Terrell and Terrell
[2013] FCCA 105
•5 April 2013
FEDERAL CIRCUIT COURT OF AUSTRALIA
| TERRELL & TERRELL | [2013] FCCA 105 |
| Catchwords: FAMILY LAW – Practice and Procedure – referral to the Legal Services Commissioner for overcharging and inadequacy of the material placed before the Court. |
| Legislation: Federal Circuit Court Act 1999 Federal Circuit Court Rules 2001 Legal Professional Act 2004 (NSW), ss.309, 316, 350 Evidence Act Real Property Act 1900 (NSW), s.74J |
| Cases cited: Weir & Weir (1993) FLC 92-338 Kyle v Legal Practitioners’ Complaints Committee [1999] WASCA 115 |
| Applicant: | MS TERRELL |
| Respondent: | MR TERRELL |
| File Number: | SYC 3348 of 2012 |
| Judgment of: | Judge Harman |
| Hearing date: | 5 April 2013 |
| Date of Last Submission: | 5 April 2013 |
| Delivered at: | Parramatta |
| Delivered on: | 5 April 2013 |
REPRESENTATION
| Counsel for the Applicant: | Mr Farah |
| Solicitors for the Applicant: | Farah Lawyers Solicitors & Barristers |
| Counsel for the Respondent: | [omitted] |
| Solicitors for the Respondent: | [omtited] |
| Counsel for the Independent Children’s Lawyer: | Ms O’Donnell |
| Solicitors for the Independent Children’s Lawyer: | Legal Aid NSW - Campbelltown Family Law |
ORDERS
The proceedings are adjourned to 9.30am on 6 June 2013 for further mention and directions.
The Applicant wife shall file and serve by no later than close of business on 26 April 2013 an Amended Application setting out with specificity all orders she invites the Court to make.
The Respondent Husband shall file and serve a Response setting out with specificity all orders he invites the Court to make by no later than close of business on 17 May 2013.
On the next occasion consideration will be given as to what further orders are required to advance matter to finality.
The Registrar of the Court is requested to furnish to the Legal Services Commissioner NSW a copy of today’s reasons for the purpose of the Legal Services Commissioner pursuing and dealing with such complaint or inquiry as he considers appropriate as to:
(a)The failure of the Attorney’s for the Husband to diligently or competently represent his interests and comply with orders of this Court as to the filling of evidence; and
(b)The fees charged with respect to the conveyance referred to within these reasons, being the sum of $6,800.
The Legal Services Commissioner shall be provided with such Affidavit material, Applications and/or Response as have been filed in these proceedings and as may be requested.
The costs of both parties and the Independent Children’s Lawyer with respect to today’s appearance (which concluded today at 1.50pm) are reserved the determination of such costs being adjourned to 9.30am on 6 June 2013.
IT IS NOTED that publication of this judgment under the pseudonym Terrell & Terrell is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT PARRAMATTA |
SYC 3348 of 2012
| MS TERRELL |
Applicant
And
| MR TERRELL |
Respondent
REASONS FOR JUDGMENT
A number of issues have arisen as a consequence of the matter coming before the Court today.
The proceedings might loosely be described as relating to issues of property adjustment and parenting.
The proceedings have been on foot since an Initiating Application was filed by the wife on 13 June 2012. No Response, or at least no Response in proper form or addressing the judiciable issues identified by the Application, has been filed by the Respondent husband.
In the proceedings an Independent Children’s Lawyer has been appointed to represent the interests of the two children the subject of the proceedings. Those children are the subject of interim orders made by consent and which regulate their present parenting arrangements being orders made on 6 July 2012. Those orders by and of themselves made clear that at that date a Response had not been filed by the husband and one has still not been filed.
It is of some importance to canvass the procedural history of these proceedings.
The Application initiating proceedings having been filed on 13 June 2012 was then the subject of an application for abridgement of time being an application made to a Registrar. That application was dealt with and an abridgement granted. The proceedings were then made returnable on 20 June 2012.
On 20 June 2012 the Applicant wife appeared with a legal representative and a legal representative appeared on behalf of the Respondent although he did not appear himself or at least such is not apparent from the bench sheet or orders engrossed following that event.
Orders were made on that day, by consent, which related to both parenting and property adjustment. To the extent that they are relevant orders were made as follows.
(1)That the proceedings were adjourned to 3 July 2012 for Interim Hearing.
(2)That the Applicant shall file and serve an Amended Application to include and address interim parenting arrangements. Same was to be filed and served by close of business on 22 June 2012.
