Legal Services Commissioner v Jackson
[2017] QCAT 207
•26 June 2017
CITATION: | Legal Services Commissioner v Jackson [2017] QCAT 207 |
PARTIES: | Legal Services Commissioner |
| v | |
| Amanda Lee Jackson (Respondent) | |
APPLICATION NUMBER: | OCR120-13 |
| MATTER TYPE: | Occupational regulation matters |
HEARING DATE: | On the papers |
HEARD AT: | Brisbane |
DECISION OF: | Justice DG Thomas, President Assisted by: Dr Margaret Steinberg (Lay panel member) |
DELIVERED ON: | 26 June 2017 |
DELIVERED AT: | Brisbane |
ORDERS MADE: | 1. In relation to Charge 1, the Tribunal concludes that the conduct of Ms Jackson amounted to unsatisfactory professional conduct. 2. Charges 2, 3 and 4 are dismissed. 3. The Legal Services Commissioner must file in the Tribunal and give to Amanda Lee Jackson one (1) copy of any submissions on sanction and costs, by: 4:00pm on 18 July 2017. 4. Amanda Lee Jackson must file in the Tribunal and give to the Legal Services Commissioner one (1) copy of any submissions on sanction and costs in reply, by: 4:00pm on 8 August 2017. 5. Unless either of the parties requests an oral hearing before 8 August 2017, the matter will be determined on the papers after 8 August 2017. |
CATCHWORDS: | PROFESSIONS AND TRADES – LAWYERS – COMPLAINTS AND DISCIPLINE – PROFESSIONAL MISCONDUCT AND UNSATISFACTORY PROFESSIONAL CONDUCT – SOLICITOR’S COSTS – where applicant alleged respondent overcharged her clients – where previous finding by District Court as to assessment of costs – where retainer agreement did not provide respondent could charge for care and consideration – where respondent charged for work done after termination of the retainer – whether respondent entitled to charge for those costs in the circumstances – whether unsatisfactory professional conduct or professional misconduct PROFESSIONS AND TRADES – LAWYERS – COMPLAINTS AND DISCIPLINE – PROFESSIONAL MISCONDUCT AND UNSATISFACTORY PROFESSIONAL CONDUCT – TRUST MONEY – where applicant alleged respondent made trust account disbursements without authority – where respondent referred to trust account authorities in retainer agreement, in separate letter and two handwritten authorities appearing on invoices rendered – whether the words of the trust account authorities authorises the disbursements made – whether the trust account authorities were operative at the time the disbursements were made – whether unsatisfactory professional conduct or professional misconduct PROFESSIONS AND TRADES – LAWYERS – COMPLAINTS AND DISCIPLINE – PROFESSIONAL MISCONDUCT AND UNSATISFACTORY PROFESSIONAL CONDUCT – OTHER MATTERS – where applicant alleged respondent failed to maintain reasonable standards of competence and diligence in claiming a lien over the client file which delayed the administration of the estate – where communications between respondent and client’s new law firm – where offer by respondent to release files – where clients new law firm instructed no urgent need for release of files – where respondent outlined concerns to applicant – whether conduct fell below the standard of competence and diligence – whether unsatisfactory conduct or professional misconduct PROFESSIONS AND TRADES – LAWYERS – COMPLAINTS AND DISCIPLINE – PROFESSIONAL MISCONDUCT AND UNSATISFACTORY PROFESSIONAL CONDUCT – OTHER MATTERS – where applicant alleges respondent failed to respond to notice issued under section 443(3) Legal Profession Act 2007 (Qld) – where applicant issued notice requesting information on respondent’s lien and itemised account in support of lien – where respondent responded outlining claim for lien and advising no account exists – where applicant issued second notice in response – whether applicant can compel practitioner to create a document – whether respondent adequately responded to first notice – whether applicant should have issued second notice – whether unsatisfactory conduct or professional misconduct Legal Profession Act 1987 (NSW) s 208Q Legal Profession Act 2007 (Qld) ss 249, 343, 418, 419, 420, 435, 436, 443 Adamson v Queensland Law SocietyInc [1990] 1 Qd R 498 |
REPRESENTATION: | |
APPLICANT: | AD Scott instructed by the Legal Services Commissioner |
RESPONDENT: | AL Jackson on her own behalf |
This matter was heard and determined on the papers pursuant to section 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (‘QCAT Act’).
REASONS FOR DECISION
The applicant has brought the following charges against the respondent.
Charge 1: Charging excessive legal costs
On or about 15 April 2008, Ms Jackson charged her former clients, Irene Elizabeth Southwell and Irene Joyce Kennedy, excessive legal costs.
Charge 2: Transfer of trust money without authority
On 15 April 2008, Ms Jackson breached section 249(1)(b) of the Legal Profession Act 2007 (Qld) (‘LPA’) by transferring trust funds held on the clients’ behalf to her general account in the amounts of $3,842.50 and $49,246.30 respectively, without authority to do so.
Charge 3: Failing to maintain reasonable standards of competence and diligence.
Between 29 July 2008 and 19 December 2008, Ms Jackson, in breach of her duty as a solicitor, failed to maintain reasonable standards of competence or diligence as expected by a member of the public in relation to the transfer of the clients’ file to the clients’ new solicitors, Crouch & Co, in that she:
a) Claimed a lien over the client file which she knew or ought to have known was not supported by a valid claim for unpaid professional fees; and
b) Thereby delayed the administration of the estate.
Charge 4: Breach of section 443(3) LPA
Ms Jackson failed to respond to a written notice issued on 21 August 2008 by the Commissioner, pursuant to section 443(3) LPA.
Background
Irene Raps and Irene Kennedy entered into a retainer agreement with Ms Jackson on 10 December 2007.[1]
[1]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE1 at pg 1-7.
A trust account authority dated 10 December 2007, was signed by the clients.[2]
[2]Affidavit of AL Jackson, sworn 29 June 2015, Exhibit AJ15 at pg 1-115.
A handwritten authority (the first handwritten authority) appears on Invoice No 872 and is dated 10 December 2007.[3]
[3]Affidavit of AL Jackson, sworn 29 June 2015, Exhibit AJ15 at pg 1-117.
A handwritten authority (the second handwritten authority) appears on Invoice No. 898, also dated 10 December 2007.[4]
[4]Ibid, Exhibit AJ15 at pg 121.
Ms Jackson says she was given “express instructions of 1 February 2008 confirmed in writing together with the progress report on 12 February 2008”,[5] that Hartwell’s be appointed as the ‘joint expert’ costs assessor.
[5]Submissions on Behalf of the Respondent – Hearing on the Papers, filed 15 July 2015 at footnote 96; referring to Affidavit of AL Jackson, sworn, Exhibit ALJ6.
