OVERVIEW

4.1 Following on from the Commission's identification of the general (or "best practice") principles which should govern the system of handling complaints against legal practitioners and the testing of the existing system against those principles in the previous Chapter, the Commission now sets out its recommendations for major reform, with supporting commentary. For reasons of convenience only, we present the "core" recommendations in this Chapter, which relate to the internal workings of the proposed system. The remainder of recommendations, which deal with external scrutiny, education and prevention, and ancillary matters (of no less importance), are presented in Chapter 5. (Chapter 6 contains a summary of all recommendations.)

4.2 In the preceding Chapter, we concluded that the design of a proper system of complaints handling must recognise that there are multiple aims which must be met: (1) there is a consumer dimension, with the consequent need to redress the complaints of dissatisfied users of legal services, but there is also (2) the need to ensure the diligence and competence of individual practitioners, as well as (3) setting and maintaining high standards of ethics and practice for the legal profession generally. Our central criticism of the operation of the existing system is that it is geared mainly to the second aim, fails to achieve even this adequately in relation to lower-level unsatisfactory professional conduct, and does not sufficiently address the other two aims.

4.3 Consequently, the vast bulk of complaints in any year are dismissed, which leaves complainants cold and sends the legal profession the quite incorrect message that, apart from some rare and spectacular lapses by a few individual lawyers (usually involving some aspect of dishonesty), there is really no need to improve the general standard of services provided. In fact, the Commission's File Survey confirmed that while a few complaints are completely insubstantial, most of them do point to genuine problems of service delivery, such as inordinate delay, poor lawyer-client communications, discourtesy and so on, for which the consumer gains no redress and the legal practitioner no sanction or incentive to improve.

4.4 Thus, the Commission has endeavoured to design a new system which is much more consumer-oriented and which actually will deal seriously and effectively with most complaints and disputes. Among other things, this will require educating the public about the nature of legal services and their rights and remedies under the disciplinary system, and educating the legal profession about the standards of practice and common courtesy to which clients should be able to feel entitled.

4.5 Briefly, the key features of the recommended new system include:

• both the perception and the reality of much more independence from the legal profession, through the establishment of the office of Legal Services Ombudsman, and changes to the provisions regarding the appointment of lay and legal participants in the disciplinary system;
• strengthening the mechanisms for ensuring the accountability of the legal professional associations and the other institutions involved in the complaints handling system, through the reinforcement of the powers and resources of the lay person-dominated Conduct Review Panel (as well as by the creation of the office of the Legal Services Ombudsman);
• much easier access to the system for potential complainants, in terms of information, language, physical access and so on;
• a more simple, streamlined structure to the system, with the central intake of all complaints about the (non-)delivery of legal services (including disputes about fees and costs), a central source of advice and assistance about making complaints (through the Legal Services Ombudsman), and a single Legal Services Tribunal to conduct hearings with greater and more flexible powers to sanction lawyers and make compensatory orders in favour of complainants;
• redress of the current imbalance of rights and safeguards between complainants and lawyers, with the creation of a statutory Complainants' Charter of Rights;
• a clearer distinction between consumer-type disputes and disciplinary matters, with a much greater emphasis on consensual dispute resolution, arbitration and compensation in the former cases; and
• increased attention to education and prevention measures, such as compulsory training in legal ethics for law students, feedback to the legal profession from the disciplinary system, and the emphasis on "Client Care" principles and practices in solicitors' offices.

4.6 The centrepiece of the reforms is the establishment of the office of Legal Services Ombudsman, around which the rest of the proposed system is designed. At the conclusion of the preceding Chapter, the Commission discussed the powerful concerns about independence and accountability which led us to the conclusion that the primary responsibility for the regulation and discipline of the legal profession could no longer be left to the profession itself, and which led us to prefer the strategy of using a Legal Services Ombudsman, rather than a Legal Services Complaints Commission.

4.7 Throughout the recommendations the Commission proposes that the independent bodies involved in the complaints handling system be referred to as the Legal Services Ombudsman, the Legal Services Tribunal and the Legal Services Conduct Review Panel. The current legislation uses the prefix "Legal Profession" to designate the various disciplinary bodies now in existence; ¹ however, the Commission believes that there should be no possibility of confusion between those institutions which are controlled by the legal profession (such as the Councils of the Law Society and the Bar Association, and the committees which operate under the delegated authority of the Councils) and those which are designed to be independent of professional control.

RECOGNITION OF THE MULTIPLE AIMS OF THE LEGAL PROFESSION'S DISCIPLINARY SYSTEM

1. Part 10 of the Legal Profession Act 1987 should expressly recognise that the multiple aims of the disciplinary system are: (1) to redress the consumer complaints of users of legal services; (2) to ensure compliance by individual legal practitioners with the necessary standards of honesty, diligence and competence; and (3) to maintain the ethical and practice standards of the legal profession as a whole at a sufficiently high level.

2. Fulfilment of the multiple aims of the disciplinary system requires a comprehensive, integrated approach, which provides for: community education about the legal system and the role of lawyers; assistance for complainants to facilitate access to the complaints system; the prompt, thorough investigation of complaints; the diversion of appropriate matters for consensual dispute resolution; the formal hearing of allegations of unsatisfactory professional conduct and professional misconduct; a flexible range of sanctions and remedies which satisfy the needs of complainants and the public interest in effective discipline; and education, counselling, and other assistance programs for lawyers.

Commentary (Recommendations 1-2)

4.8 The Commission stated in DP 26 that the complaints handling system should be:

more attuned to redressing the grievances of individual complainants, but this should not be at the expense of the general public interest in ensuring that licensed legal practitioners conduct their work with honesty, diligence and competence, and that the standards of practice required of lawyers generally are maintained at a sufficiently high level.²

4.9 Thus, the system for handling complaints against lawyers must serve at least three aims: to address promptly the consumer-type concerns of particular complainants; to secure the compliance of individual legal practitioners with the standards of professional practice; and to ensure that the standards of the profession generally are maintained at a high level. At the same time, it must be remembered that rights of professional practice must not be arbitrarily removed or limited, nor should a practitioner's professional reputation be capriciously tarnished, so that a lawyer who has been complained about should be entitled to expect a fair hearing before suffering any penalty or being subject to any criticism.

4.10 In the preceding chapter, in relation to "best practice" principles for complaints handling, the Commission noted that the "one procedure fits all" approach which has applied in NSW has largely lost sight of the (first and third) aims of client/consumer satisfaction and maintenance of high professional standards. In practice, the traditional approach has had the flavour of litigation, with the focus on whether the complainant has made sufficiently strong allegations to put into question the respondent lawyer's continued rights of practice.

4.11 In DP 26, the Commission stated that one of the biggest problems with the existing system has for some time been the "profound gap between what angered clients and what lawyers and their professional associations saw as important enough to merit disciplinary action." ³ While clients overwhelmingly complain about such matters as negligence, incompetence, delay, poor communications, discourtesy and overcharging, these complaints are rarely proceeded with and rarely result in any censure, sanction or compensation. Even where the complainant has achieved the desired result - the reduction of a bill or the surrender of files, for example - the lengthy delays involved may take the gloss off the successful resolution. It is clear from the submissions received and from the Commission's own research - especially from the survey of Law Society complaint files - that this was fair criticism and that the problems are still pervasive.

4.12 The systems for handling complaints against solicitors in Victoria and in England and Wales have changed in recent years, putting far more emphasis on the prompt resolution of clients' grievances through the use of consensual dispute resolution techniques and the ready award of compensation.⁴ The submissions of both the Law Society and the Bar Association recognise the need to move in this direction and propose mediation schemes for lawyer-client disputes.

4.13 The Commission generally supports these initiatives and makes numerous recommendations aimed at increasing the use of mediation and arbitration, and making compensation more readily available for the settlement of consumer-type disputes. However, the Commission stands by its caveat, quoted above, that a greater orientation towards client concerns must not come at the expense of the other aims of the system. What is needed is a comprehensive system with a number of separate components which, when taken together, meet all of the desired aims. ⁵

THE LEGAL SERVICES OMBUDSMAN

3. An office of Legal Services Ombudsman should be established as an independent, statutory authority. The Legal Services Ombudsman should be appointed by the Governor in Council for a term not exceeding seven years, after which the person is eligible for reappointment.

4. It should be open to the Governor to appoint one or more persons (in the same manner) to the position of Deputy Legal Services Ombudsman if the workload of the office so requires.

5. The office should have a secretariat providing sufficient professional, support and technical services to discharge its statutory responsibilities promptly and effectively in the public interest.

6. A person is qualified to be appointed as the Legal Services Ombudsman if he or she is a person who is broadly familiar with the nature of the legal system and legal practice and possesses sufficient qualities of independence, fairness and integrity. The Legal Services Ombudsman need not be legally qualified, nor should legal qualifications or experience be a disqualifying factor; however, in the event of the appointment of a non-lawyer, legal advice should be available within the office.

7. The functions of the Legal Services Ombudsman should be to:

• handle the initial intake of all complaints against legal practitioners - including non-lawyers who offer legal services, such as conveyancers;
• provide complainants and potential complainants with the appropriate level of advice and assistance about making complaints or pursuing other avenues and remedies;
• regularly monitor sources of public information, such as news and current affairs reports and court decisions, which may contain information about the conduct of legal practitioners;
• investigate directly complaints made against lawyers who currently serve or have recently served on one of the professional Councils or are otherwise associated with a Council or the complaints handling process, as well as those complaints which the Ombudsman believes should be handled directly in the interests of justice and public confidence;
• refer all other complaints to the relevant professional Council for investigation (such reference may contain a recommendation to investigate, divert to mediation, or both);
• commence an investigation or refer a matter to one of the professional Councils on his or her own initiative, such as where allegations have been aired publicly;
• prosecute disciplinary matters before the Tribunal, following an investigation or upon the request of the Conduct Review Panel or a professional Council;
• be responsible for community education about the regulation and discipline of the legal profession;
• assume a general duty to assist in the enhancement of professional ethics and standards, through liaison with institutions which provide training and education for service providers, as well as through direct efforts, such as by sponsoring research, publishing, and holding seminars and workshops; and
• report annually to Parliament through the Attorney General, and at least semi-annually to the professional Councils.