(3)The Respondent shall file and serve a Response, Financial Statement and Affidavit material sufficient to comply with Federal Magistrate Court Rules and address interim parenting orders sought by either parent with same to be filed and serve by close of business on 29 June 2012.
The parties were ordered to attend a Child Dispute Conference with a family consultant and that Conference did not occur as the husband failed to attend.
Further orders were made on 20 June 2012 that neither parent change or attempt to change the ordinary place of residence of the three children nor seek to remove the children from outside of the Sydney metropolitan area.
A number of orders were made and expressed to be orders made by consent and which had the effect of placing the children upon the airport watch list upon which they remain, and orders with respect to property adjustment.
It is the property adjustment aspect of the matter which is particularly concerning although all aspects of the conduct of the proceeding today are concerning.
Interim orders with respect to property were made which injuncted the husband from using or dealing with the balance of proceeds of sale of a property at Property S, described as the marital home, and to operate until further order.
An order was made by consent that the husband be restrained from using or dealing with the settlement proceeds other than in the following manner:
(a) To pay a debt to the Bank of Western Australia.
(b) To pay real estate agents commission.
(c) To pay “reasonable legal costs associated with the conveyance.”
(d)The balance of the proceeds to be held in trust by the solicitors for the husband pending further order.
Orders were also made for the provision of certain documents by the husband including confirmation of payment out of the Bank of Western Australia loan, provision of a copy of the real estate agents agreement and a copy of a tax invoice with respect to the costs of the conveyance.
The proceedings next came before the Court on 3 July 2012 which represented the matter having been accommodated urgently for now a third occasion. On that date, and at the request of both parties, the proceedings were further adjourned for interim hearing, again, expeditiously being an adjournment of three working days. Time was extended for the filing by the husband of a Response, Financial Statement and Affidavit. Both parties were ordered to appear in person on the next occasion and the father was ordered to disclose to the Court the address at which he and the children resided, it not being disclosed in any document filed at that time. Indeed there had not been any document filed by the husband at that time notwithstanding:
a)The operation of the Federal Circuit Court Rules which would have required the filing of a Response, Financial Statement and Affidavit within 14 days of service; and
b)Orders made by the Court as to the filing of such documents.
When the proceedings then came before the Court on 6 July 2012, the wife appeared and was represented by Counsel and an attorney appeared on behalf of the husband.
On that date orders were made by consent and which provided for the present regime of time relating to the children and being that they live with their father and spend time with their mother from after school Friday to before school Monday each alternate weekend together with a number of other periods.
An order was made appointing an Independent Children’s Lawyer based upon the allegations raised at that time by each of the parties.
It is to be noted that the folio of the Court file suggests that on 5 July 2012, the date by which documents were to be filed by the husband, that the husband had filed a Financial Statement, Affidavit and Response. Those documents would not appear to comply with Federal Circuit Court Rules in that they do not sufficiently identify issues that are in fact in dispute between these parties.
A number of Affidavits have been filed in the proceedings being Affidavits deposed by attorneys for one or other of the parties and those Affidavits would appear to outnumber those in fact filed by the parties.
An examination of the Affidavit filed by Mr Terrell, having been sworn 4 July 2012 and filed 5 July 2012, reveals that no reference is made to any issue with respect to financial arrangements or property adjustment. The document represents nothing more than a jeremiad as regards the mother and suggested deficiencies in her as a person and a parent.
The Financial Statement that is filed is handwritten, which is permitted by the Rules, and suggests that the property owned by the parties includes the property at Property S referred to above which property had already been or was in the process of being sold. Germanely the Financial Statement suggested that a home mortgage existed approximating the equity in the property or at least leaving little equity. It is also alleged therein, at question 53 page 10, of the Financial Statement as follows:
Other personal liabilities: Specify: Father & Friend. Amount of share: $56,700
Full name of any other liable person: Mr Terrell [being the husband] Your % share: 100%
Thus an allegation is raised by the husband that he owes substantial funds to his father and an unidentified friend in the singular.
The document otherwise suggests that settlement of the sale of the home was due to conclude (see question 59 of the statement) on 9 July 2012.
As a consequence of the inadequacy of those documents (which documents I note are suggested to have been prepared on the husband’s behalf by his attorneys rather than by the husband himself) further orders and directions were made requiring the filing of material by the husband. That included an order that the husband file and serve an Affidavit which particularised, with specificity, that which was alleged with respect to the loans referred to above and of which the wife disavowed all knowledge.
