Stevens v NSW Bar Association

[2003] HCATrans 707

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S166 of 2003

B e t w e e n -

CLARENCE JAMES STEVENS

Applicant

and

NEW SOUTH WALES BAR ASSOCIATION

Respondent

Application for special leave to appeal

HAYNE J
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 9 MAY 2003, AT 2.41 PM

Copyright in the High Court of Australia

MR P.L.G. BRERETON, SC:   May it please the Court, I appear with my learned friend, MR M.A. ROBINSON, for the applicant.  (instructed by Beazley Singleton) 

MR P.R. GARLING, SC:   May it please the Court, I appear with MR C.E. ADAMSON for the respondent.  (instructed by Hicksons) 

HAYNE J:   Yes, Mr Brereton. 

MR BRERETON:   I apologise deeply if there has been any inconvenience; I thought there were ‑ ‑ ‑

HAYNE J:   Not before 2.00 pm means not before 2.00 pm, Mr Brereton.  Yes, go on.

MR BRERETON:   Despite agreeing with the primary judge that on his appeal from the Bar Council’s cancellation of his practising certificate the applicant had reasonable prospects of success, and although there is no suggestion that the applicant is not to be trusted in the performance of his professional duties, and notwithstanding that the applicant’s practising certificate, livelihood and practice will all be destroyed if a stay is not granted, the Court of Appeal revoked the stay granted by the primary judge upon holding, first, that his Honour failed to take into account the public interest; secondly, that the public interest was entitled to determinative weight; and, thirdly, that the pendency of the strike‑off proceedings against the practitioner meant that the court should be reluctant to grant a stay.

Although stays pending appeals in disciplinary matters have been considered in a number of cases, principally at first instance or single judges of appellate courts, the Court of Appeal’s decision in this case is the most authoritative decision on the relevant principles.  If it stands, it establishes important principles relative to the granting of stays in disciplinary proceedings, in particular the primacy of the public interest and the subordination of the detriment to the practitioner from suffering a removal from practice, even though there is an arguable case that that removal should not take place.

HAYNE J:   Where do I find in the Court of Appeal judgment, most conveniently, the reference to public interest being determinative?

MR BRERETON:   In paragraph 141, I think, your Honour.

HAYNE J:   Yes.

MR BRERETON:   Insofar as this decision establishes that the public interest is entitled to determinative weight, that will be relied on whenever an application for a stay is made by a lawyer, or a doctor, or an accountant, or a nurse, in respect of a disciplinary order made against that practitioner.  This decision is likely therefore to be of influence in that context throughout Australia, and if it stands it will render it practically impossible for a practitioner appealing against a disciplinary determination to gain a stay.

CALLINAN J:   It means public interest in all of the circumstances of the case, does it not?  It is not as if one identifies a public interest and says, “No matter what other interests are involved, in every case where a public interest is involved, it will be determinative”.

MR BRERETON:   If it means that, then, with respect your Honour, it is wrong, because, for example, look at this case.  This case, we have first a finding that there is an arguable – the primary judge said strongly arguable ‑ case on the appeal.

CALLINAN J:   The facts were that there had been no income tax return lodged in respect of about 20 years, is that right?

MR BRERETON:   No, your Honour, the facts were these.  The Bar Council cancelled the practising certificate based on the notification of a tax offence, namely, a failure to lodge returns within time ‑ ‑ ‑

CALLINAN J:   But have I misstated those facts, that income tax returns were not lodged when they should have been, in respect of about 20 roughly consecutive years?

MR BRERETON:   That fact is not misstated by your Honour, but that was not the basis ‑ ‑ ‑

CALLINAN J:   I know it may not have been the basis, but it is not a fact that I would be prepared to ignore.

MR BRERETON:   That is one of the important issues, and I will come to that momentarily, if I may.  Before I do that, can I just make these general observations.  While it might be said that the question is an interlocutory one involving the exercise of a judicial discretion, all that could be and was said in the Court of Appeal, nonetheless, the case there was considered of sufficient significance to warrant a grant of leave to that court ‑ ‑ ‑

HAYNE J:   Because the court concluded that the judge had exercised wrong principle.

MR BRERETON:   Yes, your Honour.  In principle questions relating to applications for stays will only ever reach this Court on an interlocutory appeal.  My learned friend has argued, in his written argument, that because the matter concerns an entitlement to practise law in the State, it is not a matter for leave.  In my submission, there are three short answers to that.  First, this is not a decision by a State court as to the fitness of one of its practitioners; secondly, the legal profession has moved a long way since the cases in the 1919s and 1950s, to which my learned friend refers, to a national profession with mutual recognition and the like ‑ ‑ ‑

HAYNE J:   And with what consequence?

