NSW Bar Association -v- Howen [2003] NSWADT 117

CITATION: NSW Bar Association -v- Howen [2003] NSWADT 117 DIVISION: Legal Services Division APPLICANT PARTIES: NSW Bar Association RESPONDENT Alexander Stanislaw Howen FILE NUMBER: 012005 HEARING DATES: 17/03/2003, 18/03/2003 SUBMISSIONS CLOSED: 04/08/2003 DATE OF DECISION: 05/20/2003

BEFORE: Nader J QC - ADCJ (Deputy President); Norton S SC - Judicial Member; Mara A - Member APPLICATION: Professional Misconduct - fail to comply with s. 152 Notice MATTER FOR DECISION: Principal matter LEGISLATION CITED : Legal Profession Act 1987 CASES CITED: Smorgon and Others [1978- 1979] 143 CLR 499 APPLICANT REPRESENTATION: L McCulloch, barrister RESPONDENT B Connell, barrister ORDERS: 1. That the Respondent is guilty of professional misconduct.; 2. Matter to be relisted to receive evidence and further submissions as to the orders that should be made.

1 These reasons relate to an Information under Part 10 of the Legal Profession Act , 1987, ("the Act") laid by the Council of the New South Wales Bar Association ("the Bar") complaining that Alexander Stanislaw Howen ("the Respondent") is guilty of professional misconduct. 2 The ground of the complaint is that the Respondent failed to comply with the requirements of a notice dated 17 December 1999 pursuant to Section 152(1) of the Legal Profession Act, 1987 (NSW) issued by the Legal Services Commissioner (the "Commissioner") in respect of a complaint made by Mr Graham Leech (the "Client"). 3 The following particulars of the ground are set forth in the Information: (a) On 5 July 1999 the Commissioner received a complaint in respect of the Respondent made by Mr Graham Leech dated 2 July 1999 ("the Client's Complaint"). (b) The substance of the Client's Complaint was that the Respondent, who had been instructed directly by the Client: (i) had failed to draft documents necessary to evidence an agreement concluded on the occasion of the Respondent's appearance in Family Law proceedings on the Client's behalf; (ii) had failed thereafter to confer with the Client; (iii) had failed to attend subsequent mentions; and (iv) had failed to reply to the Client's communications. (c) On 6 August 1999 the Commissioner wrote to the Respondent requesting a response to the Client's complaint. No response was received. [ We note that, by reason of the absence of an enclosure note on this letter, there is some doubt whether there were any enclosures with the letter. ] (d) On 2 September 1999 the Commissioner sent a further letter requesting a response within 14 days and indicating that in the absence of a response a notice would be issued pursuant to Section 152(1) of the Legal Profession Act, 1987 (NSW) ("the Act"). The Respondent did not reply. (e) On 13 October 1999 a notice pursuant to Section 152(1) of the Act was signed by the Commissioner. The notice was unable to be served. (f) On 17 December 1999 the Commissioner signed a further notice pursuant to Section 152(1) of the Act seeking information in relation to the client's complaint ("the Notice"). (g) The Notice was served on the Respondent on 22 December 1999. 4 The Bar seeks orders as follows: (a) An order that the Respondent be found guilty of professional misconduct. (b) An order that the Respondent's name be removed from the roll of legal practitioners pursuant to Section 171C(1)(a) of the Legal Profession Act, 1987 (NSW). (c) An order in the terms of any one or more of the Orders set forth in Section 171C(1) of the Legal Profession Act, 1987 (NSW) as the Tribunal considers appropriate. (d) An order that a decision of the Tribunal in this matter be published. (e) An order that the Respondent pay the costs of the Bar of and incidental to the filing and hearing of these proceedings. Such further or other order as the Tribunal thinks fit. 5 The Respondent confesses and avoids the allegation respecting his failure to comply with the Notice. By his Reply dated 5 April 2003, the Respondent says that he failed to comply with the document purporting to be a notice (the "Notice") pursuant to section 152(1) of the Legal Profession Act 1987 (the "Act"), but he says that the Notice was not a valid notice by reason of the fact it was not issued solely or substantially for the purpose of investigating a complaint, but rather for the purposes, including, substantially, the making of inquiries about other matters which where not the subject of a complaint. 