The matter was otherwise adjourned for further mention and directions to 21 August 2012 and the parties directed to attend a further appointment with a family consultant. That arose as the father had failed to attend the earlier Child Dispute Conference on 26 June 2012.
The Response which is suggested by the Court folio to have been filed on 5 July 2012 is nothing of the sort. The document in fact filed on that date is a Response to an Application in a Case.
It is important to note that directions had previously been made for the wife to file and serve an Amended Application. That did not occur. The wife instead filed an Application in a Case which sought a number of interim orders. The Application in a Case professed to seek orders on both a final and interim basis and with respect to property adjustment as well as parenting orders.
The Response to an Application in a Case filed by the father is wholly deficient in placing his case before the Court or establishing any entitlement by him to participate in the proceedings.
Two orders are sought by the Response to an Application in a Case filed on behalf of Mr Terrell. It is again to be noted that the document was not prepared by Mr Terrell himself but by his attorney.
An order was sought that Mr Terrell have sole parental responsibility for the children and that the obligation to attend Family Dispute Resolution be dispensed with. No other order is sought. Thus no order is sought as to the children’s place of residence. No order is sought regarding the children’s relationship, time with or communication with their mother. Importantly, no order is sought with respect to property adjustment. Thus as at today’s date, some 10 months after the proceedings were commenced, that portion of the proceedings is and remains undefended.
That situation is made all the more problematic as the Application Initiating Proceedings filed by the wife and which commenced this litigation seeks as final orders two orders only. One is typed. One is handwritten. There is some controversy as to whether the handwritten amendment is contained upon the Court document only or upon the document as served. In any event one order is sought with respect to parenting being inclusion of the children upon the Airport Watch List. The order sought with respect to property adjustment is in the following terms. “That the mother seeks 75 per cent of the net proceeds from the sale of the marital home.”
Thus it would appear the wife has been equally ill-served by her former legal representatives. I hasten to add that the attorney appearing for and with the wife today is not the attorney who drafted that document.
The Application in a Case filed by the wife on 3 July 2012, which presumably is intended to be in compliance with the direction made as to the filing of an Amended Application, purports to seek an order, on a final basis, for sole parental responsibility of the children and seeks an order, on a final basis, that the wife be paid $600 per week by way of spousal maintenance. That Application has never been pressed.
Interim orders purport to be sought with respect to parental responsibility, the children’s immediate return to their mother, the issue of a Recovery Order to secure the children’s return to their mother and again, spouse maintenance. The wife has never sought to press for any of that relief.
Based upon the matters that were raised in the Child Dispute Conference memorandum and on the basis of it having been suggested, without the parties having been put to the task of checking the accuracy or otherwise of the assertion that a Response had been filed, a Family Report was ordered.
The Report was commissioned by orders made on 21 August 2012 on which date both parties appeared and were represented and the Independent Children’s Lawyer appeared. No criticism is made of Independent Children’s Lawyer who appropriately and diligently sought to commission relevant evidence to allow the matter to progress to conclusion.
Regrettably, the Report has not been prepared. That is not because the Court’s strained and limited resources have not been made available. It is because, for reasons which I have sought an explanation of but which have not been provided, the Court was advised or at least the family consultancy service thereof was advised, that the Report was not required as the parties had and/or were attending Family Dispute Resolution and had reached agreement. That is not intelligence that was shared with my chambers, nor the Independent Children’s Lawyer nor, would it seem, with any attorney for the wife.
Notwithstanding that I have sought explanation as to who advised family consultancy that the Report was not required, I have no information to suggest how that came to be and can take it no further. Suffice to say the Court’s resource has been wasted, other litigants disadvantaged and, ultimately, these litigants have and will be disadvantaged as they will now have a significant delay until a Family Report can be commissioned. A delay of at least eight months.
An order was also made on 21 August 2012 which required that the husband file and serve, no later than close of business 23 August 2012, an Affidavit setting out all of the information relied upon by him with the respect to:
a)The sale of the property, Property S; and
b)Loans alleged in paragraph 53 of his Financial Statement sworn 4 July 2012 as “Other Personal Liabilities – father and friend - $56,700.
