Appeal Panel - Internal CITATION: Khera v Law Society of New South Wales (No. 2) [2006] NSWADTAP 14 APPELLANT PARTIES: Jaswant Khera RESPONDENT Council of the Law Society of New South Wales FILE NUMBER: 049012 HEARING DATES: 13/03/2006 SUBMISSIONS CLOSED: 03/13/2006 DATE OF DECISION: 03/31/2006 BEFORE: O'Connor K - DCJ (President); Molloy GB - Judicial Member; Costigan M - Non Judicial Member CATCHWORDS: costs MATTER FOR DECISION: Costs FILE NUMBER UNDER APPEAL: 012024 DATE OF DECISION UNDER APPEAL: 03/31/2006 APPELLANT In person (by telephone) REPRESENTATION: RESPONDENT I Wales SC barrister ORDERS: 1. The appellant's application for costs is dismissed. REASONS FOR DECISION Background 1 On 9 February 2004 the Tribunal found the appellant legal practitioner guilty of professional misconduct and unsatisfactory professional conduct (in various particulars), ordered that his name be removed from the Roll of Legal Practitioners and that he pay one half of the costs of the respondent. 2 The appellant appealed and during the course of the appeal hearing it became clear that, on the facts disclosed to the Appeal Panel, there was a clear case of apprehended bias, for the reasons set out in Khera v Law Society of New South Wales (LSD) [2005] NSWADTAP 29. As a consequence the appeal was upheld, the orders of the Tribunal 9 February 2004 were set aside and the Information preferred by the respondent against the appellant was remitted to the Tribunal, differently constituted. In addition, the Appeal Panel took the opportunity of correcting an obvious error in the Tribunal's decision 9 February 2004. 3 In the course of our decision 21 June 2005 we made this observation: '76 Costs . On the question of the costs of appeal, we are disposed to an order that there be no order for costs. The point of appeal that has caused us to set aside the Tribunal decision was identified by the Appeal Panel at a late stage. We will allow the parties 28 days within which to file any consent order or to make any application in respect of costs, in which case directions will be made.' 4 The appellant took advantage, not surprisingly, of that observation and has applied to us for a costs order in his favour. General nature of the appellant's submissions 5 Both parties made written submissions. The appellant, at the hearing date, did not appear and sought (without any supporting material) an adjournment. This application was, again not surprisingly, opposed by the respondent. 6 Applications for adjournment, particularly where the proceedings have been listed for hearing, are unlikely to receive favourable consideration in the absence of supporting persuasive material. In this case no supportive/corroborative material was supplied by the appellant, just simply a letter sent by facsimile to the Registry received on the morning of the hearing. The application for adjournment was refused. However, the Appeal Panel arranged for the appellant to be notified of the outcome by the Registry, and offered him the opportunity to participate by telephone, which he accepted. The respondent consented to this course. Having regard to the fact that both parties had made detailed written submissions, in our opinion there was no injustice to the appellant. 7 The appellant submitted that the Appeal Panel should make costs orders in his favour, not only relating to the appeal itself but also relating to the hearing before the Tribunal from whose decision the appeal was successful. It is important to recognise at the outset that the hearing before the Tribunal occupied some 14 hearing days and the hearing before the Appeal Panel 4 hearing days such that, on any view, the legal costs incurred by the parties must have been more than considerable, to say the least. One can understand why the appellant, having been successful on appeal, would seek a costs order against the respondent. 8 A considerable proportion of the appellant's submissions dealt with perceived injustices that he asserts took place before the Tribunal. 9 The appellant also seeks his costs of the appeal. Statutory Proceedings 10 Having regard to the findings as clearly set out in our decision 21 June 2005, in the ordinary course of litigation the appellant would have been successful, had these proceedings been governed by the usual practice in proceedings in the ordinary courts (costs follow the event). However these are statutory proceedings governed in this instance, we consider, by the relevant provisions of the (now repealed) Legal Profession Act 1987, as the proceedings were brought pursuant to that Act. 11 We note that the appellant referred in his submissions to the general provisions as to costs found at s 88 of the Administrative Decisions Tribunal Act 1997 (ADT Act). This provision is not applicable. 12 The relevant provisions are ss 88(1) and (3). Section 88(1) provides: ' 88 Costs (1) Subject to the rules of the Tribunal and any other Act or law, the Tribunal may award costs in relation to proceedings before it, but only if it is satisfied that there are special circumstances warranting an award of costs. Section 88(3) provides: '(3) However, the Tribunal may not award costs in relation to proceedings for an original decision unless the enactment under which the Tribunal has jurisdiction to make the decision provides for the awarding of costs.' 