8. In the proper discharge of the functions of the office, the Legal Services Ombudsman should be entitled to:

• have access, on a confidential basis, to all of the files and other records kept by the professional associations in relation to the assessment and investigation of complaints against lawyers and the disciplinary system generally;
• have sufficient powers to conduct its investigations effectively, including the same powers available to the professional Councils in this respect;
• have the power to dismiss a complaint after investigation, on the same bases available to the professional Councils in this respect;
• attend and participate in any meeting of the professional Councils (or their committees) considering complaints;
• attend the hearings of the Legal Services Tribunal as an observer;
• attend any dispute resolution (mediation or conciliation) conference as an observer; and
• protection from all liability for anything done in good faith in the course of executing his or her statutory responsibilities.

10. The Legal Services Ombudsman should, on a regular basis, conduct surveys of the views and levels of satisfaction of complainants and respondent lawyers with the complaints handling system. Such surveys should be published in the Legal Services Ombudsman's Annual Report.

Commentary

Generally

4.14 The Commission's recommendation for the establishment of an office of Legal Services Ombudsman is based variously on the need for perceived independence, fairness and external scrutiny.

4.15 As discussed in some detail in DP 26, ⁶ there is now a Legal Services Ombudsman in England and Wales, who mainly has a review function.⁷ However, in the model we recommend in this Report, the Legal Services Ombudsman would have a greater and more direct role in the process, including providing assistance in the formulation of complaints and investigating some complaints. (Thus, for reasons of natural justice and potential conflict of interest it would be inappropriate for the Legal Services Ombudsman also to serve as the external monitor, and we prefer to leave that function to the Conduct Review Panel.)

4.16 The Commission has chosen to use the title "Legal Services Ombudsman" for the person selected to play the central role in ensuring the independence, accountability and efficiency of the complaints handling system. As we wrote in DP 26:

The term is well-known and understood by the general public and the media (notwithstanding its Swedish origins), and carries the clear connotation of the independent and impartial investigation of complaints. While the title Ombudsman initially was used mainly in relation to complaints against governments or government officers,⁸ there is a recent trend towards a more general usage.⁹

4.17 A "Banking Ombudsman" has been established in England ¹⁰ and in Australia, ¹¹ and there have been calls in this country for similar positions to be created in the insurance and telecommunications industries. A number of newspapers (including the Sydney Morning Herald) have experimented with an in-house Ombudsman, supplementing the loose regulation provided by the Australian Press Council.

4.18 The preliminary submission of the Australian Consumers Association pointed out that a single ombudsman could be expected to attain a higher public profile than a complaints commission, leading to greater awareness of and trust in the complaints handling system. ¹²

4.19 The Commission agrees that "putting a human face on the complaints handling system" has significant advantages, and considers the title "Ombudsman" to be the most appropriate one. However, the proposed title of the office is much less crucial than the proposed role of the office. The Commission notes, for example, that the Victorian Law Reform Commission recommended that an office of "Legal Services Commissioner" be established in that state.¹³ The NSW Department of Community Services (DCS) recently has released a discussion paper favouring the creation of a "Community Services Commissioner" who would "investigate, mediate and conciliate serious complaints about programmes or services". ¹⁴ However, DCS also has left open the possibility of the appointment instead of a "Deputy Ombudsman (Community Services)", with a similar role.

4.20 The broad role of the office of Legal Services Ombudsman is described in Recommendation 7, and the powers necessary to fulfil those functions effectively are listed in Recommendations 8-10. The establishment of the Office itself, and the qualifications for appointment, are the subject of Recommendations 3-6.

The Office of Legal Services Ombudsman (Recommendations 3-6)

4.21 In Recommendation 3, the Commission formally proposes the establishment of the Office of Legal Services Ombudsman as an independent, statutory authority. The Office itself should have a secretariat (Recommendation 5) with sufficient resources - secretarial, clerical, administrative, professional, technical and technological - to enable the Legal Services Ombudsman to discharge his or her functions effectively. For example, the Office will require a good computer system, adequate telephone facilities and premises for dealing with members of the public, some library facilities, modern filing systems, and so on. Funding for the office is the subject of Recommendation 64, discussed in Chapter 5, below.

4.22 The Commission recommends (Recommendation 3) that the Legal Services Ombudsman should be appointed by the Governor in Council for a term of up to seven years, with the possibility of re-appointment, which is consistent with the nature and terms of appointment of other similar, independent, statutory office holders, such as Law Reform Commissioners, ¹⁵ the Ombudsman, ¹⁶ and the principal Commissioner of the Independent Commission Against Corruption.¹⁷ The period of tenure is designed to promote the perception and actuality of independence, while retaining a degree of accountability that appointment-until-retirement (as in the case of judges) does not.

4.23 The method of appointment is important from the point of view of assuring public confidence in the new institution. In DP 26, the Commission wrote:

Without doubt, the Legal Services Ombudsman must actually be, and be seen to be, above partisan political and sectional interests. As with all statutory office holders, the formal appointment should be by the Governor in Council (that is, the Governor acting on the advice of the Cabinet), after nomination by the Attorney General. The position should first be advertised in the media to attract a suitable field of candidates.¹⁸

We continue to believe that this is the most appropriate course. Regard should be had to the merit selection processes mandated in the Public Sector Management Act 1988 (NSW). If a Public Council on Legal Services were to be established, ¹⁹ it could play an important (advisory) role in the selection process.

4.24 We have not specifically recommended any method of removal of the Legal Services Ombudsman, but this also should be consistent with the position in respect of other statutory officers; ie, removal by the Governor (for proven misbehaviour) upon the address of both Houses of Parliament.²⁰

4.25 The Commission anticipates that the appointment of a single Legal Services Ombudsman would be sufficient initially, assuming adequate support staff are provided as recommended. However, it may be that in future the workload of the Office will require the appointment of one or more Deputies to assist the Legal Services Ombudsman, at his or her direction (Recommendation 4). Such appointments should be made in the same manner as the appointment of the Legal Services Ombudsman - that is, by the Governor in Council, for a period of up to seven years. We note that provision is made in the governing Act of the Ombudsman's Office for the appointment of a Deputy and one or more Assistants, ²¹ and in the Independent Commission Against Corruption's Act for the appointment of Assistant Commissioners. ²²

4.26 The Commission gave careful attention to the qualifications of the Legal Services Ombudsman. The "threshold question is whether appointment to the office of Legal Services Ombudsman should be limited to persons without legal qualifications". ²³ In England and Wales, for example, the legislation specifies that the Legal Services Ombudsman "shall not be an authorised advocate, authorised litigator, licensed conveyancer, authorised practitioner or notary".²⁴

4.27 In DP 26, the Commission wrote:²⁵

The main rationale for limiting the position to non-lawyers is that the external monitoring function is best performed by a person who is not, and would not be suspected of being partial to the interests of the legal profession.

The Commission agrees that the external monitor, whether a Legal Services Ombudsman or some other officer, must be free from any reasonable suspicion of bias (for or against the profession). However, it is less certain that the essential characteristic of independence means that anyone with legal qualifications automatically should be debarred from holding the office of Legal Services Ombudsman. Among practising lawyers, academic lawyers, magistrates, judges and non-practising lawyers (ie, those with legal qualifications who are working in management, banking, journalism and so on), there must be many persons with sufficient personal qualities of independence, fairness and integrity to warrant appointment. Conversely, among non-lawyers, there obviously will be many persons who would be inappropriately sycophantic, insensitive to the needs of consumers, or otherwise unsuitable for appointment.

The Commission believes there are some important advantages in having a Legal Services Ombudsman who understands the substance, context and procedures of legal practice. The process of appointment, discussed above, which involves consultation and careful consideration, should ensure that the particular person chosen has the attributes and community standing to be, and be seen to be, independent of the profession. If a lay person was appointed as the Legal Services Ombudsman, he or she should could, where appropriate, take legal advice from some perceptibly neutral lawyer, such as an academic lawyer or retired judge.

4.29 This still represents the Commission's considered view (Recommendation 6). The Legal Services Ombudsman should be a person of demonstrable independence (and impartiality), fairness and integrity. Legal qualifications probably are desirable, but not essential. The submission from the NSW Commissioner for Consumer Affairs, Mr John Holloway, favoured the appointment of a person with legal qualifications.

4.30 It should be noted that the appointment of a legally-qualified Legal Services Ombudsman would not in itself depart from the Commission's stated aim of increasing lay participation and external scrutiny, since elsewhere in this Report we propose the continued (indeed, the increased) involvement of lay participants in other parts of the disciplinary system - such as on the Professional Conduct Committees of the Law Society and Bar Association, on the new Legal Services Tribunal, and on the Legal Services Conduct Review Panel.

