PETER CECIL HARCOURT DAWSON v THE LAW SOCIETY OF NEW SOUTH WALES SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL KIRBY P, MAHONEY and MEAGHER JJA 17 November 1989, 21 December 1989 [1989] NSWCA 58 LEGAL PRACTITIONERS — solicitor — former solicitor admitted to the Bar — subsequent investigation into his affairs when he was a solicitor — proceedings by Bar Association for the removal of his name from the roll of barristers — orders made by the Court without contest — passage of seven years from order of removal and fifteen years from alleged misconduct — total payments from Fidelity Fund of nearly $20,000 to two clients and their solicitors — former practitioner, with consent of Law Society, secures employment as a law clerk — applies for restoration to roll of solicitors — evidence of good character — Law Society consents to application upon conditions as to limited practising certificate and reimbursement of the Fidelity Fund and payment of its costs (Dismissing application) (per Mahoney and Meagher JJA; Kirby P dissenting) The solicitor had not affirmatively established on solid and substantial grounds that his name should be restored to the list of solicitors. Ex parte Lenehan (1949) 77 CLR 403, 422 applied. Discussion by members of the Court of the principles applicable to applications for restoration to the roll of practitioners. Discussion of the obligation to reimburse clients or the Fidelity Fund. Evatt v Bar Association of New South Wales, Court of Appeal, unreported, 15 December 1981 discussed and criticized by Meagher JA. ORDERS Summons dismissed with costs. Kirby P Mr Peter Dawson (the claimant) applies to the Court for an order that he be admitted as a solicitor. He offers to give to the Court certain undertakings which have been proposed by the Law Society of New South Wales (the Society) as a condition for his admission. Upon this basis, the Society does not oppose the claimant's application. In my opinion, the order sought should be made, although I would vary the terms of the undertakings proposed by the Society and accepted by Mr Dawson. Only upon the giving of such undertakings would I admit him once again to practise. Removal of a barrister from the roll The claimant was admitted as a solicitor of the Court on 13 February 1970. On 16 September 1977, at his own request, his name was removed from the roll of solicitors. He was on that day admitted as a barrister. On 5 April 1982, on the application of the Bar Association of New South Wales, the claimant's name was removed from the roll of barristers. Unfortunately, because the claimant consented to the order sought, it was made without elaborated reasons by the Court. The transcript of the proceedings in the Court when the order was made is short. See Bar Association of New South Wales v Dawson, Court of Appeal, 5 April 1982. The Court was on that occasion constituted by Moffitt P, Reynolds and Samuels JJA. In the exchange with counsel then appearing for the present claimant, Moffitt P indicated that upon his reading of the affidavits filed, the allegations were of "misconduct" when the claimant was a solicitor and also "a related question of non-disclosure". This 2 UNREPORTED JUDGMENTS refers to the failure of the claimant to disclose his misconduct when he applied to change from the roll of solicitors to the roll of barristers. Moffitt P said: The Court makes the following findings and orders: The Court finds that Peter Cecil Harcourt Dawson was guilty of professional misconduct as a solicitor. It further finds that at the time of his admission to the Bar he failed to disclose such misconduct. The Court accordingly orders that his name be struck off the roll of barristers of this Court. The evidence discloses that between September 1977 and the commencement of the proceedings which led to his removal from the roll of barristers, the claimant practised at the Bar. He established chambers in Parramatta. His practice involved both civil and criminal work and work in the Family Court. In 1981 he was appointed a relieving Crown Prosecutor on a number of occasions. Following the removal of his name from the roll, he necessarily ceased to practise. He was employed in various businesses as a management consultant, security consultant and real estate salesman. He commenced his negotiations with the Society in 1984 to ascertain any terms upon which he might be re-admitted to practise as a solicitor. The present proceedings represent the culmination of the discussions he has had with the Society. When in 1985 he became aware that Mr Steven Doran, whom he had known for several years, was looking for a solicitor, the claimant sought the approval of the Society to commence work with Mr Doran as a clerk. The approval was given. He commenced work in this capacity on 29 July 1985. In November 1985 Mr Doran's practice in Parramatta was acquired by Mr Gregory Haskard, solicitor. Mr Haskard continued the complainant's employment as a clerk. He has been so employed to the present time. The claimant is forty-three years of age. He is a married man. He has children aged sixteen and thirteen years. The events which led to the removal of his name from the roll occurred thirteen years ago. They occurred at a time when he had difficulties in his then practice as a solicitor. Moreover, he had suffered the death of a daughter three days after her birth in 1974. Both his then wife and he were very distressed by this loss, and understandably so. According to his affidavit he thereafter commenced drinking alcohol and smoking to excess. Because of financial difficulties his consumption of alcohol increased still further. In early 1978 he separated from his first wife. By this time he was suffering from severe depression and from the effects of consuming alcohol to excess. He was also suffering from insomnia. He was unable to control excessive worrying. The circumstances which led to the removal of his name from the roll (apart from non-disclosure) are disclosed in an affidavit of the then Registrar of the Bar Association which has been placed before this Court. To it is annexed a report of Miss Jean Sayer. Miss Sayer is a chartered accountant who was engaged by the Council of the Society to investigate a number of complaints which had been made concerning the claimant's activities when he was a solicitor. These related to irregularities in the control of his trust account. As a result of these irregularities, the Society paid a total of $19,934.45 out of the Solicitors' Fidelity Fund. This sum was made up of $2,025.20 paid on 18 November 1982 to Mr NJ Pearson; $16,974.25 paid on 21 December 1982 to Mrs IN Harrowell and $935 paid to the solicitors for Mr Pearson and $405 to the solicitors for Mrs Harrowell being their costs in respect of their respective clients' claims. UWAETER CECIL HARCOURT DAWSON v THE LAW SOCIETY OF NEW SOUTH WALES (Kirby P) The Society incurred expenses totalling $2,333 in investigating the accounts and affairs of the claimant's practice when he was a solicitor. On 28 September 1989, the Council of the Society resolved to approve the claimant's application for readmission to the roll of solicitors. However, its 5 approval was subject to three suggested conditions: (a) That