A further, more specific order was made which required that such Affidavit annex all documents relevant to and relied upon or suggested as tending to prove the allegations regarding the alleged loan or loans together with all documents relevant to the sale of the home including, but not limited to:
a. Copy of the first page of the contract for sale;
b. Copy of correspondence from Bank of Western Australia confirming the discharge figure of their mortgage and confirmation of payment of same;
c. Copy of the settlement statement with respect to the property;
d. Copy of the real estate agent’s agency agreement evidencing commission to be paid on sale and commission in fact paid;
e. Copy of the tax invoice from the solicitors acting with respect to the sale of the property and setting out in an itemised fashion, as required by the Legal Profession Act, the costs charged on the conveyance together with a copy of the cost agreement entered into by that attorney and the vendor;
f. Copy of statements, ledger cards or other material relating to and evidencing the deposit of funds from the proceeds of sale of the property (including accounting for the agent’s commission) to the trust account of the solicitors who acted with respect to the sale and demonstrating an absence of any transaction with respect to those funds following deposit.
The above orders were made largely as a consequence of the failure by the husband to comply with the orders previously referred and enumerated above regarding disclosure and notwithstanding that those orders were, by and large, orders made by consent.
That which is annexed to the husband’s material as filed is suggested to be in partial compliance with the above orders. The Affidavit includes a settlement statement and other pieces of correspondence and suggests that legal fees with respect to the conveyance had been charged and paid in the sum of $6,800.
The quantum of conveyencing fees had been raised during the listing on 21 August 2012 and as a consequence of which a notation was included at paragraph 14 of the orders as follows:
IT IS NOTED that suggestion is raised that the solicitors who acted with respect to above conveyance charged fees with respect to same of or in excess of $6,000 which costs, if in fact charged, would appear onerous, inflated and in breach of the spirit of orders made by consent as between the parties 20 June 2012. If such allegation is established it would warrant a referral of such conduct to the Legal Services Commissioner.
As a consequence, a further and final order was made on 21 August 2012 requiring the solicitor with carriage of the conveyance (being the husband’s solicitor) to appear before the Court in person at 3.30pm on 24 August 2012 for the purpose of being afforded the opportunity to make submissions as to why such referral should not occur.
Submissions were made on that date and in lieu of such referral and in an attempt to avoid, if nothing else, the unpleasantness of same, orders were instead made to facilitate assessment of costs under the relevant provisions of the Legal Profession Act 2004 and in particular, section 350.
It has been submitted from the bar table today, presumably to dissuade the Court from any suggestion of wrongdoing, as to which I make clear no finding is made, that an application for assessment of costs was made by the wife or by her then or former attorneys, if they might be so described, in light of the following, for assessment of costs.
It is suggested that the application for assessment was filed by the attorneys then on the record for the wife but following termination of their instructions. The material that warrants or supports such allegation is not before the Court.
However, what is also clear is that after the application was made, with or without instruction from the wife but in compliance with the orders made by the Court which compelled the wife, should she so desire or intend to do so, to make such application within 28 days, the application was withdrawn. The wife asserts through her attorney today (although again there is no sworn evidence before the Court with respect to it and thus no finding is made) that she, as a consequence of pressure or duress of some form from the husband or others, withdrew the assessment application.
Thus, the assessment envisaged by the orders of 24 August 2012 and in lieu of referral to the Legal Services Commissioner, has not occurred.
Also today, being the first occasion on which the matter has come before the Court since 24 August 2012, issue has arisen regarding the Affidavit filed by the husband in suggested compliance with the orders referred to above and being that sworn and filed 23 August 2012. It is to be remembered that the husband was directed, ordered and required to set out therein all information relied upon by him with respect to the suggested loans totalling $56,700.
Three paragraphs of the affidavit under a heading “Personal Loan” are suggested to deal with and comply with the above order. Those paragraphs read as follows:
15. Annexed herewith and Marked G Statutory Declaration of [name omitted].
16. Annexed herewith and Marked H Statutory Declaration of [name omitted].
17. Annexed herewith and Marked I Statutory Declaration of [name omitted].
There are then annexed three statutory declarations, one by each of the persons identified. Each of those statutory declarations asserts that the husband is or was in debt to them in specified sums. The difficulties with same are that:
a)No other document is annexed (such as documents evidencing the advance, receipt or expenditure of funds);
b)No evidence whatsoever is led by the husband with respect to the suggested loans;
c)There is no evidence contained in the Affidavit within the meaning of the Evidence Act. Nothing which is relevant, probative or, simply admissible, is thus contained in the document.
