Robb, Gary Alan v The Law Society of the Australian Capital Territory

[1996] FCA 498

CATCHWORDS

LEGAL PRACTITIONERS - Disciplinary Proceedings - suspension of practitioner by Supreme Court - appeal to Full Court of Federal Court - motion for stay of suspension pending Federal Court hearing - request for expedition.

Legal Practitioners Act 1970 (ACT), s67(1)(b), s67(3), s87(1)

Ex p Attorney-General for the Commonwealth;  Re a Barrister and Solicitor (1972) 20 FLR 234

Re Guild (1979) 32 ACTR 13

Harvey v Law Society of New South Wales (1975) 7 ALR 227

APPEALS - Stay of Orders - approach to granting stay - judgment not 'manifestly wrong' - appeal not an abuse of process - public interest as against prejudice to appellant - relevant factors to be taken into account - relevance of opportunity to mitigate consequences of order by applying to practice as an employed solicitor under supervision.

Federal Court Rules, O52 r17

Alexander v Cambridge Credit Corporation Ltd (Receivers Appointed) (1985) 2 NSWLR 685

Powerflex Services Pty Ltd v Data Access Corporation 4 June, 1996
Andrews v John Fairfax & Sons Ltd [1979] 2 NSWLR 184

Henderson v Amadio Pty Ltd (No 4), unreported, 2 May 1996

GARY ALAN ROBB and GERARD PETER REES v THE LAW SOCIETY OF THE AUSTRALIAN CAPITAL TERRITORY
No ACT G34 of 1996

FINN J
CANBERRA
21 JUNE 1996

IN THE FEDERAL COURT OF AUSTRALIA )
  )
AUSTRALIAN CAPITAL TERRITORY     )
  )    No. ACT G 34 of 1996   DISTRICT REGISTRY               )
  )
GENERAL DIVISION                 )

BETWEEN:  GARY ALAN ROBB and
  GERARD PETER REES

Appellants

AND:  THE LAW SOCIETY OF THE
  AUSTRALIAN CAPITAL TERRITORY

Respondent

COURT:    FINN J

PLACE:    CANBERRA

DATE:     21 JUNE 1996

MINUTES OF ORDERS

THE COURT ORDERS THAT:

The notice of motion be dismissed.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA )
  )
AUSTRALIAN CAPITAL TERRITORY     )
  )    No. ACT G 34 of 1996   DISTRICT REGISTRY               )
  )
GENERAL DIVISION                 )

BETWEEN:  GARY ALAN ROBB and
  GERARD PETER REES

Appellants

AND:  THE LAW SOCIETY OF THE
  AUSTRALIAN CAPITAL TERRITORY

Respondent

COURT:    FINN J

PLACE:    CANBERRA

DATE:     21 JUNE 1996

REASONS FOR JUDGMENT

On 7 June 1996 a Full Court of the Supreme Court of the Australian Capital Territory made orders under the Legal Practitioners Act 1970 (ACT), that Gary Alan Robb (the moving party in the present matter) be suspended from practice as a barrister and solicitor for a period of eighteen months and that a partner of Mr Robb, Gerard Peter Rees, pay a fine of twenty thousand dollars. An appeal against these orders was
filed in this Court on 11 June 1996.  Application was made to the Supreme Court on 12 June to stay the orders pending the appeal to the Full Court of this Court.  It was refused and the suspension was ordered to take effect on 1 July 1996.

As the Federal Court Rules, O52 r17 clearly admit, a motion for a stay of the order suspending Mr Robb has been made to this Court despite the refusal of the like application to the Supreme Court.  Coupled with that motion is one seeking the grant of an expedited hearing of the appeal.  These are the matters now before me. 

I should emphasise, lest there be any misapprehension, that the stay motion here is not in any sense an appeal from, or review of, the order of the Supreme Court dismissing the motion made to it.  The matter is now to be considered afresh though quite obviously the motion in the Supreme Court is itself part of the history - and in my view relevant history - of this matter.

