison wrote to my associate and to Mr Lashansky saying that because Mr Lashansky had identified a large amount of material on which he intended to rely, the Board would need until 31 January 2008 to consider the material and file any responsive affidavits.
24 Mr Lashansky replied on 13 December. He said that, in principle, he could see no difficulty in allowing Minter Ellison to have until 31 December 'and perhaps some extra time' to prepare a responsive affidavit. The rationale for this concession was that:
The entire thrust of my Affidavit that extends to 738 pages is to demonstrate that Minter Ellison has been remiss in the manner that they have conducted the litigation on behalf of the … Board and the … Committee.
25 A little earlier in his letter, Mr Lashansky said that he intended to press Jones v Dunkel (1959) 101 CLR 298 'as forcefully as I am able to'. He said:
What is not denied on oath must be taken to be admitted and if any affidavit material I have filed is not dealt with by Minter Ellison, I wish that the necessary negative inferences be drawn (affidavit of 3 October 2008, page 1145).
26 Mr Lashansky went on to summarise in his letter the allegations of misconduct on the part of Minter Ellison.
27 In fact, Minter Ellison did not file an affidavit until 19 May 2008. It was an affidavit of Michael Shaw Ferguson, a partner in the firm who, as I understand it, had not been involved previously in this litigation. Mr Ferguson was not, therefore, able to give direct evidence about the matters raised in Mr Lashansky's affidavit. Mr Ferguson deposed to the results of enquiries he had made of those who were involved, but who have not themselves made affidavits.
28 Mr Ferguson's affidavit therefore appears to contain only hearsay evidence.
29 Under O 37 r 6(2) of the Rules of the Supreme Court 1971 (WA), an affidavit used for the purposes of interlocutory proceedings may contain
(Page 7)
- statements of information and belief. However, an application to restrain a solicitor from acting is not an interlocutory proceeding.
30 In Michael v Freehill Hollingdale & Page (1990) 3 WAR 223, the Full Court heard an appeal from a master who had dismissed an application by the appellant that the respondent's solicitors should indemnify him in respect of costs he had been ordered to pay to another party. The solicitors sought to strike out or stay the appeal as incompetent, on the basis that the master's order was interlocutory and that the appellant had not sought leave to appeal under s 60 of the Supreme Court Act 1935 (WA).
31 Seaman J, with whom Franklyn J agreed, held:
In my view this was an application to the court to exercise disciplinary control in a summary way over officers of the court. This is a grave matter and its outcome has all the hallmarks of finality, involving, as it must, an allegation of misconduct. I am of the opinion that the learned Master's order was a final order (234).
32 Mr Lashansky did not object to the admission of Mr Ferguson's affidavit. However, it emerged in the course of submissions by senior counsel for the Board (who emphasised that he was not acting for Minter Ellison: ts 367) that the affidavit was not relied on for the truth of its contents. Rather, it was intended to demonstrate that, in relation to the impugned conduct of the Board's officers and Mr Bogue, the Board's position was, as counsel put it:
that pursuing all sources, we can find no indication anywhere that any advice was given by anyone in Minter Ellison in relation to this (ts 371).
- The affidavit therefore dealt with only one aspect of the complaints made by Mr Lashansky: the complaint that the Board had acted improperly on the advice of Minter Ellison, and that the firm had therefore compromised its independence by acting for the Board in the defence of its conduct.
33 Although Mr Ferguson's affidavit dealt only with this aspect of the matter, Mr Lashansky responded by filing, on 3 October 2008, an affidavit extending to 431 pages, including exhibits. This affidavit contained some relevant material, including the correspondence relating to the scope of Mr Lashansky's complaints. However, it is very largely argumentative. Further, the affidavit exhibits many documents concerning such matters as climate change and agricultural developments which can have no relevance to question whether Minter Ellison should be restrained from acting for the Board or the Committee.
(Page 8)
34 At the hearing of the application, Mr Lashansky relied not only on the affidavits to which I have already referred, he also made forays into other affidavits which I shall identify where necessary. He also provided three bundles of miscellaneous correspondence and other papers, to which I shall refer as I, II and III respectively.
35 After the hearing, without leave, Mr Lashansky filed a 16-page supplementary outline of submissions in further reply. I received these submissions over objection by the Board.
36 Against that background, I turn to consider the various complaints made by Mr Lashansky against Minter Ellison. I do so initially by reference to pars (a) to (w) set out in Mr Lashansky's letter of 13 December 2007 to which I have referred above. That is the most comprehensive statement of the case Minter Ellison has to meet.
(a) The fact that Minter Ellison were clearly conflicted at the time they accepted instructions to act against me;
(b) It further appears that no proper disclosure of the existence of a conflict of interest or potential conflict of interest arising from this fact and its consequences appears to have been made to the … Board as Minter Ellison was required to do by the Rules of Professional Conduct.
37 As I understand it, Minter Ellison were first instructed in this matter for the purposes of the application to McKechnie J for the orders freezing Mr Lashansky's trust and general accounts. The firm was not involved in the proceedings before the Tribunal. However, in order to understand these complaints, it is necessary to refer to references R5 and R12 to the Tribunal. These references were concerned with complaints that Mr Lashansky had received moneys from one or more of his plaintiff clients in 'a shopping centre action', when no bill of costs had been rendered and the moneys had not been paid into his trust account (affidavit sworn 5 October 2006, page 35). One of the clients was a Ms G.
38 The shopping centre action was an action in the Federal Court relating to the Colonnade Shopping Centre. The Tribunal said in its reasons that:
The matter was settled on terms of confidentiality in June 1999, the parties including Miss G may recover some more money if and when the costs are taxed. The taxation of the matter has not yet been commenced (affidavit sworn 5 October 2006, page 43).
(Page 9)
39 On 14 December 1999, Mr Lashansky wrote to his clients in the Colonnade action saying that he had received $241,021.22, apparently pursuant to the Heads of Agreement by which the settlement had been effected. Mr Lashansky said he had banked the cheque into his trust account. He went on to refer to a dispute between the parties as to whether a sum of $350,000, being the limit placed on the recovery of costs, included the costs of taxation. There was also a dispute as to whether the liability for the payment of the settlement moneys as between the respondents was joint or several (I, page 131).
40 The relevance of these matters for present purposes is that Minter Ellison acted for the second respondents in the Colonnade action.
41 In his affidavit sworn on 30 November 2007, Mr Lashansky said:
10. There were at the time of my suspension serious unresolved issues relating to the settlement of the Colonnade litigation and furthermore there were serious consequences for my Colonnade clients and me personally should the terms of absolute secrecy insisted upon by the Defendants in the Colonnade matter be breached.
11. So rigorous were the obligations of secrecy pursuant to the settlement in the Colonnade matter that the Plaintiffs were obliged to destroy all copies of the Defendants' discoverable documentation and the Plaintiffs' Counsel in the matter, Mr Neil Gentilli, had taken the unusual step of warning the Plaintiffs that it was his opinion that there was a strong possibility that one of the Defendants would go so far as to use Agent Provocateurs in order to induce the Defendants [sic, Plaintiffs] to breach the onerous terms of confidentiality.