On 12 February 2008, Ms Jackson says that Steve Hartwell was engaged to provide a costs assessment of the Estate file. Ms Jackson says that the client selected the costs assessor.[6] No document engaging Mr Hartwell is in evidence.
[6]Submissions on Behalf of the Respondent – Hearing on the Papers, 15 July 2015 at [109].
On 12 February 2008, Crouch & Co wrote to Ms Jackson advising that they had received instructions from the clients to act in the administration of the Coutts Estate.[7]
[7]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE-1 at pg 1-27.
On the same day, Ms Jackson replied to Crouch & Co advising of her requirements for the release of the files.[8] The letter tells Crouch & Co that Ms Jackson’s firm “…already have a costs assessor coming to assess the files this afternoon…” and that the costs as assessed would have to be paid in full prior to release of the file.[9]
[8]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE-1 at pg 1-28.
[9]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE1.
On 20 February 2008, Hartwell’s provided the costs statement to Ms Jackson.[10]
[10]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE4 page 4-1.
On 26 February 2008, Ms Jackson sent an email to Steve Hartwell about the costs assessment.[11]
[11]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE4 page 4-6.
On the same day, Mr Hartwell replied to that email.[12]
[12]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE4 page 4-5.
On 27 February 2008, Mr Hartwell provided a further review to Ms Jackson.[13]
[13]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE4 page 4-7.
On 10 March 2008, Hartwell’s finalised the costs assessments which were sent to Ms Jackson.[14]
[14]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE4 page 4-9.
The evidence before the Tribunal does not indicate that any of the Costs Statements prepared by Hartwell’s were forwarded to the clients.
On 13 March 2008, Ms Jackson sought advice from Counsel in relation to termination of the retainer agreement (by way of the letter of 12 February).
On 27 March 2008,[15] the barrister advised that he believed the letter received from Crouch & Co “amounts to a repudiation of the terms of the retainer and that it is open to instructing solicitors to accept the repudiation and terminate the retainer or to allow the retainer to remain on foot and act in accordance with its terms”.[16] The barrister advised further that, “the briefed trust account authority also specifically provides that ‘this Authority is to continue until revoked by us.’ I am instructed that there has not been a revocation of the trust account authority”.[17]
[15]Affidavit of AL Jackson, sworn 29 June 2015, Exhibit AJ18 pg 137.
[16]Affidavit of AL Jackson, sworn 29 June 2015, Exhibit AJ18 at pg 138.
[17]Affidavit of AL Jackson, sworn 29 June 2015, Exhibit AJ18 at pg 138..
Ms Jackson sent her clients three bills by letter dated 15 April 2008:
a) Invoice #922 dated 3 April 2008 for work done 5 December 2007 – 12 February 2008, in the amount of $3,571.60;[18]
b) Invoice #872 dated 14 April 2008 for work done 15 October 2007 – 1 April 2008, in the amount of $13,055.85;[19]
c) Invoice #898 dated 15 April 2008 for work done 17 October 2007 – 14 April 2008, in the amount of $50,786.30.[20]
[18]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE1, pg 1-53.
[19]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE1, pg 1-103 to 1-105.
[20]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE1, pg 1-63.
Ms Jackson made payment of each bill in full by making transfers from her trust account to her general account.[21]
[21]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE1 at 1-107.
Amounts of $3,842.50 (Invoice #872) and $49,246.30 (Invoice #898) transferred on 15 April 2008 are the amounts subject of the trust account withdrawals referred to in charge 2.
On 15 April 2008, by letter to Irene Raps, Ms Jackson set out her requirements for the transfer of the client file and claimed a “Solicitors Lien” for unpaid fees in respect of the Coutts Estate file, the re-opened Estate of Elaine Mary Coutts file and the Warrant file.[22] Ms Jackson states that the files would not be released until “any reasonable claim for Solicitors Lien for unpaid fees on a copy of this file is met”.
[22]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE1.
As to handing over the files to Crouch and Co, in relation to the Warrant file, Ms Jackson referred to “Extra Ordinary conditions for release of a copy of this file”.[23] Ms Jackson refers to a personal undertaking given to the Queensland Police Service and to the Coroners Courts, from which she “has not been released from this obligation”. Ms Jackson requires “release from the writers [sic] undertaking or express order permitting the writer to release copies of documents to the Executors or their Solicitors” before she can release the file.[24]
[23]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE1, pg 1-46 at clause 9.8.
[24]Affidavit of DJ Edwards, sworn 16 February 2016, Exhibit DJE1, pg 1-47.
On 23 April 2008, Crouch & Co provided Ms Jackson with signed authorities from the clients for release of the client files and any remaining trust account funds.
On 30 April 2008, correspondence followed between Ms Jackson and Crouch & Co in regards to the requirements for the file handover in which Ms Jackson questioned the adequacy of the authorities provided.
By letters dated 1 May 2008 and 6 May 2008, Crouch & Co replied to Ms Jackson.
By letter dated 7 May 2008, Ms Jackson replied to Crouch & Co:
On 16 May 2008, Crouch & Co made a formal complaint to the Commission about Ms Jackson’s refusal to transfer the files.
On 29 May 2008, an audit of Ms Jackson’s trust account was conducted by Bob Hills & Associates in relation to the Coutts Estate files.[25] This audit did not reveal any error or breaches with respect to Ms Jackson’s trust account.
[25]Affidavit of AL Jackson, sworn 29 June 2015, Exhibit AJ15 at pg 107
On 6 June 2008, Ms Jackson proposed to the Executors the delivery of the client files of the Estate of Leo Coutts and Elaine Coutts, the warrant file, the files regarding the Queensland Law Society complaint, the Commissioner’s complaint and relating to release of client material from the Legal Services Commissioner to the Executors. Ms Jackson further proposed release of the client documents from the deceased’s home and the safe custody packet to Irene Kennedy, by registered mail with notice to the parties.
Ms Jackson’s proposal was refused by the Commissioner on 11 June 2008, upon the advice of Crouch & Co.
On 20 June 2008, Ms Jackson obtained a release of the undertaking she gave to the Coroners Court.[26]
[26]Affidavit of AL Jackson, sworn 29 June 2015, Exhibit AJ13 pg 53.