13 Legal profession discipline proceedings of the present kind are proceedings for an original decision. ADT Act, s 7 provides: ' 7 What is an original decision? An original decision is a decision of the Tribunal made in relation to a matter over which it has jurisdiction under an enactment to act as the primary decision-maker.' 14 Sub-section (1) is expressed to be '[s]ubject to … any other Act', and s 88(3) requires, in effect, that the Tribunal find its source of power to award costs in proceedings for an original decision in 'the enactment under which the Tribunal has jurisdiction to make the decision'. 15 In this instance the only provision in the Legal Profession Act 1987 dealing with the award of costs by the Tribunal is s 171E. Accordingly that provision must govern our deliberations in respect of the appellant's application. 16 Section 171E provides: ' 171E Award of costs by Tribunal (1) The Tribunal may make orders requiring a legal practitioner whom it has found guilty of unsatisfactory professional conduct or professional misconduct to pay costs (including the costs of the Commissioner, the appropriate Council and the complainant). (2) If, after it has completed a hearing relating to a complaint against a legal practitioner, the Tribunal is satisfied that the practitioner is not guilty of unsatisfactory professional conduct or professional misconduct, the Tribunal may (but only if it considers that special circumstances so warrant) order payment from the Public Purpose Fund to the practitioner of the legal practitioner's costs. (3) An order for costs: (a) may be for a specified amount or an unspecified amount, and (b) if for an unspecified amount, may specify the basis on which the amount is to be determined, and (c) may specify the terms on which costs must be paid.' 17 The relevant sub-section is sub-section (2) which in its terms creates a number of prerequisites before an order for costs made be made in favour of the practitioner: (a) the Tribunal has to have 'completed a hearing'; (b) after it has completed that hearing the Tribunal must be 'satisfied that the practitioner is not guilty of unsatisfactory professional conduct or professional misconduct'; and (c) if those two prerequisites have been overcome the Tribunal may make an order for costs 'but only if it considers that special circumstances so warrant'. 18 Unless those three prerequisites are met the Tribunal has no power to make a costs order in favour of a legal practitioner. This may, and in many cases probably does (as clearly so in this case), result in an injustice to the legal practitioner in circumstances where, through no fault of the legal practitioner, the proceedings against the legal practitioner are thwarted for one reason or another or in circumstances where the legal practitioner is successful in resisting the more serious charge(s) but fails in respect of a much less serious charge. 19 We accept the force of the long line of authority to this effect in cases arising in the Legal Services Division and predecessor tribunals, emphatically reinforced recently by rulings in cases where a practitioner has been put to the cost of defending proceedings aborted for want of jurisdiction by defects in the procedure observed by the Law Society: see for example Dechnicz v Law Society of New South Wales [2002] NSWADT 198, further considered in Law Society of New South Wales v Carver [2003] NSWADT 158. 20 In Carver the Hon Acting Judge Nader QC DP (Divisional Head) noted: '23 The Supreme Court always had inherent or implied jurisdiction to award costs in any case: no statutory authority to do so is needed in any particular case. This Tribunal, as we have already noted, can do only what it is empowered to do by statute, expressly or by clear implication: it has no inherent jurisdiction. It may be thought by many to be unfair that a litigant can be involved in a costly dispute in the Tribunal about jurisdiction in which he is successful and yet be unable to get an order for his costs. The Tribunal cannot make an order for cost merely because it seems to it to be just and fair to do so. ...' 21 Two early cases dealing with s 171E are Re Mark Phillip Symonds [1994] NSWLST 20; (1994) 2 LPDR 10 and Attorney General of NSW v Gouder (unreported) No 23 of 1995 (16 April 1997). In Symonds the proceedings against the solicitor were dismissed. The Tribunal held that such a dismissal amounted to a 'hearing' and that in all the circumstances there were in fact 'special circumstances' (which that Tribunal enumerated in detail) which warranted a costs order being made in his favour. In Gouder the Tribunal determined that an interlocutory hearing which was 'finally determinative of the actual issues' before it amounted to a 'hearing'. It also held that the complaint against the solicitor having been struck out and no fresh complaint having being filed that there was only one inevitable conclusion, i.e. that the practitioner was not guilty of unsatisfactory professional conduct or professional misconduct. 