WEAVER v THE LAW SOCIETY OF NEW SOUTH WALES SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL GLEESON CJ, HANDLEY and SHELLER JJA 13 March 1992, 13 March 1992 [1992] NSWCA 266 LEGAL PRACTITIONERS — SOLICITORS — PROFESSIONAL MISCONDUCT — claimant's name removed from Roll of Solicitors in 1977 — application for re-admission — HELD — the claimant had established that he was now a fit and proper person and the public interest did not require that he remain barred from practice. Gleeson CJ This is an application by the claimant for an order that the claimant's name be restored to the Roll of Solicitors of this Court. The Law Society of New South Wales appeared by counsel on the application and provided the Court with extremely helpful submissions in relation both to the facts and circumstances of the case and the principles to be applied in a proceeding of this nature. The attitude of the Law Society was that it does not oppose the application, nor does it actively support the application. The claimant is presently aged seventy-one. His name was removed from the Roll of Solicitors by an order of this Court made on 30 November 1977. Before referring to some of the circumstances giving rise to that order of removal, it is convenient to mention some further biographical details relating to the claimant. The claimant left school in 1937, having obtained the Leaving Certificate. He obtained employment and then in December 1941 enlisted for training in the Royal Australian Air Force. Following his initial training, he was posted to Canada to complete the course of observer. In June 1943 he graduated as an air bomber navigator in Canada, with the rank of flight sergeant. Following graduation he was posted to the United Kingdom, first to further training in Wales and then to an operations unit in Staffordshire. Eventually he was posted to a Heavy Bomber Squadron. He was commissioned as a Pilot Officer in October 1944. By the time he was demobilized in April 1946 he held the rank of Flying Officer. He was awarded the Distinguished Flying Cross 1939 to 1945 France and Germany Star Defence Medal and at a later date the Australian War Medal 1935 to 1945 and the Tribute to the Air Crew of Bomber Command 1935 to 1945 Medal issued by the United Kingdom Government. In April 1946, following his discharge from the Air Force, he returned to work at the Postmaster General's Department. During 1947 he commenced the study of law at the University of Sydney. He received the degree of Bachelor of Laws in April 1953. In May 1953 he was appointed as a legal officer in the Commonwealth Crown Solicitors Office in Sydney. In June 1958 he was employed temporarily in the office of the Commonwealth Crown Solicitor in Canberra and then he returned to the Sydney branch in September 1958. He resigned from the Commonwealth Public Service in May 1960 and entered the firm of William Lander Cleary and Company in Sydney. 2 UNREPORTED JUDGMENTS In January 1961 he commenced employment as a salaried solicitor at the Bankstown branch office of Morgan Ryan and Brock, Solicitors. In about July 1963 he went into partnership with a Mr Knowles under the name of Knowles Weaver and Company. The claimant and Knowles took over the Bankstown practice of Morgan Ryan and Brock. In May 1970 the claimant reported to the Law Society certain irregularities in the trust account of Knowles Weaver and Company. Not long afterwards, Knowles was removed from the Roll of Solicitors, but the Statutory Committee of the Law Society originally acquitted the claimant of substantial wrong-doing in relation to the matter. Knowles then apparently provided the Law Society with some further information as a result of which fresh proceedings were taken against the claimant. There ensued lengthy litigation. It is unnecessary to go into the detail of all of that litigation. Amongst other things, it raised issues as to the consequences of the previous findings in favour of the claimant. Ultimately, after certain serious findings had been made against the claimant by the Chief Judge at Common Law and adopted by the Court of Appeal, the claimant was struck off the Roll. That, as I have said, occurred in November 1977. He appealed unsuccessfully to the High Court of Australia. The findings against the claimant which resulted in the striking off were stated in summary form by Reynolds JA in the Court of Appeal in the following compendious fashion. Before referring to the summary of the findings made by Reynolds JA, it should be mentioned that the substantial issue between the claimant and the Law Society in relation to the merits of the matter concerned the extent to which the claimant ought to be held responsible for certain trust account defalcations on the part of Knowles. It was never suggested that the claimant personally obtained the benefit of any trust funds misappropriated or misapplied by Knowles. As I have mentioned, it was the claimant who exposed the conduct of Knowles to the Law Society. Ultimately, however, it was alleged by the Law Society that the claimant knew or ought to have known of trust account irregularities. Further, it was alleged by the Law Society that the claimant had originally misrepresented to the Law Society and to the Statutory Committee the facts relating to his knowledge of the trust account and Knowles' operations and that he had set out to minimise his own responsibility concerning the circumstances that created the conditions under which Knowles engaged in the defalcations to which I have referred. In this regard I should mention that Taylor J found as a fact that Knowles actively concealed from the claimant the activities in which Knowles was engaging and that finding was apparently unrestricted in point of time. Notwithstanding that it was and is common ground that the claimant never himself misappropriated or misapplied money, and that he was a victim of concealment by Knowles, nevertheless serious findings against him were made and these were summarised by Reynolds JA as follows: "1 He knew in 1968 that in the two man partnership of which he was a partner there were serious deficiencies in the trust account. 