Mitry v Council of the New South Wales Bar Association

[2001] NSWCA 273

CITATION:	RICHARD MITRY v COUNCIL OF THE NEW SOUTH WALES BAR ASSOCIATION [2001] NSWCA 273
FILE NUMBER(S):	CA 40585/00
HEARING DATE(S):	12 July 2001
JUDGMENT DATE:	28 August 2001
PARTIES :	Richard Mitry (Appellant) Council of the New South Wales Bar Association (Respondent)
JUDGMENT OF:	Spigelman CJ at 1; Powell JA at 170; Giles JA at 178

LOWER COURT JURISDICTION :	Administrative Decisions Tribunal
LOWER COURT FILE NUMBER(S) :	9/00
LOWER COURT JUDICIAL OFFICER :	K P O'Connor J, J Blackman and L Bubniuk (Appeal Panel, Administrative Decisions Tribunal)

COUNSEL:	W Hodgekiss (Appellant) P Garling SC (Respondent)
SOLICITORS:	Appellant in person Hickson Wisewoulds (Respondent)
CATCHWORDS:	LEGAL PRACTITIONERS - Disciplinary proceedings - whether error of law made by tribunal - where finding of professional misconduct and order that barrister's name be removed from the roll - whether reasonable apprehension of bias on part of member of tribunal - whether amendment of information outlining complaint deprived tribunal of jurisdiction - where information required acceptance by Legal Services Commissioner - Legal Profession Act 1987, ss138(2), 167A.
LEGISLATION CITED:	Administrative Decisions Tribunal Act 1997 Companies (NSW) Code 1981 Legal Profession Act 1987
CASES CITED:	Barwick v Law Society of New South Wales [2000] HCA 2; 74 ALJR 419 In Re Davis (1947) 75 CLR 409 Ebner v Official Trustee in Bankruptcy [2000] HCA 63; 75 ALJR 227 New South Wales Bar Association v Hamman [1999] NSWCA 404 Yorke v Lucas (1985) 158 CLR 661 Ziems v Prothonotary of the Supreme Court of New South Wales (1957) 97 CLR 279
DECISION:	1. Appeal allowed; 2. Orders of the Tribunal vacated; 3. The name of Richard Mitry be reinstated on the Roll of Legal Practitioners; 4. Proceedings remitted to Tribunal to be determined in accordance with law; 5. Order the Respondent to pay the Appellant's costs.

THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40585/00

SPIGELMAN CJ

POWELL JA

GILES JA

Tuesday 28 August 2001

RICHARD MITRY v COUNCIL OF THE NEW SOUTH WALES BAR ASSOCIATION

Facts
The Appellant pleaded guilty to a charge of being knowingly concerned in the contravention, by another, of s129(1)(a)(i)(A) of the Companies (NSW) Code 1981 that a company provided financial assistance for the purchase of its own shares. Council of the New South Wales Bar Association complained to the Legal Services Commissioner about the Appellant’s conduct and, subsequently resolved that that complaint be referred to the Legal Services Tribunal. The Legal Services Commissioner accepted the complaint under s138(2) of the Legal Profession Act 1987 which would otherwise had been brought out of time because more than three years had elapsed since the conduct giving rise to the complaint. The Bar Council presented an information outlining the complaint to the Legal Services Tribunal. Subsequently, the Bar Council sought, and was granted, leave from the Tribunal to rely on an amended information. An application that a member of the Tribunal disqualify herself on the grounds of apprehended bias, was rejected. The Tribunal found the Appellant guilty of professional misconduct and ordered that his name be removed from the Roll of Legal Practitioners. An appeal to the Appeal Tribunal was dismissed.

Held

A. Professional Misconduct

per Spigelman CJ, Powell and Giles JJA agreeing.

The facts as found by the Tribunal were capable as a matter of law of constituting professional misconduct. It was open to the Tribunal to conclude that there was no doubt about the validity of the conviction. The finding of professional misconduct was open to the Tribunal. In Re Davis (1947) 75 CLR 409, Ziems v The Prothonotary of the Supreme Court of New South Wales (1957) 97 CLR 279, New South Wales Bar Association v Hamman [1999] NSWCA 404 referred to.

per Spigelman CJ, Powell and Giles JJA agreeing.

The Tribunal found a lack of probity on behalf of the Appellant. It was open to the Tribunal to make an order that the Appellant be struck off.

per Spigelman CJ, Powell and Giles JJA agreeing.

There was not a sufficient connection between the members of the Tribunal who had been asked to recuse herself and persons involved in the matters and circumstances surrounding the Appellant’s conviction, to oblige the member to do so. Ebner v Official Trustee in Bankruptcy [2000] HCA 63; 75 ALJR 277 applied.

D. Amendment of Information

per Spigelman CJ, Giles JA agreeing.

The amendment to the information was so significant as to require that leave be granted by the Legal Services Commissioner pursuant to s138(1). In the absence of such leave, the Tribunal did not have jurisdiction to decide matters raised for the first time in the amended information relied upon by the Bar Council independently of, and in the alternative to, the matters contained in the original information. The Tribunal’s reasons depended on matters contained in the amended information. Barwick v The Law Society of New South Wales [2000] HCA 2; 74 ALJR 419 applied.

per Powell JA dissenting

The matters on which the Tribunal relied which were contained in the amended information, but not in the original information, were not new complaints and did no more than identify particulars of the conduct the subject of the original information. Barwick v Law Society of New South Wales [2000] HCA 2; 74 ALJR 419 discussed.

Orders

1 Appeal allowed.
2 Orders of the Tribunal vacated.

3 The name of Richard Mitry be reinstated on the Roll of Legal Practitioners.
4 Proceedings remitted to Tribunal to be determined in accordance with law.
5 Order the Respondent to pay the Appellant’s costs.

THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40585/00

SPIGELMAN CJ

POWELL JA

GILES JA

Tuesday 28 August 2001

RICHARD MITRY v COUNCIL OF THE NEW SOUTH WALES BAR ASSOCIATION
JUDGMENT

1    SPIGELMAN CJ: On 30 August 1999, the Legal Services Division of the Administrative Decisions Tribunal of New South Wales, on application of the Council of the New South Wales Bar Association, found the Appellant guilty of professional misconduct and ordered that his name be removed from the Roll of Legal Practitioners. The Appellant lodged an appeal to the Appeal Panel of the Administrative Decisions Tribunal of New South Wales. On 30 June 2000, that Panel dismissed the appeal.

2 No application was made to the Appeal Panel for leave to appeal by way of a review of the merits, pursuant to s113(2)(b) of the Administrative Decisions Tribunal Act 1997 (“the ADT Act”). Four grounds of appeal were argued before the Appeal Panel. The same four grounds are relied upon by the Appellant in this Court.

3    The issues raised in the notice of appeal are:

(i) Whether the findings of fact made by the Tribunal are capable of constituting professional misconduct.

(ii) Whether, if professional misconduct was properly found, the order for removal should have been made.

(iii) Whether the Tribunal proceedings were flawed because a member, Deputy President C Needham should have disqualified herself because of a reasonable apprehension of bias.

(iv) Whether the Council had filed its complaint out of time and whether the Tribunal erred in permitting the Council to amend its complaint.

4 Pursuant to s119(1) of the ADT Act, an appeal was made to this Court on a question of law. The Respondent did not suggest that any of the four matters did not constitute questions of the law.

The Factual Matrix

5    On 4 September 1995, the Appellant was charged with the offence:

“between 7 August 1990 and 30 November 1990 at Sydney in the State of New South Wales, was knowingly concerned in Christopher James Donlon, an officer of Red Anchor Resources Limited, being in default, in that Christopher James Donlon was knowingly concerned in the contravention of s.129(1)(a)(i)(A) of the Companies (NSW) Code (‘the Code’) by Red Anchor Resources Limited in that Red Anchor Resources Limited did in a manner not expressly provided by the Code, give financial assistance in connection with the acquisition by Selmit Pacific Property Holdings Pty Limited of shares in Red Anchor Resources Limited contrary to s.129(5) of the Companies (NSW) Code and s.38(1) of the Companies & Securities (Interpretation and Miscellaneous Provisions) (NSW) Code (‘the Offence’).”

6    On 15 April 1996, the Appellant pleaded guilty before a magistrate to this charge. He was sentenced to 400 hours of community service. He lodged an appeal and, on 14 August 1996, a judge of the District Court quashed the order for community service and substituted an order that the barrister pay a fine of $2,500.

7    Red Anchor Resources Limited (“Red Anchor”) issued a Prospectus on 30 April 1990 by which it sought to raise $1.6 million by offering for subscription 8,000,000 fully paid ordinary shares at 20 cents each and 8,000,000 transferable options at an issue price of 1 cent each. Application was to be made to for the admission of Red Anchor to the Official List of the Australian Stock Exchange (“the ASX”). One of the requirements of the ASX was that an applicant company demonstrate that it had applications from at least 350 independent subscribers for parcels of at least 2,000 shares each and that the split of share holdings was sufficient for the conduct of an orderly, liquid market in those shares. Initially the ASX declined to grant listing approval to Red Anchor, until it was satisfied there was a sufficient spread of shareholders to support a market in the shares.

8    Selmit Pacific Properties Holdings Pty Limited (“Selmit”), Tamsulu Pty Limited (“Tamsulu”) and Valdese Pty Ltd (“Valdese”) were each companies of which the Appellant was a director and, it appears, controller.

9    On 29 August 1990, Selmit drew three cheques payable to Red Anchor in the total amount of $334,300, together with an application form for 1.5 million shares and 1.4 million options in that company. The application was signed by the Appellant. On 30 August 1990 the cheques and the application were delivered to red Anchor. The cheques were presented for payment on 31 August 1990, but were not honoured and were returned marked “present again”.

10    On 13 September 1990, at a meeting of directors of Red Anchor attended by three of its directors, Messrs Donlon, McLellan and Phillip, that company resolved to allot shares and options to Selmit in accordance with its application. At this meeting the directors also resolved to make two payments, each of $165,000 to Valdese and Tamsulu. Cheques were drawn by Red Anchor and converted into bank cheques, which were in turn endorsed by the Appellant and paid into the account of Selmit. The proceeds of these two bank cheques were used to meet the three cheques which Selmit had drawn in favour of Red Anchor and which were again presented for payment.

11    In the course of investigations by the Australian Securities Commission (“the ASC”), the Appellant made a statement to an officer of that Commission. The statement is described as a draft, but was relied upon by the Appellant in a submission he made to the New South Wales Bar Association in the course of its investigation.

12    In that statement the Appellant states he was approached by Mr Donlon indicating that he needed additional investors in an amount of some $300,000 for a company he was about to float. The Appellant agreed to attempt to obtain an overdraft of that amount. He said that he drew the three cheques on the account of Selmit without any further overdraft arrangement and “without regard as to whether the cheques would be met on presentation”. He did so, he said, to “get Mr Donlon off my back”. He filled out the application form for shares and options and signed the document. After receiving notification from his bank that the cheques had not been honoured on presentation, he spoke to Mr Donlon who said he could arrange a loan and that the shares would be sold upon the float. The Appellant said that he assumed that Donlon would be getting money from his family whom he knew to be financially strong. The Appellant said that Donlon asked him to nominate two companies to whom the money could be lent. He nominated Valdese and Tamsulu and indicated that because those companies had large overdrafts payment could not be made into their accounts. The Appellant suggested that he would endorse the cheques to Selmit.

13    In the course of his statement the Appellant was shown investment agreements between Red Anchor and both Tamsulu and Valdese. He identified his own signature. He noted the signatures on the seal of Red Anchor were those of Mr Donlon and Mr Gordon Walker, who he said had been a partner of his in a law firm of Mitry Walker at a time when the Appellant was practicing as a solicitor.