MR BRERETON:   With the consequence that the idea that each State should be left to itself to regulate its own legal profession and this Court should be reluctant to embark upon appeals in legal professional matters is of much less weight than it once was.  Thirdly, this Court is the ultimate Court of Appeal for New South Wales and has a role in the correction of error in decisions even peculiar to New South Wales.

Can I come to the basis of the decision.  The Bar Council resolved to cancel the practising certificate under section 38FC and 38FD.  It also resolved to institute strike‑off proceedings in the Court of Appeal.  The relevant legislation is set out in the Chief Justice’s judgment at paragraph 23 of his Honour’s judgment.  So far as section 38FC(1)(b) is concerned, the Bar Council’s decision was consequent upon the applicant having notified it of his conviction for a tax offence on 24 July 2001 for failing to lodge income tax returns for 1999 and 2000 within the time limited by a final notice.

Under section 38FC, the question for the Bar was whether that offence was committed in circumstances which showed that the barrister is not a fit and proper person to hold a certificate.  That focuses attention on the circumstances in which the particular offence was committed.  However, the report of the Professional Conduct Committee, on which the Bar Council acted, showed that the circumstances of the offences were not the focus of attention.  Instead, the previous history, to which Justice Callinan has referred, of the 20 years non-lodgement of returns, which had been remedied in 1996, was the focus of the Bar Council’s attention.

HAYNE J:   Thus matters personal to the barrister concerned could not be taken into account in applying 38FC(1)(b)?

MR BRERETON:   The short answer is yes, because the only question under 38FC was whether the offences were committed in circumstances which show the barrister is not a fit and proper person.  That does not authorise the taking into account, adversely to the barrister, of other misconduct, if it be misconduct.  There are plenty of ways of dealing with ‑ ‑ ‑

HAYNE J:   So to take an example separate from the facts of this case ‑ and let us ensure that that is understood – if it had been the case that a barrister X was shown to have committed a tax offence and that this was the seventeenth such offence that he or she had committed, would that be a matter that might be taken into account under 38FC(1)(b)?

MR BRERETON:   I pause, because there are obviously issues of degree.  If it was the same offence, or a very closely related offence, then I think I would have to accept that, yes, it could be taken into account.  However, if it came to light, when examining a taxation offence, that the barrister had, in the course of his practice, committed some monstrously inappropriate act towards a client and jeopardised the client’s interests – completely divorced from the tax affairs – that could not be taken into account, because it would have nothing to do with the circumstances of the tax offence.

Our contention here was that the history, so far as tax returns remedied by 1976, was not open to be taken into account, but there is a fall‑back position.  Even if it was open to be taken into account in the way, your Honour, the presiding judge puts to me, it might have been relevant in the way in which antecedents are relevant in sentencing, but the focus still had to be on the instant notified offence.  Examination of the Professional Conduct Committee’s report here showed that the instant offence received no attention at all; the report addressed and focused on the past history.

HAYNE J:   Let us assume, for the purposes of debate, then, that the applicant has an arguable case on the appeal which is instituted.  Why does that demonstrate error in the decision of the Court of Appeal?

MR BRERETON:   Because, and I should say, the Court of Appeal accepted – and this can be seen at paragraphs 133 and 136 of its judgment ‑ that he did have a reasonably arguable case on appeal.  The error then comes in why, having accepted that, the Court of Appeal declined to grant a stay, and it did so for essentially two reasons.  The first is to be found at paragraph 144.  The principal reason was that:

The protection of the public and the maintenance of the reputation of the legal profession are entitled to determinative weight –

Now, the first answer to that is that, on an application of this sort, the public interest is not entitled to determinative weight; it is one of a number of factors which have to be taken into account.  This has to be seen against the context of the way the case was argued at first instance and in the Court of Appeal.

HAYNE J:   Now, at first instance, correct me if I am wrong, the primary judge approached it by reference to a suite of factors that might be subsumed under the heading “balance of convenience”?

MR BRERETON:   Yes, but we submit that what his Honour referred to by “balance of convenience” plainly included the public interest and can I show why that is so?  The principal submissions before the primary judge were in writing.  At page 155 of the application papers the principles for which we contended are set out, in particular, 156 at the end of paragraph 2.1:

always having regard to the important public interest considerations involved.

Paragraph 2.2:

balancing the protection of the public interest on the one hand against prejudice to the practitioner on the other.

It is quite clear that before the primary judge we conceded and argued that public interest was relevant, but not determinative.