2 In that year and the following year he entered into an arrangement with his partner and the accountant employed by the firm to conceal the true position in the accounts required by law to be certified. 3 After 1968 he knew that misappropriations from the trust account were continuing. URJ — WEAVER v THE LAW SOCIETY OF NEW SOUTH WALES (Gleeson CJ) 3 4 Notwithstanding this knowledge and involvement, he did not report the matter to anyone in authority until 1970. 5 When he pave evidence in the form of a statutory declaration and orally to the Solicitors Statutory Committee that his first knowledge of a deficiency in the trust account of the partnership was on 4 May 1970, being two days before he reported the matter to the Law Society, that evidence was false to his knowledge." In short, the allegations that were said to have been established were to the effect that although the claimant was not personally involved in misappropriating money, he was aware of and implicated in trust account irregularities as a result of the activities of Knowles, his partner, and, secondly, that he originally understated and misrepresented his state of knowledge of Knowles' wrongful conduct. Those findings amply justified the removal of the claimant's name from the Roll of Solicitors. However, he has now been off the Roll for a long time and the question for this Court to decide is whether or not on the evidence, he is now a fit and proper person to practise as a solicitor and whether the re-admission of the claimant as a solicitor would be consistent with the interests of the public. The jurisdiction which the Court originally exercised in removing the name of the claimant from the Roll of Solicitors was a jurisdiction that is in its nature protective and not punitive and the same applies to the jurisdiction of the Court that is presently invoked. The principles to be applied in proceedings of this kind can be found in a number of reported and unreported cases and do not require detailed repetition. I mention cases such as Incorporated Law Institute of New South Wales v Meagher 9 CLR 655 at 644, Cotwitz v The Law Society of New South Wales Court of Appeal (unreported) 7 August 1987, Nash v The Law Society of New South Wales Court of Appeal (unreported) 30 August 1977, Ex parte Lenehan 77 CLR 422 and in the matter of The Application of Noel Norman Dennis Court of Appeal (unreported) 23 December 1988. In considering the claimant's application, the Court has to pay close attention to the detail of the matters that originally led to the removal of his name from the Roll of Solicitors. The Court also has to attend to the evidence as to his past history and present circumstances with a view to considering once again the question of his fitness to practise as a solicitor. The Court has to look at his conduct since he has been removed from the Roll of Solicitors and the Court must bear in mind constantly, as I have said, the protective nature of the jurisdiction that it is exercising and the relevant considerations of public interest that flow from that. Since the claimant's name was removed from the Roll, he has had various forms of employment. He had a casual position for a time with a firm engaging in investigation activities. He was employed as a part-time lecturer at a TAFE college. He worked for a life insurance agency. He became in 1982 a member of the Australian Welfare Officers Association. In March 1983 he took a position in welfare work with the Salvation Army. His work involved counselling of and general assistance to homeless men. In March 1986 he became employed by the Council of the City of Sydney. In April 1988 he ceased his employment with the Council of the City of Sydney and was granted a pension from the Department of Veterans Affairs. Since that time he has worked part-time for Messrs Sutherland and Co, Chartered Accountants, and the wage from his part-time employment augments his service pension. He was made bankrupt in March 1971 and obtained a discharge from bankruptcy in 4 UNREPORTED JUDGMENTS December 1982. He is also a member of the New South Wales Fire Brigade Brass Band but that is not a matter on which Mr Foord QC has placed heavy reliance in support of this application. The claimant has supplied the Court with a number of affidavits which speak in terms of high praise for his work and his conduct in recent years. Those affidavits include, although they are not limited to, affidavits of a solicitor, Mr Dearn, a barrister, Mr Smythe, and the chartered accountant, Mr Sutherland, to whom reference has earlier been made. Mr Sutherland is a former Lord Mayor of Sydney and is an alderman of the Council