Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Hall v Council of the Law Society of New South Wales [2020] NSWCATOD 96 Hearing dates: 10 August 2020 Date of orders: 26 August 2020 Decision date: 26 August 2020 Jurisdiction: Occupational Division Before: Boland J, AM ADCJ, Deputy President C Fougere, Principal Member B Thomson, General Member Decision: The decision of the Professional Standards Committee of the Law Society of New South Wales dated 16 May 2019 that Trevor Hall be reprimanded is affirmed. Catchwords: ADMINISTRATIVE LAW – Reviewability – Jurisdiction – Statutory Jurisdiction to Review decision under s 299 of the Legal Profession Uniform Law (NSW) of decision of local regularity authority Legislation Cited: Administrative Decisions Review Act 1997 (NSW) Civil and Administrative Tribunal Act 2013 (NSW) Family Law Act 1975 (Cth) Justice Legislation Amendment Act (No 2) 2019 (NSW) Legal Profession Act 2004 (NSW) (repealed) Legal Profession Uniform Law Application Act 2014 Legal Profession Uniform Law (NSW) Legal Profession Uniform Law Australian Solicitors Conduct Rules 2015 (NSW). Cases Cited: Australian Competition and Consumer Commission v Woolworths Limited [2019] FCA 1039 Council for the Law Society of New South Wales v DXW [2019] NSWCATOD 101 Donaghy v The Council of the Law Society of New South Wales [2013] NSWCA 154 Khosa v Legal Profession Complaints Committee [2017] WASCA 192 Legal Profession Complaints Committee v Detata [2012] WASCA 214 Mifsud v Campbell (1991) 21 NSWLR 725 New South Wales Bar Association v Evatt (1968) 117 CLR 177; 1968 HCA 20. Shi v Migration Agents Registration Authority (2008) 235 CLR 286; [2008] HCA 31 Youseff v Legal Services Commissioner [2020] NSWCATOD 85 Ziems v The Prothonotary of the Supreme Court of New South Wales (1957) 97 CLR 270; [1957] HCA 46 Texts Cited: None cited Category: Principal judgment Parties: Trevor Hall (Applicant) Council of the Law Society of New South Wales (Respondent) Representation: Counsel: PA Maddigan (Respondent) Solicitors: Applicant (Self-represented) Council of the Law Society of New South Wales (Respondent). File Number(s): 2020/00079575 Publication restriction: An order is made under s 64 of the Civil and Administrative Tribunal Act 2013 (NSW) prohibiting the publication of the names of the clients of the solicitors referred to in the proceedings. REASONS FOR DECISION Introduction 1. These reasons are in respect of an application by Mr Trevor Hall to review disciplinary action taken against him by the Professional Standards Committee as the delegate of the Council of the Law Society of New South Wales. 2. For convenience only, in these reasons we refer to Mr Hall as "the solicitor", the Professional Standards Committee of Council of the Law Society of New South Wales as "the Committee" and the Council of the Law Society of New South Wales as "the Council". 3. On 16 May 2019 the Committee notified the solicitor that it had determined two complaints about the solicitor's conduct. The first complaint was dismissed. That complaint asserted the solicitor had engaged in unsatisfactory professional conduct by releasing the proceeds of sale of property owned by his male client to that client. The release of the proceeds was said to have occurred in circumstances where the practitioner knew, or ought to have known, that the Supreme Court of New South Wales, had made an order that those proceeds be invested in a controlled monies account for the male client and his separated wife pending agreement between them or an order of the Family Court of Australia. 4. The second complaint, which also asserted the practitioner had engaged in unsatisfactory professional conduct, is the subject of this review. The Committee found the second complaint was upheld. The Committee ordered that the solicitor be reprimanded and that he undertake a Legal Ethics course. The established complaint was formulated by the Committee as follows: By way of correspondences, the solicitor made representations to other legal practitioners that he would hold the net proceeds of sale in his trust account pending the establishment of the controlled monies account in both the names of the parties and then, without prior notice, acted contrary to those representations. 1. For the reasons which follow, we have determined that the Committee's decision should be affirmed. Procedural History 1. It is not a matter of dispute that orders made by the Committee were made under s 299 of the Legal Profession Uniform Law (NSW) (the Uniform Law) and notified to the solicitor on 16 May 2019. The solicitor filed an application for review under s 314 of the Uniform Law on 14 June 2019 (the first proceedings). 2. However, because the Council's decision was affected by the defects identified in Council for the Law Society of New South Wales v DXW [2019] NSWCATOD 101 the first proceedings were, by consent, dismissed with no order as to costs on 7 August 2019. 3. As a consequence of the amendments introduced by the Justice Legislation Amendment Act (No 2) 2019 (NSW), the decision of the Committee was retrospectively validated. The validation required the solicitor to file the current proceedings in the Tribunal. Consequently, the review application, which is required to be filed within 28 days from the date of the decision, is out of time (see Rule 24(4)(b) of the Civil and Administrative Tribunal Rules 2014). 4. The Council do not oppose leave being granted to extend time to the solicitor to bring his review application. Having regard to the circumstances in which the first proceedings were dismissed, we are independently satisfied it is appropriate under s 41 of the Civil and Administrative Tribunal Act 2013 (NSW) (the NCAT Act) to extend time to the solicitor to bring this review application. 5. We note that, on 8 April 2020, an order was made in these proceedings that documents produced under s 58 of the Administrative Decisions Review Act 1997 (NSW) (the ADR Act), filed by the Council in the first proceedings, were deemed to have been filed in these proceedings. 6. Before leaving the topic of the procedural history, we note and agree with the submissions of Mr Maddigan of counsel, made on behalf of the Council, that under Chapter 5 of the Uniform Law, the Legal Services Commissioner (the Commissioner) is the designated local regulatory authority. The Commissioner's functions were delegated to the Council in part pursuant to an Instrument of Delegation dated 18 June 2015 made under s 406 of the Uniform Law. Under s 32 of the Legal Profession Uniform Law Application Act 2014 (the Application Act), the Council sub-delegated to the Professional Standards Committee Chapter 5 functions delegated to it by the Commissioner, except those under s 287 (informal resolution of consumer matters) of the Uniform Law. As noted above, those delegations which were initially deficient have now been validated by the amendments to the Application Act (see cl 23 of Part 5, Sch 9 of the Application Act). Background 1. The following factual matters are agreed between the parties. We have determined that the clients' names in this matter should be subject of a non-publication order under s 64 of the NCAT Act. We note that the clients were engaged in proceedings under the Family Law Act 1975 (Cth) and, consistent with s 121 of that Act, we have determined that their names should remain confidential. 