Functions of the Legal Services Ombudsman (Recommendation 7)

4.31 Reception of all complaints. The office of the Legal Services Ombudsman should be the central intake agency for all complaints relating to the provision (or, sometimes, non-provision) of legal services. Generally this involves complaints by clients or former clients against their own lawyers, but the system is not so limited, and it may be that complaints against lawyers will be received from (eg) other lawyers, judicial officers, opposing parties, government officials, or members of the public. (In Recommendation 11, below, we specify that any person may make a complaint.) The system already deals to some extent with complaints against persons employed in lawyers' offices,²⁶ and there are provisions prohibiting the practice of law by "unqualified practitioners". ²⁷ With the trend towards the deprofessionalisation of certain legal services, the system also should be able to accommodate the reception of complaints against providers of legal services who are not lawyers with practising certificates. For example, residential conveyancing, soon will be performed lawfully by licensed conveyancers as well as by solicitors. Under the new legislation, ²⁸ the discipline of conveyancers is to be handled by the Law Society Council and the existing disciplinary bodies (the Legal Profession Standards Board, Disciplinary Tribunal, and Conduct Review Panel).

4.32 The use of the office of the Legal Services Ombudsman as the central intake agency has several major advantages. First, it affords prospective complainants the confidence to approach a clearly independent and impartial body. In DP 26, the Commission noted that:

The initial step in the complaints-handling process may well be the most important, especially from the point of view of the complainant. Persons making complaints must be assured that their problems will be handled promptly, efficiently, sensitively and impartially. ²⁹

The fact that a complaint about a lawyer must be made to that lawyer's professional association may have the effect of dissuading some dissatisfied clients and others from lodging a complaint. ³⁰

4.33 The American Bar Association's Commission on Evaluation of Disciplinary Enforcement has characterised this latter issue as "the familiar criticism that the fox is guarding the henhouse", which, given a certain existing level of public distrust, is likely to be made even where the disciplinary system is in fact "fair to both respondents and complainants". ³¹

4.34 Secondly, a central intake agency would permit the establishment of a single registry of complaints and inquiries,and permit the follow-up of some inquiries which do not result in a formal complaint. The legislation currently requires complaints to be in writing before a formal investigation can commence, ³² and the Commission believes that this is appropriate. However, the Commission is aware that there are some dissatisfied clients and others who go to the trouble of making the initial contact but then do not follow this up with a written complaint for one reason or another:

There are many reasons why people may fail to follow up their concerns about a lawyer's conduct with a formal complaint. These include: the perception (correctly or incorrectly formed) that they were treated unsympathetically when they made the initial contact; the inability or unwillingness to put things in writing; the lack of opportunity to make use of the complaints assistance services provided during working hours; uncertainty over costs; or a sense of futility in complaining about a lawyer to that lawyer's professional association. ³³

4.35 Unfortunately, neither the Law Society nor the Bar Association currently keep detailed records of telephone calls to, or personal attendance at, their offices by persons who may wish eventually to complain about the conduct of a legal practitioner. In DP 26, the Commission contrasted this approach with that of the Complaints Unit of the New South Wales Department of Health:

which does carefully record all inquiries made by telephone or in person. There are several good reasons for preferring the latter approach. The initial recording allows for follow-up, after a time, in those cases in which there appeared to a problem of some significance but a formal, written complaint providing full particulars has not been lodged. The Health Complaints Unit has decided that this issue is so important that it has reorganised its operations in recent times to dedicate more resources to the initial intake and follow-up phases of their complaints-handling procedures. This has involved the development of the necessary computer software to track complaints, the use of more senior staff at the initial stages, and regular meetings of staff to consider follow-up. ³⁴

4.36 The Commission believes that the statutory requirement to take "all reasonable steps" to assist complainants ³⁵ should involve a proper system of recording, monitoring and following up initial contacts from potential complainants. This would now become the responsibility of the office of the Legal Services Ombudsman. Since there is to be increased use of mediation and conciliation (see Recommendations 15-20, below), persons who contact the Legal Services Ombudsman with complaints should be encouraged to participate in these informal dispute resolution processes in appropriate cases where the lawyer-client relationship has broken down, even though the complaint does not raise clear evidence of unsatisfactory professional conduct or professional misconduct.

4.37 This more active approach to the reception of complaints not only benefits individual complainants, but "also provides far more information about the general pattern of complaints, which is ultimately useful for developing policies and strategies aimed at preventing disputes and raising the standards of professional conduct and ethics." ³⁶ (See Recommendation 63, discussed in Chapter 5, below, regarding the need for feedback from the disciplinary system to assist in the enhancement of professional standards.)

4.38 Thirdly, the provision of a single point of entry into the disciplinary system makes the process far more simple and efficient from the perspective of complainants. As discussed in the previous Chapter, one of the Commission's main aims is to streamline the system quite dramatically, to eliminate having the complainant shuttling back and forth before different agencies and institutions, and to avoid the necessity of the complainant having to launch multiple actions in different forums.

4.39 Advice and assistance. It should only be necessary for a person to identify that he or she has a dispute of some kind with a provider of legal services; the Legal Services Ombudsman should then be able to provide full and effective advice and assistance about how best to remedy the problem. In Recommendation 14, discussed more fully below, the Commission specifies that the right to comprehensive (and comprehensible) advice and assistance should be included in a statutory Complainants' Charter of Rights.

4.40 Media monitoring. Another important responsibility of the office of the Legal Services Ombudsman should be to monitor court decisions and, especially, press reports for information or allegations about the conduct of legal practitioners. The American Bar Association's Commission on the Evaluation of Disciplinary Enforcement has made a similar recommendation, commenting that:

Proactive research includes actively monitoring such sources of information about possible lawyer misconduct as media stories and court decisions. Without the staff resources to monitor this information, lawyer misconduct that is public knowledge may escape disciplinary counsel's attention. ³⁷

4.42 Referral and direct investigation. In many or most cases, the Legal Services Ombudsman will, having assisted the complainant to formulate a proper complaint, refer the matter to the relevant professional Council(s), possibly with an attached recommendation to investigate or divert for consensual dispute resolution, or both. The Legal Services Ombudsman likewise may refer matters to the professional Councils which have commenced on the Ombudsman's own initiative (such as where the Legal Services Ombudsman is aware of publicly-aired allegations of misconduct on the part of a lawyer).

4.43 However, it is an essential part of the Commission's recommended system that the Legal Services Ombudsman also be entitled to investigate a matter directly, in certain circumstances. Direct investigation should be obligatory where the subject of a complaint (or an investigation commenced on the Legal Services Ombudsman's own initiative) is a current or recently retired member of one of the professional Councils or is otherwise associated with a Council or with the complaints handling process. This latter category might include (but is not limited to) certain current or past employees of the professional associations (especially those who serve as senior managers), lawyers who serve on important Council committees (especially complaints committees), spouses or other close relatives of Council members, and so on.

4.44 The Commission sees this power as fundamental to ensuring that there is a public perception that the complaints handling process is independent and impartial, and is not part of a "club" in which prominent lawyers look after each other's interests. The natural justice protection also runs in the other direction - a professional Council should not be placed in the position of feeling the pressure to deal unnecessarily harshly with a former member or employee in order to avoid adverse allegations.

4.45 One of the major precipitating factors in the recent changes to the regulation of the legal profession in England and Wales (including the establishment of a Legal Services Ombudsman) was the considerable public outcry and agitation in 1982-1983 over the so-called "Glanville Davies affair". In that matter, ³⁸ a complaint of gross overcharging was made by a client against the named solicitor , who at that time had been a member of the Council of the Law Society of England and Wales for 15 years. Although the solicitor's bill was reduced after "taxation" (review) by court officers from [[sterling]]197,000 to less than [[sterling]]68,000, the Law Society Council refused to pursue any disciplinary action and this decision was not challenged by the then-existing Lay Observer. The client was finally forced to take judicial action, and the Court found that Glanville Davies had been guilty of "gross and persistent misconduct", ordering that he be struck off the Roll of solicitors.

4.46 The Commission recommends that the Legal Services Ombudsman also have a more general power to investigate directly "in the interests of justice and public confidence". The decision whether to refer a matter to a Council or to investigate directly should be entirely at the discretion of the Legal Services Ombudsman. In practice, the decision to directly investigate may be because the particular matter has some special or unusual element in it, or has been the subject of public attention or controversy, or involves the possibility of a real or perceived conflict of interest if referred, or even because the Legal Services Ombudsman simply wishes to handle a representative selection of matters in order to provide a "control group" vis-a vis the professional Councils. No doubt practical considerations also will be taken into account, for there is little value in the Legal Services Ombudsman taking on such an active caseload that he or she cannot devote sufficient attention and resources to each retained matter. (See also below, the power of the Legal Services Ombudsman under Recommendation 9, to take over the investigation of a complaint from one of the professional Councils.)

4.47 Prosecution of matters before the Legal Services Tribunal. Where the Legal Services Ombudsman has conducted the investigation of a complaint (or taken over the investigation under Recommendation 9), and has decided that the matter must proceed to the Legal Services Tribunal for a hearing, the Legal Services Ombudsman normally should also prosecute the matter before the Tribunal. Similarly, the Commission has recommended in this Report that the Conduct Review Panel, after review, should be entitled to refer matters directly to the Tribunal, without the intervention of the Attorney General. (See Recommendation 54, below.) In such cases, the Panel may request that the Legal Services Ombudsman or one of the professional Councils (as appropriate) prosecute the matter before the Tribunal. It also may be that on occasion, after completing an investigation, the Legal Services Ombudsman or a Council might believe that it is desirable for the prosecution be handled by the other, eg to avoid a potential conflict of interest. In such circumstances, it should open for a request to be made along these lines and such a request normally should be favourably acted upon.

