MISCONDUCT

Definitions

4.2 Part 10 provides that the LSC has the power to receive and investigate complaints about professional misconduct and unsatisfactory professional conduct.¹ These terms are partially defined in s 127 of the Legal Profession Act 1987 (NSW) which provides that:

unsatisfactory professional conduct includes conduct (whether consisting of an act or omission) occurring in connection with the practice of law that falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent practitioner or interstate practitioner.

• unsatisfactory professional conduct that involves a substantial or consistent failure to reach reasonable standards of competence and diligence; and
• conduct not in connection with legal practice which would justify a finding that a legal practitioner is not of good fame and character, or is not a fit and proper person to remain on the roll of legal practitioners.

• Deliberate charging of grossly excessive amounts of costs, and deliberate misrepresentation as to costs.⁴
• Having an associate whom the legal practitioner knows has been disqualified from practice, or knows has been convicted of an indictable offence and does not hold a current practising certificate (in certain circumstances).⁵
• Non-compliance with a notice from the LSC or a Council under s 152 requiring information, documents or other cooperation with an investigation (unless the practitioner has a reasonable excuse). ⁶
• Non-compliance with a notice from the LSC under s 159 requiring information, documents or other cooperation with a review of a Council decision (unless the practitioner has a reasonable excuse).⁷
• Wilful failure to hold money received on behalf of others in a trust account and to deposit trust account money with the Law Society as required by Part 6.⁸
• Wilful failure to keep accounting records as required by Part 6.⁹
• Wilful failure to produce accounting records or other information in connection with an audit under Part 6.¹⁰
• Practising as a solicitor or barrister without holding a current practising certificate as required by Part 3, without a reasonable excuse.¹¹
• Non-compliance with a notice from a costs assessor requiring the production of documents in relation to a costs assessment (unless the practitioner has a reasonable excuse).¹²
• Non-compliance with a notice from a panel convened under Part 11 Subdivision 4A to review a costs assessment, requiring the production of documents (unless the practitioner has a reasonable excuse).¹³

Consequences

4.6 The categorisation of misconduct as either unsatisfactory professional conduct on the one hand, or professional misconduct on the other hand, has a number of procedural and substantive consequences for the investigation and resolution of complaints made under Part 10, in particular:

• determinations in relation to out of time complaints;¹⁷
• the power of the LSC and Councils to issue reprimands rather than refer complaints to the Legal Services Division of the Administrative Decisions Tribunal (the Tribunal);¹⁸
• the rules of evidence that apply before the Tribunal;¹⁹
• whether Tribunal hearings are held in public;²⁰
• the ability of the Tribunal to remove a practitioner from the roll of practitioners;²¹ and
• the maximum fine that may be imposed on a practitioner by the Tribunal.²²

Need for further clarification

4.7 The submissions received so far have raised a number of issues about whether the current definitions of misconduct in Part 10 require further clarification. The Law Society has questioned whether it is necessary to have two categories of misconduct, or whether one category would be sufficient.²³

4.8 Other submissions criticised the current definitions as being confusing and limiting.²⁴ The Office of the Legal Services Commissioner (OLSC) argued that this leads to uncertainty about whether a practitioner’s conduct falls within the scope of Part 10. It was argued that this makes it difficult for legal practitioners to know whether particular conduct is acceptable and for consumers to know whether specific conduct is unacceptable and a complaint should be made.

4.9 Another submission argued that the definitions should be clarified by the incorporation of the relevant common law, and criticised the divergence between the New South Wales and Victorian definitions of misconduct.²⁵

4.10 The National Competition Policy Review of the Legal Profession Act 1987 (NSW) conducted by the New South Wales Attorney General’s Department concluded that further codification of these definitions was not necessary.²⁶

Medical Practice Act 1992 (NSW)

4.11 The OLSC supports further codification of the standards for unsatisfactory professional conduct and professional misconduct, using as a model the definitions sections in the system for dealing with complaints against medical practitioners in Part 4 of the Medical Practice Act 1992 (NSW). Section 36 of the Medical Practice Act 1992 (NSW) partially defines unsatisfactory professional conduct as including:

• Lack of adequate knowledge, skill, judgement or care in the practice of medicine.
• Any contravention of the Medical Practice Act 1992 (NSW) or regulations made under it.
• Contravention of any restrictions on a practitioner’s registration.
• Convictions for a number of specified offences.
• Permitting an employee who is not a medical practitioner to perform work requiring professional skill in some circumstances.
• Enabling or assisting an unregistered practitioner to practice medicine in some circumstances.
• Using false qualifications.
• Failing to render urgent attention.
• Any other improper or unethical conduct relating to medical practice.

4.13 Section 37 of the Medical Practice Act 1992 (NSW) defines professional misconduct as unsatisfactory professional conduct of a sufficiently serious nature to justify the suspension of the practitioner’s registration or the removal of the practitioner from the roll of medical practitioners.

4.14 Under the Medical Practice Act 1992 (NSW), the Medical Tribunal has the power to suspend or deregister a medical practitioner if satisfied of any one of the following:

• that the person is not competent to practise medicine;
• that the person is guilty of professional misconduct;
• that the person has been convicted of an offence in circumstances that render the person unfit in the public interest to practise medicine; or
• that the person is not of good character.