6 The relevant parts of section 152 of the Act are in the following terms: "152 Powers of Council or Commissioner when investigating complaint (1) For the purpose of investigating a complaint, a Council or the Commissioner may, by notice in writing served on any legal practitioner, require the legal practitioner to do any one or more of the following: (a) to provide written information, by a date specified in the notice, and to verify the information by statutory declaration, (b) to produce, at a time and place specified in the notice, any document (or a copy of any document) specified in the notice, (c) to otherwise assist in, or cooperate with, the investigation of the complaint in a specified manner. ... (3) A requirement under this section is to be notified in writing to the legal practitioner and is to specify a reasonable time for compliance. (4) A legal practitioner who, without reasonable excuse, fails to comply with such a requirement is guilty of professional misconduct." 7 The material parts of the Commissioner's notice of 17 December 1999 were as follows: "Office of the Legal Services Commissioner Notice Under Section 152(1) of the Legal Profession Act 1987 (NSW) Complaint made by Mr Graham Leech Against Mr Alexander Howen To: Mr Alexander S. Howen Queen's Square Chambers Level 1, 235 Macquarie Street SYDNEY NSW 2000 I Steve Mark, Legal Services Commissioner, hereby require you to provide me with the following information pursuant to section 152 of the Legal Profession Act 1987: 1. A brief chronology of your representation of Mr. Graham Leech in his family law matter. 2. A description of the work you undertook to perform for Mr Leech after the Heads of Agreement was drawn up on 25 January 1999. 3. A description of your understanding of any agreement between yourself and Mr Leech as to how your costs would be paid in this matter. 4. Whether under the circumstances you would be prepared to negotiate your professional fees in this matter. I do not require your response to this Notice to be in the form of a Statutory Declaration. Your response to this Notice must be received by my Office by 5.00pm on Monday 17 January 2000. The address of my office is Level 15 Goodsell Building 8-12 Chifley Square Sydney NSW 2000 Please note that failure to comply with this Notice by the specified date without reasonable excuse may result in the institution of proceedings against you by way of information in the Legal Services Division of the Administrative Decisions Tribunal. Signed Steve Mark Legal Services Commissioner 17 December 1999" 8 Mr. B. Connell, of counsel, for the Respondent, in addition to his oral submissions at the hearing, prepared and furnished to the Bar and to the Tribunal written submission dated 20 March 2003. The chief issue in this, and a related, matter (012030 of 2001) was the validity of section 152 notices. We now turn to consider those submissions. 9 Mr Connell said that the issue of the validity of the Notice was not something that occurred to the Respondent at the time of his failure to comply with it. Notwithstanding, Mr. Connell argued that he was obliged to take the validity point because failure to comply with a section 152 notice, without reasonable excuse, constitutes professional misconduct: sub-section 152(4). 10 It was argued that if the Notice was invalid, failure to comply with it would not constitute professional misconduct. 11 Mr. Connell's first submission is that a notice calling upon a person to respond, in circumstances where a failure to respond may have adverse legal consequences to the person, must be expressed with sufficient clarity to enable the recipient to comprehend what is required of him. This proposition seems to us to be manifestly correct as a matter of common sense even if it were not supported by the impressive authority. 12 Although Mr. Connell does not say so in terms, we understand the inference to be drawn from his making that submission is that the Notice was not expressed with enough clarity for the Respondent to understand what was required of him. There is no specific indication of what words, expressions or phrases of the Commissioner's requirements (1 to 4, inclusive) are obscure or lacking clarity. The language of each of the 4 requests within the Notice seems to us to be sufficiently clear to enable a practising barrister to understand it. The evidence shows that Mr. Graham Leech had been a client of the Respondent, that the Respondent had represented him in a Family Law matter to a point, and that the Respondent's retainer was to continue. We do not think that the use of the word 'chronology' is lacking in clarity: the import of that word in contexts similar to this one is well known to legal practitioners. Indeed, in these proceedings we asked for a chronology. We do not attribute the fact that we were not supplied with one to the fact that counsel did not know what we had asked for! 13 We reject the submission that the Notice was expressed with insufficient clarity. 