4.48 Community and professional education. The general nature of the office and the specific role of the Legal Services Ombudsman in the complaints handling process make it necessary and appropriate for the Legal Services Ombudsman also to have responsibilities for community education, and for continuing legal education aimed at lifting standards of professional ethics and practice. This will involve, among other things, "promoting and conducting research; holding seminars, conferences and public meetings; publishing materials for public and professional use; utilising the media". ³⁹

4.49 In their submissions, the NSW Commissioner for Consumer Affairs, the Registrar of the Legal Profession Disciplinary Tribunal, and the Australian Consumers' Association (ACA), all agreed that there was a strong need for greater public awareness of the role of lawyers, the delivery of legal services, and the processes for complaining about the conduct of lawyers. The preliminary submission of the ACA noted that an advantage of the Legal Services Ombudsman proposal was that a "single Ombudsman can achieve a higher public profile leading to greater public awareness, trust and therefore greater accessibility". ⁴⁰

4.50 Reporting requirement. Finally, the Legal Services Ombudsman should be under a statutory obligation to report annually to the New South Wales Parliament (through the Attorney General), and at least semi-annually to the Law Society and the Bar Association. ⁴¹ The importance of this is twofold: first, it helps to ensure the public accountability of the office of the Legal Services Ombudsman itself; secondly, it affords the Legal Services Ombudsman a regular, formal mechanism for reporting on the state of the complaints-handling system, and for making suggestions about the improvement of that system and the enhancement of professional standards. Both the reports to Parliament and to the profession should be privileged. Such reports are likely to receive media attention, which will assist matters in terms of both community education and external scrutiny.

Powers of the Legal Services Ombudsman (Recommendations 8-10)

4.51 Investigatory powers. In order to discharge his or her responsibilities effectively in the public interest, the Legal Services Ombudsman needs to be given sufficient power both to investigate some complaints directly and to provide oversight of the handling of the remainder of complaints by the professional associations.

4.52 In respect of the former, the Legal Services Ombudsman should have the same powers as the legal professional Councils ⁴² and other similar bodies ⁴³ to investigate complaints, such as to compel a reply or the supply of other relevant information from a respondent lawyer, to obtain files and other records from the lawyer involved, and so on. (See also Recommendation 23, below.) Where the Legal Services Ombudsman has directly investigated a complaint, he or she should be able to dismiss the complaint in the same manner (that is, with or without a reprimand) and on the same bases as the professional Councils. ⁴⁴ Following an investigation, the Legal Services Ombudsman should forward to the relevant professional Council any material which bears upon the issuing, suspension or cancellation of a practising certificate. ⁴⁵

4.53 Powers to observe. The Legal Services Ombudsman should be entitled to have access at all times, on a confidential basis, to all files and records kept by the professional associations relevant to the assessment and investigation of complaints against lawyers. For example, it may be important for the Legal Services Ombudsman in some cases to know the "complaints history" of the particular lawyer to decide whether to reprimand the lawyer or to refer the complaint to the Legal Services Tribunal for a hearing.

4.54 Such open access to the complaints files and records of the professional association also is essential to the Legal Services Ombudsman's oversight function. Similarly, the Legal Services Ombudsman should be free to attend any Council meeting or meeting of a committee of Council, dispute resolution conference, disciplinary hearing or other related proceeding in order to satisfy himself or herself that the proceedings are conducted in a fair and effective manner. The preliminary submission of the Law Society acknowledged this need in its proposal for an upgraded Lay Observer scheme. ⁴⁶

4.55 Protection from liability. The Legal Profession Act 1987 already provides that "no matter or thing" done in good faith for the purpose of executing statutory responsibilities for complaints handling by a Council, the Conduct Review Panel, the Standards Board or the Disciplinary Tribunal, shall subject a person to "any action, liability, claim, or demand". ⁴⁷ The Act should be amended to extend this protection from liability for acts done in good faith to the Legal Services Ombudsman when this office is established.

4.56 Power to take over an investigation. One of the most important of the Legal Services Ombudsman's recommended powers (Recommendation 9) is the discretion to take over the conduct of the investigation of a complaint which has been referred to one of the professional Councils, where in the opinion of the Ombudsman, "the interests of justice so require". In such cases, the Legal Services Ombudsman should be entitled to uplift the complaints file and any other relevant material from the Council, in order to complete the investigation properly. In practice, this power would likely be used in circumstances in which (for example) an actual or possible conflict of interest arose, or there was a substantial and unreasonable delay in the conduct of the investigation, or there was public disquiet with the Council's handling of the matter.

4.57 The Commission hopes that this discretion will not have to be exercised often, and it should certainly be open to a Council to request that the Legal Services Ombudsman take over an investigation in appropriate circumstances. However, the ability of the Legal Services Ombudsman to take over an investigation should serve as a very powerful check on the powers of the professional Councils and an important safeguard of the public interest, which should re-assure the public of the independence and effectiveness of the disciplinary system.

4.58 Conduct of "satisfaction surveys". In Chapter 2, the Commission detailed its failure to gain the cooperation of the Law Society to conduct a survey of complainants and respondent lawyers to assess the relative levels of satisfaction with the various aspects of the existing disciplinary system. In DP 26, the Commission wrote that it is necessary, in order to preserve public confidence in the fairness and efficacy of the system:

to put in place mechanisms throughout the disciplinary process which are responsive to the concerns of complainants and which assess the satisfaction of complainants with the manner in which their complaints are being handled. ⁴⁸

4.59 The Solicitors' Board in Victoria has recently begun surveying complainants and respondent solicitors to determine their relative levels of satisfaction with the dispute resolution process, thereby providing information which may help to improve services. ⁴⁹ Such surveys also are common in the evaluation of disciplinary processes by the legal professions in the United Kingdom ⁵¹ and the United States.

4.60 The Commission feels sufficiently strongly about this matter to make a separate recommendation (Recommendation 10) that the Legal Services Ombudsman expressly be made responsible for surveying the views and attitudes of complainants and respondent lawyers with respect to the complaints handling system(s). The results should be published as part of the Legal Services Ombudsman's Annual Report. This requirement should help to ensure a high level of public accountability and provide some of the information needed to "fine tune" and improve the system over time.

THE POSITION OF COMPLAINANTS

11. It should be open to any person to make a complaint alleging that a provider of legal services is guilty of conduct that may constitute unsatisfactory professional conduct or professional misconduct.

12. The lodgment of complaints should be subject to a limitation period of six years from the time of the conduct which is the subject of the complaint. It should be open to a complainant to seek leave from the Legal Services Tribunal to pursue a complaint outside the time limit, where the matter involves a question of professional misconduct.

13. A "Complainants' Charter of Rights", having statutory force, should be inserted into the Legal Profession Act 1987, in order to clarify the position of complainants (and respondent lawyers) and to emphasise the fairness and integrity of the system.

14. The Charter should provide that:

• Complainants are entitled to receive sufficient advice and assistance in order to prepare a complaint in writing in the prescribed form, and to understand the nature of their rights and responsibilities in the disciplinary process.
• Complainants are entitled to effective access to the office of Legal Services Ombudsman and other relevant institutions.
• Complainants - and respondent legal practitioners - are absolutely immune from civil suit for all communications made to the officers of the agency responsible for the handling of complaints, for all communications made to the various disciplinary bodies exercising direct or delegated statutory powers, and for all statements made within the disciplinary proceedings.
• Complainants must receive regular and adequate notice of the status of disciplinary proceedings at all stages of the proceedings. In general, a complainant should receive, contemporaneously, the same notices and orders the respondent receives as well as copies of the respondent's communications to the agency, except information that is subject to another client's privilege.
• Complainants must be permitted a reasonable opportunity to rebut statements of the respondent before a complaint is dismissed.
• Complainants must be notified in writing when a complaint has been dismissed (with or without a reprimand to the legal practitioner). The notice should include a concise recitation of the specific facts and reasoning upon which the decision to dismiss was made. The complainant should normally be given a copy of the investigator's report, unless there are good reasons for not doing so in a particular case (such as problems of confidentiality).
• Complainants must be given proper notice of any disciplinary proceedings, and should have the right to attend any hearing. Complainants should have the right to appear as a party to the proceedings on the issue of compensation, and may appear as a party in respect of other matters with the leave of the Tribunal or Court, subject to the risk of costs.
• Complainants have the right to have the dismissal of a complaint or any other adverse decision reviewed by the Legal Services Conduct Review Panel.

Commentary

Who may complain? (Recommendation 11)

4.61 Under the present arrangements, any person may make a complaint to the appropriate professional Council alleging that a legal practitioner is guilty of conduct amounting to unsatisfactory professional conduct or professional misconduct. ⁵¹ In practice, it is usually a client (or former client) who makes a complaint, but complaints also are received from other lawyers, judicial officers, the professional associations themselves, Members of Parliament, the Legal Aid Commission, executors, and others. ⁵²

4.62 One of the matters of controversy which led to the recent withdrawal by the Minister for Health, the Hon Ron Phillips, of the Health Care Complaints Bill 1992 (NSW), for further consideration and consultation, was the provision which limited the category of complainants to: the client, the parent or guardian of the client, a person chosen by the client to be his or her representative for this purpose, "a health service provider who has sufficient interest in the matter the subject of the complaint", the Director-General of Health or a delegate, and the Minister for Health or a delegate. ⁵³ The provision came under attack from such groups as the Medical Consumers Association and the Chelmsford Victims' Action Group, who claimed that the exposure of "another Chelmsford" might be prevented in future if journalists, concerned individuals, and human rights groups, could not make the running on an issue for the benefit of current or former patients.⁵⁴

4.63 It is outside the Commission's brief to comment upon the health care complaints system, but the Commission does feel strongly that the present position in the legal complaints system - that any person may make a formal complaint - should be maintained, and we have made a Recommendation to that effect.