2. The solicitor acted for a male client (the husband) who was the owner of a property registered in his sole name. On 19 August 2016 the client's wife lodged a caveat over the title to the property. On 23 May 2018 the solicitor served the wife with a proposed lapsing of caveat notice. At about the time of the sale of the husband's property, he retained Hal Lawyers to act for him in Supreme Court proceedings about the caveat lodged by his wife over the title of the property. The wife was, at all relevant times, represented by Calabrese Lawyers both in respect of the Supreme Court proceedings and family law matters. 3. On 14 June 2018 orders were made in the Supreme Court of New South Wales. Order 2(3) of the orders provided inter alia: Upon settlement of the sale of the property at [address of property] being the whole of that property comprised in Folio Identifier [redacted] the whole of the net proceeds after payment of the amount required to discharge the mortgage in favour of ANZ Bank, real estate agents fees and expenses including commission, auctioneer fees and advertising expenses and the usual adjustments as between vendor and purchaser pursuant to the sale of contract shall be invested in a controlled monies account in the names of the parties pending agreement between them or an order of the Family Court of Australia. 1. On 11 July 2018 the solicitor sent an email to the wife's solicitor, with a copy to the husband advising that settlement was booked for 17 July 2018. The email advised: The surplus proceeds of sale will be placed into our trust account. They will then be dealt with as required. 1. On 17 July 2020 at 3.16 pm the solicitor sent an email addressed to both the wife's solicitor and the husband's family law solicitors, Hal Lawyers. The email noted that "you are respectively representing the parties in their family law dispute. As you are both aware we are the solicitors on the sale". The solicitor then referred to work undertaken to "clean up" the property for completion of settlement of the sale. Thereafter, the email records: [obliterated] that I have been made aware separately of orders of the Supreme Court of New South Wales made in the Supreme Court matter in which you both acted before the matter was transferred to the Supreme Court [semble Family Court] and requiring funds to be paid into a controlled money (joint account) in the name of both parties. I expect that these orders may need to be re-visited, however for the moment if arrangements can be made for each of your respective clients to go and identify themselves at an appropriate branch of the Commonwealth Bank, that will facilitate these arrangements. Following settlement it is intended that the funds will remain in our trust account pending the establishment of a joint controlled monies account [our emphasis] 1. In the same email, the solicitor advised "so far as concerning our Firm, [the husband] has extant obligations that need to be settled and from the proceeds of sale of this property". The email concluded: When parties intend to go and identify themselves to the Commonwealth Bank, please advise us in order that a reference number can be established for the client's visitation and identification paper work to be processed against. 1. At 3.34pm on the same day the solicitor sent an email to "Dear Solicitors" Please be advised that several minutes ago I am advised that this matter is now settled. We await cheque including as to payment as to your trust account. We encourage the parties to now move to establish the controlled monies account which we will establish with the Commonwealth Bank. Mr Calabrese telephoned me to say that the release of the deposit is in breach of order 3 of the orders of the Supreme Court of New South Wales. Perhaps someone can send me a copy of those orders? 1. Later at 4.03pm the solicitor sent a further email to both solicitors acting for the husband and wife in relation to family law matters. The email said: Please be advised that my firm has now written to the Commonwealth Bank seeking to establish a controlled monies account and parties will be notified of any appropriate reference against which they should seek to identify themselves at the Bank to establish the joint account. I will write further as to this matter and expect to hear from the Bank in a day or so. [our emphasis] 1. At 4.38pm the solicitor again emailed the solicitors for the husband and wife. He wrote: Please arrange for your clients to scan me copy of drivers license [sic] and of passport in order that the Bank can open a Controlled Money account – they advise me that the name of the account will be Hall Partners Pty Ltd Controlled Money Account on behalf of [name of wife] and [name of husband] and that once the account is established, the names of the account holder cannot be changed I await the scanned drivers licenses [sic] and scanned passports. 1. At 4.43pm an email was forwarded to the solicitor from the wife's solicitor. It notes "Please see attached". No copy of the attachment is produced in the s 58 documents. However, from correspondence (see below), it is likely the attachment was a copy of the consent orders made in the Supreme Court. 2. On 18 July 2020 the solicitor forwarded an email to the wife's solicitor. The solicitor acknowledged receipt of "the orders". The solicitor said: It seems difficult to see that an order could relate to the whole of the net proceeds of sale, to the extent that aspects of those proceeds of sale had been paid already to the Husband as at the date of the order (The release of the deposit was provided for in the contract). If that is the interpretation that your Firm wishes to place upon the orders, may I suggest that you seek instructions to proceed with a contempt application. [Obliterated] ould otherwise encourage the parties to seek to reach an agreement. This however is a matter between yourself and Mr Haralovic and I note I request passports and drivers license to establish the controlled monies account. Please provide scanned license and passport for 100% identification? [our emphasis] 1. On 18 July 2020 the solicitor received into his trust account the sum of $579,227.32. 