Legal Services Commissioner v Graham
[2012] QCAT 617
| CITATION: | Legal Services Commissioner v Graham [2012] QCAT 617 |
| PARTIES: | Legal Services Commissioner (Applicant) |
| v | |
| Michael Anthony Graham (Respondent) |
| APPLICATION NUMBER: | OCR253-11 |
| MATTER TYPE: | Occupational regulation matters |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Justice Alan Wilson, President |
| DELIVERED ON: | 7 December 2012 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | 1. Charge 4 and charge 5 of the charges contained in the disciplinary proceeding filed in the Tribunal on 17 November 2011 are struck out. 2. The costs of and incidental to the determination of the preliminary points referred to in the order of the Tribunal of 29 May 2012 are reserved. 3. The matter is listed for a directions hearing at a time and date to be advised by QCAT. |
| CATCHWORDS: | PROFESSIONS AND TRADES – LAWYERS – OTHER MATTERS – where the Respondent is an Australian legal practitioner – where the Respondent engaged in costs assessment work – where the Applicant brought disciplinary charges arising out of matters allegedly occurring in the course of costs assessment work – whether the work of costs assessment can be said to happen in connection with the practice of law – whether the deposit monies paid to the Respondent constituted trust monies – whether the Tribunal must determine these matters as preliminary legal points Legal Profession Act 2007, ss 237, 418, 419, 598, 599, Schedule 2 Adamson v Queensland Law Society Incorporated [1990] 1 Qd R 498 |
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (‘QCAT Act’).
REASONS FOR DECISION
Mr Graham is an Australian legal practitioner. He does not, however, undertake the kind of work ordinarily associated with legal practice; rather, he is the principal of a business called ‘Grahamcosts’, which engages in costs assessment. The Commissioner has brought disciplinary charges against Mr Graham arising out matters allegedly occurring in the course of his costs assessment work.
A question has arisen whether Mr Graham is, in fact, exposed to disciplinary proceedings at the hands of the Commissioner under the Legal Profession Act 2007 (‘LPA’) when he is performing work as a costs assessor. After a compulsory conference on 28 May 2012 the parties sought, and the Tribunal directed, that preliminary legal questions be determined on the papers, after written submissions from the parties.[1]
[1]Questions of this kind may be determined by the Tribunal constituted by a Supreme Court Judge, sitting alone. See Legal Profession Act 2007, s 598(2)(a); Queensland Civil and Administrative Tribunal Act 2009, s 47.
There are five charges: first, that by reason of excessive delay, Mr Graham failed to maintain reasonable standards of competence and diligence as a legal practitioner in the preparation of a costs statement on behalf of a firm of solicitors; second and third, two charges in relation to his alleged failure to comply with an undertaking to refund money to those solicitors if he did not provide the costs statement within a certain time; fourth, his failure to deposit monies paid to him by those solicitors into a trust account; and fifth, his receipt of those monies and alleged application to his own use, before he had performed the work.
After the compulsory conference the preliminary legal points were identified as:
i) Whether the work for which Mr Graham was engaged by the solicitors amounted to the conduct of a legal practice by him; and,
ii) Whether the money paid to him by the solicitors constituted trust money.
The parties filed and exchanged submissions, and Mr Graham’s solicitors have also filed submissions in reply.
The Commissioner’s submissions concede that the money received by Mr Graham from the law firm cannot be described as ‘trust money’ under s 237(1) of the LPA because it was not money entrusted to a law practice -
… in the course of or in connection with the provision of legal services by the practice and Mr Graham was not, therefore, required to deposit the money in a general practice trust account under s 248.
The Commissioner also concedes that, in accepting an engagement to prepare a costs statement for the solicitors, Mr Graham did not ‘... engage in legal practice’, a term defined in Schedule 2 of the LPA.
In light of those concessions the Commissioner seeks leave to withdraw the fourth and fifth charges relating to the alleged failure to deposit trust money into a trust account and the alleged misuse of those funds. It is submitted from Mr Graham that, rather, those charges should be dismissed.
Section 46 of the QCAT Act allows a party, with leave, to withdraw an application before the matter is heard and decided by the Tribunal. Section 47 of the QCAT Act empowers the Tribunal to dismiss or strike out a proceeding or part of a proceeding if it is, relevantly, misconceived or lacking in substance. The Commissioner’s concessions plainly amount to an admission that the charges are unsustainable in the face of the relevant legislation and, by definition, attract the operation of s 47 and should be struck out. An order to that effect will be made.
It also follows, of course, that the second of the questions set out earlier must be answered in the negative.
The Commissioner contends, however, that while its concession that, in accepting a commission for the work of preparing a costs statement for the solicitors, Mr Graham did not ‘… engage in legal practice’ – a concession which, on its face, would mean that the first question should also be answered in the negative – that is not the end of the matter. Rather, the Commissioner submits that the work of costs assessment happened ‘… in connection with the practice of law’ and may yet, therefore, amount to what the LPA calls unsatisfactory professional conduct; or, even if it was not work that can be described in that way, the alleged offending may amount to what the LPA calls professional misconduct because misconduct that falls within that category can include conduct ‘… happening otherwise than in connection with the practice of law …’.