4.64 The Commission is unaware of any evidence that the open-ended provision in the Legal Profession Act 1987 has been abused or has been the source of any mischief, and in any event the investigating authorities have sufficient powers to dismiss summarily frivolous or vexatious complaints. ⁵⁵ Perhaps the most dubious use of the legal complaints system has been as a form of collection agency: in the Commission's survey of Law Society and Bar Association complaint files it seemed that some creditors (such as interpreters, expert witnesses, accountants, real estate agents, valuers, and other lawyers) lodge complaints about unpaid bills primarily for the purpose of pressuring or embarrassing the lawyer to pay. Unless there is evidence of a persistent pattern of poor business practices, it is likely that such matters will be sent for mediation in future.

4.65 The Commission was told in some submissions, and observed in a few complaints files, that complainants who are not present or former clients of the lawyer complained about are occasionally discouraged by the professional associations from pursuing their complaints through the disciplinary system. This is not the law, and any such practice should be discontinued. In our view, the benefits of a more open system in terms of public confidence and public protection greatly outweigh any problems which may be caused by the occasional complaint by a person without a legitimate interest in the matter.

Limitation period (Recommendation 12)

4.66 In DP 26, the Commission considered that a limitation period of six years on complaints against lawyers could be appropriate, having regard to the limitation period in respect of civil actions for professional negligence, as well as the limitation period for complaints against lawyers in Victoria. ⁵⁶

4.67 The Bar Association's submission proposed a limitation period of six months from the time when the complainant became aware of the conduct ⁵⁷ which is the subject of the complaint. ⁵⁸ In the only other submission received on this subject, the Kingsford Legal Centre preferred to impose no limitation period at all, but agreed with the Commission that if there has to be one, six years is appropriate. ⁵⁹

4.68 In the United States, the American Bar Association's Model Rules for Lawyer Disciplinary Enforcement specify that disciplinary proceedings shall be "exempt from all statutes of limitations." ⁶⁰ This is justified on the basis that:

Statutes of limitation are wholly inappropriate in lawyer disciplinary proceedings. Conduct of a lawyer, no matter when it has occurred, is always relevant to the question of fitness to practice. The time between the commission of the alleged misconduct and the filing of a complaint predicated thereon may be pertinent to whether and to what extent discipline should be imposed, but should not limit the agency's power to investigate.

Discipline and disability proceedings serve to protect the public from lawyers who are unfit to practice; they measure the lawyer's qualifications in light of certain conduct, rather than punish for specific transgressions. Misconduct by a lawyer whenever it occurs reflects upon the lawyer's fitness. ⁶¹

4.69 The Commission believes that there is considerable force in this argument. However, there is a reasonable countervailing interest in prescribing a limitation period, from the point of view of certainty as well as guarding against the abuse of process. Without any time limit on complaints (or limitation on who can complain), a practitioner may be placed in the position of having to defend allegations where it would be unreasonable for there to be lasting memories or documents or witnesses to the relevant circumstances.

4.70 In the Commission's view, the legislation should specify a limitation period of six years from the time of the conduct which is the subject of the complaint. To provide a measure of flexibility, a complainant or a professional association should be able to seek leave from the Legal Services Tribunal to pursue a claim outside the time period, where the matter involves a question of professional misconduct. (Lesser allegations of unsatisfactory professional misconduct should be statute barred outside the time period.) At the same time, it is always open for the legal practitioner to argue that a complaint - whether made inside or outside the limitations period - amounts to an abuse of process and should be stayed. ⁶²

4.71 In Recommendation 74, and the accompanying text in the next Chapter, the Committee deals with the more limited issue of complaints based on conduct which occurred before the coming into force of Part X of the Legal Profession Act 1987 (on 1 January 1988).

4.72 Generally. In DP 26, the Commission noted that the "tenor of much of the Legal Profession Act 1987 suggests that complainants and complaints are to be treated with caution, while legal practitioners who are the subject of a complaint are to be accorded full procedural rights." ⁶³ The Commission suggested that the best remedy for this situation would be to have a legislative statement of a "Charter of Rights" for complainants "in order to make clear the position of complainants and to emphasis the integrity of the system." ⁶⁴

4.73 The proposal to establish a Complainants' Charter of Rights was supported in the submissions of the NSW Commissioner for Consumer Affairs, Mr John Holloway, the Australian Consumers' Association, the Kingsford Legal Centre, and the Registrar of the Legal Profession Disciplinary Tribunal, Mr Robert Bennett. The professional associations were less enthusiastic. The Law Society wrote that it "does not agree that complainants are at any disadvantage in respect of the treatment of their complaints under the present system", but maintained that it was "always ready and willing to review its procedures to ensure that complainants have every reasonable opportunity to present their complaints and have them thoroughly investigated". ⁶⁵ The Law Society did agree with most of the specifically enumerated "rights" proposed by the Commission, but considered that "such procedures can be followed without the requirement of a formal 'Charter of Rights'." ⁶⁶ Similarly, the Bar Association agreed with most of the specific principles proposed for incorporation, but stated that

it does not approve of the concept of a ''Complainants Charter of Rights". Such a charter runs the risk of introducing inflexibility into the disciplinary proceedings. Further, there is, in the Bar Association's view, no room for a charter weighted in favour of one or other party to the disciplinary proceeding. ⁶⁷

4.74 The Commission fundamentally disagrees with the notion that while the specific principles and procedures aimed at ensuring fairness for complainants are appropriate, their statement within a statutory "Charter" is not. The Commission believes that it is symbolically very important for the legislation expressly to support the position of complainants, and it is practically very useful to present the various rights and procedures collectively in Charter form, which will make these matters accessible to the general public in a way that the legislation (and subordinate rules, regulation and practices) ordinarily cannot. The Commission does not believe that with sensible application these broad principles - which really (and properly) do no more than make clear what natural justice requires in the circumstances - would cause any undue inflexibility or other problems.

4.75 Because of the existing imbalance in the Legal Profession Act, most of the recommendations in this Report are aimed at supporting the position of the complainant; however, the Commission also does make a number of recommendations aimed at ensuring fairness for respondent lawyers. ⁶⁸

4.76 Access, advice and assistance. The Legal Profession Act currently requires that the professional Councils "take all reasonable steps to ensure that a person who wishes to make a complaint is given such assistance as is necessary" to comply with the statutory formalities. ⁶⁹ Under the general regulatory scheme recommended by the Commission in this Report, this responsibility would largely pass to the office of the Legal Services Ombudsman.

4.77 The submission from the NSW Combined Community Legal Centres Group emphasised that, in its collective experience, the existing complaints procedures were clearly inadequate to meet the needs of persons from non-English speaking backgrounds, or persons with low literacy skills or other disabilities, preventing them from making an effective complaint. ⁷⁰

4.78 Ideally, much of the advice and assistance should be provided face-to-face. The office of the Legal Services Ombudsman should have access to interpreter services (in-house, or through the Ethnic Affairs Commission) and should liaise with the Disability Council of New South Wales and other relevant organisations about the best way to ensure that people with a disability have effective access to the office and that effective communication can be facilitated.

4.79 As the Commission noted in DP 26, this effort also will involve the production of:

Brochures, pamphlets, videos and other means of communication ... to provide a clear statement (in Plain English) of: the rights and responsibilities of complainants; the assistance which is available to prospective and actual complainants; the general nature of the disciplinary process, including the remedial orders which may be given; and the other forums for the resolution of disputes about the provision of legal services (mediation, civil suits, the Consumer Claims Tribunal, etc). It must be remembered that while some complaints are received from other lawyers, judges, court officials and public officials, the great bulk of complaints are initiated by members of the public (usually clients), who begin the process with very little information about how the disciplinary system works. ⁷¹

4.80 Having regard to the multicultural nature of the community in New South Wales, all of this literature and other media should be available in a wide range of community languages, with careful thought given to the question of "how to convey the information to targeted groups in a manner which most effectively identifies the way in which they actually, commonly receive information. ... More imaginative marketing techniques must be employed to reach more people and convey the information more effectively." ⁷²

4.81 The Commission acknowledged in DP 26 that the principle of making the disciplinary system more "accessible" to complainants means more than using accessible language, and also includes such practical matters as "location, working hours and minimal formality". ⁷³ Thus, the office of the Legal Services Ombudsman should be able to be reached by public transportation and should be physically accessible to people with a disability. The office should allow some "after normal working hours" access (eg, on Thursday evenings or Saturday mornings), at least by appointment, so that it is not necessary for a person to miss a day's work or to have to make difficult or expensive child care arrangements in order to get advice or make a complaint.

4.82 These matters should be uncontroversial - the submissions of the Law Society, the Bar Association, the Australian Consumers' Association, the Commissioner for Consumer Affairs, the Community Justice Centres, and the Combined Community Legal Centres Group all agreed with the Commission's proposals in DP 26, upon which the recommendations in this Report are based.