the claimant be restricted to an employee's practising certificate for a period of at least two years plus a period of three years as an employee or partner; (b) That the claimant be required to pay to the Law Society an amount equivalent to any amount paid by its Fidelity Fund in respect of his practice as a solicitor together with the Society's costs of investigation into his former practice by way of restitution in such terms as may be acceptable to the Society; and 15 (c) That the claimant pay the Society's costs and disbursements incidental to the attendance by it on the present application. Counsel for the Society described the background against which this decision had been made. It was said that the Society's Council had taken into account the following factors "as telling in favour of the claimant's application": 20 (a) In mid-1985 the Society resolved that the claimant be allowed to commence work as a clerk to a firm of solicitors; (b) Since the time of his removal from the roll of barristers in 1982 the claimant's name has not come to the notice of the Society in any adverse connection; 25 (c) Although the claimant has yet to make good the losses suffered by his former clients (or more accurately to the Solicitors' Fidelity Fund subrogated to the rights of those clients), there is no suggestion of his having been involved in any continuing misconduct; and (d) The claimant (as demonstrated by the subsequent correspondence 30 between him and the Society) was prepared to submit to his application being granted by the Court on conditions limiting his right of practise and providing for him to make restitution and to pay costs. With appropriate candour the Society drew to the attention of the Court a number of considerations which its Council had considered told against the 35 conditional support of the claimant's application set out above. These were (expressing them in general terms): (a) That the claimant had not demonstrated, by the language used in his original affidavit filed in the proceedings, that he had fully understood the nature of the misconduct which led to his name being removed from 40 the roll in the first place; and (b) Despite his recognition of some personal responsibility for losses caused by his misconduct, and despite his statement that he is now "financially stable", he did not until recently make any attempt to effect restitution of the moneys misapplied by him. Reference was made to Re 45 S (A Solicitor) [1985] VR 343, 347; [1986] VR 743, 749. The claimant placed before the Court a large number of affidavits to support his application. These were from clients of his employer, friends and other people with whom he has worked over the years since the removal of his name from the roll. I will not attempt to summarise these affidavits. Suffice it to say that they are 50 not in common form. They depose to knowledge of the circumstances leading to the removal of the name of the claimant from the roll. They set out high opinions JOBNAME: No Job Name PAGE: 4 SESS: 1 OUTPUT: Thu Mar 6 17:19:58 2008 /reports/caseml]/case/urj/8901279 UNREPORTED JUDGMENTS expressed as to his personal integrity, skill in work activities and sensitivity in the handling of difficult and upsetting cases. The claimant gave affidavit and oral evidence to the following effect: 1. He had ceased to drink to excess in 1978 following bankruptcy (from which he was later discharged); he had ceased to smoke in 1980; and by late 1981 he was regaining his health and confidence; 2. Following his removal from the roll he was deeply distressed and conscience of his "failures". I attended Court on the day the order was made striking my name from the Roll of Barristers. I felt a deep sense of shame. There were a number of Solicitors and Barristers in Court whom I knew very well. I felt I had let down everyone who knew me closely. I thought I would never recover from the shame felt. 3. He nevertheless worked hard for his employer and did his best to serve his clients; 4. He had engaged in a number of community activities including the coaching of junior rugby league teams and participation in the Parramatta City Central Lions Club of which he is presently the secretary; 5. He had remarried and his new wife, who attended Court with him, strongly supported his evidence of previous deterioration and subsequent rehabilitation. It is only by the joint incomes of the claimant and his wife that they are able to keep up the payment of mortgage instalments on their matrimonial home; and 6. If admitted, the nature of the claimant's duties would not change significantly except that he would be entitled to appear in court for clients, as he now cannot. This right of audience would be valuable to him because of his earlier experience in courts, particularly when a barrister. It would, moreover, be valuable to his employer. It could open the way to future advancement and increase in earnings. Under the conditions proposed by the Society, it was suggested that this could lead to a gradual restoration of his professional confidence and competence. 35 Principles applicable to restoration to the roll The principles applicable to the restoration of the name of a legal practitioner to the roll of practitioners are not relevantly in doubt. They have been stated in many cases. See eg Kotowitz v The Law Society of New South Wales, Court of Appeal, unreported, 7 August 1987; (1987) NSWJB 146. Relevant to the circumstances of the present case, I would 40 state then thus: 1. The purpose of the jurisdiction which is exercised by the Court is not the punishment, or further punishment, of the former practitioner (claimant). That is the province of the criminal law. Instead, the Court's jurisdiction is for the protection of the public which deals with legal practitioners on the basis that they are members of an honourable profession who can be expected, without reservation, to conduct the affairs of their clients with honour and in whom the clients can place unbounded confidence. See Willes J in In Re Poole LR 4 CP 350; Griffith CJ in Incorporated Law Institute of New South Wales v Richard Denis Meagher (1909) 9 CLR 655 and Ex parte Munro; Re The Legal Practitioners Act (1969) 71 SR (NSW) 448. JOBNAME: No Job Name PAGE: 5 SESS: 1 OUTPUT: Thu Mar 6 17:19:58 2008 /reports/caseml]/case/urj/8901279 WEITER CECIL HARCOURT DAWSON v THE LAW SOCIETY OF NEW SOUTH WALES (Kirby P) 2. The claimant, who seeks to establish fitness to have his or her name restored to the roll, having been earlier removed from it, bears the onus of proving the case. It has frequently been said that it is a heavy onus. See eg Street CJ in Evatt v The New South Wales Bar Association, Court of Appeal, unreported, 15 December 1981. The same view precisely is taken in other jurisdictions of the common law, eg the United States of America. See as an example In the Matter of Sidney J Clark 406 A 2d 28 (1979). . The question whether the claimant is a fit and proper person and one to be trusted to exercise the high responsibilities of the profession is one to be determined on solid and substantial grounds. See Griffith CJ in Meagher, ibid 664. See also Ex parte Lenehan (1949) 77 CLR 403, 422; Re A Solicitor [1952] VLR 385; Re A