2. On 19 July 2020 the solicitor says the husband, who was quite upset, attended his office. At that time the husband signed an authority as follows: I [husband's name] instruct Hall Partners to remit payment of the invoice 3097 from monies held in trust and to pay the balance of monies held to me as I intend to instruct Mr Haralovic as to all aspects concerning controlled monies and the Family Court going forward. 1. The authority has, in addition to the husband's signature, the following handwritten notation: $579,227.31 – Macquarie Bank, ANZ Bank $3,797.26 $575,430.05 We infer that invoice 3097 was the solicitor's invoice for his costs of $3,797.26. 1. On 19 July 2018 the solicitor signed a cheque drawn on the Commonwealth Bank in favour of the husband for $575,430.05. 2. On 20 July 2018 the wife's solicitor wrote to the solicitor by email referring to the solicitor's email of 18 July 2020. He advised he was seeking further instructions in relation to "your client's foreshadowed application and will communicate further with Mr Haralovic who now appears on the record for [husband's name] in the family law proceedings". The email continues: In relation to your request for copies of the passports and current drivers licence to establish the control monies account, I believe it will be far better if we communicated directly with the bank and provide it with the information requested. In this regard could you kindly provide me with the details of the person that we need to contact so that [obliterated] forward the information requested. 1. On 10 August 2020 the solicitor transferred $3,797.26 for his professional costs in acting on the sale from the trust account. 2. On 13 August 2018 the wife's solicitor wrote to the solicitor, noting that the solicitor had not provided details of the person to be contacted at the bank "so we can provide our client's ID to confirm identity". The email also said: We further note you hold the balance of the sale proceeds and accordingly request a copy of our trust account ledger confirm the deposit of the monies into your trust account. Please provide us with a copy of your trust account ledger with seven (7) days. 1. The solicitor did not respond to the wife's solicitor's email of 20 July 2018 or the email of 13 August 2018. 2. On Saturday 18 August 2020 at 3.54 pm the wife's solicitor sent an email to the husband's family law solicitors asking, as a matter of urgency, "who holds the net proceeds of sale funds and if they have been placed in a bank account and a copy of the bank statement. If you hold the same in trust, please provide me with a copy of your trust ledger". 3. On 18 August 2018 the solicitor sent an email to the wife's solicitor as follows: … My instructions were to facilitate the establishment of a controlled monies account. Your client did not cooperate with that request. My instructions to respond to you any further concerning this matter have been withdraw. I do not act in the family law matter. I did not act in the Supreme Court matter. Any further inquiries should be directed to the client [client's name]. Relevant statutory provisions and standard of proof 1. The second complaint was determined under s 299 of the Uniform Law. That section provides as follows: 299 Determination by local regulatory authority—unsatisfactory professional conduct (1) The designated local regulatory authority may, in relation to a disciplinary matter, find that the respondent lawyer or a legal practitioner associate of the respondent law practice has engaged in unsatisfactory professional conduct and may determine the disciplinary matter by making any of the following orders— (a) an order cautioning the respondent or a legal practitioner associate of the respondent law practice; (b) an order reprimanding the respondent or a legal practitioner associate of the respondent law practice; (c) an order requiring an apology from the respondent or a legal practitioner associate of the respondent law practice; (d) an order requiring the respondent or a legal practitioner associate of the respondent law practice to redo the work that is the subject of the complaint at no cost or to waive or reduce the fees for the work; (e) an order requiring— (i) the respondent lawyer; or (ii) the respondent law practice to arrange for a legal practitioner associate of the law practice— to undertake training, education or counselling or be supervised; (f) an order requiring the respondent or a legal practitioner associate of the respondent law practice to pay a fine of a specified amount (not exceeding $25 000) to the fund referred to in section 456; (g) an order recommending the imposition of a specified condition on the Australian practising certificate or Australian registration certificate of the respondent lawyer or a legal practitioner associate of the respondent law practice. (2) If the designated local regulatory authority proposes to determine a disciplinary matter under this section— (a) the designated local regulatory authority must provide the respondent or associate and the complainant with details of the proposed determination and invite them to make written submissions to the designated local regulatory authority within a specified period; and (b) the designated local regulatory authority must take into consideration any written submissions made to the designated local regulatory authority within the specified period, and may, but need not, consider submissions received afterwards; and (c) the designated local regulatory authority is not required to repeat the process if the designated local regulatory authority decides to make a determination in different terms after taking into account any written submissions received during the specified period; and (d) the rules of procedural fairness are not breached merely because no submissions are received within the specified period and the designated local regulatory authority makes a determination in relation to the complaint, even if submissions are received afterwards. (3) If the designated local regulatory authority determines a disciplinary matter under this section, no further action is to be taken under this Chapter with respect to the complaint. (4) If a complaint contains both a consumer matter and a disciplinary matter and the designated local regulatory authority has already made a determination of the consumer matter under section 290, the designated local regulatory authority may, in subsequently making a determination about the disciplinary matter, take into account the determination already made about the consumer matter, but not so as to make further orders under that section. 