On 24 June 2008, Ms Jackson sent the following to the Legal Services Commissioner:[27]
[27]Affidavit of AL Jackson, sworn 29 June 2015, Exhibit AJ14 pg 96 to 103.
a) Box labelled Coutts Warrant File (1 of 3) containing the warrant files being the original covered by the warrant at the time the warrant was given.
b) Envelope labelled Coutts Warrant File (2 of 3) containing Volume. 1 Warrant file on the Estate of the Late Leo John Coutts (Deceased) – Closed Court Proceedings
c) Envelope labelled Coutts Warrant File (3 of 3) containing Volume. 2 Warrant file on the Estate of the Late Leo John Coutts (Deceased) Cost Assessment Release of File
d) Box labelled Personal Papers 1, 2, 3, 4 and 5 of 6 containing personal papers of the Late Leo John Coutts and the Late Elaine Mary Coutts
e) 3 taped wire baskets labelled Personal Papers 6 of 6 that were used to transport the personal papers.
f) Box Labelled Estate of John Leo Coutts 1 and 2 of 2.
g) Box Labelled File Estate Leo John Coutts for release to the executors.
h) Box labelled Personal Papers 1, 2, and 3 of 4 containing personal papers of the Late Leo John Coutts and the Late Elaine Mary Coutts
i) 3 taped wire baskets labelled Personal Papers 4 of 4 that were used to transport the personal papers.
j) The original safe custody packet held in relation to the Estate of the Late Elaine Mary Coutts
k) Envelope marked Estate of Elaine Mary Coutts containing Volume 1 file regarding the estate of Elaine Mary Coutts (deceased).
l) Envelope marked File prepared for release to executors Estate of Elaine Mary Coutts
m) Box Labelled Files AL Jackson re Estate of Leo John Coutts 1 and 2 of 2.
On 24 July 2008, the Commission told Ms Jackson that the Commission had completed a review of the files and intended to release the client file to Crouch & Co. The Commissioner requested Ms Jackson’s submissions on release of the file by close of business on 31 July 2008.[28]
[28]Affidavit of DJ Edwards, sworn 24 April 2014, Exhibit DJE2.
By letter dated 30 July 2008 faxed to the Commissioner, Ms Jackson responded to the proposal to release the files seeking more information.[29] Ms Jackson raised a number of issues and claimed a lien over the material intended to be released.
[29]Affidavit of DJ Edwards, sworn 24 April 2014, Exhibit DJE4.
On 11 August 2008, the Commissioner issued a further notice to Ms Jackson providing an update on the status of the investigation into the complaint made by Crouch & Co and responding to Ms Jackson’s submissions on the lien and release of the files, as well as giving notice pursuant to section 443(1) LPA.[30]
[30]Affidavit of DJ Edwards, sworn 29 April 2014, Exhibit DJE5.
On 18 August 2008, Ms Jackson responded to the letter dated 11 August 2008, including the section 443(1) notice.[31]
[31]Affidavit of DJ Edwards, sworn 29 April 2014, Exhibit DJE6.
On 21 August 2008, the Commissioner sent a further letter advising Ms Jackson that she had not provided a full explanation for the basis of the claimed lien or any account in support. The Commissioner also gave Ms Jackson further written notice, pursuant to section 443(3) LPA, that if her failure to comply continued for a further 14 days, she may be dealt with for professional misconduct.
On 28 August 2008, by way of letter to the Legal Services Commission, Ms Jackson provided information regarding the trust authorities.
By letter dated 3 September 2008, sent by facsimile from Ms Jackson to the Legal Services Commission, Ms Jackson referred to the notice pursuant to section 443(1) reminding the Commissioner that on 18 August 2008 an explanation was provided. Ms Jackson also said “do not let the lien argument alone stop your decision on this point”.
By letter dated 8 September 2008, from Legal Services Commission to Ms Jackson, Legal Services Commission noted that no response had been received to the notice issues pursuant to section 344(3).
By letter dated 16 October 2008, from the respondent to the Legal Services Commission, Ms Jackson again referred to the argument concerning the lien and again indicated that the Legal Services Commission should take the action it thought fit “without regard to my lien”.
On 25 November 2008, Crouch & Co referred the matter to the District Court for a costs assessment on behalf of the clients.
On 18 December 2008, the bills were referred for assessment by order of McGill DCJ in the District Court of Queensland. The result of the assessment was that Ms Jackson’s legal costs were reduced, overall, by an amount of 51%.
The costs assessor found, and McGill DCJ confirmed, that Ms Jackson charged for ‘care and consideration’ when there was no provision in the retainer agreement for such a charge. Additionally, it was found that there was no provision for the amounts relating to preparation of an itemised account, research, administrative tasks at solicitor’s rates and for tasks performed once the retainer had been terminated.[32]
[32]Submissions on Behalf of the Applicant – Hearing on the Papers, 30 April 2014 at [27] referring to Southwell v Jackson [2012] QDC 62.
On 23 April 2012, the District Court delivered its decision.[33]
[33]Southwell v Jackson [2012] QDC 65.
In May 2012, the Commissioner released the client files to Crouch & Co. The Commissioner did this without further reference to the respondent.
Submissions
Charge 1
Commissioner’s Submissions
Charge 1 is that on or about 15 April 2008, Ms Jackson charged her former clients, Irene Elizabeth Southwell and Irene Joyce Kennedy, excessive legal costs.
The Commissioner submits that Ms Jackson’s conduct involved three instances of excessive charging:[34]
a) For care and consideration when it was clear that under the agreement Ms Jackson had no entitlement to charge for care and consideration;
b) For the costs of preparing the bill of costs;
c) For work performed after the retainer was terminated on 12 February 2008, by letter from Crouch & Co.
[34]Further Submissions of the Applicant, filed 16 February 2016 at [8].
McGill DCJ found that there was no basis to charge for any of these items.[35] It is submitted that in charging for these items, Ms Jackson’s conduct fell below the required standard of competence and diligence.
[35]Southwell v Jackson [2012] QDC 65.
The Commissioner submits that the LPA identifies a threshold of 15% reduction in costs as capable of instituting an investigation into misconduct.
Section 343(2) LPA provides, if the costs assessor or court reduces the legal costs payable by 15% or more, the costs assessor may, or the court may direct the registrar for the court to, refer the matter to the Commissioner to consider whether disciplinary action should be taken against an Australian legal practitioner.
Section 343(3)(a) states that if the costs assessor or a court considers the legal costs charged by a law practice are grossly excessive, the costs assessor must, or the court may direct the registrar for the court to, refer the matter to the Commissioner to consider whether disciplinary action should be taken against the practitioner.
Disciplinary action was taken in cases where the excess was 63%,[36] 47%,[37] 39%,[38] and 62%[39] respectively, and the excesses in this case are comparable.
[36]Scroope v Legal Services Commissioner [2013] NSWCA 178.
[37]Legal Profession Complaints Committee v O’Halloran [2013] WASC 430.
[38]Ibid.
[39]Veghelyi v Law Society of NSW [1995] NSWCA 483.
In Scroope v Legal Services Commissioner,[40] where a client was overcharged by an amount of 63%, the legal practitioner was found guilty of unsatisfactory professional conduct on appeal from a finding of professional misconduct, owing to his firm not having an accurate system of billing in place and the bill being approved by his supervising partner.[41]
[40][2013] NSWCA 178.
