Legal Practitioners Conduct Board v Nicholson - [2006] SASC 21

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court: Application)
LEGAL PRACTITIONERS CONDUCT BOARD v NICHOLSON
Reasons for Decision of The Full Court
(The Honourable Chief Justice Doyle, The Honourable Justice Perry and The Honourable Justice White)
1 February 2006
PROFESSIONS AND TRADES - LAWYERS - REMOVAL OF NAME FROM ROLL
Application to strike the respondent's name from the Roll of Legal Practitioners and the Roll of Public Notaries - the respondent admitted unprofessional conduct before the Legal Practitioners Disciplinary Tribunal and the Supreme Court - consideration that explanations may explain but do not exonerate unprofessional conduct - consideration that the role of the Court is to protect the public interest and maintain professional standards but not to punish - in this case the unprofessional conduct occurred over a short period of time during poor health of the respondent - consideration of whether the respondent could return to practice under supervision given evidence of improved health - Held: until further order, the respondent's entitlement to apply for the issue or renewal of a practising certificate be suspended and that the respondent's entitlement to act as a public notary be suspended.
Legal Practitioners Act 1981 s 89, s 93, referred to.
Law Society of South Australia v Murphy (1999) 201 LSJS 456; Legal Practitioners Conduct Board v Trueman (2003) 225 LSJS 503; Legal Practitioners Conduct Board v Phillips (2002) 83 SASR 467, considered.

LEGAL PRACTITIONERS CONDUCT BOARD v NICHOLSON
[2006] SASC 21
Full Court: Doyle CJ, Perry and White JJ

DOYLE CJ: Mr Nicholson pleaded guilty before the Legal Practitioners Disciplinary Tribunal (“the Tribunal”) to charges alleging unprofessional conduct by him. Mr Nicholson admitted the facts on which the charges were based.
The Tribunal found him guilty of the charges, and recommended that disciplinary proceedings be commenced in the Supreme Court.
When those proceedings came before the Court, the Court accepted and acted on the findings of the Tribunal: see s 89(5) of the Legal Practitioners Act1981 (SA) (“the Act”). The bulk of the evidence before the Tribunal was also tendered before the Court.
At the hearing the Legal Practitioners Conduct Board (“the Board”) submitted that the Court should order that Mr Nicholson’s name be struck off the roll of legal practitioners, and struck off the roll of public notaries: see s 89(2)(d) and s 93(3) of the Act.
Mr Quick QC, appearing for Mr Nicholson, submitted that the public interest would be sufficiently protected by limiting Mr Nicholson’s right to practise to the practice of advocacy, and to the practice of a public notary.
At the conclusion of the hearing the Court ordered that until further order Mr Nicholson’s entitlement to apply for the issue or renewal of a practising certificate be suspended, and that his entitlement to act as a public notary be suspended until further order. The Court indicated that it would consider allowing Mr Nicholson to practice on a limited basis, and with suitable supervision from a medical practitioner and a legal practitioner, if provided with appropriate evidence, and if it was satisfied by that evidence. I will return to that matter later.
These are my reasons for joining in that order.
The facts and the charges
Mr Nicholson is 51 years of age. He was admitted as a practitioner in 1976. After admission he practised as a private legal practitioner, as an employee of the Australian Government’s Solicitor, in the office of the Commonwealth Director of Public Prosecutions and, from 1998 until 2003, as a principal in his own practice.
Mr Nicholson has had extensive experience as a practitioner. Until the occurrence of the events the subject of these reasons, there is no indication that his conduct was in any way unsatisfactory.
The Tribunal found that Mr Nicholson began to suffer from depression, and to consume alcohol to excess, in late 1997. The condition appears to have worsened with the passage of time. Mr Nicholson was admitted to hospital in June 2000, this being the first of a number of hospital admissions, for treatment for “alcohol detoxification”. In 2002 he was diagnosed as suffering from a major depressive disorder and from alcohol dependence. He continued to receive treatment.
I gather that Mr Nicholson continued to practise.
His drinking problems led to strains within his marriage. This came to a head in March 2003, when his wife asked him to leave the matrimonial home.
It appears that at that time Mr Nicholson was in a bad way. He had no suitable accommodation to go to. He was depressed and was drinking heavily. I accept that he was in an irrational state of mind.
He agreed to leave the matrimonial home. At about this time he went to his office, and transferred $19,000 from his trust account to his personal bank account. The material before the Tribunal and before the Court indicates that he was in a confused state of mind. He had a plan to leave the country, using the money that he wrongfully took. He had no entitlement at all to the money. His conduct was fraudulent.
Within a short time of doing this he felt suicidal. Realising the risk of suicide, he called the police, and voluntarily accompanied them to hospital. He was admitted. The next day he telephoned the Law Society and informed an officer of the Society of what he had done. He also told his wife. Most of the money was repaid quite quickly. There was, however, a short fall of about $2,200, which by the time of the hearing we were told had been reduced to about $1,300. The taking of the $19,000 was the subject of one of the charges before the Tribunal. That charge was laid in December 2003.