1. The present application is brought under s 314 of the Uniform Law. Section 314 is in the following terms: 314 Right of appeal or review of decisions of local regulatory authority (1) A respondent lawyer or a legal practitioner associate of a respondent law practice may, in accordance with applicable jurisdictional legislation, appeal to the designated tribunal against, or seek a review by the designated tribunal of, a determination of the designated local regulatory authority under— (a) section 290, in relation to a compensation order for more than $10 000; or (b) section 299. (2) The designated tribunal may make any order it considers appropriate on the appeal or review. (3) It is intended that jurisdictional legislation may provide a right of appeal against or a right of review of the designated tribunal's decision. 1. The Application Act (see s 126) provides that the review is one conducted under the provisions of the Administrative Decisions Review Act 1997 (NSW) (the ADR Act) (as was the case under the repealed Act, the Legal Profession Act 2004 (NSW) (repealed)). Section 126 provides as follows: 126 Right of review by NCAT about certain determinations of local regulatory authority in consumer and disciplinary matters (1) This section deals with proceedings contemplated by section 314(1) and (2) of the Legal Profession Uniform Law (NSW) in relation to a determination of a local regulatory authority relating to— (a) a compensation order for more than $10,000 in a consumer matter, or (b) a disciplinary matter. (2) A respondent lawyer or a legal practitioner associate of a respondent law practice may apply to NCAT for an administrative review under the Administrative Decisions Review Act 1997 of a determination of the designated local regulatory authority under— (a) section 290 of the Legal Profession Uniform Law (NSW), in relation to a compensation order for more than $10,000, or (b) section 299 of the Legal Profession Uniform Law (NSW). 1. Under the ADR Act, the Tribunal's powers on hearing the review are found in Part 3 of Chapter 3. 2. Section 63 of the ADR Act requires the Tribunal to decide the correct and preferable decision, and to determine whether to affirm, set aside or vary the original decision or to remit the matter for further consideration. Section 63 provides as follows: 63 Determination of administrative review by Tribunal (1) In determining an application for an administrative review under this Act of an administratively reviewable decision, the Tribunal is to decide what the correct and preferable decision is having regard to the material then before it, including the following: (a) any relevant factual material, (b) any applicable written or unwritten law. (2) For this purpose, the Tribunal may exercise all of the functions that are conferred or imposed by any relevant legislation on the administrator who made the decision. (3) In determining an application for the administrative review of an administratively reviewable decision, the Tribunal may decide: (a) to affirm the administratively reviewable decision, or (b) to vary the administratively reviewable decision, or (c) to set aside the administratively reviewable decision and make a decision in substitution for the administratively reviewable decision it set aside, or (d) to set aside the administratively reviewable decision and remit the matter for reconsideration by the administrator in accordance with any directions or recommendations of the Tribunal. 1. Section 66 of the ADR Act deals with the date of and the effect of a decision made by the Tribunal. It provides as follows: 66 Effect of administrative review decision (1) A decision determining an application for an administrative review under this Act of an administratively reviewable decision takes effect on the date on which it is given or such later date as may be specified in the decision. (2) If any such decision varies, or is made in substitution for, an administrator's decision, the decision of the Tribunal is taken: (a) to be the decision of the administrator (other than for the purposes of an administrative review under this Act), and (b) to have had effect as the decision of the administrator on and from the date of the administrator's actual decision, unless the Tribunal orders otherwise. 1. Unlike disciplinary proceedings commenced under s 300 of the Uniform Law, there is no onus on the Council. Rather, it is the task of the Tribunal to determine the matter on the merits. It is not our role to determine, as on an appeal, if the Council was in error or the decision was manifestly unsupportable (see Donaghy v The Council of the Law Society of New South Wales [2013] NSWCA 154). 2. It is appropriate at this point in our reasons that we note the definition of unsatisfactory professional conduct found in s 296 of the Uniform Law. Section 296 is in the following terms: 296 Unsatisfactory professional conduct For the purposes of this Law, unsatisfactory professional conduct includes conduct of a lawyer 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 lawyer. 1. We adopt the comments of the Tribunal in Youseff v Legal Services Commissioner [2020] NSWCATOD 85 at [16]-[20] concerning the Tribunal's administrative review jurisdiction. We also adopt the discussion in that decision concerning the onus and standard of proof in an administrative review decision. It is appropriate however, that we repeat a number of aspects of the decision of Kiefel J (as her Honour then was) in Shi v Migration Agents Registration Authority (2008) 235 CLR 286; [2008] HCA 3 which is referred to in Youseff. Her Honour identifies at [134]-[135] the first task of the reviewing Tribunal as requiring identification of the decision to be reviewed, and that the statutory question it answers needs to be identified with some precision "for it marks the boundaries of the review". At [135] her Honour explains, by reference to s 43(1) of the Administrative Appeals Tribunal Act 1975 (Cth) (which we note is in similar language to s 63 of the ADR Act), that the Tribunal may exercise all the powers and discretions conferred on the original decision maker as the Tribunal stands "in the shoes of the original decision maker" and in so doing should consider itself "as though it were performing the function of that administrator in accordance with the law as applied to that person". 2. Her Honour at [140] explains: The term "merits review" does not appear in the AAT Act, although it is often used to explain that the function of the Tribunal extends beyond a review for legal error, to a consideration of the facts and circumstances relevant to the decision. The object of the review undertaken by the Tribunal has been said to be to determine what is the "correct or preferable decision" [139]. "Preferable" is apt to refer to a decision which involves discretionary considerations [140]. A "correct" decision, in the context of review, might be taken to be one rightly made, in the proper sense [141]. It is, inevitably, a decision by the original decision-maker with which the Tribunal agrees. Smithers J, in Collector of Customs (NSW) v Brian Lawlor Automotive Pty Ltd [142], said that it is for the Tribunal to determine whether the decision is acceptable, when tested against the requirements of good government. This is because the Tribunal, in essence, is an instrument of government administration. Issues 1. We have already noted that the solicitor, unsurprisingly, does not seek to review the Committee's determination that he did not breach the orders of the Supreme Court of New South Wales in paying out the proceeds of sale to his male client. 