Solicitor [1978] Tas SR 199; In re 5 (a Solicitor) [1985] VR 343; After having had his name removed from the roll, an applicant for restoration to the roll is in a more disadvantageous position than an original applicant. He must, in effect, displace the decision which has been made. That decision involves the judgment that the solicitor is "probably permanently" unfit to have his or her name on the roll. See ex parte Lenehan, ibid, 422. Presumptions of fitness which might arise otherwise from an absence of contrary suggestions, can no longer advantage the former practitioner precisely because of the removal of his or her name from the roll on the basis of unfitness. See ex parte Lenehan, ibid, 422. Cf Ex parte Munro, ibid, 451. In so far as there is a difference between this statement of principle and the observations of Isaacs J in Meagher, ibid, 679, this Court does well to follow the later statements of the High Court. They have been applied many times since in this Court. They appear to reflect, more accurately, the inevitable burden which a person, having been removed for misconduct, must face in displacing the formal finding of unfitness which is inherent in the earlier removal. Cf Re A Solicitor [1952] VLR 385, 389; Re Lundon [1926] NZLR 656, 657. . The decision to be made in each case depends, ultimately, on the facts proved. There is no simple formula which can be applied by reference to the seriousness of the offences and the passing of time. There is no sure path to restoration to the roll, guaranteed by engaging in particular activities, whether of employment or of service to the community. The opinion of the relevant professional body is taken into account, not to usurp the role of the Court, but as an indication of the opinion of the practitioner's potential "peers". See Nash v Law Society of New South Wales, Court of Appeal, unreported, 11 August 1988; (1988) NSWJB 142. See Clarke JA at 1-2. See also In re Thom; ex parte The Prothonotary (1963) 80 WN (NSW) 968, 971. . The ultimate issue in each case is whether the Court can conclude, on the basis of all the evidence, that the claimant is now a fit and proper person to join other members of an honourable profession in the responsible and trusted activities which are involved in the work of the legal profession. It has been said many times that what is at stake is not so much the reputation of the applicant but the Court's assessment of his or her character, uprightness, honour and trustworthiness. See Meagher, ibid, 692, and Re S (a Solicitor) [1985] VR 343, 347. Expressions such as "the intrinsic moral character" of the claimant bear the stamp of JOBNAME: No Job Name PAGE: 6 SESS: 1 OUTPUT: Thu Mar 6 17:19:58 2008 /reports/caseml]/case/urj/8901279 UNREPORTED JUDGMENTS nineteenth century approaches to psychology. However, they recur in the statements of the highest courts in this and other countries. One day, as I observed in Kotowitz (ibid, 21), they may need to be reconsidered because of our modern knowledge about the complexity and variability of human personality and its many motive forces. For present purposes I assume that it is possible to search for, and to find in a person such as the claimant, a single "intrinsic moral character". . Nonetheless, relevant to the decision to be made is any evidence concerning the reputation which the claimant holds, the employment which he has pursued, any community activities in which he has engaged, the time which has passed within which to assess the question posed for the Court and, if the time be long, whether the claimant would be sufficiently knowledgeable to rejoin a learned profession, and in particular without retraining. As these questions are asked in the context of the exercise of a jurisdiction for the protection of the public, it is plainly important to have regard to any dealings which the claimant has had, since removal, with the public, in so far as these may demonstrate such a change as converts the claimant from an unfit person to a person fit to have his or her name restored to the roll. . One specific consideration which courts have taken into account is the endeavour of the claimant to restore confidence in himself and the legal profession by taking appropriate steps to reinstate the clients, if any, whom have lost as a result of the found misconduct. See Re S (a Solicitor) (above). However, at least in the case of barristers, repayment of sums lost is not a prerequisite to an order restoring the name of the barrister to the roll. See eg Evatt v New South Wales Bar Association, Court of Appeal, unreported, 15 December 1981. . Because the jurisdiction is for the protection of the public, regard also may be had to the public's interest in the restoration to the roll of the names of such otherwise qualified persons as have demonstrated, including by their work, activities and life, a fitness to be restored. for cultural and historical reasons, redemption and forgiveness are important attributes of the shared morality of our society. In part, this is because of the teachings of religious leaders who have profoundly influenced our community's perception of justice and fairness, reflected from earliest times in the courts. See eg St Matthew's Gospel, 18, 11 ff, The Acts, 3, 19. In part, it derives from the self interest which any community has to encourage the rehabilitation of those who lapse and to hold out to them the hope that, by diligent and honourable efforts over a period, perhaps lengthy, their past may be forgiven and they may be restored to the good opinion of their family, friends, colleagues and society. The public's interest also includes the economic interest which is involved in utilising, to the full, the skills of talented people who have undergone years of rigorous training but who, having misconducted themselves, have had to be removed for a time from positions of responsibility and trust. Disbarment or removal from the roll of Solicitors is not necessarily intended to be permanent in fact. See Ex parte Evatt; Re New South Wales Bar Association (1971) 71 SR (NSW) 153, 157; The Prothonotary of the Supreme Court of New South Wales v Ritchard, Court of Appeal, unreported, 31 July 1987 and cf 7A Corpus Juris Secundum para 122, (1980). WEITER CECIL HARCOURT DAWSON v THE LAW SOCIETY OF NEW SOUTH WALES (Kirby P) 10. In the case of some offences, committed over an extended period, with deliberate intent and resulting in severe losses by clients, it will be very difficult to contemplate any circumstances in which the name of the offender will be restored to the roll. But where the offences are isolated, where there is no evidence of prolonged deliberate conduct and where, to the full extent possible in the circumstances, the funds of clients have been restored so that there is no eventual pecuniary loss, the public interest which this Court protects includes the public interest, certain matters being affirmatively proved, in the restoration of the name of the practitioner to the roll. There is no public interest in denying forever the chance of redemption and rehabilitation to former practitioners. On the contrary, the public is better served if, in appropriate cases, those who have offended, once they