4.15 Part 11 of the Legal Profession Act 1987 (NSW) requires legal practitioners to disclose the estimated costs of services to clients.²⁷ The OLSC submitted that a significant proportion of complaints it receives relate to failure by practitioners to comply with these requirements.²⁸ The OLSC submitted that it is difficult to resolve these complaints because the relationship between the disclosure requirements and the complaints system is not clear.

4.16 Part 11 provides that failure to comply with the costs disclosure requirements does not amount to a breach of the Legal Profession Act 1987 (NSW), but is capable of being misconduct.²⁹ Although the OLSC has issued a consent reprimand to a practitioner for repeated failure to comply with the requirements,³⁰ there is no authority on when non-disclosure of costs amounts to misconduct. The OLSC submitted that the Legal Profession Act 1987 (NSW) should be amended to clarify that non-disclosure of costs amounts to misconduct.³¹

Advertising

4.17 Section 38J of the Legal Profession Act 1987 (NSW) provides that legal practitioners must not breach fair trading legislation when advertising their services. In a submission to the National Competition Policy Review of the Legal Profession Act 1987 (NSW), the OLSC suggested that s 38J should be amended to provide that a breach of the section is capable of amounting to unsatisfactory professional conduct or professional misconduct.³²

Negligence

4.18 Submissions from the OLSC, the Law Society and individuals also dealt with the relationship between professional negligence and Part 10.³³ Under the current law, negligence will not necessarily constitute unsatisfactory professional conduct unless it demonstrates indifference to the basic standards of practice.³⁴ These submissions argued that Part 10 should be amended to clarify that negligence is capable of constituting unsatisfactory professional conduct. This would arguably give consumers a degree of certainty about what actions constitute negligence.³⁵

4.19 The only redress for consumers who have suffered as a result of negligence by a practitioner is to commence civil proceedings. The OLSC noted that many consumers are reluctant to take this step, because they perceive that it will be difficult and expensive to win a case against a lawyer, and because they are averse to the idea of hiring another lawyer and to the legal profession in general. For many consumers, the cost of commencing a civil action is also prohibitive.³⁶ The OLSC submitted that complainants find it difficult to understand the difference between misconduct and negligence or to accept that there will be no disciplinary action against a negligent practitioner. The OLSC also argued that current law allows practitioners who are negligent to continue to practice unchecked, and this has a negative impact on the standards of the profession generally.

4.20 Some submissions suggest that an independent statutory officer be established to be responsible for deciding from the outset whether a particular set of circumstances is misconduct or negligence. This is to counter confusion and ensure that separate claims can be made.³⁷

4.21 The definition of unsatisfactory professional conduct refers to conduct that falls short of the “standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent legal practitioner”.³⁸ In its submission to the National Competition Policy Review of the Legal Profession Act, the OLSC argued that this standard should be based on the reasonable expectations of a member of the public, rather than those of a reasonably competent legal practitioner.³⁹ The review concluded that the standard should be based on the standard expected of a reasonable person. However the standard of diligence that a reasonable person would expect of a competent practitioner is a relevant factor in establishing a finding of misconduct.⁴⁰

Whistleblowing

4.22 The Protected Disclosures Act 1994 (NSW) provides a number of protections to public servants who disclose information about corruption, maladministration or serious and substantial waste in the public sector. The Protected Disclosures Act 1994 (NSW) also applies outside the public service in relation to government work performed under contract by private practitioners.⁴¹ The Professional Standards Council has proposed the extension of whistleblowing principles to the regulation of the private sector, including the legal profession.⁴²

4.23 The Protected Disclosures Act 1994 (NSW) makes it clear that a person who makes a protected disclosure is not liable to disciplinary action because of the disclosure,⁴³ and makes it an offence to take disciplinary proceedings against a person in reprisal against the person making a protected disclosure.⁴⁴ The Public Sector Management Act 1988 (NSW) also states that this is a breach of discipline.⁴⁵ If the Professional Standard Council’s proposal is implemented, it may be necessary to clarify that these provisions also apply in relation to whistleblowing in the legal profession.

Issue 4

Are the current definitions of unsatisfactory professional conduct and professional misconduct satisfactory?

4.24 Under Part 10, complaints about the conduct of a legal practitioner may be made at any time. However, a complaint cannot be made more than 3 years after the conduct is alleged to have occurred unless a determination is made to deal with the complaint.⁴⁶ Determinations are made by the LSC, except in respect of complaints made by a Council, in which case the Council is also responsible for the determination.

4.25 The time limit provision was amended in response to the High Court’s decision in Barwick v Law Society of NSW.⁴⁷ In Barwick the Court considered the status of a complaint initiated by the Law Society Council about conduct which took place outside the time limit. The Law Society Council had not obtained a determination from the LSC waiving the time limit. The Council argued that the time limit should not apply to complaints initiated by the LSC or a Council because the very fact that the complaint was initiated by the LSC or Council was sufficient to ensure that it was properly brought⁴⁸ . The Court rejected this argument, holding that complaints initiated by the Law Society Council are subject to the time limit.⁴⁹

Should there be a time limit on complaints?