12. I am therefore aghast that Minter Ellison should consider that it was in a position to act against the Plaintiff's former lawyer in accepting instructions in a situation where the acceptance of those instructions would clearly advantage one of the Defendants in the Colonnade litigation, HIH Insurance Limited, that was clearly a major client of Minter Ellison, to the great potential detriment of my former Colonnade clients.
42 Mr Lashansky relies on r 7 of the Professional Conduct Rules which provide, relevantly:
7.1 Subject at all times to the duty of a practitioner to the court, a practitioner must give undivided faithfulness to the client's interest, unaffected by the interest of any other person, including the practitioner's own interest, or by the practitioner's perception of the public interest.
(Page 10)
- 7.2 A practitioner must at all times fully and frankly disclose to the client any interest the practitioner has in any matter in which the practitioner acts for that client. If the interest is adverse to the client's interest the practitioner must decline to represent or cease representing the client (as the case may be) unless the client is fully informed and voluntarily assents to the practitioner acting or continuing to act on the client's behalf.
7.3 A practitioner must not give legal advice to a person knowing that the interests of that person are or may be in conflict with the interests of another person who is already a client, except for advice about obtaining the services of another practitioner.
7.4 A practitioner must not represent or continue to represent two or more clients with conflicting interests in litigation.
…
7.6 If a practitioner:
(1) has obtained confidential information as a result of acting for a client; and
(2) there is a risk that by acting for a person whose interests are or may be adverse to those of the client, the practitioner may disclose or make use of the confidential information, in breach of the practitioner's duty of confidentiality to the client,
the practitioner must not act for that person.
(Annexure RJL1 to Mr Lashansky's affidavit of 30 November 2007, pages 56 - 57)
43 As I understand it, Mr Lashansky's complaint is two-fold. First, he contends that in acting for the Board, Minter Ellison could not have given their 'undivided faithfulness' to the Board's interest (as required by r 7.1) because they could not have been unaffected by the interests of their client in the Colonnade litigation.
44 Secondly, Mr Lashansky contends that in the course of acting for the Board, Minter Ellison became possessed of confidential information relating to his practice and that there was a risk Minter Ellison might use that information against Mr Lashansky's former Colonnade clients contrary to r 7.6.
(Page 11)
45 Following his suspension from practice, Mr Lashansky applied to Master Bredmeyer for a stay. The application was dismissed because the learned master held that he had no jurisdiction in the matter.
46 In an affidavit sworn on 6 December 2001 in his appeal (FUL 7 of 2001), Mr Lashansky said he had raised the matter of a conflict of interest with Mr Goetze of Minter Ellison (now his Honour Judge Goetze). Mr Lashansky said:
4. During the course of the proceedings before Master Bredmeyer, in which I sought a stay of the order of the Legal Practitioners Disciplinary Tribunal ('the Tribunal'), the matter of the conflict of interest was raised with Mr Goetze of Minter Ellison.
5. The substance of my complaint to Mr Goetze was that Minter Ellison were acting for the Second Respondent in the Colonnade proceedings, which formed part of the reference against me in the Tribunal.
6. Mr Goetze informed me that Minter Ellison no longer acted in the Colonnade matter (Conrad Tye/Bruvecchis and Ors v Lyrical Holdings and Ors WAG 106 of 1997) and that Mrs Davidson who had conducted the matter was no longer in the employ of Minter Ellison.
7. I verily believe that this is not the case and that Minter Ellison does indeed continue to act for the Second Respondent in the Colonnade matter, Realmark Pty Ltd.
8. To the best of my knowledge and belief the Colonnade proceedings have not been concluded with the outstanding issue of the costs to be taxed pursuant to the order of Justice French in the Federal Court as well as the terms of the deed of settlement in this matter yet to be determined.
9. As several of the references clearly involve Colonnade related matters, it is inappropriate that Minter Ellison remains acting for the Law Complaints Officer and inappropriate that Minter Ellison continues to act against my former clients.
10. Not only have Minter Ellison accepted a brief in proceedings where they have a clear conflict of interest, in that material that falls part of the reference is extremely relevant to the issue of the outstanding taxation of costs, but I believe that the conduct of Minter Ellison in representing the Second Respondent during the course of the Colonnade proceedings ought to be inquired into.
11. It is singularly inappropriate that Minter Ellison has ever accepted instructions in light of the Law Complaints Officer's sending of the
- Trust Account Auditor to investigate my practice and the fact that information gleamed [sic] by the Trust Account Auditor has now found its way into the possession of Minter Ellison.
- (Annexure RJL11 to Mr Lashansky's affidavit of 30 November 2007, pages 204 - 205)
47 Mr Lashansky swore his 6 December 2001 affidavit in support of an application to the Full Court in which he sought to have Minter Ellison restrained from acting for the Board. Mr Lashansky said the issue was referred for hearing before a single judge, but that a listing date for a special appointment 'was never given'. However, it was for Mr Lashansky to pursue the matter by obtaining a listing date if he wished to do so.
48 Returning to the substance of Mr Lashansky's affidavit: there is no evidence to support his belief that Minter Ellison continued to act in the Colonnade matter and, therefore, no evidence which casts any doubt on Mr Goetze's assertion to the contrary.
49 There is evidence that information obtained by the Trust Account Auditor was in Minter Ellison's possession. It is contained in a letter dated 20 March 2001 from Minter Ellison to Mr Donald McIntyre, to which I shall refer below.
50 I can see the argument that Minter Ellison ought not to have accepted instructions to act for the Board against Mr Lashansky when they were acting against his former clients in the Colonnade litigation. Mr Lashansky was, of course, under suspension when Minter Ellison accepted instructions: and both the Board and their Colonnade clients had a common interest in maintaining that suspension. However, the Board was acting in the public interest, whereas Minter Ellison's Colonnade clients had a commercial interest.
51 Further, there must have been a risk that Minter Ellison might obtain confidential information as a result of acting for the Board which would be of assistance to their Colonnade clients.
52 I note that the Board has not attempted to defend Minter Ellison's position: it has not made any submissions in relation to this aspect of the matter. However, even if Minter Ellison ought not to have acted for the Board in these circumstances (and I do not express any concluded view), I do not think it follows that they should now be restrained from acting for the Board in its defence of Mr Lashansky's outstanding claims. That is because (as I assume) the Colonnade litigation must by now be well and truly completed. Further, I do not think that Minter Ellison's involvement
(Page 13)
- in that litigation could have any bearing on Mr Lashansky's outstanding claims, as summarised above.
53 Mr Lashansky contends that similar considerations arise from the fact that Minter Ellison acted for DBF Property Holdings Pty Ltd and its insurer, Allianz Insurance Australia Ltd, the respondents to Federal Court proceedings brought by Mr Donald McIntyre and others in a representative action, W243 of 2000. The applicants comprising the group represented by Mr McIntyre are all former clients of Mr Lashansky.
54 By an originating motion dated 23 May 2005, in CIV 1574 of 2005, Mr McIntyre and Mr Lashansky sought orders that the latter's suspension from practice be partially lifted to enable him to represent the group in Federal Court appeal W82 of 2003. They sought also, orders that Minter Ellison be restrained from acting in that appeal and in the various proceedings in this court involving Mr Lashansky.