[41]Ibid at [49]-[51].
In Legal Profession Complaints Committee v O’Halloran,[42] the legal practitioner was struck off for overcharging 5 clients in excess of 39% each over a period of 12 years in circumstances where those clients were vulnerable, being personal injury plaintiffs.
[42][2013] WASC 430.
In Veghelyi v Law Society of NSW,[43] the legal practitioner was struck off for wilfully and grossly overcharging 12 clients, making threats to an arbitrator and making trust account disbursements without authority.
[43][1995] NSWCA 483.
The Commissioner submits that the solicitor does not escape responsibility for any consequent overcharging by sedulously adopting the assessor’s advice, or by delegating the preparation of the bill to an assistant.[44]
[44]Transcript, pg 18 ll 41.
There is no evidence that the Executors agreed to be bound by the assessment of a costs assessor.[45] The retainer agreement provides that the costs assessor was to be engaged in the event of a “dispute as to costs” and there was none.[46] It would appear Ms Jackson engaged the costs assessor because of “tensions” that had arisen in the matter.[47]
[45]Further Submissions of the Applicant, 16 February 2016 at [11].
[46]Further Submissions of the Applicant, 16 February 2016 at [10].
[47]Transcript, pg 34 ll 35-45.
It is submitted that, regardless of any contractual rights Ms Jackson might have had to rely on the costs assessor, Ms Jackson still had a professional responsibility to exercise competence and diligence.[48] As was said in Law Society of New South Wales v Foreman:[49]
No amount of costs agreements, pamphlets and discussion with vulnerable clients can excuse unnecessary over-servicing, excessive time charges and over-charging where it goes beyond the bounds of professional propriety…
…if costs agreements of this kind are to be obtained from clients, it is necessary that the solicitor obtaining them consider carefully her fiduciary and other duties…
[48]Further Submissions of the Applicant, 16 February 2016 at [14].
[49](1994) 34 NSWLR 408 at 422 and 437; cited with approval in Council of the Queensland Law Society Inc v Roche [2003] QCA 469 at [32].
In any event, only the first of the three bills was prepared by Hartwell’s Costs Assessors. The other two were prepared by Ms Jackson based on drafts from Hartwell’s.[50]
[50]Transcript, pg 42 ll 35-40.
The Commissioner submits that while a solicitor would be entitled to place some reliance on the professional advice of a costs assessor, the existence of advice does not absolve Ms Jackson from exercising her own competence and diligence to avoid charging for clearly un-chargeable items such as those identified.[51]
[51]Flower & Hart v White Industries (1999) 87 FCR 134 at [57].
The costs charged by Ms Jackson were excessive. The costs were deliberately or dishonestly overcharged, in line with Urban, O’Halloran and Keddie.[52] Ms Jackson’s overcharging was lower than that in Urban but higher than in O’Halloran and Keddie, which warrants a finding of professional misconduct.[53]
[52]Submissions on Behalf of the Applicant – Hearing on the Papers, 30 April 2014 at [28].
[53]Submissions on Behalf of the Applicant – Hearing on the Papers, 30 April 2014 at [69].
Ms Jackson’s Submissions
Ms Jackson submits that the bills of costs were prepared by a duly qualified assessor,[54] which were uncontested, and that they were not actually charged or prepared by her.
[54]Submissions on Behalf of the Respondent – Hearing On the Papers, 15 July 2015 at [109]-[112].
The Commissioner’s only evidence as to her ‘personal’ misconduct, is that she signed a letter enclosing the unsigned bills, and that she was a sole practitioner at the time.[55]
[55]Submissions on Behalf of the Respondent – Hearing On the Papers, 15 July 2015 at [103]-[104].
The mere fact that a bill of costs is “taxed down” is no proof of misconduct by overcharging.[56] No evidence of personal implication in misconduct in the preparation of the bill, or egregious misconduct or deliberate conduct has been inferred by the Commissioner, as was required in Nikolaidis.[57]
[56]De Pardo v Legal Practitioners Complaints Committee (1999) 170 ALR 709 at [46]; referred also to D’Alessandro and Nikolaidis.
[57]Submissions on Behalf of the Respondent – Hearing On the Papers, 15 July 2015 at [81]-[82].
Ms Jackson further contends that the charge is unsustainable on its face, as the construction of the charge does not allow the Tribunal to consider the underlying conduct or the course of conduct in issuing the bills, which was found to be determinant to characterisation of the conduct in Scroope v Legal Services Commissioner.[58] As issuing a bill is the only submission of misconduct made by the Commissioner, the charge is invalid.
[58][2013] NSWCA 178; Submissions on Behalf of the Respondent – Hearing On the Papers, 15 July 2015 at [84]-[89].
Ms Jackson submits further that to rely on McGill DCJ’s decision in the District Court alone in establishing guilt of the overcharging would lead the Tribunal into error, as was found in Nikolaidis.[59] Ms Jackson argues that because the only evidence led by the Commissioner is the costs proceeding, the charge must be dismissed.[60]
[59]Submissions on Behalf of the Respondent – Hearing On the Papers, 15 July 2015 at [94].
[60]Submissions on Behalf of the Respondent – Hearing On the Papers, 15 July 2015 at [102].
Ms Jackson submits that there can be no charge for misconduct in relation to billing for ‘care and consideration’. Ms Jackson contends that the amounts charged for ‘care and consideration’ were not charged in the traditional definition of the term, being “a mark-up or uplift fee that is not based on specific work done”, but rather to account for “numerous specific tasks charged by that collective term in the bill even though the work was done and is properly chargeable as individual items”.[61] Ms Jackson says it was reasonable to charge for those sums as the work was actually done on the file, as per the retainer agreement. The error was in form, not quantum.[62]
[61]Submissions on Behalf of the Respondent – Hearing On the Papers, 15 July 2015 at [137]-[138].
[62]Submissions on Behalf of the Respondent – Hearing On the Papers, 15 July 2015 at [141].
On whether Mr Hartwell’s costs of assessment should have been included in Ms Jackson’s legal costs, Ms Jackson submits it was reasonable to include those fees in the bills rendered to the client, as the client expected to pay the bill and expected that it would be paid from the funds in trust. Mr Hartwell was also a ‘joint expert’ retained for the file, for which his fee was treated as an outlay and included in the bill.[63] Ms Jackson refers to the retainer agreement and to the “express instructions of 1 February 2008 confirmed in writing together with the progress report on 12 February 2008” as evidence of this.[64]
[63]Submissions on Behalf of the Respondent – Hearing On the Papers, 15 July 2015 at [199]-[189].