HAYNE J:   And where do we find that reflected in the primary judge’s reasons?

MR BRERETON:   I will come to that just after I have come to the respondent’s submissions before the primary judge, which are at page 170 and in the opening of their submissions:

three matters relevant to the exercise of the Court’s discretion whether to grant a stay are:

(a)  whether the appellant had established that he had good prospects of success, or that there was a real question to be tried;

(b)  the balance of convenience;

(c)  the public interest –

So the relevance of the public interest was not a live issue, in the sense of a contentious issue, before the primary judge.  The issue was what it required, not its relevance.

In the primary judge’s judgment at page 76 paragraph 10 the primary judge said:

My attention has been drawn to the usual case law concerning balance of convenience.  There are additional factors to be considered in a matter of this sort.

And those additional factors, in our submission, are, plainly, the public interest, which both parties accepted as relevant.  His Honour then goes on to say:

But one can accept that they could all be appropriately subsumed –

in Justice Mahoney’s concept of:

“the degree of probability or likelihood of success is simply that which the court thinks is sufficient in the particular case to warrant preservation of the status”

which, in my submission, encapsulates very much what your Honour Justice Callinan was putting to me a little while ago, and was correct.

Now, against that, when we come to the judgment of the Court of Appeal, may I take your Honours to paragraph 112 and following.  Paragraph 112 concludes with the observation that the primary judge:

approached the issue as if he had before him “orders affecting two private litigants only” –

and –

failed to give weight to the public interest dimension –

In the context of the common position of the parties and the reference to other factors in the primary judge’s judgment, that, in our submission, was plainly wrong.  His Honour then says at paragraph 113 that the primary judge had found that the applicant’s case below was “strongly arguable” and “of substance”, but suggests he ought to have looked at the matter:

from the perspective of the strength of the Bar Council’s case.

With the greatest respect to his Honour, everyone knows, on an application for a stay, the question is, does the applicant have an arguable case?  In any event the arguability of the Bar Council’s case was simply the obverse of that of the applicant.  Thirdly, at paragraph 114, his Honour says that:

Terminology such as “balance of convenience”: is not apt.

His Honour overlooks that it was that very terminology which not just the applicant but the Bar Council had endorsed and adopted before the trial judge. 

That is how the Court of Appeal found error in the primary judge’s judgment.  In re-exercising the discretion, and having found or accepted that there was a reasonably arguable case ‑ ‑ ‑

HAYNE J:   Just pausing there, you say, do you, no error, because primary judge did consider public interest?

MR BRERETON:   Yes, but his Honour correctly did not treat it as determinative.  If we then come to what the Court of Appeal said about public interest at page 144 ‑ ‑ ‑

CALLINAN J:   Paragraph 144.

MR BRERETON:   I am sorry, your Honour, paragraph 144.  His Honour says: 

The protection of the public and the maintenance of the reputation of the legal profession are entitled to determinative weight –

Now, first, in our submission, it is not.  It is one factor to be taken into account.  In a case where it is found that there is an arguable or even strongly arguable appeal, and the detriment to the practitioner would be the destruction of his practice and the loss of time in practice which could never be restored to him, if his appeal succeeded, then, given the arguability of the appeal, the protection of the public or the reputation of the profession is not entitled to determinative weight.

The discretion to grant a stay is a vital instrument of justice, particularly where there is an arguable appeal, and to say that the protection of the public is entitled to determinative weight unduly constrains that important instrument of justice.  In any event, the Court of Appeal did not demonstrate why, in the context of this case, the protection of the public or the reputation of the profession were threatened by permitting him to remain in practice, on an interlocutory basis, until there could be a final determination.  There was no suggestion ‑ ‑ ‑

HAYNE J:   That is, remain in practice with an un ‑set aside conclusion of the relevant professional body that he was not a fit and proper person to conduct the practice?

MR BRERETON:   In circumstances where he has a right of appeal by way of hearing de novo from that decision, which appeal has been found to be strongly arguable or, at worst, arguable.

There is no suggestion that he cannot be trusted in the performance of his professional duties.  So far as the reputation of the profession is concerned, if it is ultimately found that he is unfit, the reputation of the profession will be vindicated by his removal at the end of a proper hearing when due process has taken place, and not an intermediate removal while he still has an arguable appeal on foot, given that that intermediate removal will destroy the practice that he has.

HAYNE J:   Yes, thank you, Mr Brereton.  Yes, Mr Garling.