4.26 Arguably, misconduct is always relevant to a practitioner’s fitness to practise, regardless of when it occurred. On this view, the time lapse between the alleged misconduct and the complaint should not affect the power to conduct an investigation, although it may be relevant to the sanction imposed if the complaint is upheld.⁵⁰

4.27 On the other hand, the time limit provides certainty and a guard against abuse of the complaints process. There may also be practical problems investigating complaints about conduct which is alleged to have occurred a very long time earlier, because of difficulties gathering and assessing the reliability of evidence in such circumstances.⁵¹

Complaints initiated by the Councils

4.28 The Law Society submitted that no time limit should apply to complaints initiated by the Law Society Council, as such complaints usually only occur as a result of trust account inspections or existing investigations.⁵² The Law Society also supports the response to the time limit issue adopted by the Government in the Legal Profession Amendment (Complaints and Discipline) Act 2000 (NSW) after the decision of the High Court in Barwick v Law Society of NSW. This Act validates investigations and decisions of the LSC, the Councils, the Tribunal and the courts, rendered invalid as a result of the High Court’s decision in Barwick, and provides that where a complaint initiated by a Council or the LSC is out of time, the Council or LSC must make a determination to waive the time limit.

Complaints initiated by the Legal Services Commissioner

4.29 The OLSC submitted that the LSC should not be required to comply with the time limit provision, describing it as peculiar to require the LSC to determine whether to accept his own complaints out of time.⁵³ On the other hand, it is arguable that the recent modifications to the time limit for making complaints under Part 10 reflect the Government’s intention to require the Councils and the LSC specifically to consider whether to accept out of time complaints and apply the test set out in the new section.

Length of time limit

4.30 Several submissions argued that the time limit should be increased to six years from the date that the alleged conduct occurred, to bring it in line with the limitations period for civil proceedings for negligence.⁵⁴ These submissions argued that the time limit creates practical problems because in many instances, for example protracted litigation, misconduct may not become apparent within three years. There has been some concern that the present time limit does not allow for misconduct that has occurred over a period of time forming a pattern of behaviour requiring discipline.⁵⁵ Additionally, clients of non-English-speaking background, clients with an intellectual disability or a lay person not familiar with the options for recourse, may be particularly affected by the operation of s 137.⁵⁶

4.31 The exposure draft version of the bill to introduce Part 10 into the Legal Profession Act⁵⁷ included a six year time limit.⁵⁸ This was based on the Law Reform Commission’s recommendation in its 1993 report Complaints Against Lawyers – Scrutiny of the Legal Profession (Report 70).⁵⁹

When should time start to run?

4.32 Another option would be for the time limit to run from the time the complainant became aware of the alleged misconduct, rather than the time that the conduct allegedly occurred. The Law Reform Commission also considered this option in Report 70.⁶⁰

Issue 5

Should there be a time limit for making complaints?

Issue 6

If there should be a time limit, should it apply to all complaints, including complaints initiated by the Councils and the LSC?

Issue 7

If there should be a time limit, how long should it be?

Issue 8

If there should be a time limit, should time start to run from the date that the conduct allegedly occurred or the date that the complainant became aware of it?

4.33 The OLSC submitted that Part 10 should be expanded to cover complaints against firms of practitioners as well as individual practitioners.⁶¹ The Victorian system, for example, essentially treats firms in the same way as individual practitioners.⁶²

4.34 The Legal Profession Amendment (Incorporated Legal Practices) Bill 2000 (NSW), currently before the Legislative Council, enables solicitors to incorporate their legal practices. If this bill is passed, the question also arises whether Part 10 should apply to incorporated firms.

Issue 9

How should complaints against bodies other than individual practitioners (eg firms or incorporated firms) be dealt with?

Referral after mediation

4.35 Division 4 of Part 10 provides for the mediation of consumer disputes. At present, Part 10 does not allow the LSC to refer to a Council any conduct issues which require investigation following the completion of a mediation. The OLSC submitted that the LSC should be given the power to refer complaints to a Council in this situation.⁶³

Issue 10

Should the LSC be permitted to refer to a Council any conduct issues that require investigation following mediation of a consumer dispute?

4.36 There is no provision for the referral of a complaint by the LSC to a Council outside the time limit by consent. At present, the LSC and Councils have an informal arrangement in place for the transfer of a complaint to a Council at any time with the consent of the Council. The OLSC submitted that this practice should be given a statutory basis under Part 10.⁶⁴

Issue 11

Should the informal arrangement in place for the transfer of a complaint to a Council at any time by consent be given a statutory basis under Part 10?

Independent investigations

4.37 Ordinarily, complaints are investigated by the Councils, or, in some cases, by the LSC. However, s 151 of the Legal Profession Act 1987 (NSW) provides for the appointment of an independent investigator by the LSC on the request of a Council. The independent investigator is to report to the Council, which is then required to make a decision on the complaint. The Bar Association submitted that in this situation, the Council has no input into the investigation and no monitoring role.⁶⁵ It was submitted that s 151 should be amended to provide for the independent investigator to report to the LSC and for the LSC to decide on the outcome of the complaint under s 155.

Issue 12

Should s 151 be amended to provide that independent investigators should report to the LSC, and that decisions under s 155 in relation to such complaints should be made by the LSC?