14    At the time of the signature of the investment agreements he said that the following conversation occurred:

“DONLON: ‘I’ve got to show Red Anchor that they have security for the loans made to Tamsulu and Valdese.’
MITRY: ‘So that was Red Anchor lending the money.’
DONLON: ‘Yes.’
MITRY: ‘Isn’t that against the rules.’
DONLON: ‘Well it is not really. I should get these documents done to comply with the requirements. Red Anchor is entitled to invest in other companies and in my opinion, Red Anchor is entitled to do this.’
MITRY: ‘If everyone else is happy with this, I prefer to keep everything above board’.”

15    In the course of his statement to the ASC the Appellant identified a letter from the auditors for Red Anchor. In that letter the auditors sought confirmation with respect to the investments by Red Anchor of $165,000 with each of Valdese and Tamsulu, to the following effect:

“Investments are bona fide investments and cannot be characterised as loans to directors in breach of ss230, 129 or any other section of the Companies (NSW) Code.
The investments have been repaid in full together with interest.”

16    In a reply, on the letterhead of his practice as a barrister, the Appellant answered “Yes” to each of these questions.

17    The auditor’s letter was not entirely clear. It referred to “loans to directors”, which was referrable only to s230 of the Code. Section 129 of the Code, concerning a company financing the acquisition of shares in itself, is expressly referred to, but it is not characterised in any way. It was not suggested in the subsequent proceedings, including in this Court, that anything turned on this lack of clarity in the letter.

18    Prior to the plea of guilty in the Magistrate’s Court, the Appellant had received advice on the subject and had signed a note, which said:

“I, Richard Mitry am charged under the Companies (NSW) Code with being knowingly concerned in Christopher James Donlon an officer of Red Anchor Resources Limited being in default. I have been advised by my solicitor and barrister that I may be convicted if I defend the matter and I also appreciate that I could be acquitted. I instruct that I do not recall the circumstances in which I received bank cheques made out in return for cheques to companies relating to me by Red Anchor Resources Limited. I have seen bank cheque requisition forms which bear signatures purportedly mine and which bear the name of Red Anchor Resources Limited. I do not recall signing same nor can I say I saw the name Red Anchor Resources. However two weeks after that time I signed loan agreements to Red Anchor Resources and I accept that this is sufficient to constitute the offence with which I am charged.
Accordingly, I instruct that I wish to plead guilty to the offence knowing that a conviction could involve a sentence and could cause my name to be removed from the Roll of Barristers. The facts that I will accept on plea are in conformity with the above.”

The Legislative Scheme

19 Part 10 of the Legal Profession Act 1987 is concerned with “Complaints and Discipline”. The general objects of the Part include the objects:

“123 (b) To ensure compliance by individual legal practitioners and interstate legal practitioners with the necessary standards of honesty, competence and diligence, and
(c) to maintain at a sufficiently high level the ethical and practice standards of the legal profession as a whole.”

20    Section 126 defines ‘complaint’ in terms of “a complaint made under Division 3”. The relevant provisions of Div 3 are:

“135(1) A Council may initiate a complaint against any legal practitioner or interstate legal practitioner under this Part.
(2) A copy of any such complaint is to be forwarded immediately to the Commissioner.”

21 “Council” includes the Council of the Bar Association of New South Wales. The “Commissioner” is the Legal Services Commissioner appointed under the Act.

22 Section 135, like s136 relating to the Commissioner, refers to ‘initiating’ rather than ‘making’ a complaint. It follows s134 which permits any person to “make a complaint … about the conduct of a legal practitioner”. The word “complaint” in s135 should be understood to also refer to a ‘complaint about conduct’.

23    Section 137 provides:

“A complaint:
(a) must be in writing, and
(b) must identify the complainant and the legal practitioner against whom the complaint is made, and
(c) must give particulars of the alleged conduct of the legal practitioner that is the subject of the complaint.”

24    Section 138 provides:

“(1) A complaint may only be made within three years after the conduct is alleged to have occurred.
(2) However, the Commissioner may accept a complaint made after that time if:
(a) the Commissioner is satisfied that it is just and fair to do so having regard to the delay and the reason for the delay, or
(b) the Commissioner is satisfied that the complainant concerns an allegation of professional misconduct and that it is necessary in the public interest to investigate the complaint.”

25    The powers of the Commissioner include a power under s140 in the following terms:

“140(1) The Commissioner:
(a) may require further particulars of a complaint to be given,
…”

26 Division 5 of Pt 10 of the Act is concerned with the “Investigation of Complaints”. The relevant provisions are:

“148(1) A Council must, subject to this section, conduct an investigation into each complaint … initiated by the Council.”
“149(1) The Commissioner is to monitor investigations by a Council into complaints.”
“150(1) The Commissioner may give the Council directions on the handling of a complaint being investigated by the Council if the Commissioner considers that it is in the public interest to do so having regard to the seriousness of the complaint.
(2) The directions may include, for example, directions to pursue a particular line of inquiry or directions concerning the time for completing the investigation.
(3) Directions may not be given on the decision to be taken by a Council following the investigation.”
“155(1) After a Council … has completed an investigation into a complaint against a legal practitioner … the complaint is to be dealt with in accordance with this section.
(2) The Council … must institute proceedings in the Tribunal with respect to the complaint against the legal practitioner … if satisfied that there is a reasonable likelihood that the legal practitioner … will be found guilty by the Tribunal of unsatisfactory professional conduct or professional misconduct.”

27    Section 127 relevantly states:

“127(1) For purposes of this Part, professional misconduct includes:
…
(b) conduct (whether consisting of an act or omission) occurring otherwise than in connection with the practice of law which, if established, would justify a finding that a legal practitioner is not of good fame and character or is not a fit and proper person to remain on the roll of legal practitioners”.

28    The Act further provides:

“167(1) Proceedings may be instituted in the Tribunal with respect to a complaint against a legal practitioner … by an information laid by the appropriate Council … in accordance with this Part.
(2) The Tribunal is to conduct a hearing into each allegation particularised in the information.
(3) Before the commencement of the hearing, the legal practitioner … must file a reply to the allegations in the information in accordance with the rules of the Tribunal and the directions of the Registrar of the Tribunal.”
“167A(1) The Tribunal may, on the application of a Council … who laid an information, vary the information laid so as to omit allegations or to include additional allegations if the Tribunal is satisfied, having regard to all the circumstances, that it is reasonable to do so.
(2) Without limiting subsection (1), when considering whether or not it is reasonable to vary an information, the Tribunal is to have regard to whether varying the information will affect the fairness of the proceedings.”

29 In the course of the hearing of the proceedings before the Legal Services Tribunal in the case of the Appellant, a new legislative scheme came into effect. The Tribunal, which had originally been constituted under the then Div 7 of the Legal Profession Act was replaced by the Administrative Decisions Tribunal and these functions were to be exercised by the Legal Services Division of that Tribunal. Other than this institutional change, the provisions of the Legal Profession Act continued to apply as set out above.

The Disciplinary Proceedings

30    On 16 April 1996, the Sydney Morning Herald carried a report of the conviction of the Appellant. The entirety of that article was as follows:

“A Sydney barrister Mr Richard Mitry has pleaded guilty to charges by the Australian Securities Commission that he was knowingly concerned in Red Anchor Resources financing the purchase of its own shares.”

31    On 24 April 1996, the Bar Council resolved:

“… that the Bar Council institute a complaint pursuant to s135 of the Legal Profession Act against Mitry in respect of his plea of guilty to charges by the Australian Securities Commission that he was knowingly concerned in Red Anchor Resources financing the purchase of its own shares.”

32    On 29 April 1996, the Bar Council wrote to the Legal Services Commissioner as follows:

“On 24 April, Bar Council resolved, pursuant to s135 of the Legal Profession Act to initiate formal complaint, under Part 10 of the Legal Profession Act against the below named: Richard Mitry.
The enclosed newspaper article which appeared in the Sydney Morning Herald on 16 April 1996 came to the attention of the Council. I will shortly be writing to Mr Mitry seeking additional information concerning his conviction.”

33 By letter of 13 May 1996, the Bar Association forwarded to the Appellant a copy of the article in the Sydney Morning Herald and indicated that the Bar Council has resolved to initiate a complaint pursuant to s135. Other than by means of the attachment of the Sydney Morning Herald article, it did not otherwise identify the conduct on which the complaint was based.

34    Mr Mitry replied to various questions asked by the Council and further correspondence ensued.

35    A Memorandum dated 27 September 1996 (hereafter referred to as a report) was considered by the Bar Council at a meeting on 24 October 1996. At that meeting, the Council made the following decision:

“Resolved that the complaint be referred to the Legal Services Tribunal upon the basis that, after investigation, the Council is satisfied that there is a reasonable likelihood that the barrister will be found guilty by the Legal Services Tribunal of professional misconduct.”

36    The memorandum of 27 September 1996 referred to the article in the Sydney Morning Herald and the Council’s prior resolution of 24 April 1996. The memorandum outlined the communications that had occurred with the Appellant and the sentencing proceedings in the Local Court and, subsequently, on appeal in the District Court. The memorandum proceeded as follows:

“ The Complaint.
The charges to which Mitry pleaded guilty were laid under s.129(5) of the Companies (NSW) Code and s.39(1) of the Companies and Securities (Interpretation & Miscellaneous Provisions) (NSW) Code .
The conduct particularised in the charges is that between 7 August, 1990 and 30 November, 1990, at Sydney, Mitry was knowingly concerned with Christopher Donlon, an officer of Red Anchor Resources Limited, giving financial assistance in connection with the acquisition by Selmit Pacific Holdings Pty Limited of shares in Red Anchor Resources Limited. Selmit Pacific Holdings Pty Ltd, (“Selmit”), is a company of which Mitry is a director.
The information supplied by Mitry pursuant to the requisition under s.152 of the Legal Profession Act on 24 and 30 May 1996, is summarised as follows:-
1. Mitry first became aware of the Australian Securities Commission inquiry into the conduct that later gave rise to the laying of charges in 1994. He made contact with Mr Martyn Carne of the Commission on 4 March, 1994. A statement provided to the Commission on 16 May 1996, and provided to the Committee together with other materials on 30 May 1996, is said by Mitry to contain, in effect, a summary of the information already supplied to them in 1994.
2. That statement refers to a number of annexures:
(i) various cheques drawn on Selmit;
(ii) an application for shares and options by Selmit to RAR;