MR GARLING:   If the Court pleases.  Your Honours, it is our respectful submission that it is not correct to say that the Court of Appeal found that, as a matter of general principle, public interest was always entitled to determinative weight in considering the question before it.  May I take your Honours, in addition to the paragraph 144 that my learned friend took your Honours to, to the judgment, commencing for this purpose at paragraph 104 which is at page 43A of the application book.  That paragraph falls for consideration, comes in place in the judgment after a review of the various authorities that were looked at.  At paragraph 104 his Honour says:

It is clear from this consideration of the authorities that each case must turn on its specific facts.  The range of relevant considerations is broad.  Nevertheless the fact that the issues involved in professional rights to practice concern the protection of the public, means that the public interest is always entitled to significant weight.

That is the general principle that his Honour states is to be drawn from the range of decisions that his Honour reviewed in the paragraphs immediately prior to that, and that is the only statement of general principle, if there be one in this judgment, which is raised, and, we would submit, unarguably correct.

HAYNE J:   What of Mr Brereton’s point that there was no error in the primary judge’s conclusion, because the primary judge did – or at least should be taken to have considered public interest, given the course of events that occurred at that hearing?

MR GARLING:   There are two responses to that, your Honour.  We would submit, a fair reading of paragraphs 10 and 11 of the primary judge judgment, which are to be found at page 76 of the application book, taken together demonstrate that what his Honour is not talking about is the public interest.  But he is talking about, as the Chief Justice found, a balancing of the convenience of two parties, because the first sentence in paragraph 11 says:

Those words –

referring to the extract from Justice Mahoney’s judgment –

apply equally to the balance of convenience.  It was submitted –

the primary judge said –

that the balance of convenience favoured the Bar Council in that Mr Stevens had little practice left, but against that what practice he has left is no doubt valuable to him.

What is obviously being done there, your Honours, is weighing what would be called the simple question of balance of convenience of prejudice to one party as against the other party’s interest.  It makes no specific reference, nor is there any specific reference at all in this judgment, to what both parties were putting before the judge as being a significant matter.  So that is the first answer.

HAYNE J:   What do you say is the relevant public interest that was here engaged? 

MR GARLING:   The relevant public interest is the interest in the preservation and upholding of the reputation of the legal profession and the integrity of the role, in that the public are entitled to expect that people who are held out as fit to practise by a court in a profession which carries with it the descriptions that are well known to this Court, and I will not repeat, would, at the very least, act in accordance with their legal and civic obligations.  Here was a case where, unarguably, for a very lengthy period of time, there had been a complete disregard of that circumstance.

To say, we would submit, that it is appropriate to hold out such a person in that way is inappropriate.  The public interest is perhaps best encapsulated, if I can draw your Honours’ attention to three paragraphs at page 174 of the application book – your Honours will see in paragraph 13 of our submissions we set out an extract from a decision of Justice Cripps in an acting capacity in a case – which are numbered [40], [41] and it should be [42].  That is a good description of the public interest.  I just draw your Honours’ attention to it:

[40]  The integrity and impartiality of the Bench is central to the functioning of our liberal democracy.  As an institution it is sustained by public confidence in that integrity and impartiality.  It would appear to me that the special position of members of the Bar, as a necessary and recognized part of the judicial process, is likewise sustained by public confidence in the integrity of its members.

[41]  The question in the present case is whether public confidence is affected by anything other than the competence a person brings to his or her practice . . . 

[42]  In order to maintain public confidence in the Bar it is necessary, in my opinion, for members of the Bar to recognize and abide by the ethical and moral standards –

we would interpolate, as well, ordinary legal standards –

expected of people enjoying the special privileges offered by the Bar –

In addition, at page 44A of the application book, I think it is – it is printed judgment page 40 paragraph 109 – is an extract of what the Court of Appeal in New South Wales said in the case New South Wales Bar Association v Cummins:

“There are four interrelated interests involved.  Clients must feel secure in confiding their secrets and entrusting their most personal affairs to lawyers.  Fellow practitioners must be able to depend implicitly on the word and behaviour of their colleagues.  The judiciary must have confidence in those who appear before the courts.  The public must have confidence in the legal profession by reason of the central role the profession plays in the administration of justice.”

We would submit that, in the particular circumstances of this case, that is the public interest that is being addressed and which was adequately addressed by the Court of Appeal in its decision.

HAYNE J:   It seems to me, Mr Garling, that the case from your end of the Bar table at the moment seems to come to this, that the Court of Appeal was right to detect error.  If it was right to detect error, it follows inevitably that they had to re‑exercise the discretion.  The third step, as I understand the argument, would be, why should this Court take on the question unless some error of principle in the re‑exercise followed?