2. In his General Law application form, the solicitor agitates three bases in support of the review. First he asserts the Committee: Did not consider or did not adequately and appropriately consider the extent to which the Applicant's "representations" and upon which it based its decision that the Applicant had engaged in unsatisfactory professional conduct were representations as to future matters. 1. Secondly, the solicitor asserts the Committee did not consider the extent to which (at the time the representations were made) there was a reasonable basis for the Applicant to have made them. Thirdly, it is asserted to the extent that it found the applicant's representations were in the nature of an undertaking, it misdirected itself to the true nature of the statements made. Finally, it is asserted that the applicant was deprived of the opportunity to have considered any evidence as to character in the circumstances in which the determination was made. 2. What was in issue before the Committee (and now before us) is relatively narrow. It requires careful consideration of the charge, and if the charge is proved, whether the conduct constitutes unsatisfactory professional conduct. Did the solicitor represent to the solicitor for the wife (and the husband) that he would hold the proceeds of sale on trust until the establishment of the controlled monies account, and without prior notice, "act contrary to those representations" by paying the money to the husband? 3. The solicitor's position is that: 1. he was obliged to act on the instructions of the husband to disperse the proceeds of sale of the husband's property to him; 2. his correspondence about placing the funds in the controlled monies account was no more than a representation of his intention at the time of the correspondence, but that intention changed when the husband requested the proceeds of sale and said he intended to have his family law lawyer invest the funds in a controlled monies account; 3. if he had advised the solicitor for the wife that he had paid the funds in the trust account to the husband, he would have breached his duty to maintain confidentiality of his client's affairs; 4. the Committee erred in its deliberations because it did not take into account a submission made on his behalf that the Hon John Dowd, AO,QC had advised the solicitor that he was not in breach of the order of the Supreme Court, nor was he in error in paying out the proceeds of sale to the husband; and 5. the Committee erred in not affording him the opportunity to adduce character evidence before deciding on a penalty. The parties' submissions 1. We commence by noting we were assisted in our task on this review by the written submissions provided to us by the parties, particularly in circumstances with the constraints of a hearing conducted by AVL due to COVID 19 restrictions. The solicitor's submissions 1. The solicitor's written submissions commence with a recitation of the factual background. We note in this case the facts are not controversial as the representations are all contained in the correspondence contained in the s 58 documents. 2. At para 17 of his submissions, the solicitor submits that there were a number of relevant factors to be taken into account at the date of settlement of the property. It is submitted the orders of the Supreme Court were inappropriate and required variation, that the parties needed to present identification for the controlled monies account to be established, and it was anticipated that the funds would remain in the trust account of Hall Partners until the controlled monies account could be established. 3. At para 25 the solicitor says that the representation in his letter was never couched as an undertaking. He further submits there was no basis for him to go behind his client's instructions "where on the face of them they are a perfectly valid instruction". 4. The solicitor notes that he cooperated with the investigation and agreed to, and has undertaken, an appropriate ethics course. 5. The solicitor relies on the observations of the Full Court of the Federal Court in ACCC v Woolworths Ltd but does not provide a citation for this authority. We infer that he refers to the decision of Australian Competition and Consumer Commission v Woolworths Limited [2019] FCA 1039 about the nature of representations in the context of the Australian Consumer Law. It is submitted by the solicitor that liability will only arise in relation to a future representation "in circumstances in which there was no reasonable grounds for making them at the time at which the representation was made". 6. The solicitor also relies on the fact that the Committee failed to address a submission made by the lawyers acting for him before the Committee, to the effect he had received advice from the Hon John Dowd AO, QC that his actions were not improper, but the Committee had failed to refer to this fact. The Council's submissions 1. We commence by noting that the solicitor in his submissions, including particularly in his submissions in reply, does not take issue with the Council's submissions on the law, or the nature of the review proceedings. Nor is there any dispute about the documents in the s 58 bundle. 2. At para 46 of the Council's submissions it is submitted that the Committee did not consider the question of "future representations" or representations as to future matters, because no submissions to this effect were made by the solicitor to the Committee prior to the decision. It is submitted that the discussion of future representations in the context of the Australian Consumer Law has no relevance to the present determination. 3. At para 51 the submissions state that "it is clear from the decision that the Society did not find the Applicant had given an undertaking". 4. The submissions next address the lack of opportunity for the practitioner to adduce character evidence, noting that the invitation to do so was in the context of a then allegation of professional misconduct and referral to the Tribunal. 