4.83 Immunity for complainants and respondents. In DP 26, the Commission wrote that:

In order for any disciplinary system to be effective, prospective complainants must feel free from any suggestion of intimidation or retaliation. The findings and recommendations of Royal Commission of Inquiry into Chelmsford Hospital pointed out the urgent need for complainant immunity in the medical disciplinary area ⁷⁴... The need for immunity in the legal disciplinary system is at least as plain, for prospective complainants will be acutely aware that lawyers will have the necessary expertise, access to the courts, and financial resources to sue or threaten to sue them, if they are so minded, in order to forestall or force a withdrawal of the complaint. ⁷⁵

4.84 Consequently, we proposed that "Complainants should be absolutely immune from civil suit for all communications made to a body with disciplinary responsibilities in respect of a complaint against a legal practitioner, and for all statements made within any disciplinary proceedings", ⁷⁶ and that "all communications made in the course of making a complaint, and in the subsequent proceedings involving the resolution of that complaint, whether involving the complainant, the respondent lawyer, any person responding to a request for information from the authorities, the authorities involved, or the agents or staff of any of the aforementioned, should be privileged in respect of defamation and ... absolutely immune from other civil actions." ⁷⁷ (It is already the case that members of the Standards Board, the Disciplinary Tribunal, the Review Panel, and the Bar and Law Society Councils, are immune from liability for any act done in good faith as part of their disciplinary responsibilities.) ⁷⁸

4.85 The Commission's proposals - which cover respondent lawyers as well as complainants, and upon which this Recommendation is based - met with agreement in whole or in part from the Law Society; the Bar Association; the Commissioner for Consumer Affairs, Mr John Holloway; and the Registrar of the Legal Profession Disciplinary Tribunal, Mr Robert Bennett; and accord with the recommendations of the American Bar Association's Commission on the Evaluation of Disciplinary Enforcement ⁷⁹ and the American Bar Association's Model Rules for Lawyer Disciplinary Enforcement. ⁸⁰

4.86 The Commission's recommendations would require consequential amendments to the Legal Profession Act 1987 (NSW) and the Defamation Act 1974 (NSW) to clarify the situation, and to make reference to the position of the office of the Legal Services Ombudsman. ⁸¹

4.87 It should become the positive obligation of the office of the Legal Services Ombudsman routinely to inform all prospective complainants of the nature and existence of this absolute immunity. The body investigating the complaint - whether the Legal Services Ombudsman or one of the professional Councils - should be under a similar obligation to so inform the respondent lawyer, for it cannot be assumed that all legal practitioners will be aware of all details of the complaints handling system.

4.88 Right to be kept informed. In DP 26, the Commission noted that a "major source of complainant dissatisfaction seems to stem from the absence of regular communication from the professional associations and disciplinary bodies informing the complainant of the progress of the case." ⁸²

4.89 The Commission considered that:

Complainants should be entitled to routine communication about the status of their complaint. In order to ensure that this actually occurs in practice, an officer in the complaints-handling agency should be designated to serve as the point of contact for the complainant in respect of each individual complaint, and the complainant should be so informed. That officer would be responsible for periodically reporting (say, every 60 days) in writing to the complainant about the progress of the matter, and for answering any direct inquiries from the complainant. ⁸³

4.90 The Commission noted ⁸⁴ incidentally that problems occasionally arise where the Law Society appoints an inspector to examine trust accounts or an investigator to scrutinise the affairs of a solicitor of firm of solicitors. ⁸⁵ Under the Legal Profession Act, the fact of such an appointment only may be disclosed to a small number of specified public or professional officials, and the complainant is not among these. ⁸⁶ Thus, it may appear to a complainant that not much is happening in response to serious allegations, whereas in fact a thorough investigation is in train. The Commission proposed that, in such circumstances:

As a matter of policy and good practice, the complainant should be entitled to be kept informed of the progress of the investigation by the complaints-handling agency and informed, at least in general terms, of the reason for any significant delay. ⁸⁷

4.91 The submissions from the Law Society, the Bar Association, the Commissioner for Consumer Affairs, the Australian Consumers' Association and the Community Justice Centres all supported the Commission's proposals on the right of a complainant to be routinely kept informed of the status of his or her complaint. The Law Society also supported the modification of the secrecy provisions of the Act "to allow information to be provided to a complainant with a legitimate interest even in circumstances where an investigation is proceeding under Section 55 of the Act" ⁸⁸ through the appointment of an inspector or investigator.

4.92 Reasonable opportunity to rebut. Where a matter is to be referred to the Legal Services Tribunal for a hearing, under the Commission's recommendations, there naturally will be an opportunity for both the complainant (at least through the prosecuting agency) and the respondent practitioner to put their cases. However, the Commission noted in DP 26 that, currently, while a Council may not dismiss a complaint with a reprimand without the consent of the practitioner involved, "there is no parallel requirement to gain the consent of the complainant to a dismissal, with or without a reprimand, or to give the complainant an opportunity to be heard on the matter". ⁸⁹ As a fundamental matter of procedural fairness, a complainant must be afforded a reasonable opportunity to rebut any statement by the respondent legal practitioner before a complaint is dismissed.

4.93 Proper reasons for dismissal. In DP 26, the Commission noted that the great majority of complaints result in a summary dismissal, and that a complainant had the right to feel dissatisfied if he or she received:

a rather terse letter with the technical reason for the decision (such as, "the complaint did not disclose evidence of unsatisfactory professional conduct or professional misconduct") but without a full explanation in "Plain English". While the technical assessment of the merits of the complaint are no doubt usually correct, the manner of its communication may give rise to doubts about the probity of the process. ⁹⁰

4.94 The Commission proposed that:

Complainants also should be entitled to a clear and full explanation of the reasons for any dismissal. The letter notifying the complainant of a dismissal should include a statement to the effect that "if you do not understand the result or wish to discuss this matter further, please contact [the designated officer]". The same general principles should apply to the determinations of the [formal disciplinary bodies]. ⁹¹

This proposal was supported by the NSW Commissioner for Consumer Affairs, Mr John Holloway, and the Australian Consumers' Association.

4.95 The Commission's survey of Law Society complaints files confirmed that the standard dismissal letter sent to complainants tended to be rather abrupt, with a formal reason for the dismissal but little in the way of genuine explanation and with no personal touch. The Bar Association, by contrast, also usually provided the complainant with the detailed investigator's report upon which the Council relied in coming to its decision, thus giving the complainant a clear insight into the nature and outcome of the investigation and the reasons for the Council's action. ⁹²

4.96 There may be some rare circumstances in which it is appropriate to withhold all or (more likely) part of the investigator's report from the complainant, such as where the report contains material which is the subject of another person's privilege. However, in the general run of cases, the complainant should be entitled to a full explanation, including a copy of the investigator's report into the matter.

4.97 Rights to be present and to appear as a party. Another fundamental aspect of procedural fairness is the right to be given effective notice of any disciplinary proceedings which arise out of the person's complaint, and to be present at the hearing. However, under the present legislation, ⁹³ complainants are not necessarily given notice of hearings (which is routinely provided only to parties), and may not be permitted to be present at the hearings of the Standards Board, which are held in camera. ⁹⁴

4.98 In DP 26, the Commission proposed that the complainant should have a statutory right to be present at any hearing into his or her complaint. ⁹⁵ This was supported in the submissions of the Bar Association, the Law Society, the Commissioner for Consumer Affairs, the Registrar of the Disciplinary Tribunal, the Australian Consumers' Association, and the Kingsford Legal Centre.

4.99 More controversial is the issue of whether the complainant should have the right to appear as a party in any subsequent disciplinary proceeding. Under the existing legislation, the complainant may appear as a party before the Standards Board or the Disciplinary Tribunal only if he or she has requested the making of an order in relation to fees, compensation or waiver of a lien, ⁹⁶ and that entitlement extends only to "those aspects of the hearing that deal with the loss (if any) suffered by the complainant as a consequence of the conduct the subject of the hearing". ⁹⁷ On all other issues, the complainant must give way to the relevant professional Council. In DP 26, the Commission proposed that:

a complainant should always be entitled to appear as a party to the hearing. Where the complainant takes an active role in the proceedings, it may be that such participation should be subject to a risk as to costs. ⁹⁸

4.100 The proposal was supported by the Commissioner for Consumer Affairs, the Registrar of the Disciplinary Tribunal, and the Kingsford Legal Centre, but was strongly opposed by the Law Society, the Bar Association, and the President of the Disciplinary Tribunal, Mr David Hunt.

4.101 The Commission is still of the view that, in theory, a complainant should be entitled to appear as a party subject to the (often powerful) disincentive of a risk as to costs. However, upon reflection, the Commission does recognise that there could be some practical problems in permitting complainants to appear as of right. For example, hearings before the Legal Services Tribunal will often involve an aggregation of complaints (into an "information"), so that an action against a practitioner could involve a large number of individual complainants. If even a proportion of those complainants chose to appear as parties, as well as the Legal Services Ombudsman or the relevant Council, the proceedings could become very unwieldy. At the formal hearing stage, the general public interest in the effective discipline of the legal profession becomes very strong, and this could be interfered with if the prosecution of the matter becomes dispersed, amateurish or ineffective.

4.102 The Commission believes that there is a happy compromise on this issue, and recommends that complainants should still have the right to appear as a party in respect of compensation, and but also should be able to appear as a party in other respects with the leave of the Tribunal, and subject to the risk of costs. The requirement of leave will guard against the sort of problems referred to above, while opening up the opportunity for complainants to appear as a party where the Tribunal is satisfied that this would assist matters.

4.103 Right to external review of any adverse decision. Under the Legal Profession Act, the Conduct Review Panel is required, upon application, to review the decision of one of the professional Councils to dismiss a complaint. ⁹⁹ (A complaint may be deemed to be dismissed if the Council has not finalised its investigation after six months; however, in practice, this procedure is somewhat meaningless as there is rarely a sufficient record to review.) ¹⁰⁰

4.104 In DP 26, the Commission considered that the Panel's jurisdiction is far too limited:

The Panel should be empowered to review every decision made by the professional associations and their Councils, whether this involves a decision to dismiss a complaint, or to issue a reprimand, or to take some other action short of referral to the Standards Board or the Disciplinary Tribunal. A complainant may feel no less aggrieved by a Council decision to issue a reprimand to a legal practitioner than by a decision to dismiss the complaint entirely. The aim of external accountability is not met in such circumstances if there is no recourse by the complainant to the Review Panel, and the complainant may well feel that the lawyer's interests were better looked after than his or her own. ... The Review Panel should have the same powers in New South Wales as the Legal Services Ombudsman has in England ¹⁰¹ - to be able to review every decision in the disciplinary process (or a failure to make a decision), except a decision made by a court or tribunal. ¹⁰²

4.105 The preliminary submission of the Law Society, which argued in favour of the replacement of the Panel by a "Lay Observer", agreed that the jurisdiction of the Panel was too narrow in this respect. ¹⁰³ The submissions of the NSW Commissioner for Consumer Affairs and of the Legal Profession Conduct Review Panel itself supported the Commission's view in this regard.