have affirmatively proved reform, are afforded a second chance, under whatever conditions and after whatever time, the Court considers appropriate. This Court has full power to protect the public by imposing appropriate conditions relating to such matters as limitations on practice or preconditions as to refresher legal education. See eg The Law Society of New South Wales v Keefe, Court of Appeal, unreported, 15 November 1989. Application to the instant case When these principles are applied in the present case, I am satisfied that the heavy onus which the claimant bears has been discharged. Several arguments are said to stand in the way of that conclusion. I shall deal with them in turn: qd) (2) It is said that the claimant did not by his original affidavit adequately indicate a full appreciation of the personal responsibility which he bore for the losses suffered by his clients when he was a solicitor. The claimant filed a subsequent affidavit. He also gave oral evidence before this Court. It is not reasonable (and it would be distorting of the truth) to require a person to acknowledge total moral turpitude where he or she feels that there are relevant extenuating circumstances. In the present case, the claimant offered evidence of such circumstances. These included his inadequate recall or memory of most of the events and matters that were subject to the application against him and which occurred thirteen or more years ago; the intervening stress and mental difficulties caused by his personal problems and his then excessive consumption of alcohol; the difficulties he had with his then partner, Mr Delaney, and the inadequate control which Mr Delaney maintained on occasion over employees of the firm. I understand that it is the last, particularly, which the claimant says was the cause of the losses which were suffered by the two clients who made claims against the Fund. The claimant in his oral evidence in the Court impressed me as a person who is genuinely contrite and keen to be given a chance to restore his reputation in the eyes of his former professional colleagues. The events which happened so long ago resulted in two claims only on the Fund; The claimant's failure earlier to contact the clients who had lost funds as a result of his "misconduct". I do not consider that this should stand in the way of his readmission. Although it is true that it would have been better had he done so, it must be remembered that for a part, at least, of the time interval involved he suffered from great personal stress, shame and humiliation. He said in evidence that to contact the clients would JOBNAME: No Job Name PAGE: 8 SESS: 1 OUTPUT: Thu Mar 6 17:19:58 2008 /reports/caseml]/case/urj/8901279 UNREPORTED JUDGMENTS (3) (4) have, he thought, caused them further upset. Moreover, some of the former clients had solicitors. He could not make direct contact with them. As well, in those cases, claims had been made on the Fund and contact with them would be irrelevant to reimbursement. Reimbursement, if any, would be necessary to the Fund, not to the clients. In any case, were he to have made contact with his former clients, his knowledge of the details of his alleged default was not accurate. Nor was his memory of the events and matters which were held to be misconduct. So if he contacted the former clients, what could he say? In the case of one client, Miss Mellor, it was complained that he had failed to reinstate her. But she made no claim on the Fund. It is not at all clear that she lost any moneys as a result of any activity of the claimant. Following questions from the Court contact was made with Miss Mellor on the day of the hearing. She is now of great age and could not recall the claim at all. The claimant acknowledged responsibility to Miss Mellor in the sense that the conduct of the practice after Mr Delaney left it was such that he should have exercised greater supervision over his then secretary in pursuing a settlement which had been achieved in Miss Mellor's claim. Miss Mellor was actually Mr Delaney's client. A letter which is produced bears the claimant's reference initials. But the claimant said in evidence, and I accept, that the handwritten initials on the letter were those of his then secretary. The result is that I do not believe that there is proved any direct wrong doing on the part of the claimant in respect of Miss Mellor. Furthermore, no claim is made by her. An earlier complaint by her to the Society concerned Mr Delaney and not the claimant; Then it was said that the claimant should have taken steps to reimburse Mr David Harper, a former client, for interest which Mr Harper claimed he had lost on an investment of $15,000 which he had asked the claimant to make on his behalf. He complained that he had not received any interest on the sum of $5,000 for a specified period. He believed, according to an affidavit of 22 January 1982, filed in the Bar Association's proceedings, that he was owed interest of approximately $1,000 which he claimed had accumulated on that investment and not been paid. However, a letter of the claimant to the solicitors for Mr Harper of 27 June 1980 was produced. It said, in substance, that Mr Harper must have forgotten that "from the earlier cheque was deducted legal fees in respect of appearances on his behalf at Bankstown Court and various conferences and attendances in respect thereof'. It was to offset these costs that the claimant justified his failure to pay interest to Mr Harper. In his affidavit, Mr Harper acknowledged that the claimant was acting for him in other proceedings. According to the Society, no claim has been made on the Fund by Mr Harper. The proper inference to draw is that Mr Harper accepted the explanation offered by the claimant. Otherwise, it might have been anticipated, that he would have pursued his rights further and, possibly, made a claim on the Fund. He did not. UWAETER CECIL HARCOURT DAWSON v THE LAW SOCIETY OF NEW SOUTH WALES. (Kirby P) I am therefore of the opinion that the claimant has adequately dealt with the various obstacles which are said to stand in the way of the Court's reaching that satisfaction that would warrant the order which he seeks. But I believe that it is necessary to say something about the conditions which should be imposed. The imposition of conditions The first condition which the Law Society proposes (namely a restricted practising certificate) is entirely appropriate. In my view, the third condition (that the claimant should pay the Society's costs and disbursements of these proceedings) is not. Whilst it is normal for the Court to so order, I do not consider that the Society should say to the Court that a person whose name is otherwise fit to be restored to the roll should not have such an order except on a "condition" that the Society's costs be paid. It is appropriate to distinguish the resolution of the substantial issue before the Court and the determination of the cost issue that then arises. The result is the same. However, the payment of the costs should not be a precondition to the solemn order of the Court restoring the name of a former legal practitioner to the roll. The second condition requires the claimant to refund to the Society the