(iii) correspondence between the various companies, and,

(iv) two investment agreements variously between RAR and two other companies, Valdese Pty Ltd and Tamsulu Pty Ltd, of which it appears Mitry was the controlling director.
3. Although this material is not annexed to the statement, the narrative parts of the statement sufficiently expose Mitry’s criminality. In essence, by countersigning bank cheque account credit vouchers drawn in favour of Valdese and Tamsulu purchased with funds supplied by RAR, depositing these cheques to the Selmit account and then executing investment agreements on behalf of Valdese and Tamsulu disguising the loans as investments, he knowingly participated in RAR purchasing its own shares.
4. Selmit did not receive any share script or take up any options to acquire shares. The monies advanced to Selmit were returned to RAR via cheques drawn on the accounts of Valdese and Tamsulu after RAR issued a letter of demand. [Somewhat curiously Mitry maintains that he did not sign either of these cheques even though he was the only signatory to the accounts. He identified the signature as Donlon. How this could be so is unexplained].
5. Mitry maintains not only that the purchase was forced upon him by Donlon, and that Donlon both actively misled him as to the source of the funds and the legality of the transaction (neither explanation sitting easily with the community’s expectation of a trained lawyer), but that he had no current memory of signing the documents that served to incriminate him. If Mitry was left to rely on a failure of memory as the only argument in mitigation of the obvious criminality involved, a much more severe criminal penalty would almost certainly have been imposed.
6. Mitry relied heavily on psychiatric evidence to explain his conduct to both criminal courts. He relies upon the same material in answering the complaint. The psychiatric report from Dr Jonathan Phillips is comprehensive. It is also supported by a body of testimonial evidence from those with whom Mitry had contact, both socially and professionally, before, during and after the relevant time frame within which the conduct occurred.
7. Dr Phillips diagnosed Mitry as suffering from major depression at the time of the incidents which in his view … ‘caused him to make inappropriate decisions being in turn the result of difficulties balancing and marshalling information and working towards a rational decision’. He went on to say that … ‘it is highly likely that Mr Mitry made decisions regarding the purchasing of the shares … which he would not have made during other periods of his life. At the time he probably lacked the higher cognitive skills to alert him that the deal was shady or illegal’.
Consideration.
The offences to which Mitry pleaded guilty carried at the relevant time penalties of $10,000 or imprisonment for two years, or both. The actions involved include the creation and execution of agreements designed to disguise the nature of the transactions. Aspects of the explanation offered by Mitry are unconvincing, and whilst it is not appropriate to form any concluded view without appropriate investigation, there is at least the potential for a Tribunal to come to the view that Mitry’s assertions as to the level and circumstances of his involvement are untrue.
Whilst there is a significant body of evidence of a psychiatric nature, that evidence was not advanced to show a lack of mens rea, rather was it put forward on penalty. By his pleas of guilty Mitry acknowledged his culpability in the matters.
Conclusion.
In these circumstances it cannot be said that there is no reasonable likelihood that the barrister would be found guilty by the Legal Services Tribunal of professional misconduct, and it is recommended that the matter be referred to the Legal Services Tribunal for its determination.”

37    On 24 October 1991, the Bar Council:

“Resolved that the complaint be referred to the Legal Services Tribunal upon the basis that, after investigation, the Council is satisfied that there is a reasonable likelihood that the barrister will be found guilty by the Legal Services Tribunal of professional misconduct.”

38    By letter of 15 November 1996, the Bar Council wrote again to the Legal Services Commissioner including a further copy of the Council’s letter to him of 29 April 1996, and a document described as the “Bar Council’s reasons for its decision”. This document is the memorandum dated 27 September 1996 which I have set out above.

39    The letter to the Legal Services Commissioner noted that the Bar Council had resolved that the complaint be referred to the Legal Services Tribunal and said:

“You will note from the report that the conduct particularised in the charges laid against Mr Mitry by the ASC occurred between 7 August 1990 and 30 November 1990 (ie more than three years ago).
The Bar Council requests you to accept the complaint made to you in our letter of 29 April 1996 pursuant to s138(2) of the Legal Profession Act . The basis of that request is:
1. You should be satisfied that it is just and fair to accept the complaint because the delay in initiating the complaint occurred because the Council was not aware until publication of the article in the Sydney Morning Herald on 16 April 1996, that Mr Mitry had pleaded guilty to charges by the Australian Securities Commission; and
2. Further, the Council submits that the complaint may concern conduct which constitutes professional misconduct.”

40 By letter of 5 February 1997 to the Council, the Legal Services Commissioner indicated that he was prepared to accept the complaint and exercise his discretion under s138(2) of the Legal Profession Act.

41 Apparently on the basis that the Commissioner’s acceptance of the complaint pursuant to s138(2) had occurred after the Bar Council resolution on 24 October 1996, the Bar Council resolved again on 6 March 1997 to refer the “complaint” to the Legal Services Tribunal.

42    On 27 June 1997, the Bar Council presented an information to the Legal Services Tribunal by which it informed the Tribunal of a complaint. The document stated:

“The grounds on which the complaint is made are as follows:
Between 7 August 1990 and 30 November 1990 the barrister did engage in professional misconduct.
Further and better particulars of the facts, matters and circumstances on which the Council relies are annexed hereto and marked ‘A’.”

43    Annexure “A” was in the following terms:

“The facts, matters and circumstances on which the Council relies are as follows:
1. Between 7 August 1990 and 30 November 1990 at Sydney in the State of New South Wales, the Barrister was knowingly concerned in Christopher James Donlon, an officer of Red Anchor Resources Limited, being in default, in that Christopher James Donlon was knowingly concerned in the contravention of s.129(1)(a)(i)(A) of the Companies (NSW) Code (‘the Code’) by Red Anchor Resources Limited in that Red Anchor Resources Limited did in a manner not expressly provided by the Code, give financial assistance in connection with the acquisition by Selmit Pacific Property Holdings Pty Limited of shares in Red Anchor Resources Limited contrary to s.129(5) of the Companies (NSW) Code and s.38(1) of the Companies & Securities (Interpretation and Miscellaneous Provisions) (NSW) Code (‘the Offence’).
2. On or about 4 September 1995, the Barrister was charged with the Offence.
3. On or about 20 June 1996, the Barrister pleaded guilty before a Magistrate, Mr Molan, and was sentenced to 400 hours of community service.
4. On or about 20 June 1996, the Barrister lodged an appeal against sentence to the District Court of New South Wales.
5. On 14 August 1996, His Honour Judge Peter Phelan quashed the order for community service and substituted therefore an order that the Barrister pay a fine of $2,500.00.
6. On 24 April 1996, the Council resolved to initiate a complaint pursuant to s.135 of the Legal Profession Act 1987 (as amended).
7. On 15 November 1996, the Council requested the Legal Services Commissioner to accept the complaint pursuant to s.138(2) of the Legal Profession Act 1987 (as amended).
8. On 5 February 1997, the Legal Services Commissioner accepted the complaint.
9. On 6 March 1997, the Council resolved that the complaint be referred to the Legal Services Tribunal on the basis that the Council is satisfied, after investigation, that there is a reasonable likelihood that the Barrister will be found guilty of professional misconduct.”

44    On 23 February 1998, the Tribunal met. It was constituted by Mr M Finnane QC as Chairman, together with Ms C Needham and Mr P O’Grady. Mr McAlary QC, who appeared on behalf of the Appellant, indicated that his client wished to contest the issue of whether there had in fact been professional misconduct. He noted that that proposition had not been explicitly stated in the Reply filed in the Tribunal and, if necessary, sought leave to amend the reply to put the question of professional misconduct in issue.

45    Counsel then appearing for the Bar Council, Mr S Rushton, said that he had assumed that that matter was in fact an issue and indeed that “it was the only issue”. The Appellant was given leave to amend the Reply.

46    The matter proceeded on 23 and 24 February 1998. The Tribunal reconvened on 23 July 1998, to hear submissions on legal issues, including an application by the Bar Council to file an amended information.

47    On 24 February 1998, Mr McAlary QC had indicated to the Tribunal that he had formed the opinion that the plea of guilty entered by the Appellant should not have been entered. Mr Mitry was recalled to give further evidence in chief as to the circumstances in which the plea of guilty was entered. Also on that day, Mr McAlary QC filed an amended Reply denying professional misconduct and also denying, it appears for the first time, par [1] of Annexure “A” of the information. This denied the proposition, expressed in terms of the original charge, that the Appellant was knowingly concerned in a contravention of the Companies (NSW) Code 1981. Mr Rushton stated that it was likely that the Council would seek to amend the information and that that would require further consideration by the Bar Council itself. Mr Rushton indicated to the Tribunal that the original Reply had been understood as an admission that an offence had been committed.

48    On 23 July 1998, the Bar Council sought leave from the Tribunal to rely on an amended information. The body of the information was in the same terms. Annexure “A” of the original information as set out above consisted of nine paragraphs. Annexure “A” of the new information consisted of sixty-one paragraphs. Annexure “A” of the new information is reproduced as an annexure to this judgment and marked Appendix 1. Over the objection of the Appellant, leave was granted.

49    In view of the amended information an adjournment was granted. By reason of the change in the legislative regime, which brought into existence the Legal Services Division of the Administrative Decisions Tribunal, when the proceedings were re-listed on 3 May 1999, Ms C Needham, who had in the interim become a Deputy President of the new Tribunal, became the Chair of the Division conducting this inquiry. The Tribunal continued to consist of the same three individuals as members.

Application for Disqualification

50    On the opening day of the hearing, Ms Needham indicated that she had noticed a reference to Mr Gordon Walker in the materials before the Tribunal. She indicated that the registrar of the Tribunal had informed the parties on an earlier occasion that Ms Needham had had a previous association with Mr Walker and that no objection was taken to her sitting on the Tribunal. Ms Needham had been a member of the Faculty of Law at the University of Sydney for a number of years and for some of that time Mr Walker was a colleague and a personal friend. The parties stated that they had no objection to Ms Needham sitting.

51    On the second day of the hearing, Mr McAlary indicated that he had received additional instructions with respect to the position of Ms Needham. He said that Mr Walker and Mr McLellan were both directors of Red Anchor. Mr McAlary indicated that his instructions were that there was a division in the company between Mr Donlon on the one hand and Messrs McLellan and Walker on the other. He also said that a Mr College was at one time proposed as underwriter for the float but that he had been rejected by Mr Donlon. Mr McAlary said that Ms Needham was “closely related and associated with College”. The basis of the objection was restated in terms of the proposition that Walker, McLelland and College formed a “clique” which wished to displace Donlon from the Board.

52    Mr McAlary submitted that, on his instructions at the time of the alleged offences in 1990, Ms Needham had a “close association with Mr College and at that time would have been aware of those matters and in particular the fallout of this matter”. He submitted that she came to the hearing with a preconception arising from her association with people involved in the matter before the Tribunal.

53    On 24 February 1999, Ms Needham published reasons for her decision not to disqualify herself. She said:

“It is said that at that time [i.e. October 1990] I had a close association with a person called Neil College and that through Mr College I have actual knowledge of matters concerning the company involved in the hearing of this complaint, Red Anchor Resources. A particular matter on which the objection was based is my supposed knowledge of what was described as a ‘split in that company’, in which Mr College, Mr Walker and Mr McLellan were apparently involved. Their involvement is said to be that they were forming a group to displace Mr Donlon from the board of that company in about October 1990.
I would say at the outset that at no time have I had what I would describe as a close association with Mr College, that I do not recall being in any regular contact with Mr College in 1990 and that I certainly have no actual knowledge, apart from that connected with the hearing of this complaint, of the company Red Anchor Resources or of the involvement of Mr College with any split in the company.”

54    Ms Needham went on to note that, on her understanding, neither Mr College nor Mr Walker were proposed to be called as witnesses in the hearing of the complaint and that their involvement relating to Red Anchor Resources “does not bear in any way on any of the matters into which the Tribunal is inquiring, namely the alleged financial assistance by Red Anchor Resources in the purchase of its shares by Selmit Pacific Property Holdings Pty Limited and Mr Mitry’s participation, if any, in that transaction as a director of Selmit.” On this basis, Ms Needham concluded:

“I do not see how any knowledge of the activities of Mr College in some apparent dispute between board members, even if such knowledge had been obtained, can bear on those matters which are the subject of the complaint, nor do I see that any such knowledge or apprehension of knowledge could suggest to a reasonable member of the public that I would be biased in my hearing of the matters which are the subject of this complaint. This is because it seems to me that the so called split in the company simply has no connection with or any bearing upon the matters the subject to the complaint. As I have already said it does not feature in any way in the evidence.”