55 I assume the appeal was brought from the decision of French J (as his Honour then was) who, on 12 September 2002, ordered that the statement of claim be struck out: McIntyre v Eastern Prosperity Investments Pte Ltd (No 4) [2002] FCA 1133.
56 The originating motion came before me on 3 June and 28 September 2005 but was adjourned sine die because the plaintiffs had not filed any supporting affidavit. The matter has not proceeded, presumably because the Federal Court proceedings were settled. According to Mr Lashansky, in his submissions dated 6 October 2008 (par 52), the settlement involved 'terms of strict confidentiality'. Mr Lashansky says he believed that Minter Ellison inserted in those terms a bar to his former clients pursuing the firm.
57 Whether or not this is so, I cannot see that Mr McIntyre, or the other members of the group he represented, would have had a cause of action against Minter Ellison. Mr Lashansky does not identify any cause of action, other than to refer to the need for 'the purity of representation'.
58 That is, of course, a legitimate consideration: see Clay v Karlson (1997) 17 WAR 493, 495 where there is a reference to Commissioner for Corporate Affairs v Harvey [1980] VR 669. In that case, Marks J said:
What is important, however, is that the Court sets its face against giving audience to legal representatives who are unable to assure the Court of a singular interest. It is the purity of interest in the adversaries before the Court that gives what fundamental utility and credence there is in the system (762).
(Page 14)
59 Mr Lashansky's point seems to be that Minter Ellison were unable to provide that purity of interest in the Federal Court proceedings because as well as acting against the plaintiffs in those proceedings, they were acting against the plaintiffs' former solicitor in other proceedings. The point was addressed in a letter dated 20 March 2001 from Minter Ellison to Mr McIntyre, where it was said:
In regard to legal representation, you have stated a view and a concern that this firm has a conflict of interest because of its work on behalf of the Law Complaints Officer in respect of the suspension of Mr Lashansky.
Contrary to what you imply, we do take matters of conflict of interest seriously. Accordingly, we did investigate whether there was a conflict of interest before accepting instructions to act for the second respondent.
This firm acted in regard to an application for a stay by Mr Lashansky.
This firm has no confidential information relative to the matters in dispute. From your previous conversations with our Mr Damien Gare, it appears that you may be under the misapprehension that Mr Lashansky's papers relating to your client's matters have been in the possession of our firm. However, these papers went directly to the supervising solicitor for Mr Lashansky's practice, Mr Peter Bogue.
The information we have in relation to Mr Lashansky and some of his clients only relates to monetary and trust account matters and his failure to comply with directions of the Legal Practice Complaints Committee and an order of the Legal Practice Disciplinary Tribunal. This information has been the subject of reports published, for instance, in the Law Society magazine Brief.
We trust that the above allays your concerns, but please feel free to contact us should you require any further clarification.
(Mr Lashansky's affidavit sworn 30 November 2007, pages 62 - 63)
60 I accept that Minter Ellison's clients had different interests. However, I do not think that they were conflicting interests, such as to give rise to a situation which r 7 of the Professional Conduct Rules is designed to avoid.
61 If I am wrong in this view, then I think that any relevant problem would have been resolved when the litigation was settled. These circumstances do not, therefore, provide any basis for restraining Minter Ellison from acting for the Board in the present proceedings.
(Page 15)
(c) The fact that Mrs Howell in her founding Affidavit in this matter prepared by Minter Ellison has failed to observe the stringent requirements of the law that are applicable to applications where urgent injunctive relief is sought on ex parte basis as is summarized [sic] by the Learned Chief Justice in Naso v Danehill Nominees Pty Ltd & Ors [2006] WASC 265 (15 November 2006).
62 In Naso v Danehill Nominees Pty Ltd [2006] WASC 265, Martin CJ referred to the duty owed to the court by a practitioner who makes an ex parte application on behalf of his client, thereby departing from 'the basic requirements of procedural fairness'. His Honour said:
When moving the Court to make orders without hearing from a party affected, those duties include firstly, the duty of satisfying themselves that there is absolutely no way whatsoever in which the legitimate interests of their client can be protected without moving the Court to depart from basic procedural fairness; secondly, the duty of satisfying themselves that the interests of their client being advanced by the application are no mere forensic or tactical advantage or interest, but a real and substantive interest which cannot otherwise be protected and that the application is not being brought to secure some collateral or tactical advantage; and thirdly, that the Court has before it all the evidence and information that could possibly impact upon the exercise of this rare and exceptional jurisdiction [7].
63 Mr Lashansky complains that when Minter Ellison applied for the orders freezing his trust and general accounts on 20 November 2000, they did not ensure that all relevant evidence and information was placed before McKechnie J.
64 In his submissions dated 6 October 2008, at par 64, Mr Lashansky said:
There is a veritable mountain of favourable information that ought to have been laid before [McKechnie J].
65 I understand Mr Lashansky to be asserting that Ms Howell's affidavit in support of the application, while exhibiting the Tribunal's reasons, did not include the annexures. Annexure G, which is said to have been omitted, contained 'the written submissions of the practitioner together with copies of the affidavits he sought to adduce in support of those submissions': Mr Lashansky's affidavit sworn 13 November 2007, par 33.
66 Mr Lashansky's assertion is only partially correct. It appears from the affidavit of Diane Howell sworn 29 November 2000 that she did exhibit Mr Lashansky's submissions (at annexure H) but not the affidavits.
(Page 16)
67 There is a further matter of particular concern to Mr Lashansky. It is the fact that in the proceedings before the Tribunal, he was not given a copy of a letter dated 15 December 1999 written to the Board's legal officer, Mr Peter Jordan, by Ms G (who was one of Mr Lashansky's Colonnade clients) in which she said she had been involved in that litigation for two and a half years and that throughout the process she had not received an account or a receipt from Mr Lashansky (I, page 128). Ms G said also that Mr Lashansky had claimed 'on several occasions twice in front of a Mr T' that she had 'finalized the account'. (Mr T denied the allegations: see II at page 486. He was not called as a witness.)
68 Ms G did not make those claims in her evidence before the Tribunal. Indeed, they are inconsistent with a letter dated 16 September 1997 addressed to Mr Lashansky and signed by his Colonnade clients, including Ms G, in which they acknowledged receipt of his account in the sum of $2,000 and their right to require an itemised bill (Mr Lashansky's affidavit sworn 30 November 2007, page 159). This letter was an exhibit before the Tribunal. Ms G's evidence was that she had received accounts from Mr Lashansky, which she identified: Mr Lashansky's affidavit sworn 14 July 2006, annexure RJL11.
69 As Mr Lashansky rightly says, if Ms G's letter of complaint had been disclosed to him, it could have been used to cross-examine her as to her credibility. However, although it is possible that this would have made a difference to the outcome of the proceedings, it seems unlikely, having regard to the following passage in the Tribunal's reasons:
The practitioner conceded that he failed to pay into his trust account certain moneys which he had received from his client Miss G which represented future costs and disbursements or alternatively partly future costs and disbursements and partly costs and disbursements already accrued but in respect of which no bills of costs had been raised in relation to eight of the eleven payments particularised in the Reference. He argued that three of the payments namely $1,000 paid in 10 August 1998, $1,000 paid 25 August 1998 and $1,000 paid 28 September 1998 were paid into his general account properly after accounts had been rendered.