That is not, of course, the question to which the Tribunal’s order of 29 May 2012 was directed, but both parties have filed lengthy written submissions addressing it. In light of the statutory exhortation in the QCAT Act for this Tribunal to ensure proceedings are conducted in an informal way that minimises costs to the parties, and is as quick as is consistent with achieving justice[2], it is appropriate to consider that question and whether it can and should be answered in a preliminary way.
[2] Queensland Civil and Administrative Tribunal Act 2009, s 4(c).
These phrases are relevant because Chapter 4 of the LPA, which deals with complaints against and the discipline of the legal profession, contains two ‘Key Concepts’. Under s 418 of the LPA unsatisfactory professional conduct is defined to include conduct of an Australian legal practitioner happening in connection with the practice of the law that falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent practitioner. Under s 419 professional misconduct is defined to include conduct of an Australian legal practitioner whether happening in connection with the practice of law or happening otherwise than in connection with the practice of law that would, if established, justify a finding that the practitioner is not a fit and proper person to engage in legal practice.
The disciplinary proceedings brought by the Commissioner alleged that Mr Graham’s purported misconduct allow either finding; ie, the charges are brought in the alternative under ss 418 and 419 of the LPA.
The charge of professional misconduct is the more serious one. It is also defined in s 419 to include unsatisfactory professional conduct under s 418, but to a level that involves a substantial consistent failure to reach or keep a reasonable standard of competence and diligence. The first charge, relating to delay in the preparation of the costs statement for the law firm, only alleges that Mr Graham ‘… failed to maintain reasonable standards of competence and diligence in relation to the preparation …’ of the costs statement. That term expressly invokes the language of s 418 and could not, it is submitted for Mr Graham, be relied upon to sustain a finding of professional misconduct. The point is plainly arguable but should not, I think, be determined in a preliminary way: delay, and the seriousness of delay in terms of effects and consequences can be a matter of degree and can, therefore, fall within either definition[3].
[3]Adamson v Queensland Law Society Incorporated [1990] 1 Qd R 498; Legal Services Commissioner v Petschler [2009] LPT 024.
For reasons that follow, I do not think it appropriate to determine the question arising with reference to s 418 – ie, whether this work happened ‘… in connection with the practice of law’ – as a preliminary matter.
The business of costs assessment has, unsurprisingly, a long and close connection with traditional legal practice. Courts order the assessment of costs, and that work is done by costs assessors. The Uniform Civil Procedure Rules 1999 (‘UCPR’) and the LPA incorporate both processes for costs assessment[4], and the formal appointment of persons as costs assessors under UCPR r 743J by the Court: they must be Australian lawyers with at least five years experience in either or both the practice of law and the assessment of costs, and must also be fit and proper persons, to assess costs.
[4] Uniform Civil Procedure Rules 1999, r 743A.
Neither party has been able to point to useful authority around the question whether the phrase in s 418 of the LPA does, or does not, extend to the work of costs assessment. Both parties have mentioned NSW Bar Association v Osei (No 2) [2008] NSW ADT 324 in which a barrister who was also a registered migration agent was charged with unsatisfactory professional conduct in relation to an appearance before the Refugee Review Tribunal (‘RRT’). The charge fell to be determined by reference to a definition in the NSW legislation, which is in the same terms as s 418 of the LPA[5]. It was noted, in that decision, that conduct may occur ‘… in connection with the practice of law’ even if it is not engaged in directly in the course of professional practice, but that conclusion specifically related to the proper construction of the expression ‘professional misconduct’ under the general law, and not under statute, and the ADT was not persuaded that the barrister’s work in the RRT was sufficiently connected.
[5] Legal Profession Act 1987 (NSW), s 127(2).
As the Commissioner’s submissions point out, misconduct under the LPA hinges on the fact that the wrongdoer is a legal practitioner, and not necessarily upon the nature of the act itself.[6] The Commissioner says that Mr Graham, an Australian legal practitioner, was engaged by the law practice as a costs assessor to determine legal fees and disbursements payable by a client to that law practice in respect of a civil litigation matter; and this, it is said, is sufficient to justify the conclusion that Mr Graham’s conduct has a direct and immediate relationship with the practice of law and was, therefore, ‘connected with’ it.
[6]See Legal Services Commissioner v La Spina [2012] QCAT 183; Legal Services Commissioner v Dore [2006] LPT 009.
That submission is weakened, it might be said, by the earlier concession that the funds received by Mr Graham were not trust monies because they were not received in the course of or in connection with the provision of legal services within the meaning of s 237 of the LPA; and, by the further concession that in accepting the engagement to prepare the costs statement Mr Graham was not engaging in legal practice.
Nevertheless the question is plainly arguable, and a matter of some importance. Section 599 of the LPA provides that a discipline application will be heard and determined by the Tribunal, with the assistance of a legal practitioner member and a lay panel member who are appointed, as s 599(2) acknowledges, to ‘help’ the Tribunal. The question raised by the parties' submissions is an apt one for decision by a fully constituted Tribunal, rather than as a preliminary point. I am reinforced in that view by the circumstances that I am, now, addressing a question that was not identified as a preliminary point and, also, by the fact the remaining three charges are brought in the alternative under both ss 418 and 419.
That said, the Commissioner will no doubt consider and reflect upon the matters raised in the submissions made for Mr Graham.
His submissions also seek the opportunity to file further submissions in relation to costs. It is appropriate to reserve that question. Otherwise the matter should be listed for a further directions hearing at a time and date to be advised by the Tribunal.
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