55    When the proceedings reconvened on 3 May 1999, Mr Mitry, then representing himself, made a further application that Ms Needham disqualify herself. He relied on an affidavit in which he said he had telephoned Mr Gordon Walker who made various statements to him, including that Ms Needham had a close connection with Mr College and that “they were dating for a while”, furthermore, that College “had a lot hanging on the success of Red Anchor and has always blamed Donlon for its failure”. Mr Walker also indicated that he thought that Ms Needham disliked him.

56    Mr Mitry said that he had also contacted Mr Donlon who informed him that College was “a prime mover” in promoting the float of Red Anchor Resources. Donlon also indicated that he himself had attended lectures given by Ms Needham at the University of Sydney Law School in the early 1980’s. Donlon also said that Ms Needham, Mr College and Mr Walker had known each other socially.

57    Ms Needham indicated that she would refuse to disqualify herself and provide reasons later. It does not appear that any further reasons were given. Ms Needham said at the time that the affidavit relied on by the Appellant did not contain any fresh material, except with regard to the fact that Donlon had once been a student of hers of which he said that she had no recollection.

58    It is notable that the allegation of a ‘clique’ and a split in the Board, which Mr McAlary had put on instructions, received no support from either Walker or Donlon. There was no evidence of any kind to support these assertions.

The Tribunal Decision

59    On 30 August 1999, the Tribunal published reasons for decision. It found the Appellant guilty of professional misconduct and ordered that his name be removed from the Roll of Legal Practitioners.

60    The Tribunal set out the facts, many of which I have summarised above. It also referred to the medical evidence to the effect that the Appellant was suffering from depression at the time of the transactions. In the course of making primary findings of fact, the Tribunal stated a number of adverse conclusions about the Appellant and his conduct.

61    In its reasons for decision, the Tribunal said inter alia:

“11. Much of the oral evidence concerned … Mr Mitry’s attempts to persuade us that he innocently became involved in these matters because he wanted to help a friend, Mr Donlon and because he was suffering from the effects of a depressive illness at the time and did not really appreciate what he was doing. We were unconvinced by his evidence and do not accept his explanations concerning his conduct which covered, not one, but a series of transactions.”

62    The Tribunal referred to the two investment agreements with Tamsulu and Valdese and added:

“13. In our opinion, these agreements were nothing but a sham, designed to hide the fact that Red Anchor Resources was providing funds through Tamsulu and Valdese and Selmit for the purpose of buying shares in Red Anchor Resources. No funds at any stage went into the bank accounts of Valdese or Tamsulu.”

63    The reasons continued:

“14. The cheques drawn in favour of Valdese and Tamsulu were endorsed by Mr. Mitry in favour of Selmit and paid into the Selmit bank account. This enabled Selmit to apply for shares in Red Anchor Resources. In our opinion, Mr. Mitry was fully aware of the reasons for this method of enabling Selmit to make the share purchases and he knew that the investment agreements were a sham, since he knew at all times that Valdese and Tamsulu had no capacity to engage in any investment activity, no interest in borrowing money and he in fact suggested that he should endorse the bank cheques because if money were paid into either account the bank would use it to reduce the company’s indebtedness to the bank.
15. On 4th November 1990, a sham demand was made by Red Anchor Resources Ltd by means of letters addressed to Tamsulu and Valdese demanding repayment of the funds advanced by Red Anchor Resources Ltd plus interest and on 6th November 1990, cheques on each company were drawn and presented to the bank. There was some dispute by Mr. Mitry about these cheques. He claimed that the signatures on them were not his but he also conceded that he may have provided to Mr. Donlon blank cheque forms which were not signed. He could not give any satisfactory explanation as to why he would make blank cheque forms available to Mr. Donlon.
In our opinion, these cheques were presented so that Donlon could pretend to the auditor that steps were being taken by Red Anchor Resources Ltd to get the money back. In fact, neither company had any capacity to draw any large cheque and in reality, neither company owed anything to Red Anchor Resources Ltd.”

64    The Tribunal also made adverse findings with respect to the auditor’s letter:

“16. On 7th November 1990, the auditor of Red Anchor Resources Limited wrote to the accountants of the company seeking confirmation that the investments by the Company in Valdese and Tamsulu of $165,000 were bona fide investments ‘and cannot be characterised as loans to Directors in breach of Section 230, 129 or any other section of the Companies (New South Wales) Code’ and that the investments have been repaid in full with interest.
On the same day, the auditors wrote to Mr Mitry and asked him to confirm the bona fides of the transactions. The letter was in the same terms as the letter to the accountants to which we have just referred.
17. By letter of 8th November 1990, written in his own hand and on letterhead proclaiming him to be a barrister at law, Mr Mitry replied to the auditor, confirming that the investments were genuine and were not in breach of the Companies (New South Wales) Code.
What he wrote in this letter was clearly false and was intended, in our opinion, to deceive the auditor. This letter was just another step in the sham transactions which are detailed above. We cannot accept, despite Mr. Mitry’s claims to innocence, that he did not fully appreciate that he was involved in a series of sham transactions which were illegal and designed to deceive the Stock Exchange into giving permission to list a company which in fact did not comply with the listing requirements.”

65    The Tribunal also indicated that it agreed with the remarks on sentence of his Honour Judge P J Phelan with respect to the offence and which the Tribunal set out as follows:

“The gravamen of course of the offence is the deception that can be worked upon the public who consider or who might be led to consider that a company is a far more viable institution than it really is, that its assets are far more substantial than it really is, and therefore the capacity to hoodwink those not in the know is manifest and the deception can sometimes have quite catastrophic affects upon the pockets of investors.”

66    The Tribunal noted the fact that the Appellant sought to argue that he was not guilty of the offence to which he had pleaded. The Tribunal referred to the statement of facts contained as Appendix “A” to the original information filed in these proceedings and concluded:

“25. … The facts alleged by the Bar Council at the outset of the case, were not shown to be in any way incorrect, nor was any doubt ever cast on the validity of the conviction and the correctness of Mr Mitry’s plea of guilty.”

67    In this regard the Tribunal set out the note signed by Mr Mitry at the time of his plea as quoted above. The Tribunal concluded:

“26. When all of the facts and circumstances are given consideration, it is obvious that there was no basis at all for Mr Mitry to claim that he was not guilty of the offence. It is also clear, in our opinion, that what was done by him was done deliberately and with an intention to help Mr Donlon perpetrate a dishonest scheme which involved deceiving an auditor, the Australian Stock Exchange and the investing public.”

68    The Tribunal referred to the medical evidence, and the submissions based thereon, with respect to the Appellant’s case that he was suffering depression at the time of the alleged offence. The Tribunal concluded:

“27. … We do not accept that he was at any relevant time affected by any psychiatric condition which would conceivably have affected his capacity to give consent to the transactions with which he became involved.”

69    The Tribunal further concluded:

“28. Mr Mitry could not advance to our satisfaction any explanation for his conduct which could satisfy us that he had no intention to commit a crime. He also failed to satisfy us that he did not have a full understanding of what he was doing during the course of these transactions. Indeed, to the contrary, he ultimately conceded that the transactions were sham transactions and that a person who engaged in them was not of good fame and character and was not fit to be on the Roll of Barristers.”

70    The Tribunal made a finding of professional misconduct. It considered evidence in mitigation on the issue of penalty and concluded that:

“34. The barrister in these proceedings is guilty of professional misconduct. The misconduct of which we have found him guilty shows that he is not a person of good fame and character. He is not fit to be on the roll of barristers.”

The Decision of the Appeal Panel

71    The four grounds of appeal to the Appeal Panel were, as noted above, identical to the grounds of appeal to this Court. Each of the issues before the Appeal Panel were issues of law. The Panel rejected the submissions made with respect to each of the four grounds.

72    It is not necessary to set out the reasons of the Appeal Panel at any length. In substance, the same submissions as were made to the Panel were also made to this Court. If the submissions with respect to any ground of appeal were to be upheld in this Court, then this would necessarily involve a finding that the Tribunal made an error on a question of law.

The Misconduct Issue

73    Mr W Hodgekiss, who appeared for the Appellant in this Court, acknowledged that in order to succeed on this ground of appeal, he had to establish that the conduct of the Appellant could not be regarded as professional misconduct. On an appeal limited to questions of law, the Appellant is restricted by the findings of fact made by the Tribunal. No legal error has been suggested with respect to the factual findings made. It was the characterisation of the conduct found to have occurred as “professional misconduct” which was challenged under this ground of appeal.

74    The Appellant challenged the finding of the Tribunal that the Appellant was in fact guilty of the offence to which he had pleaded. In this regard, counsel for the Appellant referred to the decision in Yorke v Lucas (1985) 158 CLR 661 in support of the contention that the submission made to the Tribunal by Mr McAlary QC that the Appellant should not have pleaded guilty was correct.

75    Yorke v Lucas is authority for the proposition that accessorial liability, such as that with which the Appellant was charged in terms of being “knowingly concerned in” the contravention of another, requires that the Crown establish that the accused intentionally participated in the commission of the offence, in the sense that the accused has knowledge of the essential matters which go to make up the offence, whether or not he or she knows that those matters amount to a crime (at 667).

76    This authority is of no avail to the Appellant in the present case. The primary findings of fact made by the Tribunal are sufficient to establish that the Appellant had the requisite knowledge. I refer to and repeat the particular findings set out above (using the Tribunal’s paragraph numbering):

“The investment agreements executed by the Appellant were ‘nothing but a sham, designed to hide the fact that Red Anchor Resources was providing funds through Tamsulu and Valdese and Selmit for the purpose of buying shares in Red Anchor Resources’. (par [13])

· ‘… He knew that the investment agreements were a sham’. (par [14])

With respect to the endorsement of the cheques in favour of Selmit ‘Mr Mitry was fully aware of the reasons for this method of enabling Selmit to make the share purchases … and he in fact suggested that he should endorse the bank cheques …’. (par [14])
With respect to the letter of 8 November 1990 to the auditor: ‘What he wrote in this letter was clearly false and was intended in our opinion to deceive the auditor’. (par [17])
With respect to all of the steps, including the letter to the auditor, the Tribunal characterised these as ‘sham transactions’ and said: ‘We cannot accept … that he did not fully appreciate that he was involved in a series of sham transactions which were illegal and designed to deceive the Stock Exchange into giving permission to list a company which in fact did not comply with the listing requirements’. (par [17])
‘… What was done by him was done deliberately and with an intention to help Mr Donlon perpetrate a dishonest scheme which involved deceiving an auditor, the Australian Stock Exchange and the investing public’.” (par [26])

77    On the basis of these primary findings of fact, it was open to the Tribunal to conclude:

“… Nor was any doubt ever cast on the validity of the conviction and the correctness of Mr Mitry’s plea of guilty.” (par [25])

78    The fact of conviction of a criminal offence is not of itself determinative of the issue of whether or not the conduct constituting that offence is professional misconduct (see Ziems v The Prothonotary of the Supreme Court of New South Wales (1957) 97 CLR 279; see also New South Wales Bar Association v Hamman [1999] NSWCA 404, especially at [67]-[75]. The Tribunal and the Court may look behind the conviction, to the conduct which constituted the offence and to assess that conduct in terms of the fitness of a member of a privileged profession to remain a member of that profession. The focus of attention is, relevantly, on the reputation and character of the legal practitioner whose conduct is in question. Issues of probity are of primary significance.