It is unnecessary for the Tribunal to resolve whether this be the case or not. Counsel for the complainant argues that it is not the case. The practitioner argues the contrary. The result of that argument will not affect in any way the seriousness of the concession made in the Reference that at least $20,000 of costs the subject of the complaint were dealt with improperly and, contrary to the provisions of the Act and we so find. (emphasis added) (Mr Lashansky's affidavit sworn 5 October 2006, annexure RJL4, page 21 - 41 of the affidavit)
(Page 17)
70 Mr Lashansky complains further that Ms G's letter of complaint was not put before McKechnie J.
71 In my view, it is relevant to note that the application to McKechnie J on 29 November 2000, although made ex parte, was not an application of the kind which came before Martin CJ in Naso. The application was brought under s 58B of the Legal Practitioners Act 1893,which is in the following terms:
(1) Where a Judge, on the application of the Board, is satisfied -
(a) that there are reasonable grounds for believing -
(i) that there is, or may be, a deficiency in any trust account of a practitioner; or
(ii) that there has been undue delay on the part of a practitioner in properly paying or applying trust moneys to or on behalf of a person or persons for whose use or benefit they have been received;
or
(b) that a practitioner is suspended from practising,
the Judge may make an order directed to the practitioner and to the bankers of that practitioner and their respective servants and agents restraining dealings in all or any of the bank accounts of the practitioner, subject to such terms and conditions as the Judge thinks fit.
73 Although McKechnie J had a discretion under s 58B(1), and could have adjourned the matter so as to give Mr Lashansky an opportunity to be heard, the material before his Honour clearly justified the orders made on an ex parte basis. The order included a provision for liberty to apply, which Mr Lashansky could have activated at short notice.
74 I accept that Mr Lashansky should have been given Ms G's letter of complaint for the purposes of the hearing before the Tribunal. However, Minter Ellison were not involved at that stage and are not responsible for the omission.
(Page 18)
75 Mr Lashansky's complaint against Minter Ellison must therefore be that they failed to ensure that the Board placed the letter before McKechnie J.
76 The application was made to McKechnie J before Mr Lashansky had instituted an appeal. It follows, I think, that if Mr Lashansky's complaint is justified, Minter Ellison must have failed to advise the Board that it should place before McKechnie J on the ex parte application any evidence in its possession which suggested that the Tribunal's decision might have been wrong; and identified Ms G's letter as being in that category. And this, despite the fact that the decision had not been challenged and was, in any event (as I have noted above), based substantially on admissions made by Mr Lashansky during the hearing.
77 This is clearly an untenable proposition. And not least because s 30(1) of the Legal Practitioners Act provides that a report made to the Full Court by the Tribunal
shall be taken, subject to s 29B, to be conclusive as to all facts and findings therein mentioned or contained.
- (Section 29B provided for a right of appeal to the Full Court.)
78 It follows that the application to McKechnie J could not have been used by Mr Lashansky as a vehicle for challenging the validity of the Tribunal's conclusions.
79 I therefore see no basis for criticising Minter Ellison for the fact that Ms G's letter of complaint was not drawn to the attention of McKechnie J on the hearing of the ex parte application.
(d) The fact that Minter Ellison have failed to file an undertaking as to damages as is clearly required pursuant to the decision of the High Court of Australia in Mansfield v Director of Public Prosecutions 80 ALJR 1366 prior to freezing both my trust and general accounts.
80 In Mansfield v Director of Public Prosecutions (WA) (2006) 226 CLR 486, the majority of the High Court held that when the Director of Public Prosecutions applied for a freezing order under the Criminal Property Confiscation Act 2000 (WA) the Supreme Court had the power to require the director to provide an undertaking as to damages, but was not under a duty to do so.
81 Although Mr Lashansky's complaint is made against Minter Ellison, it was, of course, the Board who would have given the undertaking in
(Page 19)
- damages, had that been required. Mr Lashansky's complaint must therefore be that Minter Ellison failed to advise the Board that it should proffer an undertaking in damages when making the application to freeze his trust and general accounts. However, as Mr Lashansky accepted in the course of the hearing:
… Mr Goetze might have been correct at that stage because it was some six years before the High Court handed down the Mansfield decision but clearly Mansfield has come down and Mansfield said that that undertaking as to damages should have been filed (ts 282).
83 In any event, as I have noted above, the High Court did not say that an undertaking as to damages should have been filed: only that the court could require it.
84 This point is therefore without merit.
(e) The prima facie illegality of Mrs Howell and Mr Bogue in breaking into my premises exactly 7 years ago as found by His Honour [sic] Justice Templeman in His Honour's reasons for decision at paragraphs 89-95 in Lashansky v Legal Practice Board & Ors [2006] WASC 247 (3 November 2006).
85 As I said in Lashansky v Legal Practice Board [2006] WASC 247 [87], my conclusions in relation to the actions of Mr Bogue and Ms Howell in entering on to Mr Lashansky's premises and removing his files were necessarily tentative. That was because I had not had the benefit of submissions from the Board. That remains the position.
86 I pause to note that in my reasons, at [89], I referred to a letter dated 17 May 2004 from Minter Ellison to Mr Lashansky in which it was said, in effect, that Mr Bogue and Ms Howell entered Mr Lashansky's premises because he had not agreed to deliver his files to Mr Bogue.
87 Mr Ferguson exhibits as annexure MSF4 to his affidavit sworn 6 October 2008, a file note said to have been prepared by Mr Bogue in relation to a meeting at Mr Lashansky's premises on 7 December 2000. Those present included Mr Michael O'Connor, Mr Lashansky's solicitor.
(Page 20)
88 The file note records that Mr Lashansky said he would speak to his clients about allowing Mr Bogue to have access to his files and that if there was to be any argument about Mr Bogue's entitlement to files 'it could be dealt with in court'. Mr Lashansky then instructed Mr O'Connor to apply to the court for a three-week extension 'to deal with these things'. However, no such application was made.
89 Mr Lashansky complains that Minter Ellison's letter dated 17 May 2004 was misleading for three reasons. First, because 'it falsely labelled [him] recalcitrant', when in fact he had given instructions to his solicitor to apply to the court to clarify his position. Secondly, because the letter made no mention of Master Bredmeyer's opinion, given in his reasons delivered on 20 December 2000 (annexure RJL15 to Mr Lashansky's affidavit sworn on 3 October 2008) that:
My tentative view is that his work for the Rural Action Group in preparing a white paper on greenhouse gas emissions is not legal work that needs to be done by a registered legal practitioner.
- Thirdly, because the letter made no mention of Acting Master Chapman's view (to which I shall refer below) that Mr Lashansky's suspension did not affect his liens.
90 In my view, there is no merit in these complaints. First, there is no evidence to suggest that when the letter of 17 May 2004 was written, Minter Ellison were aware of Mr Bogue's file note of 8 December 2000 or the fact that Mr Lashansky had given instructions to his solicitor to apply to the court. In any event, that instruction was given on 7 December, and no application had been made by 13 December, when Mr Bogue and Ms Howell broke into Mr Lashansky's premises.
91 Secondly, I do not think there has ever been any dispute as to Mr Lashansky's entitlement to retain his non-legal files and papers. The dispute is as to the identification of those materials and whether they were returned to Mr Lashansky.