[64]Affidavit of AL Jackson, sworn, Ex ALJ6.
Disposition – Charge 1
Ms Jackson has contended that the charge is invalid and unsustainable. The basis of this contention is that the formulation of the first paragraph of the charge is that Ms Jackson charged her former clients excessive legal costs. In this context, Ms Jackson refers to the fact that there is no evidence of personal implication in this conduct in the preparation of the bill, and no egregious misconduct or deliberate conduct has been inferred.
The question of evidence is not relevant to whether the charge can be dismissed on a preliminary basis. The wording of the charge follows the formulation in section 420(1)(b) LPA which provides that charging of excessive legal costs in connection with the practice of law is capable of constituting unsatisfactory professional conduct or professional misconduct.
In the particulars which are contained in Charge 1, reference is made to the taxation of costs and to the decision of McGill DCJ which itself raises a number of factual issues which led to the reduction in the costs referred to in the particulars, and which are relevant to conduct.
The tribunal must consider whether the conduct of the respondent amounted to unsatisfactory professional conduct or the more serious professional misconduct, or neither. In considering this question, reference must be had to the relevant definitions contained in the LPA.
Section 418 LPA provides that unsatisfactory professional conduct includes conduct of an Australian legal practitioner happening in connection with the practice of 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 Australian legal practitioner.
Section 419 LPA provides that:
(1) Professional misconduct includes –
(a) unsatisfactory professional conduct of an Australian legal practitioner, if the conduct involves a substantial or consistent failure to reach or keep a reasonable standard of competence and diligence; and
(b) 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.
In relation to professional misconduct, Justice James Thomas in the case of Adamson v Queensland Law Society,[65] said:
The test to be applied is whether the conduct violates or falls short of, to a substantial degree, the standard of professional conduct observed or approved by members of the profession of good repute and competency.
[65][1990] 1 Qd R 498, 507.
Section 420 LPA describes conduct which can constitute unsatisfactory professional conduct or professional misconduct.
Section 420(1)(b) LPA provides:
(1) The following conduct is capable of constituting unsatisfactory professional conduct or professional misconduct —
(a) …
(b) charging of excessive legal costs in connection with the practice of law
Section 420 LPA does not provide that the conduct referred to in the section must be unsatisfactory professional conduct or professional misconduct, just that it is capable of constituting unsatisfactory professional conduct or professional misconduct.
Section 420 is expressly said not to limit section 418 LPA or section 419 LPA.
Whilst section 418 LPA and section 419 LPA are inclusive definitions, the relevant conduct should be considered by reference to the definitions to determine whether the practitioner’s conduct falls within a definition, that is, short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent Australian legal practitioner.
Ms Jackson has referred to a number of authorities, particularly Nikolaidis v Legal Services Commissioner[66] and D’Allesandro v Legal Practitioners Complaints Committee.[67]
[66][2007] NSWCA 130.
[67](1995) 15 WAR 198.
Ms Jackson refers, for example, to the fact that the charge in Nikolaidis was the “deliberate” charging of grossly excessive amounts of costs and the need to focus on the conduct of the practitioner. Ms Jackson submits that no such assertions are made in the charges brought in these proceedings.
Care should be taken when considering previous decisions, particularly from other jurisdictions where the legislative scheme might be different or where no scheme was in place.
For example, at the relevant time in New South Wales, “professional misconduct and unsatisfactory professional conduct” were defined to include “conduct that is declared to be professional misconduct under any provisions of this Act”.[68]
[68]Section 127(1)(c), Legal Profession Act 1987 (NSW).
Section 208Q[69] in subsection (2), provided that for the purposes of the Act ‘deliberate charging of grossly excessive amounts of costs’ was declared to be professional misconduct.
[69]Legal Profession Act 1987 (NSW).
Hence, the inclusion of such an allegation in the charge and the analysis of that issue in the reasons. No such issue arises in this case because of the definitions used in the Queensland Act.
The New South Wales Act was ultimately changed, removing the reference to “deliberate” and containing similar provisions to those which appear in the Queensland legislation.[70]
[70]Nikolaidis v Legal Services Commissioner [2007] NSWCA 130 at [111].
The same caution must be applied when considering the authorities which discuss the “common law” approach to disciplinary proceedings.
Whilst these authorities might provide broad guidance, the requirement for this Tribunal is to have regard initially to the relevant definitions. Whilst the definitions are inclusive definitions and so other conduct might be included, conduct which falls within either of the definitions in section 418 LPA or section 419LPA will be either unsatisfactory professional conduct or professional misconduct.
Ms Jackson refers to the only evidence being that the bill was reduced on taxation. The submission is that to rely upon the decision of McGill DCJ in the District Court proceedings alone would lead the Tribunal into error as described in Nikolaidis.
It is a well-established principle that a Tribunal not bound by the rules of evidence may take into account relevant findings of another court or tribunal.[71]
[71]General Medical Council v Spackman [1943] Ac 627 AT 637; Ziems v Prothonotary of the Supreme Court of NSW (1957) 97 CLR 279 at 288, 303; In re a Solicitor [1993] QB 69; Wilks v Medical Board of South Australia [2010] SASC 287.
In Nikolaidis, the observation was made that a disparity between a bill of costs as rendered and a bill of costs as taxed did not necessarily lead to the conclusion of overcharging, and the evaluative judgment of the Tribunal or Court, based upon practical legal experience, is relied on in deciding whether the difference amounts to gross overcharging.[72]
[72]Nikolaidis v Legal Services Commissioner [2007] NSWCA 130 at [117].
It is undoubtedly the case (and is broadly accepted) that whilst the taxed amount is not necessarily the sole factor to be taken into account, the Tribunal is entitled to rely upon the taxed amount as the appropriate standard, and to determine, by reference to that taxed amount, that the amount in fact charged was grossly excessive. In D’Allesandro, the court concluded that there was no basis upon which it should interfere with that approach.[73]
[73]D’Allesandro v Legal Practitioners Complaints Committee (1995) 15 WAR 198 at 220, 221; Legal Services Commissioner v Keddie [2012] NSWADT 106 at 17; De Pardo v Legal Practitioners Complaints Committee [2000] FCA 335 at [45].
The decision of McGill DCJ is significant in that it deals with the assessment of the quantum of the costs upon which the Tribunal is entitled to rely as the appropriate standard to consider whether the amount in fact charged was grossly excessive. Importantly, the reasons also undertake an analysis of the reasons why the reductions were made. These reasons are significant in considering the particular circumstances and the conduct of the practitioner in those circumstances.
As has been outlined in a number of the authorities,[74] the assessment of the practitioner’s conduct is dependent upon a range of factors of which the discrepancy between costs charged and costs taxed is one.