The procedure for dealing with additional complaints

4.38 Under Part 10, informations laid in the Tribunal must contain allegations specifically nominated in a complaint and investigated in accordance with Division 5 of Part 10.⁶⁶ Therefore, whenever an additional complaint arises during the course of an investigation or a Tribunal hearing, the LSC or relevant Council is required to initiate a further complaint, and conduct a further investigation. An additional complaint may relate to alleged conduct which occurred more than three years earlier. In this situation, for the additional complaint to proceed, the LSC or Council must also make a determination to waive the 3 year time limit.⁶⁷

4.39 The Tribunal has the power to vary an information to include additional allegations.⁶⁸ Variation is not precluded because the alleged conduct which is sought to be added occurred more than three years earlier.⁶⁹ This provision was enacted in response to the decision of the High Court in Barwick v Law Society of NSW. In Barwick the High Court held that the Tribunal’s power of variation cannot be used to vary an information to add allegations relating to conduct which occurred more than three years earlier, as this would undermine the time limit.⁷⁰ Justice Callinan criticised the Tribunal’s power to vary the information to join fresh allegations.⁷¹

Criticism of the procedure

4.40 The OLSC, the Law Society and the Bar Association argued that the Councils and the LSC should be relieved from the necessity of repeatedly initiating complaints and conducting separate investigations whenever conduct is discovered which departs somewhat from the terms of the original complaint.⁷² The OLSC submitted that the requirements create procedural difficulties for the administration of Part 10. The Bar Association submitted that the procedure is highly technical and sometimes artificial. In Barwick, Justice Kirby also criticised the procedures.⁷³

4.41 The OLSC also submitted that compliance with these procedures causes delays in the disposal of complaints. In Barwick, Justice Kirby also expressed “grave concern” at the delays in disposing of the allegations in the complaint before the High Court and further observed that “unhappily, the recent experience of this Court suggests that such delays may represent the norm, not an exception.”⁷⁴ Compliance also consumes the resources of the Councils and the LSC.

Options for reform

4.42 The OLSC argued for the insertion of a new section in Part 10 stating that an investigation into alleged conduct the subject of a complaint may also extend to any other matter arising out of the initial investigation that may involve misconduct by the practitioner concerned.⁷⁵

4.43 An alternative way of addressing this issue, according to the OLSC, is to amend the provisions of Part 10 dealing with complaints, investigations and the jurisdiction of the Tribunal, to effect a clear division between these aspects of the complaints process.⁷⁶ The Law Society supports this option.⁷⁷

4.44 Under this approach, a complaint would trigger an investigation into the alleged conduct of a legal practitioner. The investigation would not be confined to the matters identified in the original complaint.⁷⁸ The LSC or Council conducting the investigation would not be required to repeatedly initiate complaints if further allegations of misconduct arose.

4.45 The powers of the Tribunal would also be expanded. The Tribunal would be permitted to examine and determine issues outside the original complaint which arise during an investigation or hearing.⁷⁹ This would ensure that it is not necessary to demonstrate a clear connection between a complaint and an information filed in the Tribunal.

Issue 13

Should the procedural requirements in Part 10 for the treatment of additional complaints be modified in response to the decision of the High Court in Barwick v Law Society of NSW? If so, how?

4.46 The OLSC submitted that situations arise where the LSC or relevant Council may be satisfied that there is sufficient evidence to institute Tribunal proceedings against a practitioner, without having to undertake a formal investigation into a complaint.⁸⁰ For example, a trust accountant’s report may identify sufficient evidence of wilful breaches of the trust account requirements in Part 6 of the Legal Profession Act 1987 (NSW), or a practitioner may be convicted of fraud in criminal proceedings.

4.47 The OLSC submitted that the LSC and the Councils could be satisfied that there is sufficient evidence to institute Tribunal proceedings by means other than by way of an investigation into a complaint, to avoid having to conduct unnecessary investigations in such circumstances.

Issue 14

Should the LSC and the Councils be able to institute Tribunal proceedings other than by conducting an investigation into a complaint? If so, in what circumstances should this be permitted?

4.48 Under the doctrine of client legal privilege, confidential communications between a legal practitioner and client are not admissible as evidence in court.⁸¹ Part 10 of the Legal Profession Act 1987 (NSW) provides for limited exceptions to client legal privilege. Under s 171, practitioners must comply with a requirement under Part 10 to answer questions or produce information or documents despite client legal privilege, but only if the client is the complainant or consents to the disclosure. Practitioners may also disclose information to the LSC, a Council or the Tribunal in breach of client legal privilege if it is necessary to rebut an allegation in the complaint.

4.49 The OLSC and the Law Society submitted that this exception to client legal privilege should be extended.⁸² It was submitted that because a legal practitioner can avoid the production of documents where the client does not consent to waive client legal privilege, it is not possible to investigate complaints where it is alleged that a practitioner and client have been jointly involved in misconduct. The OLSC and the Law Society submitted that practitioners should be required to cooperate with investigations, despite client legal privilege, even where the client does not consent.

4.50 It was also argued that the exception to client legal privilege is not wide enough to obtain information from practitioners other than a practitioner against whom a complaint has been made. The OLSC submitted that the exception should be expanded to require a practitioner to disclose information in breach of client legal privilege if the LSC, Council or Tribunal is satisfied that it is necessary in the course of an investigation.

4.51 It was submitted that the effect of client legal privilege could be preserved by preventing the LSC and Councils from disclosing information or documents obtained pursuant to s 171S(2) to the complainant.

Issue 15

Should the exception to client legal privilege in s 171S be extended? If so, how?