79    As Kitto J said in Ziems supra at 299, with respect to the barrister’s conviction for a charge of manslaughter arising out of the death of a person in a road collision caused by the barrister’s driving whilst under the influence:

“The conviction is of an offence the seriousness of which no-one could doubt. But the reason for regarding it as serious is not, I think, a reason which goes to the propriety of the barrister’s continuing as a member of his profession. The conviction relates to an isolated occasion, and, considered by itself as it must be on this appeal, it does not warrant any conclusion as to the man’s general behaviour or inherent qualities. … It is not a conviction of a pre-mediated crime. It does not indicate a tendency to vice or violence, or any lack of probity. It has neither connection with nor significance for any professional function. Such a conviction is not inconsistent with the previous possession of a deserved high reputation …”

80    Furthermore, Dixon J said in In Re Davis (1947) 75 CLR 409 at 420:

“It would almost seem to go without saying the conviction of a crime of dishonesty of so grave a kind as house breaking and stealing is incompatible with the existence in a candidate for admission to the Bar of the reputation and the more enduring moral qualities denoted by the expression, ‘good fame and character’, which describe the test of his ethical fitness for the profession.”

81    The legislative policy reflected in s129 of the Companies Code may not involve conduct that is as obviously antisocial as house breaking and stealing. The purposes of this regulatory provision has been variously stated. One purpose is the protection of shareholders and creditors from improper practices by corporate controllers, specifically the appropriation of company’s resources for purposes other than proper corporate purposes. It is a form of conduct which the parliaments of Australia, in co-operative arrangements of long standing, have created as a criminal offence with a maximum penalty of imprisonment for two years.

82    Of particular significance in the present case are the factual findings, made by the Tribunal of deception and dishonesty with respect to the Appellant’s participation in this contravention.

83    The ultimate purpose was to ensure a listing for Red Anchor on the Australian Stock Exchange, by falsely purporting to satisfy the exchange’s rules as to the spread of share holdings. These rules are designed to protect the interests of all shareholders so that shareholdings are reasonably liquid, in the sense that there is a prospect of a reasonable level of trading in shares in the corporation, so that individual shareholders are not effectively locked in. These are significant public purposes that the scheme, in which the Appellant was knowingly concerned was designed to frustrate. Furthermore, the nature of the Appellant’s participation in the scheme, in accordance with the primary findings of fact made by the Tribunal, was knowingly and intentionally deceptive by means of participation in sham transactions and knowingly deceiving the auditors.

84 In my opinion, it was open to the Tribunal to hold that these aspects of the conduct of the Appellant were relevant to his “fame and character” and his “fitness and propriety” within s127(1)(b) of the Legal Profession Act. The finding that there was professional misconduct was open to the Tribunal. This ground of appeal should be dismissed.

The Penalty Issue

85    My analysis of the first ground of appeal is really determinative of this issue also. The degree of personal impropriety involved in the deliberate acts of deception contained in the primary findings of fact, which are set out with respect to the first ground of appeal, establishes the proposition that the Tribunal was entitled to impose a penalty of striking off.

86    The facts and matters relied upon by counsel for the Appellant in this regard included the limited knowledge of the Appellant with respect to the Corporations Law, his reliance on other lawyers associated with Red Anchor, particularly Donlon, the fact that no money was in fact lost, that the transaction was never implemented i.e. no shares were allotted and that the company was not listed. These were all matters of weight capable of being placed in the balance with other considerations in the exercise of the discretion vested in the Tribunal as to what the appropriate penalty should be.

87    The submissions to this Court did not suggest that the Tribunal had committed any error in the exercise of its discretion. The penalty is not so harsh as to indicate that, in some unknown way, not apparent from the reasons for decision of the Tribunal, its discretion miscarried. The findings of lack of probity on the part of the Appellant were clear and unequivocal. They concerned conduct going directly to his reputation and character and to his fitness to be a legal practitioner.

88    It was open to the Tribunal, in the exercise of its discretion, to conclude that an order that the Appellant be struck off, was the appropriate order in the circumstances of the case.

The Disqualification Issue

89    The High Court has recently restated the relevant test for disqualification in the joint judgment of Gleeson CJ, McHugh, Gummow and Hayne JJ in Ebner v Official Trustee in Bankruptcy [2000] HCA 63; 75 ALJR 277:

“[6] Where, in the absence of any suggestion of actual bias, a question arises as to the independence or impartiality of a judge (or other judicial officer or juror), as here, the governing principle is that, subject to qualifications relating to waiver (which is not presently relevant) or necessity (which may be relevant to the second appeal), a judge is disqualified if a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide. That principle gives effect to the requirement that justice should both be done and be seen to be done, a requirement which reflects the fundamental importance of the principle that the tribunal be independent and impartial. It is convenient to refer to it as the apprehension of bias principle.
…
[8] The apprehension of bias principle admits the possibility of human frailty. Its application is as diverse as human frailty. Its application requires two steps. First, it requires the identification of what it is said might lead a judge (or juror) to decide a case other than on its legal and factual merits. The second step is no less important. There must be an articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits. The bare assertion that a judge (or juror) has an “interest” in litigation, or an interest in a party to it, will be of no assistance until the nature of the interest, and the asserted connection with the possibility of departure from impartial decision-making, is articulated. Only then can the reasonableness of the asserted apprehension of bias be assessed.” [citations omitted]

90    I have set out above the way in which the application for disqualification was made before the Tribunal. In this Court the Appellant repeated the submissions made to the Appeal Panel. The basic submission was as follows:

“Of necessity, Ms Needham had to form a view on Mr Mitry. It would have been virtually impossible with her previous involvement with the protagonists not to be perceived to have and/or formed a view as to Mr Mitry’s action.”

91    Nothing in the materials before the Court justifies the characterisation of the other persons, with whom Ms Needham is said to have had a social acquaintance, as “protagonists”. Nor is there any basis for the suggestion that Ms Needham might have formed a view about any aspect of Mr Mitry’s conduct, let alone his conduct in question before the Tribunal. There was no evidence of any character to suggest that she knew anything about the relevant transaction. She denied it.

92    Of particular significance was the position of Donlon who was, in a sense, the principal offender. The only material before this Court about him was that Donlon had, in the early 1980’s, attended tutorials and lectures given by Ms Needham at the Law School of the University of Sydney. During this period he was “introduced socially” to Ms Needham. Ms Needham indicated, at the time that she refused to disqualify herself, that she had no recollection of Mr Donlon. There is no connection of a character which could lead a fair minded observer to apprehend that Ms Needham might not bring an impartial mind to the resolution of the issues involved in the proceedings before the Tribunal.

93    The evidence as to the social connection between Ms Needham and Mr College and Mr Walker was somewhat more extensive. Most of the assertions made from the Bar table by Mr McAlary QC, on instructions, were not, in the event, supported when Mr Mitry put on evidence in support of his further application for disqualification. In particular, the suggestion that there was some kind of split in the company between Donlon, as supported by Mitry, on the one hand and College and Walker on the other hand, received no support in that evidence. Neither Mr Walker nor Mr Donlon, both of whom provided information to Mr Mitry for this purpose, suggested any such a division. The most that Mr Walker said was that College blamed Donlon for the failure of Red Anchor to successfully float.

94    The evidence, such as it is, may support the proposition that College had a financial interest in the success of the float and that Walker was, as Ms Needham stated at the commencement of the proceedings, known to her socially. Ms Needham also acknowledged some social contact with College.

95    However, neither College nor Walker was at any stage proposed to be a witness in the hearing. Nor is there any basis for a suggestion that they could have been witnesses. Nor is there any suggestion that their own conduct was in any way in question.

96    The closest connection of any character is the fact that Walker, as a director of Red Anchor, was a co-signatory with Donlon to the affixing of the corporate seal of Red Anchor to the investment agreements with the Appellant’s companies, Valdese and Tamsulu. He was not, however, present at the meeting of the Board of Directors of Red Anchor which authorised these agreements. His signature was, it appears, a ministerial act. There was no suggestion that Mr Walker was in any way a participant in the scheme to contravene s129 of the Companies Code. He was never charged with any offence. There was no suggestion that he had ever done anything wrong.

97    In my opinion, Ms Needham was not obliged to recuse.

The Amendment Issue

98 The conduct which constituted the offence of which the Appellant was convicted occurred in late 1990. The complaint was initiated by the Bar Council in April of 1996. This was beyond the three year period for which s138(1) of the Act provides and, accordingly, the Council requested that the Commissioner accept the complaint under, and in accordance with, s138(2).

99    The Bar Council filed an information on 27 June 1997 which included an Annexure “A” in the form of nine paragraphs set out above. No complaint is made with respect to the contents of this information.

100    Pursuant to leave of the Tribunal, the Bar Council filed an amended information on 9 April 1998, which appended as Annexure “A” the sixty-one paragraph statement of facts and circumstances which I have appended to this judgment as Appendix 1.

101 The Appellant contended that the amendment of the information was not authorised by s167A of the Act, by reason of the requirements of s138. The Appellant relied on the decision of the High Court in Barwick v Law Society of New South Wales [2000] HCA 2; 74 ALJR 419. The Appeal Panel rejected an argument to this effect. The Appeal Panel noted the submission on behalf of the Appellant that the decision of the Tribunal to grant the amendment had been based in significant measure on the reasons of the Court of Appeal decision in Barwick v The Law Society of New South Wales, a decision which had thereafter been overturned in the High Court.

102    The Appeal Panel expressed its reasons in the following passage:

“95 … but it is significant that in this case the original information referring to conduct that was out of time had been laid after the procedure required by s138(2) had been undertaken, with the Legal Services Commissioner accepting the complaints.
96 Accordingly the Tribunal was properly seized of the discretion given by s167A. …
97 It is the case that the revised particulars were much more extensive than the particulars given in the original information. But they remained within the compass of the original information. They simply set out the events and circumstances which had formed the basis of Mr Mitry’s plea of guilty before the magistrate. The more extensive information was drafted when it became clear that Mr Mitry no longer unequivocally admitted the facts that had formed the basis of his plea of guilty before the magistrate in 1996, in particular in relation to the question of intent. The particulars also contained some allegations in the alternative to take account of Mr Mitry’s contention that his plea of guilty should now be disregarded because of circumstances that affected him at the time of the events giving rise to the charge. The Tribunal dealt fairly with the application under s167A. There is no basis for disturbing its exercise of discretion.”

103    In this case, as in Barwick, the Appellant does not rely on any denial of natural justice arising by reason of the amendment. The submission is that by reason of the failure to comply with the provisions of Pt 10, the Tribunal had no jurisdiction to deal with complaints about the conduct set out in the amended Annexure “A”.

104    In Barwick, two alternative bases for invalidity were considered which are relevant to the present circumstances. First, whether the investigation for which s155 provides had been conducted. Secondly, whether acceptance of an out of time complaint needed to satisfy the requirements of s138(2), was required and the role of the amendment power in s167A.

105    In the course of considering the s155 issue Gleeson CJ, Gaudron and McHugh JJ said, in a joint judgment:

“[46] Section 167 states that proceedings may be instituted in the Tribunal “with respect to a complaint against a legal practitioner” by an information laid “in accordance with this Part”. … The expression “in accordance with this Part” must, in the context, be a reference to s155(2).
…
[50] The jurisdiction of the Tribunal, conferred by s167 relates to [p]roceedings … instituted … with respect to a complaint against a legal practitioner … by an information laid … in accordance with [Pt 10]. … it is difficult to accept that it is consistent with the purpose of the legislation that a time-barred complaint could become the subject of a Tribunal hearing. Section 138(2) refers to the power of the Commissioner to accept (or, by implication, to decline to accept) such a complaint. The corollary appears to be that, if not accepted, such a complaint can go nowhere.
[51] The jurisdiction of the Tribunal to deal with proceedings is correlative with the duty of the Council or the Commissioner to institute proceedings, in certain circumstances, following a complaint, and what s 155 refers to as the completion of an investigation. That relationship arises from the concluding words of s 167(1).
[52] An important aspect of Div 5 of Pt 10 is the duty imposed upon the Commissioner, under s 149, to monitor investigations by a Council. One evident purpose of this provision is to enable the Commissioner to supervise the way in which a Council deals with a complaint, and to ensure, for example, that the conduct of a practitioner is treated with appropriate seriousness.
[53] Not every departure from the procedures laid down by Pt 10, and, in particular, Div 5, will result in a lack of jurisdiction under s167. However, one of the purposes of the legislation is to bring about the result that, before a matter comes to the tribunal, it will have been the subject of a complaint which was the subject of an investigation monitored by the Commissioner and considered and dealt with by a Council or the Commissioner under s 155.”