The issue has thus arisen and have I sought to obtain submissions from Counsel for the husband as to why I should not review and revisit the suggested referral to the Legal Services Commissioner regarding overcharging and, in addition, the failure to provide full, proper and appropriate assistance to the husband and, thereby, the Court, in what might be categorised, and which I have for the purpose of seeking submissions, categorised as gross incompetence in the drafting of that Affidavit.
They are matters which are not directly germane to the exercise of the Court’s jurisdiction in determination of the judiciable dispute between these parties. However, they are matters which fall within the domain of the Court’s concern.
It is the Court’s entitlement to be vigilant as to the conduct of proceedings before it. As Wooten J discussed in McMahon v Gould (1982) 7 ACLR 202 there are a number of basic rights and entitlements of litigants, commencing with the right of a plaintiff, to have their action tried in the ordinary course of procedure and business of the Court.
In that regard it is very clear that these proceedings, for 10 months now, have done very little but to consume the Court’s and parties’ resources and those of the public purse through the funding of the Independent Children’s Lawyer. It is in no way a criticism of the Independent Children’s Lawyer who is doing the best that she can to provide abundant assistance to the Court and the parties in circumstances which are, at best, trying, wherein there is no readily available means to ascertain what either party in fact invites the Court to do, let alone the evidence relied upon by them.
However, the wife’s position is also added to by the difficulties which follow from the, at very least, poor preparation and presentation of her case to date. Indeed, on most occasions the matter has been before the Court time and attention has been diverted from the paramount interests of these children, or determination of property proceedings between these parties, so that the bench can, in essence, referee disputes and controversies between the legal practitioners and to the extent that it has been necessary, on at least two occasions, for the Court to order a transcript of proceedings on the basis that one or other of the attorneys has suggested some impropriety by the other.
For the purpose of this determination I am focused upon the issues I have identified as to whether there can or should be a referral of conduct as regards the apparent or suggested overcharging with respect to the conveyance and that which arises from the inadequacy of the material that has been placed before the Court.
I am satisfied that the Court has jurisdiction to control its own affairs. I am satisfied that the Court has an obligation, see, for instance, Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175, to ensure that its resources, in this day and age, are well managed and well applied and are not wasted by the parties.
As Mason CJ discussed and explained in Giannarelli v Wraith (1988) 165 CLR 543, a barrister’s duty to the Court, in this case extending, I am satisfied, to an attorney, epitomises the fact that the course of litigation depends on the exercise by Counsel of an independent discretion or judgment in the conduct and management of a case in which he has an eye not only to his client’s success but also to the speedy and efficient administration of justice. His Honour concluded:
The duty to the court is paramount and must be performed, even if the client gives instructions to the contrary…The administration of justice in our adversarial system depends in very large measure on the faithful exercise by barristers of this independent judgment in the conduct and management of the case.
Thus, as is discussed in a paper delivered by the New South Wales Legal Services Commissioner, Steve Mark, to the Australian Young Lawyers stream of the Australian Legal Convention on 18 September 2009:
Inherent in the lawyer’s duty to the Court is a duty to the community through the lawyer’s high ethical standards and duty to uphold the rule of law. Legal practitioners must not only obey the law but must also ensure the efficient and proper administration of justice. This is a duty owed to society as a whole. The duty to the court stipulates that as officers of the Court, legal practitioners must act in a certain way.[1] Legal practitioners must not mislead the Court[2] and must act with competence, honesty and courtesy towards other solicitors, parties and witnesses. The duty to the Court also provides that legal practitioners are independent (free from personal bias), frank in their responses and disclosures to the Court and diligent in their observance of undertakings given to the Court or their opponents.[3]
[1] Myers v Elman [1940] AC 282 at 291 (Lord Maugham), 302 (Lord Atkin), 307 (Lord Russell of Killowen), 316-9 (Lord Wright), 334-5 (Lord Porter).
[2] New South Wales Bar Association v Thomas [No. 2] (1989) 18 NSWLR 193.
[3] New South Wales Bar Association v Livesey [1982] 2 NSWLR 231, at 233; New South Wales Bar Association v Thomas (No 2) (1989) 18 NSWLR 193 at 204; Wallersteiner v Moir (No 2) [1975] QB 373 at 402.
The paper continues:
The duty to the Court is also reflected in State and Territory Professional Conduct Rules in Australia. In NSW, for example, Rules 17-24 of the Revised Professional Conduct and Practice Rules 1995 (Solicitor’s Rules) clearly state that a legal practitioner:
“in all their dealings with the courts, whether those dealings involve the obtaining and presentation of evidence, the preparation and filing of documents, instructing an advocate or appearing as an advocate, should act with competence, honesty and candour. Practitioners should be frank in their responses and disclosures to the Court, and diligent in their observance of undertakings which they give to the Court or their opponents”.