4.52 One of the express objects of the complaints system set up by Part 10 is to ensure that the rules of procedural fairness are applied to all disciplinary proceedings against lawyers.⁸³ It is uncontentious that practitioners should be afforded procedural fairness throughout the complaints process – the common law would require this even if the Legal Profession Act 1987 (NSW) was silent. The threshold question is what aspects of procedural fairness should be specified in Part 10 for the purpose of clarity.⁸⁴

4.53 In Murray v Legal Services Commissioner,⁸⁵ the New South Wales Court of Appeal considered the application of procedural fairness to the investigation of complaints under Part 10.⁸⁶ The Court of Appeal held that procedural fairness requires that before a decision is made under s 155 of the Legal Profession Act 1987 (NSW), the legal practitioner who is the subject of the complaint must be given a copy of the complaint and an opportunity to respond to it.⁸⁷ Failure to do so vitiates the institution of Tribunal proceedings.⁸⁸

4.54 In its submission, the OLSC criticised the requirement that the practitioner be provided with a copy of the complaint.⁸⁹ The OLSC submitted that this requirement places undue emphasis on the form of the complaint. The OLSC noted that most complaints the LSC receives are made by lay persons. In many instances, the complainant is not aware of, or able to describe accurately, all the misconduct issues arising from the allegations against the legal practitioner. Frequently, the substance of the complaint is only ascertained during the course of the investigation.

4.55 The OLSC also submitted that in some cases the complaint contains inflammatory or defamatory statements which, if provided to the practitioner, will escalate the dispute, making it more difficult to resolve. In other situations, where the complaint contains material which is irrelevant or lacking in substance, providing the practitioner with a copy results in the practitioner wasting resources responding to allegations which will not be pursued. The OLSC also pointed out that this requirement may prejudice investigations relating to alleged trust account defalcation.

4.56 The OLSC submitted that the legal practitioner should be entitled to receive, in writing, the substance of the allegations which are the subject of the investigation. The Law Society supported this submission.⁹⁰

4.57 Section 156 of the Legal Profession Act 1987 (NSW) provides that the LSC or relevant Council must keep a record of its decision in respect of every investigation. Under s 171J, the LSC or relevant Council must notify the complainant and legal practitioner, in writing, of its decision under s 155, together with the reasons for the decision. The Law Society and the OLSC submitted that this notice requirement should not apply where the outcome of the investigation is a decision to refer the complaint to the Tribunal.⁹¹ The Bar Association also submitted that consideration should be given to this issue.⁹² It was argued that substantial resources are wasted complying with the notice requirement in this situation, because the parties will already be fully aware of the reasons for referral.⁹³

4.58 The OLSC argued that where the LSC or Council decides to refer a complaint to the Tribunal, providing the parties with copies of the draft information and affidavits to be filed in the Tribunal should be sufficient to satisfy the notice requirement under s 171J.

4.59 The Bar Association submitted that the LSC or Council should only be required to provide written notice of its reasons if it dismissed the complaint.

4.60 On the other hand, one submission argued that the Law Society should be required to provide more information about its decisions to the parties.⁹⁴ This submission noted that the Bar Association provides the parties with a copy of the report prepared by the Professional Conduct Committee which is used to determine complaints. This submission argued that the Law Society should also adopt this practice.

Issue 16

What should be required by Part 10 in order to clarify the requirement of procedural fairness to the practitioner and the complainant in respect of a decision under s 155?

Issue 17

How extensive should the notice requirements of s 171J be?

4.61 Under s 152 of the Legal Profession Act 1987 (NSW), the LSC and Councils have the power to issue notices compelling a legal practitioner whose conduct is the subject of a complaint to co-operate with an investigation.⁹⁵ This power also applies to reviews of Council decisions by the LSC under Division 6.⁹⁶ Non-compliance with a notice issued under s 152, without reasonable excuse, is itself professional misconduct, while misleading or obstructing an investigation is capable of amounting to professional misconduct.⁹⁷

4.62 The Law Society observed that solicitors do not always respond to notices to produce under s 152.⁹⁸ The OLSC criticised s 152, observing that it is a source of significant dissatisfaction to both complainants and OLSC staff.⁹⁹ It was submitted that the procedure is time and resource intensive, as well as inefficient. The OLSC estimates that it may be a year or more before it is able to obtain sufficient information from the practitioner in order to undertake an investigation of a complaint.

4.63 The OLSC submitted that the effectiveness and efficiency of the complaints system would be significantly improved if its powers to obtain information from practitioners were more flexible. The OLSC argued that the LSC or a delegate should be permitted to attend a practitioner’s office and inspect files or interview a practitioner who failed to comply with a notice to produce under s 152.

4.64 Solicitors are permitted to withhold all files, documents and personal property of a client until the client pays their costs in full, unless the Supreme Court orders the solicitor to give up the documents.¹⁰⁰ Sometimes a solicitor will claim this lien over the file of a client who has complained about the solicitor, preventing the client from gaining access to the file.