106    Their Honours referred to the particular facts of the case before them and said:

“[61] The proper focus of attention should not be whether enquiries were made by the Council before the initiation of the complaint, or after the laying of the information. The focus of attention should be whether, in the events that happened, there was an investigative stage which permitted the requirements of Div 5 to be satisfied, and the legislative purpose of the Division to be fulfilled. In some cases, that stage might be brief, and might not necessarily involve the gathering of information not already in the possession of the Council. It must, however, be such as to permit monitoring of the investigation by the Commissioner, and, at the conclusion of the stage, (referred to in s 155 as the completion of the investigation), the Council must address the issues raised for consideration by s 155, and record its decision and its reasons for the decision. The capacity of the Commissioner to monitor an investigation is not an empty formality. In a given case, the Commissioner might consider that a complaint is not being treated seriously enough, or has been misunderstood, or has been inadequately investigated. Questions might in turn arise as to the accountability of the Commissioner.
[62] In the present case the Law Society Council does not appear to have directed its attention of the need for initiation of a complaint, and for compliance with Div 5, until late in the course of its enquiries and then, in the relevant resolutions, the procedures of initiating a complaint and making decisions under s 155 were telescoped. In the result, in the case of both complaints there was nothing that can be described as the investigative stage required by Div 5.
[63] It would be inconsistent with the legislative purpose to conclude that the Tribunal has jurisdiction to deal with a matter brought before it in circumstances where the procedures established by Div 5 have been substantially bypassed.”

107    The Court held that the jurisdiction of the Tribunal was not properly invoked under s167 and that the Appellant was entitled to an order for prohibition.

108    The Court turned to the argument based on s138. In Barwick no application had been made to the Commissioner to exercise his power under s138(2) to accept a complaint lodged out of time. The Court of Appeal had held that s138 did not apply to a complaint initiated under s135. The High Court determined otherwise.

109    In the course of deciding this issue, the joint judgment said:

“[71] The purpose of s 138 is to set a time limit on complaints, whilst allowing the Commissioner an overriding discretion, to be exercised upon specified grounds, to accept complaints that would otherwise be out of time. That discretion protects the public interest. It has not been exercised in this case. It is not apparent why that legislative purpose would not embrace complaints under s 135 as well as complaints under s 134. The practitioner’s need for protection against stale complaints is the same. There is nothing in the Act to suggest that the Council was intended to have the same power as the Commissioner to override any need for such protection. There are no statutory constraints governing the exercise by the Council of any such power, of the kind that apply to the Commissioner.”

110 The joint judgment then considered the proposition that the exercise of a power to permit amendments under s167A could be effective, even in a case in which s138 had not been complied with. Their Honours said:

“[74] In a case to which s 138 applies, and where there has been no exercise of discretion by the Commissioner under s 138(2), the clear intent of the statute is that the procedures of Pt 10 of the Act cannot be invoked after the period of three years referred to in s 138 has elapsed. A complaint which is not accepted by the Commissioner under s 138(2) has no statutory effect. The consequences of s 138 cannot be negated by an exercise by the Tribunal of its powers of variation of an information under s 167A. The matters to be considered by the Commissioner in deciding whether to exercise the discretion under s 138(2) are not repeated in s 167A, which simply applies a test of reasonableness. What is there involved is a discretion of a different character.
[75] Section 167A is not intended to subvert the protection given by s 138.”

111    Callinan J, who came to the same conclusion as their Honours who co-authored the joint judgment, said:

“[162] But as to the question whether s 167A permits the addition of allegations of conduct that is out of time, that is conduct occurring more than three years before the laying of an information and not the subject of a decision to enlarge the time, the answer must be in the negative. Such allegations would not be allegations in the information with respect to conduct the subject of a relevant complaint within time.”

112    His Honour referred to the phrase “with respect to a complaint” appearing in s167(1) and said:

“[174] “With respect to” is a phrase capable of having a very wide import. However as I have said, there must be a reasonable relationship between conduct the subject of the complaint and the variations in the allegations sought to be made. So too, allegations of conduct occurring more than three years before may not be introduced because to do so would be to defeat the intended operation of s 138.” [citation omitted]

113    His Honour had earlier said:

“[156] There can be discerned in the Act an intention that there be a relationship between the conduct the subject of complaint, any information laid in respect of it and the allegations in the information of the conduct. Another way of putting it is to say that the allegations in the information must be reasonably related to, and be of the conduct the subject of the complaint. This is because proceedings must be with respect to the complaint, which is to say that the information must be with respect to the complaint and sub-s (2) provides that the Tribunal is to conduct a hearing into each allegation particularised in the information. The need for proper process in connexion with proceedings by way of information may be inferred from sub-s (3) which obliges the practitioner to file a reply to the allegations in the information.”

114    It is convenient to deal with one argument put on behalf of the Respondent at the outset. It was submitted, in an argument which found favour with the Appeal Panel as quoted above, that Barwick was distinguishable because in this case, unlike Barwick, the power under s138(2) had been exercised. The power having been exercised, it was said, s167A enabled amendment to enlarge the complaint. This is not a relevant point of distinction.

115 The Commissioner agreed to accept a “complaint”. However, that complaint related to specific conduct about which he was informed, indeed about which it was necessary to inform him, by reason of the express requirement to particularise the “alleged conduct … that is the subject of the complaint” under s137I and in order to enable the Commissioner to satisfy himself of the matters set out in s138(2)(b). The Commissioner has not “accepted” a complaint with respect to any conduct which was not specified in the materials before him at the time of the exercise of the power. The Tribunal has no jurisdiction to consider any complaint about the conduct which has not been ‘accepted’ by the Commissioner and which fell within s138(1). Section 167A can not be used to overcome the lack of jurisdiction.

116 The best evidence of the scope of the investigation conducted by the Bar Council is the memorandum of 27 September 1996. This is also the document forwarded to the Commissioner for the purposes of s138(2). In Barwick, the High Court found for the Appellant on the alternative bases of s155 and s138. By reason of the dual role of the 27 September 1996 memorandum, the present Appellant could rely on either s155 or s138. The submissions focused on the latter.

117    I have set out above the correspondence between the Bar Council and the Commissioner. The materials before the Commissioner were the extract from the Sydney Morning Herald of 16 April 1996 and the memorandum to the Bar Council of 27 September 1996. These are set out in pars [30] and [36] above.

155 In its letter of 15 November 1996 requesting the Commissioner to exercise his power under s138(2), the Bar Council identified the conduct which had occurred more than three years ago as being “the conduct particularised in the charges laid against Mr Mitry by the ASC” [emphasis added]. Furthermore, the “complaint” which the Bar Council asked the Commissioner to “accept” was “the complaint made to you in your letter of 29 April 1996”. That letter had referred only to the article in the Sydney Morning Herald about the plea of guilty to a specific charge.

156 As I have indicated above, no criticism can be made about the recitation of the original Annexure “A” in pars [39]-[44]. These matters were investigated by the Council and constituted the complaint ‘accepted’ by the Commissioner. Paragraphs [1]-[37] were not, however, an elaboration of the facts, matters and circumstances underlying the allegations in pars [39]-[44]. They are expressed to be different conduct relied upon, in the alternative, as constituting professional misconduct. No complaint about such conduct, considered as such, was ever ‘accepted’ by the Commissioner under s138(2). In my opinion, the Tribunal did not have jurisdiction to deal with the matters set out in pars [1]-[37] as “conduct” about which a “complaint” had been made, accepted and investigated. The power to vary an information under s167A(1) could not be exercised to add the allegations set out in pars [1]-[38].

157    With respect to these matters, I am unable to conclude that they played no role in the Tribunal’s determination. The primary matter considered by the Tribunal in its reasons for decision was the guilt of the Appellant of the charge of accessorial liability to an offence under s129 of the Companies (NSW) Code. The jurisdiction to determine that issue was not in doubt. However, the Tribunal’s reasons extend beyond this issue.

158    The Tribunal emphasised that the Appellant’s conduct “covered, not one, but a series of transactions” (par [11]). These “transactions” included the application for shares with supporting cheques; the entry into the investment agreements; the endorsement of the bank cheques; the drawing of cheques by Valdese and Tamsulu in purported repayment; and the letter to the auditor. These were described collectively (pars [17], [28]) and individually (pars [13], [14] and [15]) as “sham transactions”.

159    In the report of 27 September 1996, which was before the Commissioner, a number of these transactions were referred to as acts constituting the Appellant’s involvement in the offence, specifically, the application for shares and supporting cheques, the investment agreements, and the endorsement of the bank cheques. The purported repayment cheques were not, however, there treated as conduct of the Appellant.

160    More significantly, the letter to the auditor was not mentioned at all. Reference was made to the statement of the Appellant to the ASC, which did refer to this letter. However, the conduct constituted by the letter was not before the Commissioner. He did not ‘accept’ a complaint with respect to this conduct.

161    The letter to the auditor was given significant weight by the Tribunal in its reasons for decision. I have set out pars [16] and [17] of the reasons above. To repeat, the Tribunal concluded:

“What he wrote in this letter was clearly false and was intended, in our opinion, to deceive the auditor.”

162    This finding is not related to the illegality the subject of the charge. This is made clear in the same paragraph when the Tribunal refers to this letter as a “step in the sham transactions” and concludes that the Appellant appreciated:

“ … that he was involved in a series of sham transactions which were illegal and designed to deceive the Stock Exchange …” [Emphasis added]

163    This finding expressly goes beyond the conviction for a specific offence to encompass other misconduct i.e. deception of the ASX. The broader proposition is reiterated in par [26] where the Tribunal refers to the perpetration of a “scheme which involved deceiving an auditor, the Australian Stock Exchange and the investing public”.

164    The Tribunal sets out the original Annexure “A” in par [19] to the amended Annexure “A”. Nevertheless, the separate treatment of the auditor’s letter is referable only to pars [36] and [37] of the amended Annexure “A”.

165    Furthermore, when it came to the ultimate conclusion of professional misconduct in par [29], the Tribunal emphasised participation in “sham transactions” (see also par [28]), rather than the commission of an offence. These are the “transactions” set out in pars [1]-[37] of the amended Annexure A. The Tribunal appears to have treated these transactions as separate acts constituting conduct, rather than as acts manifesting or evidencing the commission of an offence. This is not how these acts were treated in the report of 27 September 1996.

166    The Commissioner, in my opinion, ‘accepted’ a complaint of conduct said to be the conviction and/or the commission of a specific offence. The Tribunal upheld the complaint before it in relation to that conduct. However, it went further. It also upheld the complaint in relation to conduct constituted, specifically, by the letter to the auditor and, generally, by all the transactions found to be “shams”, considered as conduct in and of themselves unrelated to the commission of an offence.

167 The Commissioner had not accepted a complaint about such conduct under s138(2). The Tribunal had no jurisdiction to deal with a complaint about this conduct. The Tribunal could not give itself jurisdiction by purporting to vary the information under s167A.