The burden of the stay motion is the prejudice it is said Mr Robb will suffer if his appeal is successful but his suspension is allowed to run in the meantime.  In considering that possible prejudice - or to put the matter another way, the possible inutility of the appeal to Mr Robb if the suspension were to run - both parties submitted that I was not being invited to pass on the prospects of the appeal itself.  Rather they suggested that all I need - or should - satisfy myself of in relation to the appeal is that (a) the lodging of the appeal was not, in the circumstances, an abuse of process;  and (b) the judgment appealed from was not manifestly wrong.  If I was satisfied on these two counts, it could properly be said that there were at least arguable grounds of appeal.  Indeed Mr Lindsay SC, who appeared for the Law Society of the Australian Capital Territory on the motion, has expressly disclaimed any argument that Messrs Robb and Rees do not have grounds of appeal which they ought not be allowed the opportunity to advance.

While I refrain from expressing a view on whether my role in relation to considering the appeal itself is the limited one the parties suggest - there are judicial observations including in this Court which suggest a somewhat less restrictive approach:  see e.g. Andrews v John Fairfax & Sons Ltd [1979] 2 NSWLR 184 at 187 ff; Henderson v Amadio Pty Ltd (No 4), unreported, 2 May 1996, at 528 per Heerey J - I am content to limit my consideration of the appeal as the parties suggest, and to accept that there are arguable grounds of appeal.  I should add, in any event, that the complexity and some uncertainty in some at least of the areas of law relied upon by the Supreme Court make such acceptance almost inevitable.

It cannot be a matter of dispute that, in exercising its disciplinary function, it is the duty of the Supreme Court to ensure that the standards properly required of members of the profession "are fully maintained":  Harvey v Law Society of New South Wales (1975) 7 ALR 227 at 230. It equally is not open to argument that the "object of disciplinary action against legal practitioners is not to exact retribution; it is to protect the public and the reputation of the profession": Ex p Attorney-General for the Commonwealth;  Re a Barrister and Solicitor (1972) 20 FLR 234 at 244; Re Guild (1979) 32 ACTR 13.

The stay motion before me needs, then, to be considered in the light of the role of the Supreme Court in disciplinary proceedings and of the object of the sanction it imposed on Mr Robb in the present instance.

Given that I am prepared to find that there are arguable (I would prefer to say reasonably arguable) grounds of appeal, counsel are at one in further agreeing that the success or failure of the stay motion turns on the appropriate weight to be given here to protecting the public interest on the one hand and to avoiding prejudice to Mr Robb on the other.  By prejudice I mean the detriment he would suffer if his appeal in the event was successful in howsoever many month's time, but his suspension had remained operative until the Full Court has so ruled in his favour.

To indicate why I have reached the conclusion I have in this matter - and it is adverse to Mr Robb's motion - it is necessary to refer albeit briefly to the judgment of the
Supreme Court and to events subsequent to it.  Before so doing there is one particular matter to which I should refer.

While the Legal Practitioners Act 1970 (ACT), S67(1)(b) empowers the Supreme Court to make suspension orders, subsection (3) of the same section provides that when such an order is made in respect of a barrister and solicitor:

" ... the Court may also order that the barrister and solicitor may be employed in the practice of another barrister and solicitor for such a period and on such conditions as the Court considers appropriate."

It is common ground between the parties that it has been open to Mr Robb from the making of the suspension order to seek an order under s67(3). This entitlement was adverted to by Miles CJ when judgment was given on 7 June and was again adverted to during the hearing of the motion for a stay before the Supreme Court. Mr Robb appears not to have sought such an employment order.