4.65 The Councils and the LSC can compel a practitioner to waive this lien if satisfied that it is “necessary for the orderly transaction of the client’s business”.¹⁰¹ The OLSC submitted that it is not clear whether this test covers the situation where a complainant requires the file in order to determine any possible causes of action against a practitioner. It was submitted that a broader test, such as whether the Council or LSC is satisfied that waiver is fair and just in all the circumstances, would be more appropriate.¹⁰²

4.66 The Law Society submitted that Councils should have the power to resolve to suspend a practitioner’s practising certificate until he or she complies with a notice to produce.¹⁰³

4.67 Another submission suggested that the real delays in the complaints system occur after the practitioner has responded to a s 152 notice.¹⁰⁴

4.68 The Bar Association submitted that consideration should be given to amending s 152 to provide that a notice need not be served on the practitioner personally but can be served at his or her last known place of business, or otherwise in a manner reasonably calculated to bring the notice to the attention of the practitioner.¹⁰⁵

Issue 18

Are the powers of the LSC and Councils to compel practitioners to co-operate with investigations adequate? If not, what additional powers should the LSC and Councils have?

Issue 19

Are the sanctions for failure to respond to a s 152 notice adequate? If not, what additional sanctions should apply?

Issue 20

Should the service requirements under s 152 be amended?

4.69 The LSC may take over the investigation of a complaint from a Council if he considers it appropriate to do so,¹⁰⁶ and may refer a complaint to a Council after commencing an investigation into the complaint.¹⁰⁷ The LSC may also, with the consent of a Council, refer a complaint to the Council after completing an investigation into the complaint (including after the institution of Tribunal proceedings).¹⁰⁸

4.70 One submission argued that complainants should be entitled to a review of a decision to transfer a complaint between the LSC and relevant Council.¹⁰⁹ A disadvantage of this is that it increases the length of the complaints handling process.

Issue 21

Should complainants be entitled to a review of a decision to transfer a complaint from a Council to the LSC? If so, who should conduct the review?

4.71 In Murray v Legal Services Commissioner,¹¹⁰ the New South Wales Court of Appeal held that the effect of a breach of the procedural requirements for investigations and decisions under s 155 is to invalidate the investigation and any proceedings commenced in the Tribunal.

4.72 The Law Society submitted that non-compliance with the procedural requirements of Part 10 should not invalidate Tribunal proceedings. It was submitted that the Tribunal and the Supreme Court should be given remedial power to cure procedural irregularities in investigation of complaints and the initiation of Tribunal proceedings. The Bar Association also submitted that consideration should be given to this issue.¹¹¹

4.73 Section 81 of the Supreme Court Act 1970 (NSW) provides a model for this power. Section 81 provides that procedural defects do not nullify Supreme Court proceedings, and permits the Supreme Court to cure procedural irregularities rather than setting aside proceedings, or any step taken in proceedings, or any document, judgment or order.

4.74 The Law Society also submitted that Part 10 should be amended to provide that the parties may waive rights arising from non-compliance with the requirements of procedural fairness under Part 10, and that failure to object is deemed to amount to waiver.¹¹² The Bar Association also submitted that consideration should be given to this issue.¹¹³

4.75 An alternative approach to this issue, which would cover non-compliance with all the procedural requirements of Part 10, would be to include a validating provision in Part 10 providing that the decisions of the Tribunal are deemed to be valid regardless of any procedural irregularities occurring in the course of investigating and determining a complaint.

Issue 22

Should the Tribunal be given power to cure any non-compliance with the provisions of Part 10?

Issue 23

Should Part 10 be amended to provide for waiver of the procedural fairness requirements?

Issue 24

Should Part 10 be amended to include a provision validating Tribunal proceedings regardless of procedural defects?

4.76 Complainants are entitled to have the LSC review decisions about complaints made by the Councils.¹¹⁴ This is the only review mechanism available to complainants under Part 10. The vast majority of reviews undertaken by the LSC confirm the initial decision of the relevant Council.¹¹⁵ The Law Society and the Bar Association submitted that in these circumstances, the right to a review often wastes considerable resources. It was argued that the right to a review should be restricted to create a disincentive for frivolous applications for review.

4.77 The Law Society submitted either that a small fee should be introduced for conducting reviews, or that a complainant seeking a review should be required to complete a detailed statutory declaration setting out the reasons the review is requested.¹¹⁶ The Bar Association also submitted that consideration should be given to imposing a fee for conducting a review of Council decisions.¹¹⁷ The Bar Association also submitted that the review process should be amended to provide that an application for review not determined within a particular time limit shall be deemed to have been dismissed.¹¹⁸ Another approach to this issue would be to give the LSC a power to summarily dismiss an application for review which did not disclose any basis for reconsideration of the Council’s decision.

Issue 25

Should the right to a review of Council decisions be restricted in any way? If so, how?

1. Legal Profession Act 1987 (NSW) s 131.

2. Legal Profession Act 1987 (NSW) s 127(1).

3. See Legal Profession Act 1987 (NSW) s 127(3).

4. Legal Profession Act 1987 (NSW) s 208Q(2).

5. Legal Profession Act 1987 (NSW) s 48K.

6. Legal Profession Act 1987 (NSW) s 152(4). See para 4.61-4.68.

7. Legal Profession Act 1987 (NSW) s 159(4), inserted by the Legal Profession Amendment (Complaints and Discipline) Act 2000 (NSW) s 3 and Sch 1.