92 Thirdly, the seizure of Mr Lashansky's legal files by Mr Bogue would not, of itself, have any detrimental effect on his liens. I therefore see nothing misleading in Minter Ellison's letter of 17 May 2004.
93 Minter Ellison's position in relation to Mr Bogue's entry into Mr Lashansky's premises is set out in par 16 of Mr Ferguson's affidavit of 6 October 2008:
(Page 21)
- In or around February 2008 I arranged for a lawyer under my supervision to contact Mr Bogue to discuss the entry to the Premises and ask Mr Bogue whether to his knowledge Minter Ellison had advised him, the [Committee], the Board or any entity related to them in relation to the entry to the Premises. I am informed by Mr Bogue and verily believe that to the best of his recollection he did not seek legal advice from Minter Ellison in relation to entry into the Premises before, during or after the event, nor was he instructed by Minter Ellison to enter into the Premises.
94 In par 20 of his affidavit, Mr Ferguson said he asked Judge Goetze if he could recall ever providing advice to Mr Bogue, the Committee or the Board or any entity related to them, in relation to the entry to Mr Lashansky's premises. Mr Ferguson said:
Judge Goetze informed me and I verily believe that to the best of his recollection he did not, nor did any one at Minter Ellison under his supervision working on matters involving [Mr Lashansky], provide advice to Mr Bogue, the [Committee], Board or any entity related to them in relation to the entry to the Premises, before, during or after the event.
95 Mr Ferguson went on to say that he had arranged for all relevant files maintained by Minter Ellison to be reviewed by both a solicitor and an articled clerk under his supervision for any advice, file note, memorandum or other document or record that would suggest Minter Ellison provided advice to Mr Bogue, the Committee, the Board or any related entity in relation to the entry to Mr Lashansky's premises, before, during or after the event. Mr Ferguson said he was informed that no such document was located.
96 As I have noted above, in an application such as this, hearsay evidence (and a fortiori, double hearsay evidence, as much of this is) is inadmissible. It proves only that Minter Ellison does not believe it has a conflict.
97 Mr Ferguson's evidence leaves open the possibility that informal advice was given to the Board by someone on behalf of Minter Ellison who was not asked about the matter, or by Mr Goetze who has since forgotten that he did so. Any such advice would, of course, be privileged.
98 However, the important point, I think, is that neither Mr Bogue nor the Board claims to have been given any such advice. If such a claim had been made, then, as senior counsel for the Board accepted, Minter Ellison's position as its solicitors would be untenable: ts 369.
99 In the absence of any such considerations, I see nothing to prevent Minter Ellison from acting for the Board in relation to any claim arising
(Page 22)
- out of the entry into Mr Lashansky's premises by Ms Howell and Mr Bogue.
(f) The failure of Minter Ellison or the … Board to do anything for several weeks notwithstanding the direction of His Honour [sic] Justice Templeman on the morning of Thursday, 13 January 2005 to the effect that my personal property, (which was clearly required on an urgent basis), was to be returned to me;
(g) The fact that after a delay of several weeks, I was presumably to be satisfied with the contents of the bizarre correspondence from Minter Ellison dated 1 February 2005 and 4 February 2005 instead of receiving at the very least an Affidavit from Mr Bogue setting out the circumstances of his purported attempts to return my personal property and/or the current whereabouts of my personal property;
(h) The obvious fact that when you seize personal property that you have no right to seize in the first place, then surely at the very least you should ensure the safe return of that property to its rightful owner or have the rules of common decency and the law relating to fiduciary duties been thrown out the window in the state of Western Australia[?]
100 On 13 January 2005, Mr Lashansky filed a chamber summons in which, among other relief, he sought an order against the Board that it deliver to him within three days:
Any materials in its possession or in the possession of its agent, Mr Peter Bogue, regarding re-afforestation, carbon credits trading, greenhouse gas emissions, soil beneficiation products including products to increase carbon levels in soils and … if the [Board] or its agent has parted with possession thereof, in whose possession such documentation currently is.
101 The chamber summons came before me on the same day. Mr Lashansky informed me that, as he had already informed Mr Goetze's receptionist, he would not then be proceeding with that part of the application (ts 90). Mr Lashansky acknowledged that Mr Goetze needed to take instructions on whether those documents referred to above (which were Mr Lashansky's personal papers) were in the Board's possession.
102 In relation to that matter, I said:
It seems to me that if there are personal papers there, then obviously you are entitled to retrieve them, and it's a question of the most effective way of locating them. Since you know what is there, it seems to me that the sensible course would be for you to go in and find them. Obviously … there would have to be some presence from the [Board] if
(Page 23)
- they wanted to, to make sure that only non-legal papers were retrieved (ts 91).
103 A little later in the hearing, after I had adjourned this part of Mr Lashansky's summons, I noted again that Mr Lashansky had told the Board that morning that he would not be pursuing that aspect of the summons on that day. Mr Lashansky said:
No, it's not that urgent, Sir, that Mr Goetze and the … Board can't have time to make their own enquiries as to what has happened.
- I replied:
Yes, but you can inform the [Board] from me that I would entertain an urgent application, if the matter became urgent. Perhaps the best thing to do is for me to see if I can get the transcript of this hearing this morning made available quickly, and then you can have the transcript and you can, in that way, pass on to the [Board] what I have said.
105 The subsequent correspondence from Minter Ellison which Mr Lashansky describes as 'bizarre' is in the following terms. First, the letter of 1 February 2005:
We refer to your application to the Hon Justice Templeman in chambers on 13 January 2005 and your subsequent communication to us by letter dated 31 January 2005.
At the time of dictating this letter, we have not been able to make contact with Mr Peter Bogue, the solicitor who supervised your practice following your suspension. However, the writer's understanding is that Mr Bogue made several deliveries to you over a period of time of various personal papers and items.
We understand the reason for several deliveries being made to you is that as Mr Bogue progressed through the task of sorting out the materials taken by him from your office, client files were dispatched as previously advised and that he returned papers and items personal to you as the same were located.
We have previously written to you on 17 May 2004 explaining what happened to your various files which were taken by Mr Bogue.
Neither the Legal Practice Board nor Mr Bogue had or have any interest in retaining materials personal to you.
In the circumstances, we suggest that you look elsewhere for the documents which are you seeking.
(Page 24)
- We regret that we can not assist you.
106 Secondly, the letter of 4 February 2005:
We refer to our letter to you dated 1 February 2005. We have now had the opportunity of speaking with Mr Bogue who has instructed us, that, after taking delivery of such materials that were at your office premises, and this was clearly not all of your client files, Mr Bogue stored the same in Subiaco.
After sorting, Mr Bogue delivered to your clients or their new solicitors those files which he could. Client files which could not be returned to your clients were delivered to the Legal Practice Board.
Further, matters personal to you were delivered to you as Mr Bogue sorted his way through the various documents taken by him, many of which were loose papers. Matters personal to you were delivered to you on a number of occasions including 1 June, 12 June, 11 July, 20 July, 15 October, 9 November, 6 December 2001 and 13 March 2002. These deliveries were made by courier, save for the last delivery which was made by Mr Bogue's secretary.