I hasten to add that I am not suggesting that the Court has been misled, at least not through any conscious action by the attorney or anything put by the attorney to the Court.
The difficulty that arises in this circumstance is that orders have been made by the Court, on a number of occasions now, to seek to move the matter to conclusion. That has included, as I have already noted, these proceedings having been listed before the Court, including in Chambers in the case of the Registrar dealing with an Application for abridgment of time, on each of 13 June 2012, 20 June 2012, 3 July 2012, 6 July 2012, 21 August 2012 and again on 24 August 2012. All of those appearances are within the space of around nine weeks. That is to respond to the suggested urgency raised, initially by the wife, with respect to both parenting and property issues and to allow those issues to be fully and properly addressed.
The Court has not been assisted in any fashion by the husband or his attorneys. Whilst I accept and appreciate that an attorney is a creature of instruction and thus bound by their client’s instructions, the overriding obligation that an attorney owes to the Court and the community, to ensure the proper conduct of litigation, is something which has real gravity in these proceedings.
It is to be noted that in this day and age, and particularly within this Court, that significant workloads apply with resources that are continuously and increasingly strained and in demand. The resources that have been available to this matter – two Child Dispute Conferences, an order and thus the reservation of time of a family consultant to conduct interviews and prepare a Family Report, let alone the Court time that has been consumed with this matter – is far more than most litigants have made available to them for the totality of their case.
The Court’s resources have been made available for no apparent purpose as they have all been wasted. The matter has progressed not one single centimetre forward since it was commenced.
In Myers v. Elman [1940] AC 282, the House of Lords succinctly set out what a legal practitioner can and cannot do in litigation. That case involved an allegation of a suspected false statement knowingly allowed by the client’s attorney to be made. I hasten to note, again, that I am not making such a finding or, indeed, allegation. What I am talking about in this case is what could only be described as the most incompetent preparation of material such that the Court, notwithstanding a series of orders and the filing of a document in purported compliance therewith, still has no evidence available with respect to significant transactions which the wife would appear to suggest are, at the very best, the husband’s responsibility and, at the worst, would represent fraud, collusion, or an argument of wastage (see, for instance, Kowaliw v Kowaliw (1981) FLC 91-092). The House of Lords indicated that a solicitor:
…can not simply allow the client to make whatever affidavit or documents he thinks fit, nor can he escape the responsibility of careful investigation or supervision. If the client will not give him the information which he is entitled to require, or if the client insists on swearing an affidavit which the solicitor knows to be imperfect, the solicitor’s duty is to withdraw from the case.
Clearly, the document that has been filed was intended specifically – by reference to the orders to which I have referred – to allow the wife and the Court to understand that which is alleged. It does not fulfil that purpose.
Clearly, the document that has been filed was intended specifically – by reference to the orders to which I have referred – to place before the Court all “evidence” relied upon by the husband to prove disputed loan transactions. It does not fulfil that purpose. Indeed, there is simply no evidence within the document which falls within the ambit of the order made.
It is asserted by the attorney who prepared the document (which I deliberately do not refer to as an Affidavit) that the material contained within the document is the information that has been provided by the client. However, in the words of their Honours, that then imposes an obligation, one would think, for a solicitor to make further inquiry, insist on further instruction, and if it is not available, to withdraw. Otherwise, the action of the client – if that is what it is – becomes the action of the attorney.
On one view the document, drawn as it is with no regard to the Evidence Act or basic rules and protocols of drafting that should be known to an undergraduate law student let alone a lawyer or legal practitioner, represents gross incompetence. On another view and if knowledge of the above matters is assumed, it aids the husband, deliberately or otherwise, in breach of the Court’s orders and the husband’s obligations both under those orders, the Federal Circuit Court Rules and as regards his general duty of disclosure (as discussed in authorities such as Weir & Weir (1993) FLC 92-338 and Black & Kellner (1992) FLC 92-287 and many others).
In Kyle v Legal Practitioners’ Complaints Committee [1999] WASCA 115, a West Australian Supreme Court decision, their Honours opined:
It is the essence of a charge of unprofessional conduct involving misleading the court that the practitioner concerned is guilty of having done something dishonourable…The dishonourable quality lies in knowingly misleading the court…A practitioner who knowingly misleads a court will do so dishonestly. Therein lays the unprofessional conduct. There can be no professional misconduct where a practitioner innocently misleads a court; that is, without knowledge that the court is being misled I accept, therefore, the submissions made by senior counsel that an intention to deceive, or dishonesty, is a necessary element of misleading the Court.