amounts paid out by the Fund. In correspondence which was placed before the Court, it was disclosed that the Society had agreed in the payment of the total amount paid out from the Fund (viz $19,934.45) in monthly instalments of $500 each. The claimant gave oral evidence that he had already made a number of such instalments. Both in this correspondence, and in oral evidence, the claimant gave an outline of his present income ($30,000 a year) and his high mortgage and motor vehicle commitments which virtually consume the whole of his income. In these circumstances, it was said, to require the claimant to reimburse the Fund in advance before re-admission would effectively prevent his application from succeeding. The suggestion was made (without actual evidence) that the claimant would be unable in his present financial position to raise the sum of $19,934.45 before his name was restored to the roll. As I have previously stated, it is not a universal rule, at least in this State, that before a practitioner's name is restored to the roll he or she must reimburse all clients who have suffered financial loss or, where those clients have been indemnified by the Fund, must reimburse it. In Evatt (above) it was recorded that the claimant there had failed, despite the passage of the years, to make any attempt to "right the wrong he did to the sixteen clients the subject of the proceedings and findings at the time of disbarment". Despite this, and in the light of all of the evidence produced in that case, this Court (Street CJ, Moffitt P and Hope JA) ordered that Mr Evatt's name be restored to the Bar roll. The position of a barrister may be different from that of a solicitor. A solicitor must deal regularly with client funds. In this sense he is more directly exposed to the temptation of misconduct in relation to funds than a barrister is. It may be that what was said in Evatt, in relation to a barrister, is not equally applicable to a solicitor. I have already referred to the stringent view that is taken in Victoria as demonstrated in the decision of the Full Court of that State in Re S (a Solicitor) [1985] VR 743, 751. In that case the clients had already been reimbursed. Although each case is different and no universal rule may be laid down, I see disadvantages in a scheme of repayment which follows the restoration of the name of the former practitioner to the roll. What is the Court then to do if the solicitor fails to maintain the payments? If he is otherwise an honourable practitioner, is his name then to be removed, eg for financial disabilities? It is much preferable that the reimbursement, if it should be ordered, should be made 10 UNREPORTED JUDGMENTS before the order is made restoring the solicitor's name to the roll. Although I realise that the claimant would have difficulty in raising the funds, I am not persuaded that it would be impossible. I do not believe that to so require would render the order of restoration ineffective and pointless. It is preferable in my opinion that the losses of former clients which the claimant agrees he must bear and reimburse should be entirely out of the way before his name is restored to the roll. Then, in his dealings with practitioners who know of these unhappy events, he could proceed on the basis that he has not only restored himself personally and professionally. He will also have closed the chapter of the losses of his former clients. Orders The orders which I would therefore propose are as follows: 1. Order that the claimant be admitted a solicitor of the Court upon condition that within sixty days or such further time as the court allows he pay to the Secretary, the Law Society of New South Wales, the sum of $19,934.45 being the sum paid out of the Solicitors' Fidelity Fund in respect of the claimant, together with the sum of $2,333 being the costs incurred by the Society in investigating the accounts, transactions and affairs of the claimant's former practise as a solicitor; 2. Direct the Society by its proper officer to signify to the Prothonotary the receipt of the moneys referred to in (1) upon which notification, order that the name of the claimant be entered on the Roll of Solicitors of the Court; 3. Order that the claimant's certificate to practise as a solicitor be thereafter restricted to an employee's practising certificate for a period of two years and thereafter to employment as an employee or partner for a further period of five years; 4. Order the claimant to pay the costs of the Society of an incidental to these proceedings; and 5. Liberty to either party to restore the matter to the list upon two days notice to the other provided such liberty shall be exercised within one hundred days of judgment. Mahoney JA The facts are set forth in the judgments of Kirby P and Meagher JA.I shall therefore not repeat the detail of them. The principles to be applied were not in contest when the appeal was before the court: at least, they were not in contest in argument. Without, of course, putting aside the effect of later decisions, the court has ordinarily cited the principles relating to the readmission of a solicitor as formulated in Ex parte Lenehan 77 CLR 403 and the earlier decision of the High Court there referred to Incorporated Law Institute of New South Wales v Meagher 9 CLR 655. Judged according to these principles, I am not satisfied that Mr Dawson should be re-admitted to practice as a solicitor. It is, I think, important to have clearly in mind, and to hope that others will understand, what is involved in such a case as this and what is not. What is to be decided is whether Mr Dawson is "a fit and proper person" to be admitted to practice as a solicitor. The meaning of this was explained in the cases to which T have referred. In Meagher's case, Griffith CJ: at 664; said: "In my judgment, therefore, the question which we are now to ask ourselves is this: Are we justified upon solid and substantial grounds in sanctioning the conclusion that the respondent is a UAETER CECIL HARCOURT DAWSON v THE LAW SOCIETY OF NEW SOUTH WALES (Mahoney JA) person of such a character? The question is not whether if the acts subsequent to 1896, to which reference has been made, had been done by a solicitor on the roll, the suspension which would perhaps have followed would have been a longer or shorter period, but whether in the light of those acts the respondent can show affirmatively that he ought to be regarded as a 'fit and proper person to be so trusted.'" See also per Isaacs J at 681 ("It is not a question of what he has suffered in the past, it is a question of his worthiness and reliability for the future"); and per Higgins J at 691 ("Our duty is to be satisfied that the respondent has shown in 1909 that he is a 'fit and proper' person to be put on the roll as a solicitor, notwithstanding the fact that in 1896 he was not fit or proper'). In Lenehan, Latham CJ, Dixon and Williams JJ: at 422; said: "The decisions cited refer to cases where a solicitor who had been on the roll was struck off the roll. When such a person applies for reinstatement he is in a more disadvantageous position than an original applicant because he must displace the decision as to probable permanent unfitness which was the