[74]De Pardo v Legal Practitioners Complaints Committee [2000] FCA 335 at [45].
Reference has been made to other factors including difficulty, novelty or complexity, experience of the practitioner, quality of the work, the amount of time spent and any retainer agreement.[75] Where there is a retainer agreement, which governs the practitioner/client relationship, and which is the basis on which the practitioner agreed to act in the matter, the terms of this agreement are of particular significance.
[75]D’Allesandro v Legal Practitioners Complaints Committee (1995) 15 WAR 198 at 214.
The charge relates to charging excessive fees.
The Tribunal must determine whether the fees charged were excessive. The Tribunal has evidence as to the amount charged and the amount allowed by McGill DCJ.
Ms Jackson has submitted that the Tribunal must assess the fair and reasonable figure for fees, in deciding this question.[76] What the Tribunal must do is decide what Ms Jackson should have charged in determining if the charge was excessive. In doing this, the Tribunal must take into account all of the circumstances in which the accounts were rendered.
[76]Submissions on Behalf of the Respondent – Hearing on the Papers, 15 July 2015 at [174].
These circumstances include that, for two of the matters, a retainer agreement was entered into. The basis on which professional fees are charged under retainer agreements is generally very different from the basis on which professional fees are charged under court rules or assessed historically on taxations of costs.
Many practitioners, like the respondent in this case, require clients to enter into retainer agreements (called variously retainer agreements or client agreements or fee agreements). Such agreements are commonplace. Some of the terms of such agreements are mandated by the LPA.
These agreements set out the terms on which the practitioner is prepared to act for the client. They are often prepared in standard form by the practitioner. The practitioner is familiar with the terms.
As was observed by McGill DCJ,[77] many clients would never have understood the complexity of assessments before the advent of retainer agreements which provide for payment of fees based on the hours worked at the rates set out in the agreement. In many ways, the retainer agreement (on this basis) will provide the client with a greater level of understanding and more certainty around fees by providing for charges based on work done at an hourly rate.
[77]Southwell v Jackson [2012] QDC 65 at [46].
The retainer agreement is the basis which determines the fees that the practitioner is entitled, under the agreement, to charge. Importantly, the taxation of costs and decision of McGill DCJ set out the calculation of this figure by reference to the requirements of the retainer agreement. This is the maximum figure that the practitioner should charge the client.
As was observed by French J in De Pardo v Legal Practitioners Complaints Committee,[78] one of the cases referred to by Ms Jackson, even where the practitioner complies with the retainer agreement it might still be the case that the conduct is inappropriate. In D’Allesandro,[79] Ipp J observed:
There is, furthermore, strong authority to the effect that the existence of an agreement between a legal practitioner and client, as to the amount of costs payable by the latter, is no bar to disciplinary proceedings against the practitioner involving complaints of unethical overcharging.
[78](2000) FCA 335 at 45.
[79](1995) 15 WAR 198 at 211.
This has been the basis, in some cases, for the observation that the assessment may not be the end of the consideration.
At a minimum, however, from the practitioners’ perspective, the practitioner must comply with the terms of the agreement. At a minimum, the practitioner’s conduct must be considered by reference to compliance with the terms of the retainer agreement.
The practitioner must understand the terms of the retainer agreement, which the practitioner requires that the client enter into as a condition of the practitioner being prepared to act. This is a level of competence and diligence which the public is entitled to expect of a legal practitioner.[80]
[80]See sections 418, 419 LPA.
Practitioners who do not comply with the terms of their retainer agreements will fail to achieve the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent Australian legal practitioner.
Ms Jackson has made submissions about the need to identify the conduct of the practitioner and in that context has submitted that the disallowance of items on a taxation is not sufficient to underpin a conclusion that the conduct of the practitioner falls below the required standards.[81]
[81]Submissions on Behalf of the Respondent – Hearing on the Papers, 15 July 2015 at [171], referring to Legal Services Commissioner v Bone (2013) QCAT 550 at 73.
In D’Allesandro,[82] Ipp J referred to the fact that the arguments advanced on taxation had been regarded as “very attractive in some respects”, indicating a view that those submissions were at least reasonably arguable. Ipp J regarded this as a highly relevant factor to be taken into account in determining whether the amount charged under the bill of costs was grossly excessive. His Honour concluded:[83]
If a practitioner claims a fee on a reasonably arguable, but wrong basis, it could hardly be said that his or her conduct in so charging is to be characterised in any way as unprofessional.
[82](1995) 15 WAR 198.
[83]D’Allesandro v Legal Practitioners Complaints Committee (1995) 15 WAR 198 at 223.
This is a very different position from the circumstances where the practitioner ignores the provisions of the retainer agreement in charging fees to a client beyond those which are allowed under the terms imposed by the practitioner as conditions upon which the practitioner is prepared to act.
In those instances, it is not just the case that there is a valid (or appropriately arguably valid) claim but the quantum might be within a range of figures. Where the terms of the retainer agreement are ignored, the fee should never have been imposed.
In those circumstances, the claims are not reasonably arguable. This leads to the opposite conclusion to that which was expressed by Ipp J in D’Allesandro.
The retainer agreements entered into by the parties in this case were in clear terms.
Provision is made that “the firm charges fees according to the time spent on the matter”.[84]
[84]Para 3, retainer agreement.
Rates are specified for various categories, which include partner, associate, solicitor, article clerk, paralegal and consultant.
The agreement provides that the charge will be on the basis of a six minute unit, for each unit or part thereof charged at one-tenth of the hourly rate applicable. The retainer warns the client that there is potential for the time charging to result in a different figure from the charges which might be derived using the relevant courts scales, and those scales are attached to the agreement.
There is no allowance for care and consideration in the retainer agreement.
Ms Jackson submits that the amounts which were charged for care and consideration in her accounts were not charged in the same way as “care and consideration” would be charged under the court scales. Rather, care and consideration was charged by Ms Jackson to account for “numerous specific tasks charged by that collective term in the bill even though the work was done and is properly chargeable as individual items”. Ms Jackson asserts that the error is in form, not quantum.
That argument is unsustainable.
In this case, the parties entered into an agreement, which defined the obligations of the clients with respect to fees. The practitioner required that the retainer agreement be entered into.
The practitioner’s rights are defined by reference to the retainer agreement. As there is no provision in the retainer agreement for a charge such as that which is asserted by Ms Jackson as falling under the heading “care and consideration”, no such charge in that category can be made by the client.
The Tribunal concludes that the retainer agreement between the parties did not allow for care and consideration and no charge should have been made. Acting to a standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent practitioner, this should have been obvious to Ms Jackson who had reviewed the draft itemised accounts and was familiar with the terms of the retainer agreement.