5. It is submitted that the solicitor's reliance on the failure of the Committee to have referred to the evidence of the Hon John Dowd AO, QC is misplaced because there was no evidence before the Committee, rather what was before the Committee were submissions made on behalf of the solicitor. Consideration 1. Our task is to determine whether, on the evidence before us, including the character evidence, the decision that the solicitor engaged in unsatisfactory professional conduct, and as a consequence should be reprimanded, is the correct and preferable one. 2. We commence by noting that the chronology in this matter makes it clear that the solicitor at the time of settlement of the sale of the property registered in the husband's sole name, had notice that orders had been made in the Supreme Court which required the net proceeds of sale to be held in a controlled monies account in the name of the husband and wife, pending further agreement or order of the Family Court of Australia. 3. Further, we are satisfied that the solicitor made unambiguous statements in his correspondence of 11 July 2018 and 17 July 2018 that he would, on settlement of sale of the property, place the net proceeds of sale into his trust account pending the establishment of a controlled monies account. It is clear from the correspondence that the wife's solicitor relied on those representations. If there had been any doubt the funds would not remain in the trust account, the wife's solicitor would have been on notice to seek urgent injunctive relief in the Family Court. 4. The submissions relied on by the Council at [51] note "It is clear from the Decision that the Society did not find that the Applicant had given an undertaking". We note the Committee at [26] said "The representations may be construed as an undertaking". This finding is repeated at [36]. Although we accept the Committee did not state the representation was an undertaking, they found it could be "construed" as such. We do not find the representations made by the solicitor constituted an undertaking in the strict sense that concept is understood in the Australian Solicitors Conduct Rules (see Rule 6) and the authorities. However, because we will later refer to the discussion of Martin CJ, it useful at this point that we set out the law relating to undertakings as espoused by his Honour in Legal Profession Complaints Committee v Detata [2012] WASCA 214. His Honour explained: The importance of legal practitioners performing their undertakings 48 The importance of legal practitioners performing their undertakings cannot be overstated. The practice of giving, and relying upon, undertakings given by legal practitioners is widespread and serves an important public purpose. The circumstances in which undertakings are given and relied upon are many and varied. In some cases an undertaking will be proffered and received as a substitute for strict or timely performance of an obligation, perhaps arising under a contract or under a statutory provision. In other cases, the undertaking might be given in order to provide a form of security to the person to whom it is proffered - for example, an undertaking that an executed document will be held in escrow until certain conditions are met, or that legal proceedings will not be instituted if certain conditions are met, or that funds or other property will be retained by the practitioner until certain conditions are met. In all of these circumstances, the usual effect of the proffer and acceptance of the undertaking will be to obviate the need to commence or to continue legal proceedings. This serves the public interest by preserving the limited resources of the parties and the courts. 49 Undertakings will often be proffered and received in the course of legal proceedings - for example, in relation to interlocutory procedures. The provision of undertakings in those circumstances serves the public interest by reducing or averting interlocutory disputes. 50 Undertakings by legal practitioners are a common feature of commercial and property transactions in which legal practitioners are engaged. In some cases, a party might complete a transaction before all relevant conditions are satisfied in reliance upon an undertaking by a practitioner to the effect that he or she will cause a particular condition to be satisfied. In this context, the proffer and acceptance of undertakings by legal practitioners improves the efficiency and expedition of commercial and property transactions and thereby serves to lubricate the wheels of commerce, trade and finance: see Rubik Financial Ltd v Herskope [2010] WASC 343; In the Matter of a Solicitor 'L' (Unreported, VSC, LPA 3 of 1989, 17 - 21 June 1989). 51 Undertakings can only serve these purposes and thereby further the public interest if they are accepted and relied upon. In some circumstances, a practitioner may proffer an undertaking in terms which makes it clear that the undertaking is only that of the client and not the practitioner. In such a case, the obligation of performance will fall upon the client, not the practitioner. However, this is not such a case. In this case, the undertaking was expressly and unequivocally given in terms which bound both Mr Detata's client, Mr Detata and the firm by which he was employed. 52 The proffer of an undertaking binding upon a legal practitioner and his or her firm can be expected to enhance the reliability of the undertaking, and thereby the prospect that it will be accepted and relied upon by the party to whom it is proffered. In this way, the proffer of an undertaking binding upon a legal practitioner enhances the achievement of the various purposes to which I have referred, and thereby enhances the public interest. It is therefore vital that legal practitioners perform their undertakings, regardless of whether the undertaking was proffered in error or oversight, irrespective of any change in circumstances, no matter how radical, and irrespective of any hardship to the legal practitioner concerned (see Bhanabhai v Auckland District Law Society [2009] NZHC 415 [59] - [64] (Priestley, Heath and Winkelmann JJ). 53 Further, it is vital for the maintenance of public confidence in the integrity of the legal profession and its practitioners, and for the maintenance of the confidence which practitioners have in dealing with each other, that performance of their undertakings be enforced: see (Rubik Financial Ltd). 54 For these reasons, the obligation of a legal practitioner to perform his or her undertaking is a solemn obligation of the utmost importance. Failure to perform that obligation will generally be regarded as professional misconduct, and depending on the circumstances, will often be regarded as serious professional misconduct. 