We also understand that on 28 November 2002, Mr Bogue, your former client Mr Sam Novatscov and his new solicitor Mr Stuart Forbes attended at Mr Wormall's premises in Maddington for the purpose of collecting files relating to the Colonnade matter. Mr Forbes and Mr Novatscov took away with them two large cardboard containers and a plastic container on wheels. A detailed search on a document by document basis was not then undertaken, but, if any documents were so taken which did not relate to the Colonnade, then, Mr Forbes was to return the same.
We have been advised by Mr Forbes that the only documents that he took were those relating to the Colonnade matter such that there was nothing to be returned. He did however find that he had taken a number of file sleeves or other items of stationery which were not client matters, but certainly nothing of a documentary nature.
Mr Forbes believes that there were in fact other documents left behind at Mr Wormall's premises in boxes. Further, there was a set of Halsbury's Laws of England which were left behind.
Mr Bogue is adamant, that, of the documents and files taken by him, all such documents have either been returned to you, your former clients or their new solicitors direct, or such files could not be returned to clients and those documents are in the possession of the Legal Practice Board.
We trust this answers your queries.
107 With all respect to Mr Lashansky, I can see nothing bizarre in these two letters. The letter of 1 February 2005 appears to be a prompt response
(Page 25)
- to a letter from Mr Lashansky of the previous day. It was written in the absence of express instructions, but sets out the writer's understanding of the relevant circumstances: an understanding which was apparently confirmed after the writer had spoken to Mr Bogue. The letter of 4 February 2005 sets out the position in some detail.
108 Mr Lashansky disputes that documents were delivered to him as set out in the 4 February letter (ts 309). He points to the fact that Mr Bogue has not sworn an affidavit deposing to the fact that the deliveries were made, nor has he produced any documents such as those kept by a courier as a record of delivery. However, that has no bearing on Minter Ellison's conduct which, in my view, in relation to this aspect of the matter, could not be the subject of legitimate criticism.
(i) With the utmost of respect to the present Judge Goetze, his assertion that I was only an 'unsecured creditor' in the RL Wright Pty Ltd liquidation was patently absurd when the entire line of legal authority is that I held the status of being the ultimate of secured creditors;
(j) Accordingly, the very least that I am entitled to request that Judge Goetze set out in Affidavit from the sources of his information and belief as to my status as an 'unsecured creditor' and since this view flies directly in the face of contrary authority of the Full Court of the Supreme Court of Western Australia to the effect that a solicitor's lien is valuable property and cannot be confiscated by Liquidators how such a view can reasonably be arrived at;
(k) Judge Goetze is clearly required to set out whether he is aware of the reasons of His Honour Justice Wallwork delivered in Bennett & Co v CLC Corporation & Ors (2001) 23 WAR 344 at [29] and the clear illegality of the actions of the Liquidator, Hillary Orr in purporting to confiscate my property after she was armed with my documents through the illegal actions of Mr Bogue and Ms Howell and why, he continued to maintain his stance that I was an 'unsecured creditor' even after acting Master Chapman sitting in Judge's Chambers opined that my liens were been [sic] protected by the Legal Practitioners Act 1893 (WA);
(l) Since Friday, 3 November 2006, Minter Ellison are 'without the proverbial leg to stand on' when it comes to continuing to act to defend the indefensible actions of their client and their client's agent, Mr Bogue and their own role in those actions.
(Page 26)
109 The primary source of Mr Lashansky's complaint is a letter written to him on 17 May 2004 by Minter Ellison in relation to a matter in which he had acted for a company known as R L Wright Pty Ltd.
110 The relevant facts are set out in my judgment in [2006] WASC 247. In essence, Mr Lashansky represented the client company in an arbitration. He succeeded in securing the dismissal of the claim made against the company and in obtaining an award in which the arbitrator upheld part of the company's counterclaim.
111 Mr Lashansky was entitled to charge the company for his services in an amount which I found to be some $177,000: [15]. However, the company was wound up on 1 August 2000 by order of the Supreme Court of South Australia. A liquidator was appointed.
112 Mr Lashansky's files relating to R L Wright Pty Ltd were among those seized by Mr Bogue and Ms Howell on 13 December 2000. Mr Bogue subsequently gave the files to the liquidator.
113 On 17 May 2004, Minter Ellison wrote to Mr Lashansky in relation to his claim against R L Wright Pty Ltd. So far as relevant, the letter was in the following terms:
As you know, you were suspended from practice by order of the Legal Practitioners Disciplinary Tribunal in November 2000. The consequence of that is that the Supreme Court ordered that the Legal Practice Board be empowered to appoint a supervising solicitor to your practice. Mr P J Bogue was so appointed.
The duties of a supervising solicitor in these circumstances are to enter the practitioner's office, take possession of client files and deliver them to the client or to the client's new solicitor. In certain circumstances, the supervising solicitor may also carry on work with respect to those files.
In your case, Mr Bogue entered your office, took possession of the file relating to R L Wright Pty Ltd which was then in liquidation. The appropriate person to whom to hand the file was the liquidator, which Mr Bogue duly did.
The liquidator has appointed Messrs Price Sierakowski, solicitors, to act on his behalf. Mr Damien Cooper from that office has the conduct of the matter.
Mr Cooper was in the Supreme Court on 5 April 2004 to observe proceedings. He has advised us, that, your former client company won the arbitration proceedings and obtained an order for costs. That arbitration proceeding was registered by you in the Supreme Court and can be
(Page 27)
- enforced in Supreme Court. This means that it is necessary for your former client company, now in liquidation, to tax its costs and recover the same.
At face value, we understand that you are nothing more than an unsecured creditor.
114 The duties of a supervising solicitor were then as set out in s 58E of the Legal Practitioners Act 1893. Section 58E(1) provides:
(1) The supervising solicitor shall conduct the practice for the purpose of concluding or disposing matters commenced but not concluded by on behalf of clients of the practice and, where necessary, for the purpose of disposing of, or dealing with, documents relevant to those matters and, in the case of the practice of a deceased practitioner, shall carry on the practice until it can otherwise be dealt with according to law.
115 It seems that when Mr Bogue took possession of Mr Lashansky's files relating to R L Wright Pty Ltd, that matter had not been concluded because the payment of costs remained outstanding. In those circumstances, there is an issue as to whether s 58E authorised Mr Bogue, as the supervising solicitor to destroy Mr Lashansky's lien over the client's documents by returning the documents to the liquidator.
116 Mr Lashansky's principal complaint, however, is that it was not correct to say that he was 'nothing more than an unsecured creditor'. Even though his possessory lien had been destroyed by the return of documents to the liquidator, Mr Lashansky remained entitled to a particular lien (otherwise known as a fruits of action lien or an equitable lien) both at common law and pursuant to s 73 of the Legal Practitioners Act: [2006] WASC 247 [67] - [86].
117 Of course, my judgment to that effect was not given until over two years after Minter Ellison's letter of 17 May 2004. Although Acting Master Chapman had previously expressed the opinion that Mr Lashansky's liens were protected by the Legal Practitioners Act, that was said in the course of argument, not in a decision. As will be seen below, the application before the acting master was adjourned. Further, the decision of the Full Court in Bennett & Co v CLC Corporation (2001) 23 WAR 344, on which Mr Lashansky relies, arises from s 530B(1) of the Corporations Law, not the Legal Practitioners Act. Further again, Minter Ellison did not purport to set out, in their letter of 17 May 2004, a concluded view of the law. The proposition that Mr Lashansky was
(Page 28)
- 'nothing more than an unsecured creditor' was prefaced by the words 'at face value'.