Investigations were put in train, as a result of what he disclosed to the Law Society. It came to light that in early March 2003, about two weeks before the above events, Mr Nicholson had made four withdrawals from his trust account. Each of them was in the sum of $350. He did so without sending an account to the relevant client, or without issuing a trust account statement. He acted contrary to the provisions of the Act and contrary to the provisions of the Legal Practitioners Regulations 1994. However, the matter proceeded before this Court on the basis that these were amounts to which he was entitled, had he rendered a proper account and in other respects properly recorded the transactions. These transfers were the subject of a charge of unprofessional conduct laid in May 2004.
It also came to light that in November 2001 Mr Nicholson, without authority, applied $845 from his trust account to meet the cost of him being admitted as a practitioner in Victoria. He was admitted as a practitioner in Victoria in connection with him representing a client facing charges in Victoria. The case proceeded on the basis that the expenditure was proper expenditure, in the sense that had authority been sought from the person who provided the funds in the trust account, that authority would have been granted. I accept that it is likely that authority would have been granted. Nevertheless, the fact remains that the expenditure was incurred without obtaining authority to do so. This matter was the subject of a charge laid in May 2004.
Finally, in early May 2003 Mr Nicholson told an officer of the Law Society that he had ceased to practise. He asked for and obtained a refund of part of the premium he had paid for professional indemnity insurance. That statement was false. In fact, he was intending to continue to act for the client facing charges in Victoria, the person referred to above. However, it appears that his involvement in the affairs of the client in Victoria was minor. I proceed on the basis that he did not appear in court, did not handle any funds, and did not deal with third parties. As I understand it, all that he did was give some assistance to counsel who was appearing before the Victorian court for the client in question.
This matter was the subject of a charge also laid in May 2004.
In short, Mr Nicholson admitted four charges of unprofessional conduct. And, as I have already noted, he admitted the facts upon which the charges were based.
Consideration of the Board’s application
When the matter came before this Court in December 2005, Mr Nicholson had not practised as a solicitor since some time in 2003. He had been receiving treatment for his depression and alcohol dependence. Evidence was given to the Tribunal in November 2004 by Dr Kelly, a psychiatrist who had treated Mr Nicholson. His evidence was that although Mr Nicholson had made good progress, there was still a risk of him relapsing, and if he did relapse, he would not be fit to practise. Dr Kelly said that Mr Nicholson would need “more than minimal supervision”. Suitable supervision would not be easy to arrange. The Board found that Mr Nicholson was a person with a “strong personality” and added that he was a person “who needs to be in control of a situation and is not one who succumbs easily to supervision”.
A report from Dr Kelly of 25 August 2005 was tendered before this Court. Dr Kelly said that he had seen Mr Nicholson intermittently since 2004. Dr Kelly said that certain tests that had been conducted were consistent with Mr Nicholson “not drinking excessively”. Dr Kelly reported that Mr Nicholson had said that he did not consider that he needed further psychiatric treatment. He added that Mr Nicholson presented in a manner that was consistent with him not being depressed.
The starting point in considering this matter is the practitioner’s own admission of unprofessional conduct. That admission is properly made. There is no doubt that each of the matters the subject of the charges involved unprofessional conduct by Mr Nicholson.
I accept that the unauthorised payment in November 2001, and the unauthorised transfers of money in March 2003, are not instances of professional misconduct of a serious kind. Nevertheless, they do involve unprofessional conduct. The dishonest appropriation of $19,000 was a very serious instance of unprofessional conduct. The false and misleading statement to the officer of the Law Society, to the effect that he had ceased to practise, was also a serious instance of unprofessional conduct.
As to the latter two incidents I accept that they occurred at a time when Mr Nicholson was unwell. This is particularly the case in relation to the appropriation of $19,000. I do not overlook the fact that within a day of having made that appropriation, Mr Nicholson realised that he had done wrong, and took steps to remedy the situation.
The evidence about Mr Nicholson’s state of health explains how the unprofessional conduct came to occur. But it does not alter the fact that the conduct is unprofessional conduct: see The Law Society of South Australia v Murphy [1999] SASC 83; (1999) 201 LSJS 456 at 460; Legal Practitioners Conduct Board v Trueman [2003] SASC 58; (2003) 225 LSJS 503 at 506; Legal Practitioners Conduct Board v Phillips [2002] SASC 63; (2002) 83 SASR 467 at [39].
I must also bear in mind that in proceedings of this kind the function of the Court is to take such action as required to protect the public interest. The role of the Court is not to punish. It is to take such action as will encourage the maintenance of proper professional standards, and to deal with practitioners in a manner that will protect the public interest. In considering the public interest, matters that might substantially mitigate wrongdoing, were the court considering punishment, are not necessarily entitled to the same weight as they would be in proceedings directed towards punishment: see Murphy at 460-461; Trueman at 505-506.