Thus the issue which potentially arises in this case is whether the preparation and filing of a document which contains no admissible evidence as to the judiciable controversy could constitute misconduct.
Again, I make clear that I am not suggesting that there has been any statement made by the attorney to the Court designed to or purposive of misleading the Court. However, the Court is misled through omission.
Directions have been made, indeed orders made, on not less than two occasions requiring the disclosure by the husband of certain documents and the provision of certain evidence on oath. It has simply not been provided. What has been provided is not evidence. The provisions of the Evidence Act have been entirely overlooked as have any basic principles of drafting. It is regrettable and egregious.
The provisions of the Evidence Act and prior to them, the common law provisions with respect to evidence, have developed to ensure the integrity of the judicial process and, indeed, as regards legal practitioners, officers of the Court, to rely upon their assistance and vigilance in ensuring that matters are dealt with promptly, expeditiously and upon probative admissible evidence.
The Affidavit that is filed if it is asserted, as it has been in submissions by the attorney in question, to provide “evidence” to the Court represents such a lack of knowledge, understanding or insight into that which is admissible or which constitutes evidence that, in my mind, it must represent, at the very least, incompetence. As to whether wholly omitting material or failing to obtain and include it, not only as part of a client’s obligation to full and frank disclosure but pursuant to orders by the Court compelling its disclosure, is tantamount to misconduct is best a matter for determination by the Legal Services Commissioner. I am satisfied that is nothing short of allowing the husband to mislead the Court not through active statement but through omission and chicanery.
It is regrettable that the Court must deal with any such matter. However, the standards of legal practitioners and the preparation by them of cases on behalf of clients is of fundamental importance to the administration of justice as was observed by my brother, Lindsay FM, in Khotsimeuang v Workcover Corp of SA [2006] FMCA 204 in dealing with a similar issue as to poorly prepared material.
There is nothing about that [being the relevant and germane issue in the proceedings] in the affidavit. It may be that the applicant did not give Mr Vigar [the solicitor] instructions in relation to that matter. If that were the case, again, focusing upon the circumstances in which the litigation was embarked upon, it seems to me it ought to have been the subject of some inquiry.
The information was, after all, easily available. It was available simply by making an inquiry …
That is the issue in this case. If the loans can be asserted as an allegation within a Financial Statement (and within that document it is an allegation and no evidence is led whether within the Financial Statement or subsequent Affidavit which would support the allegation or enable a finding of fact in accordance with it), then clearly evidence must be available. Indeed, the fact that statutory declarations have been completed, it would appear without the engagement or involvement of the attorney, but then annexed to an Affidavit, would suggest that evidence is readily available from those persons.
The Statutory Declarations are not sworn evidence. For it to be evidence, it requires:
a)Evidence to be led by the husband who would have knowledge of the transactions. He has been silent on the issue. What is completely absent is any evidence by the husband himself and the production of any document supportive or corroborative of the allegation;
b)Affidavit evidence by each of the three makers of the statutory declarations.
It is to be noted that a statutory declaration is not a form of evidence recognised in this Court or by its Rules.
This Court conducts its business in accordance with the Federal Circuit Court Act 1999 and Federal Circuit Court Rules 2001 by Affidavit evidence or oral evidence. A clear order was made compelling the filing of Affidavit material. Indeed, all evidence that was to be relied upon with respect to those issues.
It is open to the husband to be silent. In those circumstances the husband would run the risk of a Jones v Dunkel (1959) 101 CLR 298 inference. However, it is not open to him to mislead or deceive or mischievously feign compliance.
To assert that the material provided was considered appropriate by the attorney must, at best and at its most innocent, represent gross incompetence and a complete failure to comprehend the meaning of evidence. In those circumstances I am satisfied that the matter must be referred to the Legal Services Commissioner.
The Court simply cannot condone the wastage of its resources that this represents let alone the disadvantage to which the wife is put. She cannot instruct her attorneys or embark upon any further inquiry without that information being provided and it was information and evidence wholly and solely within the domain of the husband.
The husband instructs attorneys. It is their duty and responsibility to prosecute his interests diligently but consistent with their obligation to the Court and the broader community. The standards demonstrated in the preparation and conduct of this case to date fall so far short of those standards that I am satisfied, although it is not a matter of my satisfaction, that it would represent, at the very least, unacceptable conduct if not misconduct.