8. Legal Profession Act 1987 (NSW) s 61(7) and 64(5).

9. Legal Profession Act 1987 (NSW) s 62(4).

10. Legal Profession Act 1987 (NSW) s 63(5).

11. Legal Profession Act 1987 (NSW) s 25(4).

12. Legal Profession Act 1987 (NSW) s 207(6).

13. Legal Profession Act 1987 (NSW) s 208KD(5).

14. Legal Profession Act 1987 (NSW) s 152(5). See also s 127(3).

15. Legal Profession Act 1987 (NSW) s 182(4), 183.

16. Legal Profession Act 1987 (NSW) s 57D. See also Parts 3B, 3C and s 55, which regulate the entitlement of interstate legal practitioners to practice in New South Wales under the national practising certificates scheme, and local registration of foreign lawyers; s 172X, dealing with misconduct by solicitors corporations, and s 208KD.

17. See para 2.5-2.7 and 4.24-4.32.

18. See para 2.36 and 5.13-5.14.

19. See para 6.9-6.12.

20. See para 2.52 and 6.13-6.18.

21. See paa 2.54.

22. See para 2.54.

23. Law Society of NSW, Preliminary Submission Issue 1; The Hon Peter Breen MLC, Preliminary Submission at para 2.4.

24. OLSC, Preliminary Submission at 8; The Hon Peter Breen MLC, Preliminary Submission at para 2.4; S Cuddy, Preliminary Submission at 3; NSW Legal Reform Group, Preliminary Submission at para 2.2.

25. S Cuddy, Preliminary Submission at 3.

26. New South Wales, Attorney General’s Department, National Competition Review of the Legal Profession Act 1987 (Report, 1998) at Recommendation 9.5.

27. Legal Profession Act 1987 (NSW) s 175 and 177.

28. OLSC, Preliminary Submission at 18.

29. Legal Profession Act 1987 (NSW) s 182(4).

30. OLSC, Preliminary Submission at 18.

31. OLSC, Preliminary Submission at 18.

32. OLSC, Submission to National Competition Policy Review at 9-10.

33. OLSC, Preliminary Submission at 15-16; Law Society of NSW, Preliminary Submission Issue 12; The Hon Peter Breen MLC, Preliminary Submission at para 1.5, 2.2, 2.4.

34. Pitsikas (1995) 1 LPDR 5.

35. The Hon Peter Breen MLC, Preliminary Submission at para 2.4.

36. OLSC, Preliminary Submission at 14; G Taylor, Preliminary Submission (Oral Submission).

37. The Hon Peter Breen MLC, Preliminary Submission at para 2.2.

38. See para 4.2.

39. OLSC, Submission to National Competition Policy Review at 15.

40. New South Wales, Attorney General’s Department, National Competition Policy Review of the Legal Profession Act 1987 (Report, 1998) at para 9.4, 9.5.

41. Professional Standards Council, Whistleblowing in the Professions (Consultative Paper, April 2000) at 7.

42. Professional Standards Council.

43. Protected Disclosures Act 1994 (NSW) s 21.

44. Protected Disclosures Act 1994 (NSW) s 20.

45. Public Sector Management Act 1988 (NSW) s 66.

46. Legal Profession Act 1987 (NSW) s 137, as amended by the Legal Profession Amendment (Complaints and Discipline) Act 2000 (NSW) s 3 and Sch 1. See para 2.5-2.7.

47. Barwick v Law Society of NSW [2000] HCA 2 (3 February 2000).

48. Barwick v Law Society of NSW [2000] HCA 2 (3 February 2000) at para 88 per Kirby J.

49. Barwick v Law Society of NSW [2000] HCA 2 (3 February 2000) at para 72 per Gleeson CJ, Gaudron and McHugh JJ; at para 97 per Kirby J; at para 143, 171 per Callinan J.

50. New South Wales Law Reform Commission, Scrutiny of the Legal Profession – Complaints Against Lawyers (Report 70, 1993) at para 4.68-4.69.

51. NSWLRC Report 70 at para 4.69.

52. See also Kirby J’s detailed consideration of the Law Society’s submissions on this point in Barwick v Law Society of NSW [2000] HCA 2 (3 February 2000) at para 87-96. Issues arising from the discovery of additional complaints in the course of existing investigations are dealt with at para 4.38-4.45.

53. OLSC, Preliminary Submission, Appendix at 2.

54. B Golder, Preliminary Submission at 2; G Taylor, Preliminary Submission (Oral Submission). This is the general time limit for civil actions for negligence: Limitations Act 1969 (NSW) s 14. The time limit for personal injury actions is 3 years: s 18A. See also Part 3, Division 3.

55. Law Society of NSW, Preliminary Consultation.

56. B Golder, Preliminary Submission at 2.

57. Legal Profession Reform Bill 1993 (NSW).

58. Legal Profession Reform Bill 1993 (NSW) cl 139(1).

59. NSWLRC Report 70 Recommendation 12.

60. NSWLRC Report 70 at para 4.67.

61. OLSC, Preliminary Submission at 10. See para 2.20.

62. See, for example, Legal Practice Act 1996 (Vic) s 122, 137 and 151.

63. OLSC, Preliminary Submission, Appendix at 3.

64. OLSC, Preliminary Submission, Appendix at 3. See also s 141(4), which provides that the LSC may refer a complaint to a Council even though the LSC commenced but has not completed an investigation; and s 147A, which is discussed at para 4.69-4.70.

65. NSW Bar Association, Preliminary Submission 2 at 2.

66. Barwick v Law Society of NSW [2000] HCA 2 (3 February 2000) at para 60-64 per Gleeson CJ, Gaudron, McHugh JJ; at para 115 per Kirby J; at para 156 per Callinan J.