The formal allegations made by the Law Society against Messrs Robb and Rees concerned, primarily, the manner in which client (i.e. trust) monies were used when paying the accounts of third parties.  It was alleged and found by the Court that client monies appropriated for such payments were transferred to the solicitors' office account but that payment itself to the third party was delayed for unreasonably lengthy periods.  A report consequent on a Law Society investigation detailed twenty one retainers in which the average delay in making
payment was about five months.

In its Reasons for Judgment the Supreme Court condemned this practice in forthright terms.  They likewise characterised the manner in which client monies were so used as involving breaches of the trust money (s87(1)) and trust account (ss91, 92(2)) provisions of the Legal Practitioners Act.  Those breaches, though, were found not to have been wilful.

It equally is the case that no client was shown to have suffered pecuniary loss from the actions of the solicitors and that all disbursements were paid eventually.

Mr Conti QC in his submissions for Mr Robb denied that the monies, once taken from the trust account, remained client monies and suggested that in any event the worst that could be said of Mr Robb's misconduct was that it involved delay in paying primarily counsel's fees.  It was not a case, for example, of defalcations.  In consequence in terms of protecting the public interest, the case was not one of such a significant threat being posed as to make a stay inappropriate when regard was had to the possible prejudice to which Mr Robb would be exposed if a stay were not granted.

I do not, with respect, regard the judgment of the Supreme Court in quite this relatively benign light.  As the Court indicated early in its Reasons for Decision (pp. 4-5), the evidence compelled it to consider questions which went well beyond allegations of breaches of particular provisions of the Legal Practitioners Act.  In this the Court noted that:

"There are questions concerning the fiduciary relationship between solicitor and client, the duties that are imposed upon the solicitor in accordance with that relationship, conflicts of interest between those of the client and those of the solicitor and the inevitability of those conflicts in a practice such as that conducted by the solicitors.  Those questions were all addressed by Mr. Conti QC, who appeared for the solicitors, and we have no doubt that there is no unfairness to solicitors occasioned by the Court adverting to all those questions, as we believe it must."

While it is the case that the essential focus of the Court's reasons was on the trust account/delay in payment issue, there is nonetheless significant emphasis across the reasons on the solicitors' ignorance of, or indifference to, the fiduciary nature of their role and of its attendant obligations.  The manner in which settlements "inclusive of costs" were effected, for example, was used by the Court to illustrate this:  see Reasons for Decision, 32.  The solicitors' indifference to their fiduciary responsibilities was itself regarded as a matter of "aggravation" and it accentuated the serious view taken of their misconduct:  Reasons for Decision, 31 and 66.

It is not, then, surprising in my view that in refusing the stay motion on 12 June, Miles CJ could say that:

"it is ... to be emphasised that the orders the court has made are the result of a considered decision of the court and  ...  that they should take effect as ordered in the particular circumstances of a case of this nature in order to mark the seriousness of the misconduct which the court identified in its judgment.":  Transcript p346, (emphasis added).

Again it is not surprising that Mr Lindsay SC in his submissions to me, emphasised the proper concern of the Supreme Court with maintaining the standards of the legal profession, of its obvious appreciation of its public interest responsibility, and of the deliberate and considered character of its conclusions.

The circumstances of this case are not ones in which it is appropriate to order a stay.  The ordinary rule applied in this Court would now seem to be what, for convenience, I will call the Cambridge Credit Corporation test:

"It is sufficient that the applicant for the stay demonstrates a reason or an appropriate case to warrant the exercise of discretion in his favour."

See Alexander v Cambridge Credit Corporation Ltd (Receivers Appointed) (1985) 2 NSWLR 685 at 694; and in this Court see the unreported decision of the Full Court in Powerflex Services Pty Ltd v Data Access Corporation 4 June, 1996.

In applying this, though, it must be remembered that this is not the usual instance of civil litigation in which the question is whether a reason is there to hold a successful party out of the benefit of a judgment obtained until the appeal is heard.  Here Mr Robb's "reason" must be considered, not in the context of a judgment giving a benefit to a litigant, but rather as one designedly made to protect both the public and the reputation of the profession.