basis of his removal. A solicitor may be restored to the roll after he has been struck off, but the power to reinstate should be exercised with the greatest caution and only upon solid and substantial grounds: Incorporated Law Institute of New South Wales v Meagher 9 CLR 655." But the principle there stated is the major premise. The problem with which courts are faced is not solved by the reiteration of generalities. A court's function lies in the minor premise. It must, by the exercise of its judgment, decide whether, in the particular case, the applicant is, for the purpose, a fit and proper person. And that requires the court to decide, and to articulate, what being a fit and proper person involves. The court is not required to state exhaustively what is involved: it would be wrong to attempt to do so. Circumstances and what they require of human nature are too various. Knowledge and ability are involved: Meagher at 682; but these are not in issue in the present case. What, in a practical sense, is here involved is the determination of whether the applicant will act as a solicitor should. In this sense, what a court is concerned with is "his worthiness and reliability for the future". For present purposes, four things may be said about this. First, the standard of conduct required of a solicitor is high. It is not merely that he will obey the law. There is a distinction between law and honour and it is, as the cases have indicated, honourable conduct as well as obedience to the law which is expected of a solicitor. This is not to impose on what a solicitor must do in the real world standards which belong to cloisters. The law cannot function - at least, it will not function as it is required to do in this country - if the court and his fellow practitioners cannot act upon the basis that a solicitor will honour his word, that he will not abuse confidence reposed in him, and that property entrusted to his care will be safe. The stress upon honourable conduct does not relate merely to the observance of niceties or conventions. In Meagher Griffith J: at 676-7; said: "On the whole facts disclosed before us I am compelled to the conclusion that Meagher regards his conduct to which I have adverted as quite consistent with the obligations of honour, and that if he is restored to the roll he will regard it as consistent with the honourable obligations of a solicitor to act in a similar manner when opportunity offers. Under these circumstances I cannot answer in the affirmative the question whether the Court is justified on solid and substantial grounds in sanctioning the 12 UNREPORTED JUDGMENTS conclusion that he is a fit and proper person to stand in the ranks of an honourable profession, and in whom the public may repose unbounded confidence." Isaacs J: at 680-1; said: "So that the decisions in England resting on the self-same words 'fit and proper' are exactly in point in the present case. Lord Esher MR, in Weare's Case [1893] 2 QB 439 at 447, goes on to make some observations very pertinent to Meagher's application for readmission. After saying that the Court below, in view of the nature of the offence, was bound to strike the solicitor off the roll, he said: 'I know how terrible that is. It may prevent him from acting as a solicitor for the rest of his life; but it does not necessarily do so. He is struck off the roll; but if he continues a career of honourable life for so long a time as to convince the Court that there has been a complete repentance, and a determination to persevere in honourable conduct, the Court will have the right and the power to restore him to the profession. His case, therefore, is not hopeless; but for the time he must be struck off the roll, and this appeal must be dismissed." Isaacs J then: at 682; said: "It may be that the error, though flagrant, has proved to be solitary lapse. It may be that after sufficient time has passed the applicant can satisfy the tribunal that his purgation is complete, his repentance real, his determination to act uprightly and honorably so secure that he may be fairly re-entrusted with the high duties and grave responsibilities of a minister of justice. But that obligation lies upon him, and it is no light one. The errors to which human tribunals are inevitably exposed, even when aided by all the ability, all the candour, and all the loyalty of those who assist them, whether as advocates, solicitors, or witnesses, are proverbially great. But, if added to the imperfections inherent in our nature, there be deliberate misleading, or reckless laxity of attention to necessary principles of honesty on the part of those the Courts trust to prepare the essential materials for doing justice, these tribunals are likely to become mere instruments of oppression, and the creator of greater evils than those they are appointed to cure. There is therefore a serious responsibility on the Court - a duty to itself, to the rest of the profession, to its suitors, and to the whole of the community to be careful not to accredit any person as worthy of public confidence who cannot satisfactorily establish his right to that credential." Second, what, in this respect, the court must determine, is whether it is satisfied that "for the future" the applicant will act in such a way and in accordance with such standards. It is always difficult to judge how a man will act. But, in law and in other areas of life, judgments of this kind must be made: cf Jones v Sutherland Shire Council [1979] 2 NSWLR 206 at 223-4. In judging whether an applicant will, in the future, act differently from the past, the court is not required to act on psychological theories or analyses. Nor, where "character" is referred to in the cases: see Meagher at 692 ("it is not his reputation that is in question but his intrinsic character"); is the court concerned with inate disposition or the principles of behaviourism. Normally what is meant by "character" in this context is the standards, of right and wrong and of behaviour, which the applicant has exhibited: see Meagher at 676-7, 691. It was, for example, the applicant's understanding of what, in the relevant sense, was right and wrong that underlay the decisions in some at least of the Clyne cases. The court may decide whether it is satisfied that the applicant will act properly in the future by taking into account the standards that he has exhibited and his understanding of what conduct is required of a solicitor. UWHETER CECIL HARCOURT DAWSON v THE LAW SOCIETY OF NEW SOUTH WALES (Mahoney JA) As I have said, it is difficult to decide what a man will do and the decision in a particular case is, to a greater or lesser extent, dependent on the court's assessment of the applicant. And in making that assessment it may, of course, draw inferences from what he has done in the past and, in particular, what led to his being removed from the roll. An understanding of that may assist the court to determine what are his standards and his understanding of a solicitor's responsibility and, from this, what he is apt to do in the future. And it is, perhaps, on this basis that, where what has been done in the past has been sufficient to indicate his "probably permanent unfitness": Ex parte Lenehan at 422; the