The Tribunal notes that Judge McGill also came to this conclusion.[85]
[85]Southwell v Jackson [2012] QDC 65 at [37], [41] and [43].
Ms Jackson purported to make a charge with respect to a cost of drawing the itemised accounts. Ms Jackson submitted that the client expected to pay for the costs assessor’s fees, particularly as the costs assessor was to be a “joint expert” for which the fee was to be treated as an outlay included in the bill.[86]
[86]Submissions on Behalf of the Respondent – Hearing on the Papers, 15 July 2015.
Ms Jackson refers to the terms of the retainer agreement and also to an express instruction given on 1 February 2008.
Item 5, which is contained in the reference schedule to the retainer agreement, deals with the costs of an independent costs assessor. Item 5 is said to apply where there is a dispute regarding the invoice and an independent costs assessor becomes involved to resolve that dispute. Those circumstances did not occur in this case and so Item 5 is not relevant. There is no other provision in the retainer agreement, which deals with the costs of preparation of the itemised bill.
The conversation said to have occurred on 1 February and confirmed in the letter of 12 February does not provide that the client would pay the costs of preparing an itemised bill.
The letter does not contain any sufficiently clear agreement that the clients would pay Hartwell’s fees. The words used "Obviously Mr Hartwell will render an invoice for his attendances in preparing the costs assessment" are ambiguous. If such an unusual obligation was intended to be imposed it should have be done in clear terms.
On the basis of the communication on 12 February, it could not be said that the client would have expected to pay for the cost of preparation of the itemised bill, or that the payment would be made from funds in trust or that there was provision of express instructions as to that matter.
At common law, a solicitor is not entitled to charge for preparing an itemised bill.[87]
[87]Carter Newell’s Bill of Costs [1996] 2 Qd R 13 at 19; Re Moore [1996] QSC 212.
In the circumstances, there was no clear entitlement to claim for the cost of preparing the itemised bill. Again, this would have been obvious to a practitioner acting to a standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent practitioner in the circumstances.
The Tribunal notes that Judge McGill dealt with this matter in the reasons in similar terms.[88]
[88]Southwell v Jackson [2012] QDC 65 at [44]-[46].
The third issue raised by the applicant concerns the charging of work done after termination of the retainer.
Dispute arose concerning a letter dated 12 February 2008, which was sent from Crouch & Co to Ms Jackson which indicated that Crouch & Co had been instructed to act in the administration of the estate.
Ms Jackson’s submission is that the letter was not effective to terminate the retainer as it was not expressed in language that was sufficiently definite, clear or precise.
The letter read:
We now have instructions from Irene Elizabeth Raps and Irene Joyce Kennedy who are the executors named in the last will of the abovenamed who now instruct that they want us to act for them in the administration of the estate.
We would be pleased if you could advise your requirements in order to allow transfer of the file.
We have received your fax dated 11 February 2007. In view of these latest instructions we ask you to take no further steps in the estate’s administration.
The Tribunal concludes that the letter was sufficiently clear to indicate to Ms Jackson that her retainer had been terminated. The letter makes it clear that Crouch & Co had been asked to act in the matter in which Ms Jackson had been acting and that Ms Jackson was asked to transfer her file. The words used were, in the Tribunal’s view, sufficiently clear and precise to communicate to Ms Jackson that her instructions were terminated.
The letter also made it clear that Ms Jackson was to take no further steps in the estate’s administration.
In the circumstances, Ms Jackson had no entitlement to make any claim with respect to costs incurred after the termination of the retainer on 12 February 2008.
Judge McGill dealt with this issue in similar terms.[89]
[89]Southwell v Jackson [2012] QDC 65 at [55]-[61].
The Tribunal concludes that no fees associated with those three items (care and consideration, preparation of the bill and costs incurred after termination) should have been charged. The charges should not have been included in the accounts. It was not a matter where a percentage was taxed off the account where a larger quantum might have been reasonably and properly arguable. To the contrary, the entitlement was not arguable. No charge should have been made.
The fact that these charges should not have been made was obvious from Ms Jackson’s standard retainer agreement and must have been obvious to Ms Jackson. The fact that they were charged was obvious (including to Ms Jackson) from the face of the assessments and the accounts which were rendered, in itemised form, to include all those items. It is clear (as the Tribunal has found in these reasons) that Ms Jackson reviewed the assessments.
Ms Jackson has referred to an arrangement with the client by which she asserts it was agreed a “joint expert” would determine the fees. Ms Jackson says that the accounts were not prepared by her.
The basis on which Mr Hartwell was appointed was not clear.
The terms of the retainer agreement do not apply - there was no dispute about costs, as is required by the retainer agreement.
The letter sent by Ms Jackson on 12 February 2008 to the clients was not clear and could not be regarded as any agreement that Hartwell’s would act in the capacity as joint expert.
In any event, the circumstances reveal that Hartwell’s did not act as an independent decision maker in the role they undertook.
No evidence was available to the Tribunal to establish that the relevant draft Hartwell’s assessments were sent to the clients. The Tribunal finds that the assessments were not sent to the clients. This is not consistent with the suggestion that Mr Hartwell was a joint expert.
In a letter dated 26 February 2008, Ms Jackson questioned the draft assessment in one matter. In communications, Ms Jackson demonstrated that she had reviewed the assessments. The Tribunal finds that Ms Jackson reviewed the assessments.
Ms Jackson required Hartwell’s to undertake a further review and assessment. Ms Jackson asked Mr Hartwell to review what he had done.
Mr Hartwell responded making observations such as "Perhaps we could increase the claim for care and consideration" and "obviously we have misinterpreted some notes. Perhaps you could have your staff mark the amendments required and we will then amend the costs statement” and “We have, nevertheless, amended the bill in accordance with your instructions.”
His language was that of a person aiming to accommodate the requirements of Ms Jackson not acting as an independent jointly appointed expert.
In that context, Mr Hartwell provided advice to Ms Jackson about a possible dispute over the assessments and offered to represent Ms Jackson in that context.
These circumstances are very different, and can be distinguished, from the cases referred to by Ms Jackson, where the billing process was handled completely by another competent lawyer within the firm, who had the carriage of the relevant matters and without any involvement of, or interference by, the lawyer who was the subject of the disciplinary proceedings.
Unlike those cases, Ms Jackson was the solicitor with the conduct of the matter and had a role in reviewing the detail and particulars of the invoices rendered, and who sent the invoices.
An overall figure of 51% was taxed from the 3 accounts. As to the two accounts to which the retainer agreements were relevant, the figure was 46%.
Section 343(2) LPA provides that if the costs assessor or court reduces the legal costs payable by 15% or more, the costs assessor or the court may direct the registrar for the court to refer the matter to the Commissioner to consider whether disciplinary action should be taken against an Australian legal practitioner.