22 As to the non-availability of a power to order costs where proceedings are aborted short of a final order (the situation here) Acting Judge Nader concluded in Carver: '37 There could not be a finding one way or another on the issue of guilt until the completion of a valid hearing. That does not mean that a hearing might not be abandoned by an Informant in its course with insufficient evidence for a finding of guilt. In such a case the hearing may be regarded as completed and, if jurisdictionally valid, would result in the Tribunal not being satisfied of the guilt of the practitioner. We think that such a hearing would be a "completed hearing." 38 A hearing that is aborted for some reason, or invalid for want of jurisdiction cannot result in any finding, either way, as to the guilt of the practitioner. This is such a case. By reason of the invalidity of the proceedings, there has been no hearing, completed or otherwise, that could lead to a finding about the guilt of the respondent. The analogy with the criminal law is with a trial that aborts in its course, and where the trial judge remands the accused for a new trial on a future date. The mere fact that the proceedings may not have resulted in a conviction does not mean that the accused was found to be not guilty.' Application to Present Case 23 There is no doubt in our mind that, absent other legislative strictures, this case demonstrates special circumstances warranting a costs order being made in favour of the legal practitioner. 24 There is no question that there has been a 'hearing'. We doubt whether the Tribunal has 'completed' the hearing, as the orders of the Appeal Panel required the filed Information to be remitted to the Tribunal, differently constituted. There is no need to finally determine this question. 25 The most obvious difficulty is that the second prerequisite, namely that the Tribunal must be 'satisfied that the practitioner is not guilty of unsatisfactory professional conduct or professional misconduct' has not been overcome. The decision of the Appeal Panel 21 June 2005 remitted the proceedings for a fresh hearing before a differently constituted Tribunal. There has therefore been no finding 'that the practitioner is not guilty of unsatisfactory professional conduct or professional misconduct'. In those circumstances it is not open to us to make a costs order in favour of the practitioner. Legal Profession Act 2004 26 It may be contended that the relevant provision is no longer s 171E, but, following the coming into force of the new Legal Profession Act 2004 on 1 October 2005, the matter is to be addressed by reference to the relevant provision in that Act, s 566. This section in some of its terms (which we do not need to address here) is somewhat wider than s 171E. The relevant sub-section is (3) which is in the following terms: 'The Tribunal may make orders requiring payment of an Australian legal practitioner's costs from the Public Purpose Fund, but may do so only if satisfied that the practitioner did not engage in unsatisfactory professional conduct or professional misconduct and the Tribunal considers that special circumstances warrant the making of the orders. The Tribunal is to have regard to the length and complexity of the proceedings when making a determination under this subsection.' 27 There is no need for us to comment upon this sub-section. The relevance for this decision is simply that if it be the case (which we doubt) that the Legal Profession Act 2004 applies to this determination then it remains the case that the practitioner can not satisfy a requirement to similar effect to the one we regard as conclusive in relation to the application of s 171E of the old Act, i.e. there is no finding as yet that 'the practitioner did not engage in unsatisfactory professional conduct or professional misconduct'. Concept of 'Justice' 25 We accept the submission of the appellant that the failure of the statute to permit this Tribunal to extend to him 'justice' in the form of legal costs not only leaves proceedings in this Tribunal open to abuse without penalty but also imposes upon him an injustice through no fault of his. The Legal Services Tribunal in Gouder made this observation: 'From the point of view of fairness and justice we find difficulty in understanding the legislative intent of this sub-section (referring to section 171 E(3)). It is totally at variance with the clear entitlement of the Commissioner for Legal Services, the appropriate professional Council and any complainant to an order for costs, almost as of right (having regard to the usual principles that apply to the making of orders for costs in favour of successful plaintiffs) against a solicitor against whom there has been an adverse professional finding. Why a solicitor or barrister who successfully resists such a finding should be placed in a disadvantageous position, when his/her own costs in contesting the proceedings would no doubt have been more than considerable, remains a mystery to this constituted Tribunal. One might even go so far as to say that it is plainly unfair.' 28 Notwithstanding the strong observations made in Gouder in 1997 and the more restrained observations of the distinguished Divisional Head in Carver in 2003, the legislature has seen fit in the Legal Profession Act 2004 to re-enact and re-enforce the obstacles confronting a legal practitioner seeking a costs order. The inherent unfairness is, in our respectful opinion, one that warrants legislative review. Order 1. The appellant's application for costs is dismissed. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.