14 Mr. Connell also submitted was that the Notice was not 'For the purpose of investigating a complaint.': see section 152 of the Act, supra. The word 'complaint' here means a complaint under part 10 of the Act. The reasoning is that a notice, purporting to be a notice under section 152 of the Act but which is given for a purpose other than the investigation of a complaint, would not be a valid notice under that section. It would follow that a person given such a notice would not be obliged to respond to it. The general contention seems sound. 15 Therefore, the immediate question is whether the Notice was given for the purpose of investigating a complaint. 16 It was contended that at the time of the giving of the Notice there was no relevant complaint in existence. Section 140 of the Act allows the withdrawal of complaints. Mr. Connell submitted that once withdrawn (unless the withdrawal is rejected under subsection 140(3) of the Act) a complaint ceases to exist. The Respondent contends that, by the time of the issue of the Notice, the relevant complaint was no longer in existence, having been effectively withdrawn. 17 Mr. Connell relied on four communications. The first was a letter dated 29 March 2000 from Mr. Graham Leech to the Bar. We quote the significant parts of that letter: "I can now confirm that Mr Howen, upon the influence of the Fair Trading Tribunal, contacted me recently, and I accepted his settlement offer on Monday March 27. I note that the Legal Services Commission, itself apparently unable to pursue the monetary compensation aspect, had recommended that Tribunal to me, and I am therefore most grateful to it." 18 That letter is not, in terms, a withdrawal of the complaint. It is advice to the Bar that the claim for compensation, associated with Mr. Leech's complaint, had been settled. 19 In a letter to the Bar dated 21 November 2000, Mr. Leech expressed surprise that the Bar was still pursuing his complaint. He pointed out that his letter of 29 March 2000 had clearly advised that he had accepted the Respondent's offer of settlement. He added that he had also advised the Legal Services Commission. Mr. Leech requested that the Bar make its conduct committee aware of the resolution of 'my complaint in March.' 20 By letter dated 3 May 2001, the Bar noted that Mr. Leech had by letter dated 29 March 2000 advised that his financial issues with the Respondent had been settled. The letter included, amongst other things,: 'soon after the receipt of that letter/facsimile [dated 21 November 2000] on 23 November 2000 we had a telephone conversation in which I asked you if you wanted to withdraw your complaint. In the absence of a formal withdrawal by you of your complaint against Mr Howen the Bar Council continued its investigation of your complaint.' 21 In a letter to the Bar dated 10 May 2001, Mr. Leech said: 'I regret that last November I hadn't understood that I was to further confirm the withdrawal of my complaint against Mr Howen.' 22 It seems to us that Mr. Howen did not understand the true nature of proceedings commenced by way of his complaint under part 10 of the Act. He is not to be in the least criticized for that. A complaint under part 10 is a creature of statute having a special status. The conduct alleged by a complaint may relate to conduct by a legal practitioner that may have caused loss to the person by or in respect of whom the complaint is made. In some cases no such loss is suffered and the complainant may have little or no actual interest in the prosecution of the complaint. In cases where loss is suffered, the person may have a close and real interest in the matter in the hope that s/he may be able to gain compensation without having to resort to more formal litigation against the legal practitioner. It appears to us that Mr. Leech believed that having resolved the financial aspect of his complaint that the complaint was at an end. 23 Notice of withdrawal of Complaint was required to be in writing. Subsection 140(2) provides: 'If the complaint was made to the Commissioner, the withdrawal of the complaint is not effective unless notice in writing of the withdrawal is given by the complainant to the Commissioner or to the Council to which the complaint has been referred.' 24 It is also to be noted that, in the circumstances, even if Mr. Leech had withdrawn his complaint in writing, it was open to the Commissioner to reject the withdrawal of the complaint. Subsection 140(3) of the Act provides: 'The Commissioner or the Council to which the complaint has been referred may reject the withdrawal of the complaint if satisfied that it may involve unsatisfactory professional conduct or professional misconduct.' 25 But, in the absence of a sufficiently clear expression of intention to withdraw his complaint, there was nothing upon which the Commissioner was able to exercise his discretion under subsection 140(3). We think that Mr. Leech effectively did no more than advise that the financial aspect of his complaint had been settled. 