118 I see no basis here for restraining Minter Ellison from acting for the Board. Minter Ellison owed no duty to provide correct or complete advice to Mr Lashansky. It is no doubt frequently the case that a solicitor, in writing to an opposing party or his client, will express a view of the law which is incorrect and which the recipient of the letter recognises as being incorrect. However, those circumstances clearly provide no justification for the removal of the solicitor concerned.
119 Mr Lashansky's assertion that since Friday, 3 November 2006 Minter Ellison are 'without the proverbial leg to stand on' is a reference to the date on which I handed down my reasons in [2006] WASC 247. However, so far as I am aware, Minter Ellison have not since that date sought to argue that the proposition set out in their letter of 17 May 2004 was correct.
(m) Whichever Court is seized of the matter is entitled to assume that the Legal Representatives who appear before it are not tainted with motives to deflect the Honourable Court from the truth and doing justice;
(n) On the Afkos line of authority, purity of representation is demanded.
120 These propositions are undoubtedly correct. However, nothing needs to be said about them out of the context to which I have referred already.
(o) Regrettably the motive to misrepresent is only too real in the present matter as what is in issue is not only the past actions of Judge Goetze and Mr Bogue and Ms Howell that are clearly bad in law but section 371 of the Criminal Code makes it quite clear what the negative consequences are for persons who interfere with liens.
121 In this application, I am concerned only with the position of Minter Ellison, not the actions of Mr Bogue or Ms Howell. There is no evidence on which it could be even suggested that Mr Goetze was prompted by any improper motives to write the letter of 17 May 2004 on behalf of Minter Ellison.
(p) Minter Ellison clearly ought to have advised their client properly, but the failure does not end at poor advice but extends to the unpalatable truth that Minter Ellison have actively sought to deflect the Honourable Court from truth and justice by introduced [sic] into the court system the blatantly untenable submissions that are to be found in the Outline of Submissions filed by Minter Ellison in matter CIV 1768 of 2004;
(Page 29)
(q) The facts alleged in the Outline of Submissions filed by Minter Ellison in matter CIV 1768 of 2004 further are nowhere supported by admissible evidence;
(r) It is my submission that any competent first year legal practitioner would have provided correct and impartial advice to the … Board as to the effect of the decision of His Honour Justice Wallwork in Bennett & Co v CLC Corporation & Ors (2001) 23 WAR 344 at [29] and Mr Goetze should explain on oath how he arrived at the conclusion that I was merely an 'unsecured creditor'.
122 The outline of submissions to which Mr Lashansky refers in (p) above were those dated 10 September 2004 prepared for a hearing before Acting Master Chapman on 7 October.
123 Mr Lashansky then complained that no affidavits had been served in response to the 'copious affidavit material' that he had filed. However, the outline of submissions filed by Minter Ellison proceeded on the basis that factual matters asserted in their letter of 17 May 2004 were correct. These included the assertion that it was not possible to cost any of the files seized from Mr Lashansky's offices, other than the file on the Colonnade matter which had been referred to another solicitor for taxation.
124 The submissions then refer to s 58E(1) of the Legal Practitioners Act 1893 and the true construction of that provision.
125 The submission was then made that because Mr Lashansky had been suspended, and was therefore unable to complete what was an entire contract to act for his clients, he was not entitled to recover unbilled work in progress, there being no implied term that he should be entitled to a quantum meruit in those circumstances.
126 The submission continued further, that because no account had been rendered, nor could be rendered, Mr Lashansky had no lien in respect of work as yet unbilled: affidavit of 3 October 2008, page 252.
127 I see no basis for the proposition that Minter Ellison 'actively sought to deflect the Honourable Court from truth and justice' by relying on the submissions to which I have referred above. Minter Ellison were entitled to make the submissions which, it seems, were given short shrift by the acting master in any event. As I have noted above, the acting master expressed the view that Mr Lashansky's lien was preserved by s 31D(4) of the Legal Practice Act 2003 (WA): ts 48.
(Page 30)
128 Ultimately, it was not necessary for the acting master to decide the point because the application was adjourned sine die: ts 75.
129 Even if Minter Ellison's submissions were completely untenable, that could provide no basis for requiring their author to explain on oath (or at all) how they came to be made, as suggested by Mr Lashansky in (r) above.
(s) The law frowns upon people who take the law into their own hands;
(t) The use of self-help at the best of times is to be deprecated, but this is especially so when the party wrongly exercising the remedy of self-help happens to be the … Board … , an entity that should be, with the utmost respect, the absolute paragon of model litigants;
(u) In filing any responsive Affidavit, it should be born in mind that the High Court of Australia has set out in the case of Plenty v Dillon that 'the policy of the law is to protect the possession of property and the privacy and security of its occupier' (Semayne's Case (1604) 5 Co Rep 91a at P91B), and the Affidavit should set out fully the justification for destroying my liens and invading my privacy.
130 These are matters for the Board and Mr Bogue to deal with in due course. As I have noted above, there is no evidence that Minter Ellison were involved in, or gave advice in relation to, the entry into Mr Lashansky's premises or the seizure of his files.
(v) Furthermore, it is absolutely disgraceful that one of the parties who broke into my premises, and violated my property rights and my right to privacy was none other than Mr Peter Joseph Bogue;
(w) Mr Bogue was legitimately challenged by me as to his own position in light of his close ties to the firm of Minter Ellison as is evident from the case of Esanda Finance Corporation Ltd v Rocco Dominic Alvaro (unreported Supreme Court Decision Lib No 980310 delivered 3 June 1998).
131 The essence of Mr Lashansky's complaint, is that when Mr Bogue was appointed as the supervising solicitor of Mr Lashansky's practice, he was not an independent practitioner but was a consultant to Minter Ellison.
132 Mr Lashansky's concern arises from my judgment in Esanda Finance Corporation Ltd v Alvaro (Unreported, WASC, Library No 980310, 3 June 1998). I there noted that Mr Bogue was, as at 3 June
(Page 31)
- 1998, a consultant to Minter Ellison. However, as appears from Mr Ferguson's affidavit of 6 October 2008, Mr Bogue ceased acting as a consultant for Minter Ellison 'in or around late 1998'. I have referred above to the fact that Mr Ferguson's affidavit contains largely hearsay evidence. The evidence relating to the relationship between Minter Ellison and Mr Bogue is not, however, hearsay. It is direct evidence and is therefore admissible in this application.
133 Mr Lashansky complains also about the way in which Mr Bogue proposed to deal with any conflict of interest which might emerge when he reviewed Mr Lashansky's files.
134 It is not necessary to refer to this complaint in detail because there is no evidence that Minter Ellison were involved.