Bearing those general considerations in mind, I turn to the particular circumstances of this case.
The Court has before it two instances of professional misconduct of a quite serious kind, and two other instances that are by no means as serious. The latter two matters would not, in my opinion, warrant an order striking the name of the practitioner from the roll of practitioners. However, in principle the other two matters are of sufficient seriousness to warrant the making of such an order.
In considering whether an order to that effect should be made, there are further matters that call for consideration. Mr Nicholson has practised for a lengthy period of time, and has not previously been dealt with by the Board or by the Tribunal, as far as the Court is aware. The circumstances in which the matters of March 2003 occurred indicate that the departure from proper professional standards was attributable to Mr Nicholson’s disturbed state of mind. I am able to make a firm finding to that effect. In short, the serious unprofessional conduct occurred over a short period of time during which Mr Nicholson was in a seriously disturbed frame of mind. The making of that finding means that if the Court is satisfied that Mr Nicholson has recovered his health, and has before it evidence that he is conducting himself appropriately, the public interest would not be adversely effected were Mr Nicholson to be permitted to return to practice under appropriate supervision. That conclusion can be drawn because the serious unprofessional conduct is an isolated occurrence in a long career, and is attributable to a temporary medical condition.
To the extent that the public interest requires that it be brought home to Mr Nicholson that his conduct was professional misconduct, and was unacceptable, I consider that that purpose has already been served. First, Mr Nicholson himself has frankly acknowledged his wrongdoing. Second, adverse findings against him have been made. Third, he has been suspended from practising as a solicitor and as a public notary for some time now, and no doubt has suffered considerable financial hardship as a result of that. That should suffice to bring home to him the importance of observing the proper professional standards.
A further matter to bear in mind is that, on the evidence before the Court, he has sought treatment for his depression and his alcohol dependence, and has made substantial progress in recovering from those conditions. There is good reason to think that the condition that precipitated the misconduct has been, or soon will be, cured.
In all the circumstances I am satisfied that an order striking Mr Nicholson’s name from the roll of practitioners is not called for in the present case. Serious as the misconduct was, it can be substantially attributed to a disturbed state of mind at the time in question, and not to a failure to appreciate what proper professional standards require, nor to an inability to adhere to those standards under normal circumstances.
On the other hand, on the information now before the Court I am not satisfied that Mr Nicholson has fully recovered his health, or at least recovered his health to a point at which, in the public interest, he can again be permitted to practise.
On the information presently available to me, it would be appropriate for the Court to permit Mr Nicholson to resume practice, initially on a limited basis, if and when the Court is satisfied that he has sufficiently recovered his health to make it appropriate to do so. If Mr Nicholson were to provide a detailed report from his treating doctor, and if he were to submit to examination by an appropriate specialist nominated by the Board, it may be that on the basis of that material the Court would be satisfied that his health has sufficiently recovered for him to be permitted to return to practice.
A return to practice would necessarily be on a restricted basis at first. Once again, it is only with more detailed information that the Court would be in a position to determine upon what basis Mr Nicholson should be permitted to return to practice. There is not sufficient information before the Court at present for the Court to formulate an appropriate restriction in that respect.
If Mr Nicholson is permitted to return to practice, it would be appropriate that initially that be subject to some kind of supervision by his treating doctor, so that his state of health can be monitored, and subject to supervision by another legal practitioner. Practice as an employed practitioner seems an appropriate starting point. Again, establishing an appropriate regime for supervision is something that the Court is not in a position to do on the information now before it.
Accordingly, while I am of the view that Mr Nicholson’s right to practise as a legal practitioner and as a public notary should be suspended until further order, I indicate that subject to me being satisfied, by information of the kind just indicated, that an appropriate regime can be established under which Mr Nicholson can return to practice, I would be prepared to vary the order of the Court to permit him to return to practice. In due course the restrictions on practice and the requirement for supervision could be reduced and then removed, after an appropriate period of time, and in the light of satisfactory conduct by Mr Nicholson.
Conclusion
There are my reasons for joining in the order that the Court made at the hearing of this matter. I have also set out the basis upon which I would consider an application by Mr Nicholson for a variation of the order that the Court has made.
PERRY J. The reasons now published by Doyle CJ substantially reflect the views which I formed which led me to concur in the order of the Court made on 19 December 2005.
WHITE J. On 19 December 2005, I joined with the other members of the Court in the order that the practitioner’s entitlement to apply for the issue or renewal of a practising certificate be suspended until further order, and that his entitlement to act as a public notary be suspended until further order. The Court said that it would publish reasons later. My reasons for joining in the orders are in general the same as the reasons now published by the Chief Justice.
I agree also with the observations of the Chief Justice as to the basis upon which the Court may consider an application for variation of these suspension orders.
There is nothing which I wish to add.