67. See para 2.5-2.7 and 4.24-4.32.

68. Legal Profession Act 1987 (NSW) s 167A.

69. Inserted by the Legal Profession Amendment (Complaints and Discipline) Act 2000 (NSW) s 3, Sch 1[8].

70. Barwick v Law Society of NSW [2000] HCA 2 (3 February 2000) at para 74-76 per Gleeson CJ, Gaudron, McHugh JJ; at para 100 per Kirby J; at para 162 per Callinan J. While Kirby J ultimately dissented on this point, holding that the variation was valid because Barwick did not object to it when the Law Society Council applied for it, he also held that in the face of an objection, the variation would have been invalid (at para 108).

71. Barwick v Law Society of NSW [2000] HCA 2 (3 February 2000) at para 159-162.

72. OLSC, Preliminary Submission at 3-4; Law Society of NSW, Preliminary Submission Issue 3; NSW Bar Association, Preliminary Submission 1 at para 4 and 18-28.

73. Barwick v Law Society of NSW [2000] HCA 2 (3 February 2000) at para 113, 115 per Kirby J.

74. Barwick v Law Society of NSW [2000] HCA 2 (3 February 2000) at para 80 per Kirby J. See also para 113.

75. OLSC, Preliminary Submission at 4. The OLSC emphasised that this submission is linked to its submissions in relation to procedural fairness under Part 10, which are discussed at para 4.52-4.60.

76. OLSC, Preliminary Submission at 4-5.

77. Law Society of NSW, Preliminary Submission Issue 3.

78. This would require an amendment to s 148 which deals with the investigation of complaints.

79. This would require an amendment to s 167 which deals with the institution of proceedings and hearings.

80. OLSC, Preliminary Submission, Appendix at 8.

81. Evidence Act 1995 (NSW) s 117-126.

82. OLSC, Preliminary Submission at 11; Law Society of NSW, Preliminary Submission Issue 11.

83. Legal Profession Act 1987 (NSW) s 125(a).

84. Kioa v West (1985) 159 CLR 550.

85. (1999) 46 NSWLR 224.

86. See also para 4.71 and 5.2.

87. Murray v Legal Services Commissioner (1999) 46 NSWLR 224.

88. Murray v Legal Services Commissioner (1999) 46 NSWLR 224.

89. OLSC, Preliminary Submission at 2-5.

90. Law Society of NSW, Preliminary Submission Issues 3 and 4.

91. Law Society of NSW, Preliminary Submission Issue 5; OLSC, Preliminary Submission, Appendix at 8.

92. NSW Bar Association, Preliminary Submission 1 at para 22-23.

93. Note that the practitioner must be served with initiating documents under the Administrative Tribunal (Interim) Rules 1998 (NSW), made pursuant to the Administrative Decisions Tribunal Rules (Transitional) Regulation 1998 (NSW) Rule 14, sub-rule 3.

94. S Cuddy, Preliminary Submission at 4.

95. Legal Profession Act 1987 (NSW) s 152.

96. Legal Profession Act 1987 (NSW) s 159(3), inserted by the Legal Profession Amendment (Complaints and Discipline) Act 2000 (NSW) s 3 and Sch 1.

97. Legal Profession Act 1987 (NSW) s 152(4) and 152(5).

98. Law Society of NSW, Preliminary Submission Issue 10.

99. OLSC, Preliminary Submission at 6-7.

100. For a discussion of the scope of the solicitor’s lien, see Halsbury’s Laws of Australia (Butterworths, 1997) Volume 16 at [250-1030]-[250-1065].

101. Legal Profession Act 1987 (NSW) s 152(2).

102. OLSC, Preliminary Submission at 6-7

103. Law Society of NSW, Preliminary Submission Issue 10.

104. S Cuddy, Preliminary Submission at 3.

105. NSW Bar Association, Preliminary Submission 1 at para 57.

106. Legal Profession Act 1987 (NSW) s 147A(1).

107. Legal Profession Act 1987 (NSW) s 141(4), inserted by the Legal Profession Amendment (Complaints and Discipline) Act 2000 (NSW) s 3 and Sch 1.

108. Legal Profession Act 1987 (NSW) s 147A(A1), inserted by the Legal Profession Amendment (Complaints and Discipline) Act 2000 (NSW) s 3 and Sch 1. Section 167B, also inserted by the Legal Profession Amendment (Complaints and Discipline) Act 2000 (NSW) s 3 and Sch 1, provides for the substitution of informants.

109. S Cuddy, Preliminary Submission at 4-5.

110. (1999) 46 NSWLR 224.

111. Law Society of NSW, Preliminary Submission Issue 7; NSW Bar Association, Preliminary Submission 1 at para 12, 29-30, 33.

112. Law Society of NSW, Preliminary Submission Issue 8.

113. NSW Bar Association, Preliminary Submission 1 at para 32.

114. Legal Profession Act 1987 (NSW) Part 10, Division 6 as amended by the Legal Profession Amendment (Complaints and Discipline) Act 2000 (NSW) s 3, Sch 1.

115. See Law Society of NSW, Professional Standards Department, Annual Report 1998/9 at 20; Law Society of NSW, Preliminary Submission Issue 6.

116. Law Society of NSW, Preliminary Submission Issue 6.

117. NSW Bar Association, Preliminary Submission 1 at para 44-45.