court will require "solid and substantial grounds" for the conclusion that his standards have changed or that he will act differently. Third, there has been a reference to terms such as "repentance", "rehabilitation", and the like. "Repentance" is referred to in some of the cases: see, eg, Weare's case [1893] 2 QB 439 at 447. But these references do not suggest that repentance, as such, is the passage to readmission. Repentance is relevant, at least in the ordinary case, because it assists the conclusion that the applicant has left his previous standards or values and adopted more appropriate ones. Without that, his conduct in the future is unlikely to be acceptable. More recently, reference has been made to matters such as forgiveness and rehabilitation. There is a suggestion sometimes in the argument, and perhaps in some judgments, that refusal to re-admit an applicant who has suffered from disqualification involves a lack of the forgiveness or compassion which religion, or modern society, requires of a court. These, in my opinion, are not considerations which an applicant would ordinarily invoke. Whether there is to be forgiveness or rehabilitation will involve ordinarily the consideration of a punishment: at least, it may be necessary to consider whether there should be forgiveness and rehabilitation in the absence of appropriate punishment. But the court, on such an application as this, is not concerned with punishment. If it were, a solicitor who had stolen or misapplied money and had not been sentenced might find himself in a position of difficulty. One may feel compassion for a surgeon who was drunk or an engineer whose bridge collapsed and for the tragedy of his life. But what is in question in an application for readmission to the legal profession is whether the applicant is fit and proper to be held out "to the rest of the profession, to its suitors and to the whole of the community": Meagher at 681; as a person worthy of their confidence. Fourth, it has not, I think, been finally determined whether or to what extent, in such an application, the court should take into account the public opinion of a person who privately may be of appropriately good character. The court does not, in such an application, look to further punishment. It is arguable that it may take into account, if it be the case, that the readmission to practice of a person who, though of private virtue, is judged by the public generally to have acted dishonourably. It is arguable that it may do so upon the ground that to hold out such a person as a solicitor may affect the confidence which the public should have in the integrity of the law and those who practice it. It is arguable in the present case that, if Mr Dawson's personal character is satisfactory, the court may yet take into account the view the public would have of a person who has not taken appropriate steps to repair the damage suffered by his clients. This aspect of the matter has not been argued and I do not take it into account in the present case. 14 UNREPORTED JUDGMENTS I come now to the facts of the present case. I am not satisfied that Mr Dawson should be re-admitted to practice. Iam conscious that a judgment of this kind depends both upon facts and upon the impression which must be formed of an applicant. I have considered carefully both the terms of Mr Dawson's evidence and the impression which I have formed of him in the witness box. Without limiting the considerations to which I have had regard, I shall refer by way of example to two matters. First, the misconduct which led to Mr Dawson's disbarment involved implications of some seriousness. He was guilty of professional misconduct as a solicitor in that clients lost moneys which he received on their behalf; and he failed, on his subsequent application for admission to the Bar, to disclose what had happened. The amount of money involved was not as large as has been involved in other cases: $19,934.45 has been recovered by clients from the Solicitors Fidelity Fund and, as the judgment of Kirby P indicates, other moneys were lost. Explanations have been offered as to how the moneys came to be lost. It has been suggested that some at least resulted from failures of those associated with Mr Dawson properly to keep the trust account and the moneys. But these were matters for which, in the sense here relevant, Mr Dawson had responsibility. And, in part at least, his explanation has been it happened because he did not know what he should have done to safeguard the moneys or that he did not do it. Whatever be the situation, it has not been suggested - at least, I do not accept - that when he was admitted to the Bar he did not know that there were matters which, if his obligations were to be performed, he should disclose. Second, I am not satisfied that he now accepts, or at least fully appreciates, what is required, in terms of obligation and honour, of a solicitor. He has done little, if anything, to repay the moneys lost because of his misconduct. I am conscious of what he has said as to his emotional difficulties and his lack of means. And I am conscious of the undertaking which the Law Society has required of him in respect of repayment. But in the course of evidence questions were asked of him with a view to eliciting what he felt was required of him in relation to those who had suffered from his Misconduct. In relation to the four matters to which reference was made which had not been the subject of claims on the Fidelity Fund, nothing had been done. It may be that there were reasons why, in some cases, a defence against a claim could have been advanced. But, from what was said in the witness box, I was left with the conclusion that Mr Dawson did not appreciate the standards of conduct required and, in particular, of a solicitor who had been the subject of orders made in respect of him. I am not satisfied that there are the solid and substantial grounds required to establish Mr Dawson's fitness to be returned to practice. In my opinion, the application should be dismissed with costs. Meagher JA The claimant, Mr Dawson, was admitted to the Bar of New South Walesas a non-practising barrister on 26 July 1968 and as a solicitor on 13 February 1970. He practised in various firms until September 1977, when he was re-admitted to the Bar. In February 1982 he sold his chambers and on 5 April 1982 the Court of Appeal ordered that his name be struck off the Roll of Barristers. The Bar Association of New South Wales had moved the Court for such an order, and he did not oppose it. The grounds on which his removal was sought were various misdeeds which he had committed whilst a solicitor, together with non-disclosure of those misdeeds when he applied to be admitted to the Bar. Since July 1985 he has practised as a conveyancing clerk, with the UHETER CECIL HARCOURT DAWSON v THE LAW SOCIETY OF NEW SOUTH WALES (Meagher JA) permission of the Law Society, at the office of Messrs Stephen J Doran and Co, where he has fulfilled his tasks with diligence and propriety. He now applies to be re-admitted as a solicitor, and the Law Society conditionally consents to his application. Before his name was removed from the Roll of Barristers he suffered various personal