MR GARLING:   Yes, and also given the particular subject matter and nature of the proceedings, this Court would ordinarily be reluctant to intervene in a decision of a Court of Appeal of a particular State. 

There is one other error of the primary judge which I should draw your Honours’ attention to.  Your Honours may not have appreciated that the legislation had two parts to it.  My learned friend took your Honours to section 38FC.  There was a second part, section 38FD, which dealt with a requirement to notify within a period of time and a failure to do so.  The failure here stretched approximately 11 months, your Honours, and the Court of Appeal held that the primary judge did not adequately address that failure in his reasons.  That of itself would give rise to a reason to re‑exercise the discretion.  They are our submissions.

HAYNE J:   Yes, thank you, Mr Garling.  Yes, Mr Brereton.

MR BRERETON:   In answer to the three steps formulated by your Honour the presiding Judge as to why the Court of Appeal’s decision was affected by error, attention ought to be paid to paragraphs 150 and 151 of the Court of Appeal’s judgment, in which, in exercising its discretion adversely to the applicant, it seems to have taken into account and proceeded on the basis that where, by the striking‑off proceedings, there was a serious challenge to the practitioner’s membership of the profession, the court should be reluctant to exercise a discretion in his favour.  That, in my submission, is plainly wrong.  The pendency of unheard, unresolved, undetermined proceedings which might or might not succeed could not be a relevant factor in deciding whether to grant a stay in different proceedings.

Next, my learned friend referred to section 38FD.  The primary judge dealt with the section 38FD issue in paragraph 8 of his Honour’s judgment at page 76 of the application papers.  In the argument before the primary judge neither party gave much attention to it, because the case obviously turned on the 38FC, not FD, issue.  The notice of appeal to the Court of Appeal did not challenge the primary judge’s finding on the basis of section 38FD and no argument was addressed to it, or very little, if any, argument was addressed to it, in the Court of Appeal.

Thirdly, so far as my learned friend has identified what the public interest is, that is largely by reference to paragraph 109 of the Court of Appeal’s judgment taken from Cummins’ Case.  We accept that all of those are correct manifestations or characterisations of the public interest in a case at the final hearing stage.  On a permanent basis, those matters are relevant, but one has to ask how are any of those interests engaged on an interim basis while an arguable appeal de novo is being heard? 

In our submission, looking at them seriatim, first, there is no suggestion that a client cannot trust Mr Stevens or that that first interest is in any way at risk.  There is no suggestion that fellow practitioners cannot depend on him.  There is no suggestion that judges cannot depend on him. 

The only aspect which comes into question is confidence in the legal profession.  There is an arguable case that Mr Stevens should remain a member of the profession. 

In those circumstances, neither confidence in the profession nor the reputation of the profession can be affected by permitting him to remain in practice until a proper final determination is made.  To the contrary, his peremptory removal before due process has been completed jeopardises confidence in the judicial process, rather than reinforcing it.

HAYNE J:   Thank you, Mr Brereton.

The applicant seeks special leave to appeal against orders of the Court of Appeal of New South Wales setting aside an order of a single judge of the Supreme Court staying the operation of the respondent’s decision to cancel the applicant’s practising certificate.  The primary judge’s judgment was a discretionary one.  The Court of Appeal, which lifted the stay his Honour granted, were conscious of that fact.  Although the primary judge may, perhaps, have taken into account some aspects of the public interest, there were other and important aspects of that interest that had been overlooked.  That required the discretion that was exercised below to be set aside and exercised anew.  That is what the Court of Appeal did.

The orders of the Court of Appeal not only were made in the exercise of a discretion, but also were interlocutory orders concerning a matter of practice and procedure, relating, in particular, to the regulation of professional practice in the State.  It is well established that it will seldom be appropriate for this Court to intervene in such matters.  See, for example, Adam P. Brown Male Fashions Pty Limitedv Philip Morris Incorporated (1981) 148 CLR 170 and Paringa Mining & Exploration Company PLC v North Flinders Mines Limited (1988) 165 CLR 452 where reference is made to the well‑known statements of Chief Justice Jordan in In re Will of F.B. Gilbert (deceased) (1946) 46 SR(NSW) 318 at 323.

In the event, the Court of Appeal’s conclusion that the primary judge did not apply proper principle is not attended by doubt.  In our opinion, no arguable error is demonstrated in the Court of Appeal’s re‑exercise of the relevant discretion.  It follows that special leave is refused with costs.

Adjourn the Court to 2.00 pm Tuesday next, 13 May, in Sydney.

AT 3.18 PM THE MATTER WAS CONCLUDED