4.106 In this Report, we recommend that the Panel (to be renamed the Legal Services Conduct Review Panel, to emphasise its independence from the legal profession) be empowered to review, upon application from the complainant, any adverse decision by the Legal Services Ombudsman or one of the professional Councils (short of referral of the matter to the Legal Services Tribunal). Decisions of the Tribunal itself are only reviewable in the Court of Appeal, of course. See Recommendation 44, below.

DISPUTE RESOLUTION

15. If a complaint does not raise issues of unsatisfactory professional conduct or professional misconduct, but is capable of consensual resolution, it should be open to the Legal Services Ombudsman, the Law Society and Bar Councils, and the Conduct Review Panel to refer the matter for conciliation or mediation.

16. If a complaint does involve an issue (or issues) of unsatisfactory professional conduct or professional misconduct, but also involves a consumer dispute which is capable of consensual dispute resolution (such as where an apology or compensation is called for), it should be open to refer the latter aspect for mediation or conciliation, while the disciplinary aspect proceeds through the formal disciplinary system. In such cases, the dispute resolution process should not have to wait for the disciplinary proceedings to conclude.

17. The Law Society and Bar Councils should maintain a list of mediators for this purpose, in consultation with the Legal Services Ombudsman and the Director of the Community Justice Centres.

18. Mediators on the list maintained by the professional Councils should be obliged to undertake a specific training program. The training program, as well as a Code of Conduct for mediation between lawyer and client, should be developed by the professional Councils in consultation with the Director of the Community Justice Centres and the Legal Services Ombudsman.

19. All confidential communications which are part of the mediation or conciliation process should be privileged, except for admissions or communications which reveal irregularities or dishonesty by a legal practitioner in respect of trust accounts or controlled funds.

20. In the event that conciliation or mediation fails to resolve the dispute, the complainant may apply to the Registrar of the Legal Services Tribunal to have the matter resolved by arbitration. In such cases, the Registrar or his or her nominee may award compensation not exceeding $6,000.

Commentary

Disputes suitable for consensual resolution (Recommendations 15-16)

4.107 Perhaps the matter on which there was the most agreement was the Commission's proposal ¹⁰⁴ that there be much more use made of consensual dispute resolution techniques to settle the great bulk of complaints against lawyers which are of a "consumer complaint" type - that is, those disputes which do not raise issues about the character, honesty or competence of the legal practitioner involved. The complaints handling systems in Victoria and in England and Wales certainly boast high "success rates" for mediated settlements. ¹⁰⁵

4.108 Support for this came in the submissions of the Law Society, the Bar Association, the Australian Consumers' Association, ¹⁰⁶ the Commissioner for Consumer Affairs, the Lawyers Reform Association, the Registrar of the Disciplinary Tribunal, the Chairperson of the Conduct Review Panel, and the Community Justice Centres.

4.109 Under Recommendation 15, each of the Legal Services Ombudsman, the professional Councils and the Conduct Review Panel (where a matter has reached that stage) would be empowered to refer a complaint for mediation or conciliation where they are satisfied that the matter "is capable of consensual resolution", ¹⁰⁷ and the body is satisfied that the complaint does not raise issues of unsatisfactory professional conduct or professional misconduct (which are more properly the province of the formal disciplinary system).

4.110 In Recommendation 16, the Commission recognises that some complaints involve an accumulation of allegations, some of which may raise issues of unsatisfactory professional conduct or professional misconduct, and some of which may be categorised as consumer type disputes which are capable of consensual dispute resolution. In such circumstances, it should be open to the above-mentioned authorities to refer (only) the latter aspects of the complaint for mediation or conciliation.

4.111 For example, a complaint may allege that a legal practitioner handling the sale of real property on behalf of the client (complainant) had: communicated poorly with the client; negligently handled the settlement of the sale, costing the client some hundreds of dollars; overcharged for the services provided; and then dealt improperly with the proceeds of the sale held in trust. The first three matters could be sent for mediation, while the trust account issue should be formally investigated through the disciplinary process. In "mixed" consumer/disciplinary cases such as these, the dispute resolution process should proceed without having to wait for the formal investigation and the disciplinary proceedings to conclude, since there is no reason why the complainant should be out-of-pocket for a substantial time while the more serious allegations are being pursued. ¹⁰⁸

4.112 The Commission has cautioned before ¹⁰⁹ that "alternative dispute resolution" (or ADR) should not be regarded as "a panacea for the notional ills of the judicial system but rather a set of further options to be carefully considered in each case". ¹¹⁰ In the context of complaints against lawyers, it is important not to lose sight of the multiple aims of the system, which include public interest concerns about the standards of the legal profession and the compliance of individual practitioners with those standards as well as the satisfaction of consumer-type grievances. ¹¹¹

4.113 Thus, the referring authorities - the Legal Services Ombudsman, the professional Councils and the Conduct Review Panel - must be careful not to divert entirely those disputes which may have public interest ramifications. For example, where substantial negligence or a pattern of poor practice becomes apparent on the part of lawyer or law firm, the lawyer or firm should not be able to "buy" themselves out of trouble regularly by quickly settling such matters through mediation. The authorities should carefully keep track of referrals in order to be able to identify those cases which require consideration by the disciplinary system.

4.114 Similarly, "it may be that the lawyer involved has acted utterly in accordance with standard legal practice, but the practice itself is arguably contrary to the public interest." ¹¹² Disciplinary action against the particular lawyer concerned would be inappropriate in such circumstances, but there should be feedback into the system so that, for example, there are changes in legal education or changes in the codes of ethics and practice, or the issuing of a practice direction, or some other action calculated to remedy the problem. (See Recommendation 63, discussed in Chapter 5, below.)

Appointment and training of mediators (Recommendations 17-18)

4.115 In DP 26, the Commission considered that concerns about the imbalance of knowledge and power between lawyers and clients, and about the perception of impartiality, meant that it may be inappropriate for persons employed by or associated with the professional associations to serve as mediators:

Perhaps the mediators used should not be staff members of the Law Society or Bar Association, and particularly not staff members who are involved in any way in the investigation or prosecution of complaints. ... There is already a danger that the dynamics of the mediation situation will inherently favour the lawyer, who is used to negotiating and operating in such an environment, rather than the lay complainant. While it is not really the role of the mediator to redress the balance of power or sophistication between the parties, an experienced mediator should be able to restrain one of the parties from being overbearing. In order to assure complainants that the system is not weighted against them, independent mediators should be used. Depending upon the nature of the complaint, the mediators need not necessarily be legally trained. For example, disputes about discourtesy or poor communications would not require the mediator to be a lawyer. Where an understanding of the exigencies of legal practice would be a major advantage for the mediator, such as in the case of a dispute arising out of the tactics or strategy employed by a barrister in the course of a trial, then it may be best to seek the services of an academic lawyer, a retired judge, a government lawyer or some other lawyer who is not readily associated with the interests of the professional associations. ¹¹³

4.116 The submissions were split on the issue of whether mediators should be entirely independent of the professional associations. The Bar Association, the Commissioner for Consumer Affairs, the Australian Consumers' Association and the Community Justice Centres (CJC) agreed with the proposition, and the CJC offered itself as the mediation agency, given its demonstrated neutrality, effective use of limited resources, and connection to an established infrastructure for training, quality assurance and continuing development. ¹¹⁴ However, the Law Society and the (lay) Chairperson of the Conduct Review Panel disagreed, emphasising that it was important in some cases for mediation to be handled by senior and experienced lawyers who also have a knowledge of the disciplinary system. It is true that in Victoria and in England and Wales, client-lawyer mediation is handled by officers of the legal professional associations. ¹¹⁵

4.117 In our recent Report on mediation (LRC 67), the Commission was reluctant to be overly prescriptive about training, qualifications and accreditation at this early stage in the development of ADR. ¹¹⁶ Similarly in this report, the Commission has decided to refrain from specifying precisely who may or may not serve as a mediator for the run of client-lawyer disputes. Rather, the Commission has recommended that the professional Councils maintain a list of mediators for this purpose, in consultation with the Legal Services Ombudsman and the Director of the Community Justices Centres. We have no hesitation in recommending, however, that the mediators on the list - including lawyers and non-lawyers ¹¹⁷ - be required to undertake a specific training program for this purpose. As we wrote in LRC 67:

The Commission accepts that training for mediators is necessary for competence as a mediator and to enhance the credibility of mediation. We accept that no one is automatically qualified to perform the role of a mediator simply by virtue of professional or occupational qualifications in another discipline, or because of appropriate personal qualities. The role requires knowledge and skills of a distinct process. Training is the most effective way for a person to acquire expertise. Failure to undergo training in the process increases the risk that a mediator's behaviour will be incompetent and unethical, and of harm to clients. ¹¹⁸

4.118 We also propose, in Recommendation 18, that the training program should be developed by the professional Councils in consultation with the Director of the Community Justice Centres and the Legal Services Ombudsman, and that a Code of Conduct for mediation between lawyer and client be developed in the same manner.