26 The intention behind the legislation is clear. The procedures are not established solely, or even primarily, as an alternative means of gaining compensation for victims of unsatisfactory professional conduct or of professional misconduct. The chief purpose of the legislation is to maintain the highest achievable standards of professional conduct by means of appropriate discipline. Such discipline is designed to educate the defaulting legal practitioner as well as to act as an educative caution to other legal practitioners. The ultimate purpose of the procedures is the protection of the public by appropriately designed disciplinary measures. The awarding of compensation is important but secondary. 27 Reliance was placed on cited passages of Smorgon and Others [1978- 1979] 143 CLR 499. We will not give the effect of the passages cited by Mr. Connell because we think that they are not significantly relevant to the present case. However, they do show that the validity of a notice may not be a matter of construing it grammatically and abstractly without reference to other matters. In the case at bar we think that relevant considerations include the purposes of the legislation – part 10 of the Act – and other circumstances, including the fact that the person to be bound by the notice is the respondent legal practitioner himself: the very person against whom the complaint was made. It would be fanciful to suggest that the Respondent was unaware of the identity or nature of the complaint about which the Notice was issued. The Respondent was aware of the identity of Mr. Leech, of the Family Law matter in which he had been retained, of the professional service he had performed for Mr. Leech, of the fact that Mr. Leech had complained about his professional conduct and the subject matter of the complaint. We think that there is no substance in the contention that the complaint about which the notice was issued was insufficiently identified. 28 Mr. Connell also contended that the Notice was issued for purposes other than the investigation of a complaint. He submitted that, therefore, the notice is not a valid notice. We understand that this submission is founded on a contention by Mr. Connell that numbered requests 3 and 4 of the Notice were incapable of furthering the purpose of investigating the complaint being investigated by the Commissioner. This submission raises two separate issues. First, that the Respondent's answers to requests 3 and 4 could not have served the purpose of investigation of the complaint and, secondly, if they were so incapable, their inclusion in the Notice renders it invalid. 29 We first consider the question whether requests 3 and 4, or either of them, was capable of furthering the purpose of the Commissioner's investigation. The answer to the question involves a consideration of the nature and circumstances of the complaint that was before the Commissioner at the time of the issue of the Notice. 30 By complaint dated 2 July 1999, Mr. Leech complained to the Commissioner. The relevant terms of his complaint followed a recital of the mutual history of the Respondent and Mr. Leech, as barrister and client. Mr. Leech said that, five months after certain specified events, he had not seen any draft of necessary documentation; that despite his requests and the Respondent's own proposals, they had had no conference(s) to discuss the matter; that the Respondent had missed two hearings, appointing a reader in his place at one of them; that the Respondent had not replied to two proposals which he, Mr. Leech, had offered in case the Respondent's proposal had met with serious difficulties; that the Respondent seldom replied to his messages; that, as far as he could recall, the Respondent had not initiated any communication with him since 31 January 1999; and that a verbal apology made in April had not resulted in any progress. 31 After referring to other matters, Mr. Leech gave some particulars of how the alleged failures of the Respondent had affected him and his former wife adversely. He said that a failure to settle the matter earlier with a part-payment of some $5,000 to her may, together with the delay in general, jeopardize continuing negotiations. 32 It is argued that answers to requests 3 and 4 of the Notice, relating as they did to costs and fees, could not have assisted the purpose of investigation of the complaint. The complaint, it seems to be contended, did not relate to costs or professional fees. 33 However, it must be remembered that, at the time of the issue of the Notice, the Commissioner had not been assisted by the Respondent either as to whether Mr. Leech's allegations were admitted, or, if they were admitted in relevant respects, why the Respondent had failed to provide the services for which he had been retained. If the Respondent had given some assistance to the Commissioner, the Commissioner would have understood better the gravamen of the complaint. 