168 It may well be the case that the Tribunal would have made the same order on the basis of its findings about the conduct that was properly before it. That is a matter for the Tribunal. Notwithstanding the apparent breadth of s120 of the Administrative Decisions Tribunal Act 1997, which empowers this Court to “make such orders as it thinks appropriate in light of its decision”, this Court should not speculate as to what order the Tribunal would have made. Nor in an appeal limited to questions of law, should this Court comment on the merits of matters which require the exercise of discretion by the first instance decision maker.

Orders

169    The orders I propose are:

1. Appeal allowed.

2. Vacate the orders of the Tribunal of 30 August 1999.

3. Order that the name of Richard Mitry be reinstated on the Roll of Legal Practitioners.

4. Remit the proceedings to the Administrative Decisions Tribunal to be determined in accordance with law.

5. Order the Respondent to pay the Appellant’s costs.

170    POWELL JA: I have read in draft the Judgment which has been prepared by Spigelman CJ with which Judgment I understand Giles JA to agree.

171    I agree with the Chief Justice:

1. that Deputy President Needham was not, in the circumstances, obliged to disqualify herself because of a reasonable apprehension of bias;

2. that, in the circumstances, it was not open to the Tribunal to permit the Annexure to the Information to be amended by including the particulars contained in paragraphs 45-57. However, since, as the Chief Justice has pointed out, the Tribunal did not make any finding in respect of, or base its orders upon, any of the matters set out in any of those paragraphs, the fact of the inclusion of those paragraphs in the Annexure does not appear to be a matter of any consequence;

3. that the facts found by the Tribunal, in the circumstances of this case, justified the Tribunal’s conclusion that the Appellant had been guilty of professional misconduct;

4. that it was open to the Tribunal, in the exercise of its discretion, to conclude that an order that the Appellant be struck off was the appropriate penalty in the circumstances of this case;

I regret, however, that I am unable to share the Chief Justice’s view that, in the circumstances of this case, it was not open to the Tribunal to permit the Information to be amended by including in the Annexure the matters contained in paragraphs 1-37.

172    The decision of the High Court in Barwick v. Law Society of New South Wales (2000) 74 ALJR 419; 69 ALR 236 would not seem to preclude the exercise of the power conferred on the Tribunal by s.167A of the Legal Profession Act 1987 (“the Act”) to permit the addition of “additional allegations” to vary an Information so long as the “additional allegations” so added do not constitute new complaints which would be statute barred by the provisions of s.138(1) of the Act without the exercise by the Legal Services Commissioner of the discretion vested in him under s.138(2) of the Act to accept those new complaints. This being so, the question is whether, as is the view of the Chief Justice, the addition of the matters contained in paragraphs 1-37 constituted the addition of new

complaints.

173 In the report to the Bar Council of 27 September 1996, a copy of which report, as the Chief Justice has recorded, was forwarded to the Legal Services Commissioner under cover of its letter of 15 November 1996 in which letter the Bar Council requested the Legal Services Commissioner to accept “the complaint made to you in our letter of 29 April 1996 pursuant to s.138(2) of the Legal Profession Act” the following appears:

“THE COMPLAINT
The charges to which Mitry pleaded guilty were laid under s.129(5) of the Companies (NSW) Code and s.39(1) of the Companies and Securities (Interpretation & Miscellaneous Provisions) (NSW) Code.
The conduct particularised in the charges is that between 7 August 1990 and 30 November 1990, at Sydney, Mitry was knowingly concerned with Christopher Donlon, an officer of Red Anchor Resources Limited, giving financial assistance in connection with the acquisition by Selmit Pacific Holdings Pty. Limited of shares in Red Anchor Resources Limited. Selmit Pacific Holdings Pty. Ltd, (‘Selmit’), is a company of which Mitry is a director.”

Then, after summarising the information – including the draft statement by the Appellant prepared for the Australian Securities Commission Inquiry – provided by the Appellant to the Bar Council, the report concluded:

“CONSIDERATION
The offences to which Mitry pleaded guilty carried at the relevant time penalties of $10,000.00 or imprisonment for two years, or both. The actions involved include the creation and execution of agreements designed to disguise the nature of the transactions. Aspects of the explanation offered by Mitry are unconvincing, and whilst it is not appropriate to form any concluded view without appropriate investigation, there is at least the potential for a Tribunal to come to the view that Mitry’s assertions as to the level and circumstances of his involvement are untrue.
Whilst there is a significant body of evidence of a psychiatric nature, that evidence was not advanced to show a lack of mens rea, rather was it put forward on penalty. By his pleas of guilty Mitry acknowledge his culpability in the matters.
CONCLUSION
In these circumstances it cannot be said that there is no reasonable likelihood that the barrister would be found guilty by the Legal Services Tribunal of professional misconduct, and it is recommended that the matter be referred to the Legal Services Tribunal for its determination.”

174 In the circumstances, it seems to me that the complaint which was accepted by the Legal Services Commissioner was a complaint that the Appellant had been guilty of legal professional misconduct in that between 7 August 1990 and 30 November 1990 he had engaged in conduct which constituted the offence with which he was later charged and in respect of which he later pleaded guilty, some of which conduct was summarised in the report which had been submitted to and acted upon by the Bar Council. If, as I believe to be so, this be the correct view and, if the matters contained in paragraphs 1-37 in the Annexure to the Amended Information do no more than identify the conduct alleged to have been indulged in by the Appellant during the period from 7 August 1990 and the facts and matters showing that, in indulging in that conduct, the Appellant was knowingly concerned in Mr. Donlon’s contravention of the provisions of s.129(1)(a)(i)(A) of the Companies (NSW) Code, then it would, in my view, follow that the inclusion of those paragraphs in the Annexure to the Amended Information did not constitute the addition to the Amended Information of a new complaint which, in the absence of the exercise by the Legal Services Commissioner of the discretion vested in him by the provisions of s.138(2) of the Act would be time barred.

175    In my view, the matters contained in paragraphs 1-37 do no more than identify the conduct in which the Appellant was said to have indulged during the period from 7 August 1990 to 30 November 1990 and the matters indicating that, in indulging in that conduct, the Appellant was knowingly concerned in Mr. Donlan’s misconduct.

176    That this is so is, I suggest, demonstrated by the following examples:

1. the matters contained in paragraphs 1-37 all relate to conduct which took place, or circumstances which existed, in the period between 7 August 1990 and 30 November 1990;

2. the report to the Bar Council refers to the Appellant’s position as a director of Selmit Pacific Property Holdings Pty. Limited (“Selmit”), of Valdese Pty. Limited (“Valdese”) and Tamsulu Pty. Limited (“Tamsulu”) (paragraph 1);

3. the report to the Bar Council refers to cheques drawn on Selmit, which cheques, by reference to the draft statement by the Appellant to the Australian Securities Commission, can be identified as the cheques referred to in paragraph 2;

4. the report to the Bar Council refers to an application for shares and options made by Selmit to Red Anchor Resources (paragraph 8);

5. the report to the Bar Council refers to the cheques issued by Red Anchor Resources in favour of Valdese and Tamsulu being converted into bank cheques which were then endorsed by the Appellant in favour of Selmit (paragraphs 14-18);

6. the report to the Bar Council also refers to the investment agreements between Red Anchor Resources, on the one hand, and Valdese and Tamsulu, on the other, executed by the Appellant on behalf of the latter two companies (paragraphs 24-26);

7. the report to the Bar Council also refers to the letters of demand from Red Anchor Resources directed to Valdese and Tamsulu and the cheques said to have been provided by the Appellant to Mr. Donlon in response to those letters of demand (paragraphs 29-31).

177    Since, in my view, the matters in paragraphs 1-37 did not add a new complaint to the information and since, as the Chief Justice has recorded, the Tribunal did not base its determination on any of the matters contained in paragraphs 45-57 of Annexure A to the Amended Information, it is my view that the appeal should be dismissed with costs.

I agree with Spigelman CJ.

**********

APPENDIX 1

The facts, matters and circumstances on which the Council relies are as follows:

FACTS AND CIRCUMSTANCES SURRROUNDING THE OFFENCE TO WHICH THE BARRISTER PLEADED GUILTY

1. At all material times, the Barrister was a director of Selmit Property Holdings Pty Limited (“Selmit), Valdese Pty Limited (“Valdese”) and Tamsulu Pty Limited (“Tamsulu”).

2. On or about 29 August 1990, the Barrister drew three cheques (“The Selmit Cheques”) on the account of Selmit at the Banque Nationale de Paris in favour of Red Anchor Resources Pty Limited (“Red Anchor”) in the following amounts:

Cheque no. 27323 $4,200.00

Cheque no. 27324 $300,000.00

Cheque no. 27325 $30,000.00

$334,200.00

3. At the time of drawing the Selmit Cheques, the Barrister knew that there were insufficient funds in the account of Selmit at Banque Nationale de Paris to meet the Selmit Cheques.

4. At the time of drawing the Selmit Cheques, the Barrister knew that the Banque Nationale de Paris was unlikely to provide financial accommodation which would be sufficient to meet the Selmit Cheques.

5. At the time of drawing the Selmit Cheques, the Barrister knew that the Selmit Cheques would be dishonoured on presentation.

6. Alternatively to paragraphs 3 and 4 above, at the time of drawing the Selmit Cheques, the Barrister knew that the Selmit Cheques were to be met by the provision of funds to Selmit (either directly or indirectly) by Red Anchor Resources.

7. At the time of drawing the Selmit Cheques, the Barrister knew that the Selmit Cheques would be used by Christopher James Donlon (“Mr Donlon”), a director of Red Anchor Resources, or alternatively, Red Anchor Resources itself, to demonstrate to the Australian Stock Exchange that it had received applications from at least three hundred independent subscribers for parcels of at least two thousand shares each and that the spread of shareholders was sufficient for the conduct of an orderly and liquid market in those shares.

8. On or about 30 August 1990, the Barrister signed an Application for Shares and Options with Red Anchor Resources on behalf of Selmit.

9. At the time of signing the Application for Shares and Options, the Barrister knew that the Application for Shares and Options would be used by Mr Donlon or alternatively Red Anchor Resources to demonstrate to the Australian Stock Exchange that it had received applications from at least three hundred independent subscribers for parcels of at least two thousand shares each and that the spread of shareholders was sufficient for the conduct of an orderly and liquid market in those shares.

10. On or about 31 August 1990, the Selmit Cheques were presented by Red Anchor Resources through its bank, Westpac, to Banque Nationale de Paris.

11. On or about 31 August 1990, the Selmit Cheques were dishonoured and were returned to Banque Nationale de Paris on 3 September 1990 marked “Present Again”.

12. On 13 September 1990, a meeting of directors of Red Anchor resources was held which resolved to allot shares and grant options to Selmit in accordance with the application of 30 August 1990. The directors further resolved to make payments of $165,000 to Valdese and a further $165,000 to Tamsulu.

13. On 13 September 1990, Red Anchor Resources again presented the Selmit Cheques to Banque Nationale de Paris.

14. On 14 September 1990, Red Anchor Resources drew cheques in favour of Valdese and Tamsulu being cheque numbers 924967 and 924966, each cheque being in the sum of $165,000.00.

15. Each of the cheques referred to in paragraph 14 above was endorsed with a request to issue a bank cheque.

16. On 14 September 1990, the cheques referred to in paragraph 114 above were converted into two Westpac bank cheques in favour of Valdese and Tamsulu in the sum of $165,000 each being bank cheque number 442388 and 442389 (“The Bank Cheques”).