Further complaints by Mr Lashansky
Failure to permit proper inspection of the Board's documents
135 In par 204 of his affidavit of 30 November 2007, Mr Lashansky said he attended the offices of Minter Ellison to inspect documents pursuant to an order I had made on 5 April 2004. In pars 210 to 211, Mr Lashansky said:
… Mr Goetze additionally did not give me proper unrestricted access to the files for purposes of proper inspection of the documents contained thereon but he elected to ration my access by handing me each individual document on the file in question after reading it himself and thereafter allowing me the briefest opportunity of examining the document in question.
I resented both the presence of Mr Goetze generally, (as I believe he had no right to be present while I inspected the documents having not sought any order from His Honour [sic] Justice Templeman to this effect), and the manner in which Mr Goetze controlled my access to the files, such that I virtually had to sit on his lap in order to examine these files.
136 This evidence has not been challenged and I therefore accept it as accurate. However, Mr Lashansky is in error when he says that I made an order for discovery.
137 On 5 April 2004, I sat as a single judge of the Full Court to give directions in Mr Lashansky's pending appeal. One of the directions Mr Lashansky sought was that discovery be given by the Committee.
(Page 32)
138 Leading counsel for the Committee on that occasion was Mr R J Davies QC. Mr Davies' initial response to the application was that it might be possible to avoid an order being made. He said:
As part of the exercise of what, after all, is a pseudo-prosecutorial matter the Complaints Committee would be prepared to make the entire file available for perusal under appropriate supervision (ts 136).
139 Almost immediately, Mr Davies retreated somewhat. He said:
I may have gone a little far … What is proposed is that we will, without an application for discovery, provide an entire listing of the documents that are on the file … Not the file itself. Then, subject only to any considerations about some internal memoranda and the like, we will allow the viewing of the documents selected by [Mr Lashansky] from that list. It is simply obviating the need for a formal order and an application … (ts 136). (emphasis added)
140 After some discussion about the way in which the proposal would be put into practice, Mr Lashansky agreed to proceed in that way. However, I said to Mr Lashansky:
I'm not shutting you out from coming back … if you're not satisfied and you can persuade me that there's more there that needs to be disclosed to you (ts 138).
141 I therefore made no formal order, but noted in my fiat that the Committee had undertaken to provide Mr Lashansky with a list of documents on the file concerning him held by the Board by the end of April 2004.
142 At that stage, Mr Lashansky's appeal from the Tribunal had been dismissed for want of prosecution. However, for reasons which are not presently relevant, the court decided later that Mr Lashansky should be given leave to re-open it. The undertaking given on behalf of the Committee was intended to facilitate Mr Lashansky's preparation for the resumed hearing.
143 On 16 November 2005, a differently constituted Full Court decided that it had no jurisdiction to re-open the appeal (the order dismissing the appeal having been perfected): and that in any event, the application was without merit: Lashansky v Legal Practitioners Complaints Committee [2005] WASCA 217.
144 In the summary of its reasons, the court said of the decision to dismiss the appeal for want of prosecution:
(Page 33)
- That decision was not procured or affected by fraud. There has been demonstrated no conspiracy against the applicant. The applicant has not been prevented by any oversight or act of the respondent, of the Court, or of the Court's officers, from being fully and properly heard. On the contrary, it is clear beyond doubt that the various difficulties which the applicant has laboured under throughout this matter have resulted from his inability to appreciate what the thrust of the various references against him was, or what the reasons of the Tribunal were, or what material might be relevant to an appeal, or how to make an application in proper form, together with his habit of filing prolix and repetitive materials [258].
145 In my view, this decision of the Full Court precludes Mr Lashansky from complaining about the way in which he was permitted to inspect documents on the list provided to him by the Committee. Any such complaint should have been the subject of an application for discovery or further and better discovery which, as I have noted above, I told Mr Lashansky on 5 April 2004, would have been open to him.
146 As I understand it, Mr Lashansky seeks discovery of the Committee's or the Board's files for the purpose of pursuing the balance of the present application. However, that is a matter which will need to be addressed at a later date.
147 Mr Lashansky complains also about Minter Ellison's conduct in his attempts to prepare an appeal book index in relation to his appeal from the Tribunal's decision: and in particular, a refusal to sign the certificate of correctness. Again, it is not necessary to refer to these matters in detail. In my view, the complaint is no longer open, having regard to the decision of the Full Court dismissing the appeal for want of prosecution. Malcolm CJ expressly held that
having regard to the state of preparation of the appeal book on 31 May 2002, the solicitor for [the Committee] was entitled to refuse to sign the certificate of correctness (Lashansky v Legal Practitioners Complaints Committee [2002] WASCA 326 [24]).
- Although Mr Lashansky contends that the decision contains many errors, as I have noted above, a subsequent Full Court held that it could not be re-opened and was without merit in any event.
148 That fact disposes also of a complaint that Mr Goetze failed to draw the attention of the Full Court to Mr Goetze's request to re-list the matter for further hearing before judgment was delivered on 4 December 2002, in his absence. The request was contained in a letter from Mr Lashansky to the court which, regrettably, did not reach the members of the court before that date. However, Mr Goetze was entitled to assume that the
(Page 34)
- court was aware of the letter. Further, in my view, Minter Ellison did not act precipitately in extracting the Full Court's order, as Mr Lashansky asserts.
149 In all the circumstances, I do not consider that the way in which Minter Ellison permitted Mr Lashansky to inspect the Committee's documents provides any basis for restraining them from continuing to act for the Board.
The payment to Ms G by the Legal Contribution Trust
150 Mr Lashansky deposes to the fact that when inspecting the documents in the way described above, he saw a chain of correspondence indicating that Ms G 'was clearly in receipt of a significant payment from the Legal Contribution Trust for an alleged defalcation by me …': Mr Lashansky's affidavit of 30 November 2007, par 205.
151 Under s 20(1) of the Legal Contribution Trust Act 1967 (WA), a person who suffers pecuniary loss 'by reason of professional defalcation' is entitled to claim compensation from the Guarantee Fund established under that Act. By s 4, 'professional defalcation' is defined to mean:
[T]he stealing or fraudulent conversion, by a practitioner, by any one or more of his employees or by a practitioner with whom he shares remuneration (other than as principal and agent), of money or other property at any time entrusted to him, them or any of them, for or on behalf of another person, in the course of the practitioner's practice.
152 Mr Lashansky points out that relevantly, the complaint against him before the Tribunal was not that he had been guilty of any defalcation, but that he had not dealt properly with moneys which should have been paid into his trust account. By s 27 of the Act, the trust is subrogated to the claimant against the legal practitioner responsible for the defalcation. However, Mr Lashansky says in his affidavit that the trust has never approached him (par 201).
153 The Board did not address this issue at the hearing of this application. However, if, as Mr Lashansky suggests, there has been some unwarranted imposition on the trust in relation to Ms G, there is no evidence to suggest that Minter Ellison was involved.
Conclusion
154 It is a serious matter to deprive a litigant of his solicitor of choice, although the court will not hesitate to do so in an appropriate case.
(Page 35)
However, in my view, this is not such a case. For the above reasons, I see no basis for restraining Minter Ellison from acting for the Board in relation to the balance of Mr Lashansky's application. Nor do I see any basis for acceding to Mr Lashansky's request that Minter Ellison should be required to disclose such advice (privileged as it would be) as they might have given to the Board or the Committee in relation to matters the subject of his various complaints.
2
14
1