misfortunes: his marriage broke up, he took to alcohol and on 21 September 1978 he was made bankrupt. He was discharged from bankruptcy in September 1981. The test to be applied by the Court on an application to be re-admitted to the profession by a person who has been struck off is clear enough. The applicant must furnish "demonstrative, objective proof of persistence in habits of integrity, uprightness and responsibility": per Sugerman P and McLelland JA in Evatt v New South Wales Bar Association (NSW Court of Appeal, unreported, 12 April 1972), quoted with approval by Hope JA in Evatt v New South Wales Bar Association (NSW Court of Appeal, 15 December 1981, happily, unreported). In my opinion, Mr Dawson has in his present application demonstrated that he has failed to meet this test. In order to understand why I am of this view it will first be necessary to consider the circumstances of his disbarment. Miss Jean Sayer, an investigator from the Law Society, discovered that insofar as Mr Dawson kept books at all when a solicitor, those books were not kept in accordance with the Society's requirements and were often totally chaotic; in many cases, for example, clients of the Trust Account were in unexplained debit. What is worse, in four cases clients had suffered financial loss; not that Mr Dawson had defaulted with their money, but simply that he had negligently lost it or failed to account for it. Four cases in particular are instructive. A Mr H, a storeman, entrusted $15,000 in October 1967 to Mr Dawson for a 12-month investment. After being requested in early 1978 to repay the amount, Mr Dawson in August 1978 repaid $10,000 with interest, but did not repay the remaining $5,000 until December 1979, and without interest. He compounded his offence by giving false reasons for refusing to pay the interest. In the case of Miss M, Mr Dawson's firm acted for her in a personal injury case in which she gave instructions to settle the case for $1,000 (the amount offered by the defendant), which was never paid to her. In a letter to the Law Society dated 19 September 1977 she said, very fairly, that not to have received the money after 8 years "does not encourage one to have much confidence in the processes of the law'. Miss H lent him $12,000 for investment on her behalf in 1974; in August 1978 he condescended to repay $3,000 of this amount, but never repaid the balance; in a letter to his client's new solicitors he said it was lost "in circumstances which can best be described as negligent". Mr P, an unemployed man, lent him $1,500 for investment, and he repaid no more than one third of that sum. An illuminating illustration by his attitude to his victims was the statement in his affidavit in the disbarment proceedings "I do not admit to the matters alleged against me, but because of my faulty memory I am not in a position to deny the allegations on oath". Two of his client's Miss H and Mr P, have now been reimbursed by the Solicitors Fidelity Fund, no thanks to Mr Dawson. Mr H and Miss M have not. They did not claim against the Fund. Whether or not the Law Society invited them to do so, history does not relate. Mr Dawson sought to gain some comfort from this failure to claim against the fund; so, surprisingly, did the Law Society. Indeed, further comfort was sought from the reply received during the course of this hearing from the nursing hospital in which Miss M now resides to the effect 16 UNREPORTED JUDGMENTS that Miss M cannot now remember either Mr Dawson or the accident or the offer to pay $1,000. It is a novel proposition that a solicitor's obligation to repay his client moneys which he holds on his behalf can be extinguished by allowing sufficient time to elapse for his client to suffer from senile dementia. The fact that Mr Dawson has not lifted a little finger to repay either Mr H or Miss M reflects little credit on him; the fact that the Law Society has done nothing to protect their interests reflects little credit on it. The fact that Mr Dawson has entirely neglected their interests, and continues to do so, is hardly consistent with an objective demonstration of persistent honesty. What were the facts which it was alleged sufficed to merit readmission? First, that Mr Dawson had felt a sense of shame when his name was removed from the Rolls of Barristers; secondly, that he has joined the Lions Club; thirdly that he conducted a conveyancing practice for a few years with apparent satisfaction; and fourthly that he has resisted the temptation to relapse into alcoholism. Manifestly, neither these factors in any combination nor the aggregate of them, prove that the claimant is fit for re-admission to the profession. But, when weighed against the claimant's refusal to repay his clients, they pale into insignificance. It is timely to reiterate the proposition that, except perhaps in the most exceptional circumstances, no defaulting member of the profession will ever be re-admitted until at least he has made full restitution to those clients whom he has caused financial loss. Justice requires such a rule. The former practice of this Court was to insist on it. The Supreme Court of Victoria still does: see Re S [1986] VR 743. Mr Ward QC, senior counsel for the applicant, challenged these principles and referred us to the 1981 decision of this Court in Evatt v New South Wales Bar Association. In that case, the applicant for readmission had previously been removed from the Roll of Barristers for, in effect, conspiring with his solicitor to rob their clients by overcharging them; yet he was eventually re-admitted despite having made no attempt at restitution. For just what proposition this unsatisfactory decision is authority it is impossible to understand. In my opinion it must be considered as laying down no principle of general application; it must be confined to its own facts and is of no relevance unless a precisely similar set of facts arises. The court which gave the decision consisted of Street CJ, Moffitt P and Hope JA. On the question of the legal significance of the fact that no attempt at restitution had been made, Street CJ was silent, Hope JA apparently excused it partly on the basis that the actual defrauders were the solicitors concerned and not the barrister, and partly on the basis that in previous applications for re-admission the Bar Association had not relied on this ground; and Moffitt P, having stressed the importance of restitution and noted its absence in the case before him, recited the supposed excuses for lack of restitution and dismissed them, saying "None of these matters.....provides an excuse for not at least attempting to do something to reimburse the clients", and yet contradicted himself by announcing that the failure to make restitution was no barrier to the claimant's case. This unfortunate aberration must not be read as detracting from the correct principles to which I have referred. The application should be dismissed with costs. Summons dismissed with costs. Counsel for Claimant: I Ward QC with WJL Berry UWHETER CECIL HARCOURT DAWSON v THE LAW SOCIETY OF NEW SOUTH WALES (Meagher JA) Solicitors for Claimant: Haskard and Co (Leongs) Counsel for Opponent: GC Lindsay 5 Solicitors for Opponent: Rosemary MacDougal