17. On or about 14 September 1990, the Barrister endorsed the Bank cheques in favour of Selmit.

18. The endorsements were made by the Barrister in the belief that if banked into the accounts of Valdese and Tamsulu, the Bank Cheques would be used to satisfy outstanding loans from the ANZ Bank to Tamsulu and the State Bank to Valdese.

19. At the time of endorsing the Bank Cheques in favour of Selmit, the Barrister knew that the Bank Cheques had been purchased using fund of Red Anchor Resources.

20. At the time of endorsing the Bank Cheques in favour of Selmit, the Barrister knew that the proceeds of the Bank Cheques would fund the Selmit Cheques.

21. At the time of endorsing the Bank Cheques in favour of Selmit, the Barrister knew that neither Valdese nor Tamsulu could repay the funds represented by the Bank Cheques to red Anchor Resources or any other person or corporation who had provided the funds to purchase the Bank Cheques in favour of Valdese and Tamsulu.

22. On or about 14 September 1990, the Barrister caused the Bank Cheques to be deposited into the account of Selmit at Banque Nationale de Paris.

23. On or about 14 September, 1990, the proceeds of the Bank cheques were used by Banque Nationale de Paris to meet the Selmit Cheques.

24. In or about late September 1990, the Barrister signed two Investment Agreements with Red Anchor Resources on behalf of Valdese and Tamsulu (“The Investment Agreements”).

25. At the time of signing the Investment Agreements, the Barrister knew that they did not accurately reflect any agreement which had been reached between Red Anchor Resources, Tamsulu and Valdese.

26. At the time of signing the Investment Agreements, the Barrister knew that they would be backdated to a date preceding the provision of the Bank Cheques to the Barrister.

27. At the time of signing the Investment agreements, the Barrister knew that they were false or misleading in that the Investment Agreements purported to record a bona fide arm’s length commercial transaction whereby Red Anchor Resources had invested the Bank Cheques in Valdese and Tamsulu when in fact Red Anchor Resources had provided the Bank Cheques to Valdese and Tamsulu for the sole purpose of funding the Selmit Cheques.

28. At the time of signing the Investment Agreements, the Barrister knew that the Investment Agreements would be used to deceive the auditor of Red Anchor Resources into believing that the sum represented by the Bank Cheques was a bona fide arm’s length commercial investment rather than a mechanism by which Red Anchor Resources could fund the purchase of its own shares.

29. On or about 4 November 1990, the Barrister received Letters of Demand from Red Anchor Resources directed to Valdese and Tamsulu requiring immediate payment of the sum represented by the Bank Cheques together with interest thereon.

30. On or about 6 November 1990, and at the request of Mr Donlon, the Barrister provided two blank cheques on the account of Valdese and Tamsulu (“the Purported Repayment Cheques”).

31. Alternatively, the Purported Repayment Cheques were signed by the Barrister.

32. At the time of providing the Purported Repayment Cheques, the Barrister knew that the Purported Repayment Cheques would be used by Mr Donlon or alternatively Red Anchor Resources to create the false impression that the monies advanced to Valdese and Tamsulu by way of the Bank Cheques had been repaid.

33. At the time of supplying the purported repayment cheques, the Barrister knew that the purported repayment cheques would be used by Mr Donlon or alternatively Red Anchor Resources to deceive the auditor of Red Anchor Resources.

34. On or about 7 November 1990, the Barrister received a letter from the auditor in relation to the completion of the audit of Red Anchor Resources for the year ended 30 June 1990 (“The Auditor’s Letter”).

35. The Auditor’s Letter contained, inter alia, the following request:

“I seek your confirmation of the following matters with respect to investments by the company of $165,000 in Valdese Pty Limited and Tamsulu Pty Limited, companies in which you are a shareholder/director:

(1) The investments are bona fide investments and cannot be characterised as loans to directors in breach of ss. 230, 129 or any other section of the Companies (NSW) Code.
(2) The investments have been repaid in full together with interest.”


36. On or about 8 November 1990, the Barrister responded to the Auditor’s Letter in the following terms:

“I refer to your letter of 7th November and reply to your two queries as follows:

(i) Yes.
(ii) Yes.


Please do not hesitate to contact me if you require further information.”

37. At the time of replying to the Auditor’s Letter, the Barrister knew that:

(a) the investments referred to were not bona fide investments;
(b) the investments referred to were in breach of s.129 of the Companies (NSW) Code;
(c) The investments referred to had not been repaid in full or at all.


38. By reason of the matters recited in paragraphs 1-37, the Council contends that the Barrister has engaged in professional misconduct.

THE PLEA OF GUILTY AND SENTENCE

39. Between 7 August 1990 and 30 November 1990 at Sydney in the State of New South Wales, the Barrister was knowingly concerned in Mr Donlon, an officer of red Anchor Resources, being in default in that Mr Donlon was knowingly concerned in the contravention of s.129 (1) (a) (i) (A) of the Companies (NSW) Code (“ the Code ”) by Red Anchor Resources in that Red Anchor Resources did in a manner not expressly provided by the Code, give financial assistance in connection with the acquisition by Selmit of Shares in Red Anchor Resources contrary to s. 129 (5) of the Code and s. 38 (1) of the Companies and Securities (Interpretation and Miscellaneous Provisions) (NSW) Code (“ the Offence ”).

40. On or about 4 September 1995, the Barrister was charged with the Offence.

41. On or about 20 June 1996, the Barrister pleaded guilty before a Magistrate, Mr Dolan, and was sentenced to 400 hours of community service.

42. On or about 22 June 1996, the Barrister lodged an appeal against sentence to the District Court of New South Wales.

43. On 14 August 1996, his Honour Judge Peter Phelan quashed the order for community service and substituted _herefore an order that the Barrister pay a fine of $2,500.

44. By reason of the matters recited in paragraphs 39-43 above, the Council contends that the Barrister has engaged in professional misconduct.

ALTERNATIVE FACTS AND CIRCUMSTANCES AMOUNTING TO PROFESSIONAL MISCONDUCT

45. The Council repeats paragraphs 1-37 above.

46. If, contrary to the contentions set out in paragraphs 3, 4, 5, 6, 7, 9, 19, 20, 21, 25, 26, 27, 28, 32, 33 and 37, the Barrister did not have knowledge of the facts and circumstances recited therein or any of them, the Council contends that the Barrister ought to have known of each such fact or circumstance.

47. By reason of the matters recited in paragraphs 45 and 46, the Council contends that the Barrister has engaged in professional misconduct.

THE BARRISTER’S CONDUCT AS A DIRECTOR AMOUNTING TO PROFESSIONAL MISCONDUCT

48. The Council repeats paragraphs 1-37, 45 and 46 above.

49. By drawing the Selmit Cheques, the Barrister:

(a) failed to exercise a reasonable degree of care and diligence in the exercise of his powers and the discharge of his duties as an officer of Selmit; and/or
(b) made improper use of his position as such an officer to gain directly or indirectly an advantage of Mr Donlon or alternatively Red Anchor Resources namely satisfaction of the Australian Stock Exchange requirement that red Anchor Resources receive applications from at least three hundred independent subscribers for parcels of at least two thousand shares each and a spread of shareholders sufficient for the conduct of an orderly and liquid market in those shares.

50. By signing the Application for Shares and Options, the Barrister:

(a) failed to exercise a reasonable degree of care and diligence in the exercise of his powers and the discharge of his duties as an officer of Selmit; and/or
(b) made improper use of his position as such an officer to gain directly or indirectly an advantage for Mr Donlon or alternatively Red Anchor Resources namely satisfaction of the Australian Stock Exchange requirement that Red Anchor Resources receive applications at least two thousand shares each and a spread of shareholders sufficient for the conduct of an orderly and liquid market in those shares.

51. By signing the Bank Cheques, the Barrister:

(a) failed to exercise a reasonable degree of care and diligence in the exercise of his powers and the discharge of his duties as an officer of Tamsulu; and/or
(b) made improper use of his position as such an officer to gain directly or indirectly an advantage for Mr Donlon or alternatively Red Anchor Resources namely satisfaction of the Australian Stock Exchange requirement that Red Anchor Resources receive applications from at least three hundred independent subscribers for parcels of at least two thousand shares each and a spread of shareholders sufficient for the conduct of an orderly and liquid market in those shares.

52. By signing the Bank Cheques, the Barrister:

(a) failed to exercise a reasonable degree of care and diligence in the exercise of his powers and the discharge of his duties as an officer of Valdese; and/or
(b) made improper use of his position as such an officer to gain directly or indirectly an advantage for Mr Donlon or alternatively Red Anchor Resources namely satisfaction of the Australian Stock Exchange requirement that Red Anchor Resources receive applications from at least three hundred independent subscribers for parcels of at least two thousand shares each and a spread of shareholders sufficient for the conduct of an orderly and liquid market in those shares.

53. By signing the Investment Agreement, the Barrister:

(a) failed to exercise a reasonable degree of care and diligence in the exercise of his powers and the discharge of his duties as an officer of Tamsulu; and/or
(b) made improper use of his position as such an officer to gain directly or indirectly an advantage for Mr Donlon or alternatively Red Anchor Resources namely satisfaction of the Australian Stock exchange requirement that Red Anchor Resources receive applications from at least three hundred independent subscribers for parcels of at least two thousand shares each and a spread of shareholders sufficient for the conduct of an orderly and liquid market in those shares.

54. By signing the Investment Agreement, the Barrister:

(a) failed to exercise a reasonable degree of care and diligence in the exercise of his powers and the discharge of his duties as an officer of Valdese; and/or
(b) made improper use of his position as such an officer to gain directly or indirectly an advantage for Mr Donlon or alternatively Red Anchor Resources namely satisfaction of the Australian Stock Exchange requirement that red Anchor Resources receive applications from at least three hundred independent subscribers for parcels of at least two thousand shares each and a spread of shareholders sufficient for the conduct of an orderly and liquid market in those shares.

55. By providing the purported Repayment Cheques, the Barrister:

(a) failed to exercise a reasonable degree of care and diligence in the exercise of his powers and the discharge of his duties as an officer of Tamsulu; and/or
(b) made improper use of his position as such an officer to gain directly or indirectly an advantage for Mr Donlon or alternatively Red Anchor Resources namely satisfaction of the Australian Stock Exchange requirement that Red Anchor Resources receive applications from at least three hundred independent subscribers for parcels of at least two thousand shares each and a spread of shareholders sufficient for the conduct of an orderly and liquid market in those shares.
56. By providing the Purported Repayment Cheques, the Barrister:

(a) failed to exercise a reasonable degree of care and diligence in the exercise of his powers and the discharge of his duties as an officer of Valdese; and/or
(b) made improper use of his position as such an officer to gain directly or indirectly an advantage for Mr Donlon or alternatively Red Anchor Resources namely satisfaction of the Australian Stock Exchange requirement that red Anchor Resources receive applications from at least three hundred independent subscribers for parcels of at least two thousand shares each and a spread of shareholders sufficient for the conduct of an orderly and liquid market in those shares.


57. By reason of the matters recited in paragraphs 48-56 above, the Council contends that the Barrister has engaged in professional misconduct.

58. On 24 April 1996, the Council resolved to initiate a complaint pursuant to s.135 of the Legal Profession Act 1987 (as amended).

59. On 15 November 1996, the Council requested the Legal Services Commissioner to accept the complaint pursuant to s. 138 (2) of the Legal Profession Act 1987 (as amended).

60. On 5 February 1997, the Legal Services Commissioner accepted the complaint.

61. On 6 March 1997, the Council resolved that the complaint be referred to the Legal Services Tribunal on the basis that the Council was satisfied, after investigation, that there was a reasonable likelihood that the barrister would be found guilty of professional misconduct.

**********