34 But, in the absence of such assistance, the Commissioner needed to explore the matter. It is not really for us to speculate what particular purpose the Commissioner had in mind when he sought the information, but legal practitioners (rightly or wrongly) have been known not to perform work for a client because of disagreements about costs or fees. It was not unreasonable for the Commissioner to ask questions about costs. Where a barrister has accepted a retainer directly from his lay client, the matter of costs may be critical, as it may be for a solicitor who is without funds to pay for some important step in proceedings. The answer to requests 3 and 4 may have enabled the Commissioner to put the matter of costs and/or fees to one side and to disregard it, or it may have suggested to him that it should be pursued further. 35 We do not think that a too analytical approach to the construction of a section 152 notice is appropriate. In a position of non-cooperation, where there is no joinder of defined issues, the Commissioner, or a Council, may have great difficulty in ascertaining the real focus of a dispute from the complaint alone. In such circumstances, some exploration of matters that may later be seen to have been immaterial is permissible. Such exploration may well assist to investigate the complaint. 36 We find therefore that requests 3 and 4 cannot now be said to have been incapable of furthering the Commissioner's purpose of investigation. We conclude that their inclusion does not render the Notice invalid. 37 Although we hold that view confidently, it is appropriate to assume for the purposes of disposing of the next submission that were are wrong and that requests 3 and 4 were incapable of furthering the purpose of investigating a complaint. 38 A finding that the inclusion of impermissible requests in a section 152 notice renders the whole notice invalid leads to unacceptable consequences. 39 In cases such as this, that the person to be affected by the notice is a legal practitioner who should either understand the legislation under which the notice is issued or be able to become familiar with it, and to identify a request that could have no possible bearing on the Commissioner's (or a Council's) purpose of investigation. Such a person is not a lay person who, because a notice comes from high authority, may be mislead into thinking that it must be valid. He is a person whose training should have rendered him/her vigilant to see that persons seeking to exercise authority over others does so legitimately. Therefore, it cannot be validly argued that there is some lack of procedural fairness in requiring a legal practitioner to respond to the valid requests in a notice and to ignore any invalid ones. 40 A legal practitioner ought to know that the purpose of part 10 of the Act is to benefit the legal profession as well as the public. It operates punitively only as an incident to its main function. Although 152 contains a sanction to encourage compliance, its primary purpose is not to create the circumstances in which legal practitioners may be found guilty of professional misconduct but to facilitate investigations. 41 On a more practical level, it seems to us that if Mr. Connell is correct as we understand his submission, if a notice were to contain 20 valid requests for information and one impermissible request, the legal practitioner would be able to ignore the notice altogether. We cannot accept that as a valid proposition. Mr. Connell's submission is either correct in principle and applies to all such cases or it is not a valid submission at all. 42 We also note that requests 3 and 4 are logically unconnected to requests 1 and 2. They are also logically independent of one another. In such cases there is no persuasive argument why impermissible requests should not be regarded as severable from a notice. 43 Therefore we do not think that the inclusion of requests 3 and 4 in the Notice renders it invalid. 44 As a consequence, we reject Mr. Connell's argument that failure to comply with the Notice cannot constitute professional misconduct. 45 We find that the Respondent's failure to comply with the Subject Notice was without reasonable excuse and, therefore, that by reason of section 152(4) of the Act, it was professional misconduct. 46 This matter, together with matters numbers 012004 and 012030 of 2001, may be relisted in order to receive evidence and further submissions as to the orders that should be made. We offered the Respondent the opportunity to adduce professional evidence that may tend to explain his behaviour. He is not obliged to accept that opportunity. Accordingly the matters will be listed for directions to ascertain his wishes.