I am also satisfied that the husband’s actions as aided, assisted or condoned by his attorneys, have a real potential if not having real prejudicial effect upon the wife.
The pool of property that is available for division between these parties, bearing in mind the significant number of appearances that have occurred within a limited period of time and now the necessary further adjournment of the proceedings with absolutely nothing gained, is miniscule. There is presently a fund of less than $10,000 available for division between these parties and thus:
a)The amount suggested to be outstanding as loans and thus payable from that sum dwarfs that available for division between the parties by a factor of six;
b)The costs which have been charged with respect to the conveyance approximate the amount which will be available for these parties.
The Court is required (see Jefferson Ltd v Bhetcha [1979] 1 WLR 898) to balance justice between the parties. The Court has made attempts, through orders to commission evidence from litigants in the proceedings, litigants who have an obligation to disclose that information and advance that evidence without Court order, and has been unsuccessful in doing so.
The Court relies upon legal representatives for parties to aid in the conduct of litigation and to aid the exercise of jurisdiction. The Court has a realistic expectation that will apply in that proportion of cases left where parties are able to or choose to instruct legal representatives.
A party has an obligation, as does their attorney, to ensure that litigation is conducted promptly and efficiently and, in the case of attorneys, to ensure that justice is done, justice is able to be done and that the Court is treated as the attorney’s primary duty. That would appear to be entirely lacking in the context of this case.
As regards the costs to which I have already referred, I am satisfied that it is not a matter for me to determine whether they are inflated although, on their face, they would appear clearly to be so.
The suggestion, in accordance with a cost disclosure document filed in evidence, is that the costs charged are in accordance with the disclosure made by the attorney (s.309 of the Legal Profession Act 2004).
However, the cost disclosure provided was on the assumption that litigation, which was apprehended, would in fact be required and would occur to cause the removal of a caveat. That is concerning for a number of reasons:
a)The caveat was lodged by the wife. The wife was legally represented and there is no evidence to suggest that any request was made at any time to obtain the withdrawal of caveat and simply enable the matter to proceed unhindered. In that case the only increased cost would have involved the writing of a letter or the making of a telephone call together with an additional lodgement fee for a withdrawal of caveat.
b)Litigation is not required to remove a caveat. Provisions of the Real Property Act 1900 (NSW) (such as s.74J) are clear. The obligation is upon the caveator to justify the continuation of the caveat against title in the event of controversy. Thus, an application for preparation of lapsing notices would have resulted, after the expiration of the relevant period after service, in the automatic removal of the caveat without the need for any litigation. If litigation were to eventuate then it was a matter for the wife to instigate and, in which case, costs would have been at large in those proceedings and would, in all probability, have followed the cause.
c)Thirdly, and perhaps most importantly, the Legal Professional Act 2004 contains clear provision regarding not only cost disclosure but the obligation to update that disclosure and advice at all times (s.316). Thus, on the basis that cost disclosure was made in anticipation of litigation to require the removal of the caveat and litigation not having eventuated, variation of the cost disclosure should have been given in writing to the relevant client. Clearly, the client was the husband not the wife.
d)However, that leads to the fourth, final and most grave issue being that, on its face and from that which has been put to the Court both in submissions on 24 August 2012 and in the Affidavit material filed, costs have been charged for work which was simply not performed. It was anticipated that if performed, that work would result in a certain cost. Submissions were put on 24 August 2012, and which the orders for assessment were intended to seek redress or remedy, that cost disclosure having being made, the practitioner was entitled to payment in accordance with the notice of disclosure. That would appear an entirely erroneous position and wrong at law. Indeed, it would appear to be entirely inconsistent with all which has flowed from such authorities as Bechara v Legal Services Commissioner [2010] NSWCA 369.
In those circumstances, I am satisfied that having taken what I had described at the time, 24 August 2012, as the preferable course of least resistance, that is, orders which would instigate and allow assessment of costs, that there is no alternative now left.
I note that as there is significant impact upon the subject matter of the proceedings between these parties, that is, the pool of property available for division is depleted by something in the nature of 60 per cent of its total by the costs charged, to similarly make referral on the basis of a concern that there has been gross overcharging.
Therefore, I make orders as set out at the commencement of this Judgment.
I certify that the preceding one hundred (100) paragraphs are a true copy of the reasons for judgment of Judge Harman.
Associate:
Date: 22 April 2013
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