The Supreme Court clearly regarded Mr Robb's professional misconduct as serious.  Equally it found him to be ignorant of, or indifferent to, his fiduciary responsibilities.  It is not for me to gainsay these conclusions.  Notwithstanding the appeal lodged, to allow Mr Robb a stay in the face of such findings would require the demonstration of a reason of some cogency.  I do not consider that the prejudice asserted, given as I will indicate the prospect of its mitigation in some degree, outweighs the very distinct prejudice to the public interest that could be sustained if the stay was granted  - even if that stay was subject to such undertakings as have been offered by Mr Robb and his partners.  I do not consider it necessary to refer further to those undertakings given the view I take of this matter.

It is the case whenever an order for suspension is made and an appeal is lodged on arguable grounds, that the practitioner affected can assert that prejudice will be suffered if, the suspension having begun to run, the appeal is successful.  This circumstance could not in my view justify, in effect, a stay as of right in all such circumstances.  The decision to stay a suspension order subject to appeal on arguable grounds must in my view involve an instance specific question.

There is a variety of factors of which account can or should properly be taken when considering a stay in such cases.  Among these are (i) the seriousness of the misconduct found;  (ii) the likely prejudice to public confidence both in the integrity of the disciplinary processes themselves and in the reputation of the profession if the practitioner is granted a stay;  (iii) the means available to mitigate the prejudice alleged;  and (iv) the expedition with which the appeal can be heard.

As to (i), I have already noted the seriousness attributed by the Supreme Court both to Mr Robb's conduct and to his understanding of his fiduciary responsibilities.

As to factor (ii), given those findings, to grant a stay would, in my view, pose a significant threat to the reassurance that the disciplinary processes and sanctions themselves provide to the public.  It equally would undercut in a quite basic way the proper significance to be attributed to the Supreme Court's finding as to Mr Robb's ignorance of, or indifference to, the standards expected of him.

Factor (iii) in turn is not without importance in this case.  Mr Robb, by the Court's order, has not been shut out totally from practising his profession.  He has been shut out from practising as a principal.  This doubtless is a cause of detriment to him - but a detriment which inheres in the nature of the suspension order itself.  He can, if he is so minded, apply for an order that he be allowed to practise his profession in an employed capacity.  Doubtless if he did so the Supreme Court would consider such supervisory conditions as would be appropriate in the event of such an order being made.  Mr Robb has not to date pursued this course.  In my view that course, rather than a stay motion, provides the appropriate vehicle to secure a proper balance between protecting the public interest and protecting him from untoward prejudice resulting from the orders of the Supreme Court pending the hearing of the appeal.

As to factor (iv) - the expedition with which the appeal can be heard - I have indicated to the parties that the next Full Court sittings scheduled for Canberra are in October 1996.  It may, nonetheless, be possible that an earlier hearing may be able to be secured outside of Canberra.  Be this as it may, an October hearing is one which can properly be said to be a relatively expeditious one.  I do not in any event regard this factor as being of marked significance in this instance given the weight I attribute to those others I have already mentioned.

Accordingly, I do not find that a reason or an appropriate case has in the circumstances been advanced to justify the grant of a stay.  Equally, while I recognise that the appeal is one in which an early hearing is desirable, given what I have said about the next sittings of the Full Court in Canberra, I do not consider it appropriate formally to make an order for an expedited hearing.

The order of the Court is, then, that the notice of motion be dismissed.

I certify that this and the preceding 11 pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Finn.

Associate

Dated:  21 June 1996

Counsel for the applicant    :    R Conti QC
  W Haffenden
Solicitors for the applicant :    Abbott Tout Harper & Blain

Counsel for the respondent   :    G C Lindsay SC
Solicitors for the respondent     :    Phelps Reid

Date of hearing             :    18 June 1996

Date of judgment            :    21 June 1996