of the City of Sydney. He said that his association with the claimant spans a period of more than twenty years. He said that he has always been impressed by his commitment to community activity and service. He said that should the Court grant him the right to practice, his firm would offer him a full-time position as an inhouse solicitor. That observation by Mr Sutherland led to some questions on the part of the Court as to what exactly was proposed between Mr Sutherland an the claimant, bearing in mind particularly the provisions of s119 of the Legal Profession Act 1987 and the statement of policy appearing in the New South Wales Solicitors Manual entitled "Solicitors Employed by Non Solicitors: Council Declares Its Position on Sharing of Receipts". The Court has been assured by the claimant that he understands and intends to abide by the provisions of s119 and the terms of the policy to which I have referred. Indeed, senior counsel for the claimant has made it clear that his client has no intention of applying for an unrestricted practising certificate because he does not want to operate a trust account or undertake the responsibilities associated with that and further that the claimant will notify the Council of the Law Society of all the terms and conditions of his arrangements with Mr Sutherland and of any material changes in those arrangements. It may be convenient at this stage if I recite the terms of certain undertakings to the Court that are offered on the part of the claimant. Those undertakings are two in number and to the following effect: 1 That the claimant will not apply for an unrestricted practising certificate. 2 That the claimant will notify the Law Society of the proposed terms of any contract of employment he makes with Mr Sutherland or Mr Sutherland's firm and of any variations in the terms of such contract relating to the nature of the work to be performed by the claimant and that such notification will be made at the time of the application for an annual practising certificate and at the time of any proposed variation of any of those terms. The Court notes and accepts those undertakings to the Court and the orders that I will propose are based upon that acceptance. In my view the evidence establishes that the claimant is now a fit and proper person to practise as a solicitor and that considerations of public interest and protection of the public do not lead to the consequence that the present application should be refused. It is, I think, material to take into account in favour of the claimant the matters that I mentioned earlier; that is to say, that when he was originally struck off the Rolls, there was no suggestion that he personally benefited from misappropriation or misapplication of monies. One of the serious aspects of the misconduct of which he was found guilty involved an attempt to minimise or explain away his own responsibility in relation to the trust account irregularities in the firm of which he was a partner. URJ WEAVER v THE LAW SOCIETY OF NEW SOUTH WALES (Sheller JA) 5 That is a serious matter, but in human terms one that is not beyond understanding, and the Court should also take into account in judging his conduct and his present fitness to practise that it seems to be clear that he was to a significant extent the victim of concealment on the part of his partner Knowles. He has been off the rolls for a long time. The evidence shows that he accepts the findings of wrong-doing that have been made against him and that he regrets sincerely the conduct that led to the removal of his name from the Roll. I consider that in all the circumstances it is appropriate for the Court to make an order in terms of the order asked and I would propose that upon the claimant giving to the Court the undertakings that I have recited earlier, the Court should order that the name of Arthur George Weaver be restored to the Roll of Solicitors of the Supreme Court of New South Wales. Handley JA I agree. Evidence has been given relating to the claimant's proposedemployment by Mr Sutherland which will not involve the claimant in conducting a solicitor's trust account on his own behalf. Undertakings have also been given to the Court which will have the same practical result. In these circumstances the order proposed by the Chief Justice should be made. Sheller JA The claimant was struck off on serious grounds, including giving false evidence to the Statutory Committee about the affairs of the partnership of which he was a member. However, I was impressed by Mr Weaver when he gave evidence and I am impressed, apart from the events surrounding his striking off, with his record. I am impressed also by the evidence given about him by other witnesses. In view of his background, which has been referred to by the Chief Justice, I would be concerned with his operating a trust account on his own account. However, in the light of the undertaking that has been given, I agree that the orders proposed should be made. GLEESON CJ: The orders of the Court will be as I have proposed. Upon the claimant giving the undertakings to the Court noted in the reasons for judgment, order that the name of the claimant be restored to the Roll of Solicitors. Counsel for the claimant: J Foord QC / DL Williams Solicitors for the claimant: Helliars Counsel for the opponent: D Hipsley Solicitors for the opponent: The Law Society of New South Wales