Confidentiality and privilege (Recommendation 19)

4.119 The Commission recognises that privilege ought normally to attach to confidential communications made during an attempt at consensual dispute resolution. Such informal processes only work if the parties are assured that there will be no negative repercussions flowing from candid conversation or the spirit of compromise.¹¹⁹ However, as foreshadowed in DP 26, the Commission also recognises the need for an exception to the proposed general rule about privilege with regard to admissions or communications which reveal dishonesty or irregularities in dealings with trust accounts or controlled funds. ¹²⁰

4.120 Only the submission of the Bar Association addressed this area, with the Bar Association agreeing with the Commission on both the general rule and the exception. ¹²¹ (The exception, of course, would normally only apply to solicitors, as barristers do not hold or control clients' money.) See also Recommendations 65-67, discussed in Chapter 5, below, regarding confidentiality and privilege issues at the investigation and review stages.

Arbitration of disputes as a last resort (Recommendation 20)

4.121 It is to be hoped that most of the disputes which "are capable of consensual dispute resolution" (per Recommendations 15-16) will in fact be settled by that method. However, the Commission believes that there should be a mechanism for determining such disputes where the parties are unable to agree (whether through intransigence or bad faith, or for other reasons) on a satisfactory outcome.

4.122 In Victoria, the Registrar of the Solicitor's Board is empowered to award compensation in such cases after an informal, in camera hearing. ¹²² The (now defunct) Victorian Law Reform Commission has recommended that the Board be replaced by a Barristers and Solicitors Tribunal, and the Judicial Registrar of the Tribunal take over this arbitration function. ¹²³

4.123 This Commission recommends that arbitration powers be vested in the Registrar of the Legal Services Tribunal, with the Registrar able to refer matters to a nominated arbitrator if necessary (for reasons of speed or propriety). The Commission's has expressed the strong view throughout this Report that, in our proposed system, complainants who approach the Legal Services Ombudsman should be entitled to resolve their disputes fully and finally without having to launch additional or ancillary actions. Accordingly, we recommend that the jurisdictional limit of the Registrar should be initially set at $6000, the same as that of the Consumer Claims Tribunal (CCT), to obviate the need for complainants to have to approach the CCT. (It should remain open to clients to approach the CCT if they wish, subject to provisions to protect against "double-dipping".)

THE ROLE OF THE PROFESSIONAL COUNCILS

21. The Councils of the Law Society and the Bar Association should continue to be responsible for: the investigation of complaint matters (those forwarded by the Legal Services Ombudsman, as well as those matters in which a Council acts on its own initiative); diverting consumer complaints for dispute resolution; dismissing appropriate complaints (with or without a reprimand); determining which matters should be sent to the Legal Services Tribunal for hearing; and prosecuting disciplinary offences before the Tribunal.

22. The Councils must ensure that the investigation of complaints is accomplished in a prompt, active, thorough and professional manner. Sufficient resources and training (for members of the Council and its committees as well as for staff) must be provided to make this possible. An obligation on the part of the Councils (and the Legal Services Ombudsman) to investigate and process complaints expeditiously should be inserted into the Legal Profession Act 1987.

23. In the event that a legal practitioner unreasonably fails to reply to the allegations made in the complaint or to respond to requests for information, it should be open to a Council (or the Legal Services Ombudsman) to apply to the Registrar of the Legal Services Tribunal for an administrative penalty of up to $2000 to be assessed against the practitioner. (Nothing in this Recommendation is meant to derogate from the power of a Council to suspend or cancel a practitioner's practising certificate under s 35 of the Legal Profession Act 1987.)

24. The Councils should operate several Professional Conduct Committees (exercising delegated authority) in tandem, to speed up its handling of complaints, reduce the workload of individual Committee members, and increase the intensity of investigations.

25. The powers of a Council should be the same whether the investigation has arisen on the Council's own initiative or following a complaint forwarded by the Legal Services Ombudsman.

26. Following an investigation into any complaint, a Council must refer a matter to the Legal Services Tribunal for a hearing if "it appears to the Council that (a) the legal practitioner may be guilty of unsatisfactory professional conduct or professional misconduct, or (b) the interests of justice so require". (The same standard shall apply in respect of the investigations of the Legal Services Ombudsman.)

27. Following a referral by its Council to the Legal Services Tribunal, or upon the request of the Legal Services Ombudsman or the Legal Services Conduct Review Panel, the Law Society and the Bar Association should be responsible for preparing the information and prosecuting the matter before the Tribunal and the courts.

28. Where a Council has dismissed a complaint following investigation (with or without a finding of unsatisfactory professional conduct), it should nevertheless have the power to award compensation to the complainant with the consent of the legal practitioner, or to refer the matter for mediation (and ultimately arbitration) on the question of compensation, or to make an ex gratia award of compensation from a discretionary fund maintained by the professional Council for this purpose.

29. The Act should be clarified to ensure that the Councils must report on their activities to the Parliament through the Attorney General at least once per year. It should be standard practice for the Councils each to produce a detailed report at least once per year specifically dedicated to the regulation and discipline of the legal profession.

30. The present role of Councils in the setting of standards of professional ethics and conduct should continue.

Commentary

The continuing role of the Councils (Recommendations 21 and 29-30)

4.124 For the reasons already discussed, the Commission has not recommended that the professional Councils be removed from the complaints handling process, but rather that the activities of the Councils in this area be made subject to tighter legislative requirements and placed under much closer external scrutiny by a Legal Services Ombudsman and the Conduct Review Panel. Under our recommendations, the Legal Services Ombudsman would have parallel powers in respect of investigation, but would be in a superior position in so far as the Ombudsman would be entitled to choose which matters to retain and to remove matters from the Councils, at his or her discretion.

4.125 As acknowledged in Recommendation 21, the Councils of the Law Society and the Bar Association would nevertheless retain statutory responsibility for:

• investigating complaints (at least those referred by the Legal Services Ombudsman, as well as those matters in which a Council acts on its own initiative);
• diverting appropriate matters for consensual dispute resolution, as well as generally supervising the mediation process (see Recommendations 15-18);
• summarily dismissing frivolous or vexatious complaints;
• dismissing other complaints, after investigation, with or without a reprimand, in accordance with s 134 of the Legal Profession Act;
• referring to the Legal Services Tribunal for hearing those matters which involve substantial issues of unsatisfactory professional conduct or professional misconduct; and
• prosecuting matters before the Tribunal, where the Council is the referring authority or the Council has been requested to prosecute by the Legal Services Ombudsman or the Conduct Review Panel.

4.126 The Councils, being the peak professional associations, also would continue their current role in the setting of standards of professional ethics and conduct - subject to the Supreme Court's general supervision of the administration of justice in New South Wales. (See Recommendation 30. See also Recommendation 59, discussed in Chapter 5, below, regarding the need for Codes of Conduct and Practice.)

4.127 In DP 26, the Commission looked at upgrading the reporting requirements placed on the professional Councils in respect of complaints handling, both in terms of frequency and quality. ¹²⁴ The Commission suggested that it become standard practice for the professional Councils and other responsible agencies to make annual reports to the Attorney General, for tabling in Parliament, which contain "a full treatment of statistics, empirical and comparative analysis, case studies, satisfaction surveys, recommendations for consequential legislative or administrative change, and so on." ¹²⁵

4.128 The Law Society recently has commenced publishing a six monthly report on trends and statistics in the disciplinary process, ¹²⁶ a welcome development which goes some of the way towards achieving the desired levels of presentation of statistical material, although it is rather shorter on analysis. The Commission also would like to see much more correlation of the statistical material. For example, the Law Society now offers a Table indicating the types of complaints received (failure to carry out instructions, poor communications, failure to account for trust account money, etc), but a better demographic portrait of the complaints handling system also would correlate the particular types of complaints with tabulated information about outcomes - how many complaints of a particular type are dismissed, how many are referred on to the Standards Board or Disciplinary Tribunal, what sanctions are meted out, and so on. An analysis of time taken to deal with complaints (by the presentation of mean and median figures as well as numbers of "more than 6 months" and "more than 12 months" matters) also would be useful. Since many complaints are received in one year but finalised in the next, it also would be helpful if the material was presented in such a way as to permit a particular year's complaints to be traced through to final disposition.

4.129 In Recommendation 29, the Commission proposes that it should be standard practice for the Councils to produce detailed reports (at least annually) which are specifically dedicated to issues of regulation and discipline. It is proposed that the Legal Services Ombudsman also will be placed under a statutory obligation to monitor relevant developments and to report fully (see Recommendation 7), so the information available in this area should be comprehensive and edifying.

Investigation of complaints (Recommendations 22-25)

4.130 The nature and quality of investigations. In the earlier inquiry into the legal profession, over a decade ago, the Commission criticised the inadequacy of the investigation of complaints by the professional associations, condemning, for example, the "perfunctory investigation of many complaints". ¹²⁷ One of the main concerns at that time was that the professional associations relied very heavily on the information provided by the complainant to determine the validity of the complaint, often making a final decision on this basis without further investigation. If the investigation proceeded the next step was to contact the lawyer concerned for a reply. In the not infrequent event that the matter hinged on the word of one party to the dispute against the word of the other, the lawyer was generally given the benefit of the doubt without the matter being referred for a formal hearing. ¹²⁸

4.131 In DP 26, the Commission noted ¹²⁹ that:

Some of the submissions in the current inquiry question whether the investigation of many matters is adequate to define all of the possible issues and to ascertain all of the relevant facts, particularly in relation to the far more numerous complaints against solicitors. The chief technique employed in most cases for compiling the facts and preparing the report and recommendations for Council remains the "paper chase" of acquiring the written complaint, requesting a written response from the legal practitioner involved, and subsequently comparing them. Sometimes one party or the other is asked for further particulars. However, only in a very small proportion of cases is there a fuller examination using trained investigators or auditors, and these cases almost invariably involve allegations of fraud, trust account violations or other financial impropriety. In the circumstances, it is arguable that the bulk of complaints are processed, and not actively, thoroughly, investigated.

In the absence of an