4.    Role of the Disciplinary Proceedings

The role of disciplinary proceedings in New South Wales was articulated by Beazley JA in Walsh v Law Society of New South Wales.[1] In that case Her Honour stated that:

“it is undisputed that disciplinary proceedings are concerned with the protection of the public.  The court’s duty to protect the public is not confined to the protection of the public against further misconduct by the particular practitioner who is the subject of disciplinary proceedings.  It extends to protecting the public from similar defaults by other practitioners.  Thus, it is relevant to take into account the effect the order will have upon the understanding in the profession and amongst the public of the standard of behaviour required of solicitors.”[2]

Her Honour referred to Mahoney JA’s judgment in Law Society of New South Wales v Foreman[3] where it was stated:“…in deciding whether a person is a fit and proper person for this purpose, the Court may, in accordance with the circumstances, take into account matters going beyond the mere protection of the public against similar misconduct.”[4].

Should the Council recommend an initiation of proceeding against S, these are not designed to be punitive in nature.  For example in Harvey it was held that striking a solicitor off the Roll was in the interest of protecting the public interest after the solicitor had been found guilty of professional misconduct resulting from the commingling of his clients funds with companies in which he held a financial interest.  Similarly in Clyne v The New South Wales Bar Association[5] case, the High Court expressed the view that it was bound to protect the public.  The Court also found that it was required to protect the reputation and the privileges of the balance of the profession.  For example, the Court held that:

“Although it is sometimes referred to as the “penalty of disbarment”, it must be emphasized that a disbarring order is in no sense punitive in character.  When such an order is made, it is made, from the public point of view, for the protection of those who require protection, and from the professional point of view, in order that abuse of privilege may not lead to loss of privilege.”[6]

Finally, Sheller JA’s judgment in Law Society of New South Wales v Bannister[7] is the authority for the proposition that:

“..the exercise of the power to remove from the roll, suspend or fine a solicitor is directed to protecting the public by ensuring that those not fit to practice do not continue to hold themselves out as fit to practice and that high standards are maintained.  The maintenance of such standards involves deterring the offender from repeating the offence and deterring others who might be tempted to offend.”[8]

The issue now turns to the likely consequences for S, having regard to the legal principles stated above.  If the Council refers proceedings, in regards to the complaints against S, to the Legal Services Commissioner, the subsequent tribunal can make any order it thinks fit under the Act.  From the facts and taking into account the provisions in the Act and the Common Law, S has misappropriated client funds and has breached corresponding provisions in the Act under Section 255 and 256 of the Act.  S misled an officer of the ATO by not fully explaining his position in the company being audited and manner in which he obtained the information requested by the officer.  Finally S has misled his client and breached the fiduciary duty owed to her.  It is immaterial that no damage has been suffered by Maria as per the authority in Bolster’s case it is the unethical conduct that the Commissioner and tribunal are most concerned with.  For these offences it is likely S would be guilty of Professional Misconduct under statute and at Common Law.

5.    Orders Available

Should S be found guilty of Professional Misconduct, the question then turns on whether S is a fit and proper person to remain on the Roll and whether the tribunal is comfortably satisfied under the Briginshaw test mentioned above as to his apparent fitness or lack thereof.  In Foreman, Mahoney JA stated that:

“…in deciding whether a person is a fit and proper person for this purpose, the Court may, in accordance with the circumstances, take into account matters going beyond the mere protection of the public against similar misconduct.  The Court may consider the character of the practitioner, or aspects of it relevant to the office of a solicitor.  A solicitor may affirm and sincerely believe that she will not offend again. But the character of the solicitor – demonstrated by the offence or otherwise – may be such that no sufficient reliance can be placed upon that affirmation.”[9]

In this case, noting the elements of Professional Misconduct and S’s actions and no apparent mitigating factors that could be taken into account to build credible case of prospects not to offend in this manner again it is likely that the Council pass this complaint to the Legal Services Commissioner for determination.  It is likely that the Legal Services Commissioner would seek a protective order that S be struck off, and possibly a supplementary order for costs.