Section 343(3)(a) LPA provides that if the costs assessor or a court consider the legal costs charged by a law practice are grossly excessive, the costs assessor or the court may direct the registrar for the court to refer the matter to the Commissioner to consider whether disciplinary action should be taken against the practitioner.
These provisions are unhelpful in defining at what level costs become excessive.
Comparing subsections (2) and (3), it would seem to follow that a reduction of 15% is not excessive.
With an overall reduction of an excess of 50% and reduction on the two accounts which were the subject to the retainer agreements at a figure just under 50%, the Tribunal concludes that the respondent charged excessive fees.
As to the underlying conduct, significant charges were made by Ms Jackson for care and consideration, preparation of itemised accounts, and work done after termination of the retainer where there was no entitlement under the terms of the relevant retainer agreement.
The fact that the charges were made was obvious to the respondent from the itemised accounts. The fact that the charges should not have been made was obvious to the respondent from the provisions of the retainer agreement and the circumstances at the time.
The Tribunal finds that the conduct which led to the charging of the excessive fees was conduct which fell below the standard of competence and diligence a member of the public is entitled to expect of an Australian legal practitioner. On this basis, the conduct was, at the very least, unsatisfactory professional conduct.
The LPA does not provide that charging of excessive fees is professional misconduct. Section 420 provides that it might be either unsatisfactory professional conduct or professional misconduct.
The Legal Services Commissioner asserts that the costs were deliberately or dishonestly overcharged. There is no evidence of dishonesty, or any deliberate intention in that respect. That submission is without merit.
The conduct in this case occurred with respect to one client on one occasion, and as to costs, was over a very limited time frame.
The Commissioner has compared the level of reduction in some of the cases with that which occurred in this case in submitting that finding of professional misconduct should be made.
The conduct in these cases were much more serious than that of Ms Jackson.
For example, O’Halloran,[90] involved a practitioner overcharging 5 of his clients over a period of 12 years where the overcharging was in excess of 39% for each client. Additionally, those clients were vulnerable personal injury clients. Similarly, the practitioner in Veghelyi v Law Society of NSW,[91] was found to have wilfully overcharged 12 of his clients and to have made trust account disbursements without authority.
[90][2013] WASC 430.
[91][1995] NSWCA 483.
Scroope v Legal Services Commissioner,[92] is at least comparable in the sense that a single client had been overcharged by an amount of 63%, but in that case the practitioner’s bill had been approved by his supervising partner. The practitioner’s conduct was found to be unsatisfactory professional conduct, on appeal from a finding of professional misconduct.
[92][2013] NSWCA 178.
As is clear from the authorities, the level of reduction is a factor which is taken into account but it is not the sole factor or indeed the determinative factor. It is just one aspect of the conduct which is considered.
Some of the areas of reduction at the taxation, which contributed to the overall level of reduction, were attributable to areas where there might arguably have been a range. In other areas, such as charging for care and consideration, the charge should simply not have been made.
The Commissioner forwarded a further letter on 21 August 2008, which contained a notice pursuant to section 443(3) LPA.
The relevant part of that letter is as follows:
Further to my letter of 11 August 2008, in which you were directed to provide an explanation of the basis for your lien and a copy of your itemised account in support of your lien, you have provided neither an explanation nor an invoice.
Accordingly, I hereby give you written notice pursuant to section 443(3) of the Legal Profession Act 2007 that you may be dealt with for professional misconduct if your failure to comply with that direction continues for a further 14 days - that is to say beyond 4 September 2008.
Please note that the Act provides at section 443(4) that you will be taken to have committed professional misconduct if you fail without reasonable excuse to provide me with the explanation by that date.
The section 443(3) notice seems to ignore the communication from the respondent on 18 August 2008. Whilst the letter from the Commissioner dated 21 August 2008 refers to the facsimile of 18 August 2008, the notice reads, “you have provided neither an explanation nor an invoice”. That was incorrect.
In the letter dated 3 September 2008 from the respondent to the Legal Services Commission, the respondent draws attention to this fact. The respondent says, referring to the letter of 21 August 2008 from the Legal Services Commission:
You go on to require pursuant to “section 443(1) of the Act, an explanation of the basis for the claimed lien and a copy of the itemised account in support of that lien”. On 18 August 2008, by correspondence I provided you with an explanation at item 3.
In your correspondence dated 21 August 2008, you state “you have provide neither an explanation nor an invoice”. With respect, the explanation has been provided on 18 August 2008. Do you discount it? Apparently you do, it seems in your view a solicitor should act on demands of a solicitor for the executors of a Will, even if this is without competent authority and direction from the executors of that Will and is contrary to the solicitor’s obligation to others including the estate and the Coroners Court
By way of letter dated 8 September 2008 from the Legal Services Commission to the respondent, the Legal Services Commission notes that the information required by the section 443(3) notice was not provided by 4 September and states “pursuant to section 443(4) you may be dealt with for professional misconduct for failing to comply with my request without reasonable excuse”.
The letter from the respondent dated 18 August 2008 referred to the section 443(1) notice. The letter dated 18 August provided the respondent’s explanation in paragraphs d and e. In paragraphs a, b and c, the respondent makes it clear that there was no itemised account in support of that lien.
Section 443(1) notice cannot compel a practitioner to prepare a document. The power is limited to requiring the practitioner to produce a document.[189] The Applicant was told that the document does not exist.
[189]Section 443(1)(a)(iii) LPA.
It is clear that the response did not provide an explanation which the Commissioner believed was plausible. However, the notice was not ignored and an answer to the question requiring the explanation was provided. It is obvious that in some cases, an explanation that the Commissioner does not think is plausible will be provided. This is to be expected in the context of an investigation (in aid of which a section 443(3) notice can be issued). No doubt, as in this case, those matters will be the subject of disciplinary proceedings.
In answer to the question requiring production of the itemised account, the response made it clear that there was no such document in existence.
In the circumstances, the notice pursuant to section 443(3) LPA should not have been issued.
Charge 4 is dismissed.
Sanction and Costs
The Tribunal invites the parties to make further submissions as to the appropriate sanction as to Ms Jackson’s conduct which was the subject of Charge 1 and regarding costs of the proceedings.
Accordingly, the Tribunal directs that:
a) The Legal Services Commissioner must file in the Tribunal and give to Amanda Lee Jackson one (1) copy of any submissions on sanction and costs, by:
4:00pm on 18 July 2017.
b) Amanda Lee Jackson must file in the Tribunal and give to the Legal Services Commissioner one (1) copy of any submissions on sanction and costs in reply, by:
4:00pm on 8 August 2017.
c) Unless either of the parties requests an oral hearing before 8 August, the matter will be determined on the papers after 8 August 2017.
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