1. We note that Martin CJ's decision was cited by the Committee in their reasons. The Committee also cited Khosa v Legal Profession Complaints Committee [2017] WASCA 192. In Detata the solicitor in his correspondence with another solicitor said in writing on two occasions "We would formally undertake not to release funds". In Khosa, the solicitor unequivocally gave his personal undertaking not to remove a caveat until costs owing to the opposing party had been paid. In each of these cases, it was not in doubt that an undertaking had been given. We note that Mr Maddigan was unable to direct us to any authority discussing representations, not expressed in terms of an undertaking, in a factual context similar to the facts in this matter. 2. However, notwithstanding our conclusion that the representations were not expressed specifically in the form of an undertaking given by one practitioner to another, a breach of which may constitute professional misconduct, we find the facts in the charge are established. First, the husband and wife had reached agreement in the Supreme Court about preservation of the proceeds of sale and that agreement was formalised in a Consent Order. The solicitor knew of the existence of the Supreme Court order, and although he was not bound personally by the order, as an officer of the Court he could not ignore or disregard its obligations. 3. The solicitor made clear and unambiguous representations to the wife's solicitor on both 11 July and 17 July 2018. Those representations were consistent with the Supreme Court orders and were relied on by the wife's solicitor who promptly corresponded about the details necessary for the opening of the controlled monies account. Notwithstanding the representations, the solicitor disbursed the whole net proceeds of sale, save for his costs, to the husband one day after settlement, and without any reasonable opportunity for the wife's solicitor to provide the details necessary to establish the controlled monies account. We are satisfied that the solicitor's explanation in his email of 18 August 2018 that he paid out the funds in circumstances where the wife's solicitor did not co-operate in providing details for the establishment of the controlled monies account was disingenuous. However, in fairness to the solicitor, we note that before us he did not rely on any lack of action by the wife's solicitor to justify his conduct. 4. The solicitor asserts error by the Committee in failing to take into account advice he received from the Hon John Dowd AO, QC, the effect of which advice was summarised in submissions made on his behalf on 15 March 2019 by his then representative, The Law Offices of Dr Dion Accoto. We find that we cannot place any weight on the submission or the Committee's failure to take Mr Dowd's advice into account. We accept that the solicitor did consult Mr Dowd. However, no advice from Mr Dowd was adduced before the Committee. At its highest, the submission relayed hearsay evidence. The submission was not evidence, nor was there evidence of any probative value on which the Committee could place weight, or in respect of which it could have made any findings. Consequently it was not necessary for the Committee to refer to the submission (see Mifsud v Campbell (1991) 21 NSWLR 725). It is irrelevant to our consideration on this review. 5. The solicitor asserts the representation in his letters of 11 July and 17 July 2018 that he would hold the funds in his trust account was a representation "as to a future matter as to where it was intended that the funds would remain (until the client's instructions changed and on the face of it for a proper purpose)". As we have earlier noted, at para 35 of his submissions the solicitor refers to the decision of the Full Federal Court in ACCC v Woolworths (but does not provide a citation). In its submissions, the Council note that representations were made on behalf of the solicitor to the Committee by The Law Offices of Dr Dion Accolo on 29 May 2019 (after the Committee's determination). Dr Accolo stated: The test to whether a representation as to a future matter is misleading falls to be determined by the circumstances in existence at the time the representation was made, refer Rakic v Johns Lyng Insurance Building Solutions (Victoria) Pty Ltd (Trustee) [2016] FCA 430. 1. The Council's submissions cite the decision of Mortimer J in Australian Competition and Consumer Commission v Woolworths Limited [2019] FCA 1039. It is submitted that the statements relied on are ones made in the context of the Australian Consumer Law and in particular s 4 of that law which defines misleading representations with respect to future matters, and are irrelevant to these proceedings. 2. We do not accept that the representations made by the solicitor in his correspondence should be construed as a representation as to a future matter as explained in the context of the Australian Consumer Law. The circumstances which existed at the time the representations were made are highly relevant. The representation the funds would be maintained in the trust account pending their placement in the controlled monies account was made very shortly before settlement. Almost immediately after settlement, the solicitor wrote about the establishment of the controlled monies account. But, before the necessary details were received or confirmed, he paid out the funds to the husband. In the event we are wrong about the nature of the representations, and the solicitor's intention changed on 18 June 2018, his conduct in not informing the wife's solicitor and the husband's family law solicitor was improper. He knew or ought to have known that those solicitors relied on his representation that the funds would be held in his trust account pending establishment of the controlled monies account. At a minimum he should have replied promptly to the wife's solicitor's email of 20 July 2018 and notified those solicitors his instructions were at an end. 3. We are satisfied the solicitor failed to respond to correspondence from the wife's solicitor about the proceeds of sale in a timely manner or at all. 4. The solicitor relies on his duty to keep confidential the affairs of his client as one of the reasons he did not inform the wife's solicitors that he had paid out the funds to the husband. We note that Rule 9 of the Legal Profession Uniform Law Australian Solicitors' Conduct Rules 2015 (NSW) provides as follows: 9 Confidentiality 9.1 A solicitor must not disclose any information which is confidential to a client and acquired by the solicitor during the client's engagement to any person who is not: 9.1.1 a solicitor who is a partner, principal, director, or employee of the solicitor's law practice, or 9.1.2 a barrister or an employee of, or person otherwise engaged by, the solicitor's law practice or by an associated entity for the purposes of delivering or administering legal services in relation to the client, EXCEPT as permitted in Rule 9.2. 9.2 A solicitor may disclose information which is confidential to a client if: 9.2.1 the client expressly or impliedly authorises disclosure, 9.2.2 the solicitor is permitted or is compelled by law to disclose, 9.2.3 the solicitor discloses the information in a confidential setting, for the sole purpose of obtaining advice in connection with the solicitor's legal or ethical obligations, 9.2.4 the solicitor discloses the information for the sole purpose of avoiding the probable commission of a serious criminal offence, 9.2.5 the solicitor discloses the information for the purpose of preventing imminent serious physical harm to the client or to another person, or 9.2.6 the information is disclosed to the insurer of the solicitor, law practice or associated entity. 1. There is no doubt that a solicitor must not disclose any information which is confidential to a client acquired during his or her retainer. In this case, the fact that the proceeds of sale were to be placed into a controlled monies account was not information which was confidential to the client. It was information known to the solicitors acting in the family law matters as well as the solicitor, by reason of the Consent Orders. We do not find that Rule 9.1 was engaged to prevent the solicitor advising the wife's solicitor and the husband's family law solicitor, in a timely way, that he had paid out the proceeds of sale to the husband. Even if we are wrong about that, there was nothing preventing the solicitor promptly advising the wife's solicitors his instructions were terminated. 2. We are satisfied that the solicitor did not, at any time, after the completion of the sale of the property and payment out to the husband, provide any advice or response to the wife's solicitor notifying him that the funds were no longer held in his trust account. That failure deprived the wife the real opportunity in a timely way to seek orders from the Family Court for the preservation of the funds. Thus, we are satisfied that part of the charge which asserts that the solicitor "without prior notice acted contrary to those representations" (being the representation he would hold the funds in his trust account pending the establishment of the controlled monies account) is established. 3. In reaching our conclusions, we find the solicitor provides no rational explanation as to why his position changed from 17 July 2018 to 19 July 2018, when he permitted the funds to be paid out, other than his assertion that the funds were his client's funds and that he was obliged to disburse them to the client. Even accepting the solicitor had an honest belief the husband would provide the total funds to Hal Lawyers to place in a controlled monies account, we are satisfied, in the circumstances where he made the representation the funds would remain in his trust account pending the establishment of the controlled monies account, that he had a responsibility to notify the wife's solicitor in a timely way that representation had changed because of his changed instructions. Does the conduct set out in the charge amount to unsatisfactory professional conduct? 1. We have earlier in our reasons set out the statutory definition of unsatisfactory professional conduct. We find that the comments of Martin CJ at [53] in Detata, albeit made in the context of a breach by a solicitor of his or her undertaking, have relevance to the facts in this matter. His Honour stresses the importance of integrity of the profession and practitioners, and the maintenance of confidence of practitioners in each other. We are in no doubt that the wife's solicitor relied in good faith on the representations made by the solicitor to the potential or actual detriment of his client. 2. It is to be remembered that disciplinary proceedings are not to punish the practitioner but to protect the public (see Ziems v The Prothonotary of the Supreme Court of New South Wales (1957) 97 CLR 270; [1957] HCA 46; New South Wales Bar Association v Evatt (1968) 117 CLR 177; 1968 HCA 20. The solicitor's actions in failing to notify the wife's solicitor that he had paid out the funds undermined the confidence and trust a practitioner should expect from his or her fellow practitioners and does not uphold the high standards and integrity expected of the profession. We are satisfied that the conduct amounted to unsatisfactory professional conduct. The conduct fell short of the diligence the public are entitled to expect. Is the imposition of a reprimand by way of penalty appropriate? 1. The practitioner relied on a number of character references before us. We are satisfied that those references, which were not before the Committee, are relevant to penalty. 2. We note that we are to determine this matter on the evidence now before us, and determine at this time, whether the penalty imposed was appropriate. 3. The solicitor's referees include references from clients (Lincoln Daley, Rudyards Pty Ltd, Mr John Zappia CFO On-Call, Emile Aiame, Hannas, Peter Walsh, Pelin Developments Pty Ltd) as well as professional colleagues Ms N Nelson, Barrister at Law, and Justin Raine, solicitor. All the character referees refer to their high regard for the solicitor. We give more weight to the character reference of Mr Raine, and Mr Aiame than the other referees because they refer to the circumstances of this matter. We accept however that the solicitor is held in high regard by his character referees. 4. We also take into account that the solicitor has at all times co-operated with the Council and that he has, as required by the Committee's orders, undertaken the ethics course as ordered. 5. It was, however, of some concern to us that the solicitor remains entrenched in his position that his conduct was appropriate, albeit we acknowledge that he concedes an apology he made was not an apology to the client's wife. 6. We have considered the range of outcomes available to the Committee under s 299 and to us under s 314, including the imposition of a fine. We have considered, in light of the solicitor's referees' evidence, whether the appropriate outcome is to caution the practitioner rather than to impose a reprimand. However, given the high standards to which the profession should be held, we are satisfied a reprimand is the appropriate outcome. In these circumstances, we affirm the decision of the Committee in imposing a reprimand on the solicitor. As the solicitor has completed the ethics course, no order requiring the completion of such course will be imposed. Costs 1. We note that neither party sought that we make an order for costs. Orders 1. The decision of the Professional Standards Committee of the Law Society of New South Wales dated 16 May 2019 that Trevor Hall be reprimanded is affirmed. ********** I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 26 August 2020