Council of the Law Society of New South Wales v Zaki

The Hearing on 12 December 2018

1. At the hearing, the Law Society tendered without objection the following affidavits: 1. The affidavit of A M Foord dated 2 July 2018 - Exhibit A; 2. The affidavit of A Jones dated 7 June 2018 - Exhibit B; and 3. The affidavit of A M Foord dated 13 November 2018 - Exhibit C.
2. The solicitor did not require any of the Law Society's witnesses for cross examination.
3. The solicitor, in addition to tendering the Reply referred to above, also tendered an affidavit (dated 12 December 2018) which he had sworn himself before a witness. That was marked Exhibit 1 and was tendered without objection. The Law Society did not seek to cross examine the solicitor.
4. However, the Tribunal asked questions of the solicitor and the essence of the evidence given by him may be described as follows: 1. During the period when the Notice had been issued and during which compliance with the Notice was required, the solicitor was distracted by family issues; and 2. At that time, he was substantially working from home and the only matter he had taken on was the matter referred to in the Notice, being the Van Vlymen proceedings.
5. Mr Pierotti took the Tribunal to the exhibits filed by the Law Society to demonstrate the evidence in support of the assertions made in the application. He then made the following brief submissions: 1. The solicitor failed to comply with the Notice. The solicitor's breach of his obligations initially commenced on 6 July 2017 and continued until 15 February 2018. He agreed it was arguable that the solicitor was entitled to a reasonable period to consider the Notice before responding to it, and if that view was taken, then non-compliance might be said to have commenced from August 2017; 2. A solicitor has a fundamental responsibility to assist the Law Society in its statutory duties and there is a need for strict compliance with Law Society notices. Failure to comply constitutes professional misconduct. In this case, there was no reasonable excuse for non-compliance. The Notice was not onerous; 3. Although there is evidence that the solicitor forwarded a statutory declaration to the Law Society dated 16 August 2017, that declaration did not constitute full compliance; 4. The Law Society relies upon the provisions of s 298(a)(1) and s 466 of the Uniform Law in support of the submission that the solicitor's conduct constitutes professional misconduct. The Law Society also submitted that the conduct could be objectively described as disgraceful and dishonourable (as per the Allinson v General Council of Medical Education and Registration [1894] 1 QB 750); 5. From late August 2017 onwards, there was continuing non-compliance and the solicitor knew that he had not complied, in that he had not provided the documents referred to in schedule 2 of the Notice. The Law Society's personnel had sent communications to the solicitor requesting compliance and these had been ignored. The delay from August 2017 to February 2018 is sufficient to categorise the solicitor's conduct as professional misconduct; and 6. The Law Society does not seek to impose a fine upon the solicitor.
6. The solicitor then sought an adjournment of the hearing for the purposes of obtaining and filing additional evidence. The Tribunal made directions for the proceedings to be adjourned, for the hearing to continue on 27 February 2019 and in the meantime, for the solicitor to file evidence and submissions by 21 January 2019, with the Law Society having an opportunity to respond. No evidence has been filed by the solicitor, in conformity with the directions.
7. However, on 26 February 2019, the Tribunal received an email from the solicitor to which was attached a letter dated 24 January 2019 from the Rev. Dr D Fanous.
8. In addition, the Tribunal has received written submissions from the Law Society. These were filed in accordance with the timetable included in the directions made at the hearing on 12 December 2018.

Resumption of the Hearing

1. On the resumption of the hearing, the solicitor tendered (without objection or a requirement for cross examination) the letter dated 24 January 2019 from Rev. Dr. Daniel Fanous, parish priest. That letter was marked Exhibit 2. In summary, the letter stated: 1. Dr Fanous has known the solicitor for approximately four years; 2. The solicitor has had difficulties and has been suffering mentally as a result of stresses placed upon the solicitor's family. Those difficulties has lead the solicitor to making decisions that he would not have ordinarily have made; and 3. Since early 2018 and certainly as of today, there has been "quite profound positive changes" in the solicitor whereby he has recovered from past difficulties.
2. Mr Pierotti submitted that little weight should be given to Exhibit 2. In applications of this kind, the rules of evidence apply (see cl 20 of Sch 5 of the Civil and Administrative Tribunal Act 2013 (NCAT Act)). The letter was not sworn evidence in that it was not annexed to an affidavit or statutory declaration.

The Law Society's Submissions

1. The Law Society's written submissions may be summarised as follows: 1. The solicitor is guilty of professional misconduct in that he has failed to comply with the Notice. The facts relied upon are those contained in the application (set out above numbered 1 - 13); 2. The solicitor's affidavit (Exhibit 1) states that the solicitor was not aware that the statutory declaration sent on 16 August 2017 was not received by the Law Society until the solicitor received notification from the Law Society on 22 August 2017. Although he believed that the statutory declaration had complied with the Notice, his affidavit states that he now understands it's (i.e. the statutory declaration's) deficiency. That deficiency was rectified by a further statutory declaration of 15 February 2018. The solicitor was advised by email of 29 August 2017 from the Law Society that the statutory declaration (which had been emailed the day before by the Solicitor) did not respond to questions 5 and 6 of the Notice and did not respond to schedule 2 of the Notice. In addition, the solicitor did not address the remaining requirements of the Notice until February 2018; 3. Section 466(6) of the Uniform Law states that a failure by an Australian lawyer to comply with the requirements of the various notices referred to in that section (including a s 371 notice) is capable of constituting unsatisfactory professional conduct or professional misconduct; 4. Section 298 of the Uniform Law lists conduct which is capable of constituting unsatisfactory professional conduct or professional misconduct. Such conduct includes conduct constituting of a contravention of the Uniform Law; 5. Section 297 of the Uniform Law provides 297 Professional misconduct (1) For the purposes of this Law, professional misconduct includes - (a) unsatisfactory professional conduct of a lawyer, where the conduct involves a substantial or consistent failure to reach or maintain a reasonable standard of competence and diligence; and (b) conduct of a lawyer whether occurring in connection with the practice of law or occurring otherwise than in connection with the practice of law that would, if established, justify a finding that the lawyer is not a fit and proper person to engage in legal practice. (2) For the purpose of deciding whether a lawyer is or is not a fit and proper person to engage in legal practice as referred to in subsection (1)(b), regard may be had to the matters that would be considered if the lawyer were an applicant for admission to the Australian legal profession or for the grant or renewal of an Australian practising certificate and any other relevant matters. 1. The above definition is an inclusive one and further guidance as to what constitutes professional misconduct may be derived from the cases. The common law concept of professional misconduct includes conduct in pursuit of professional activities which would reasonably be regarded as disgraceful or dishonourable by professional colleagues of good repute and competency - see The Council Of The New South Wales Bar Association v Sahade [2007] NSWCA 145 at [54] (per Basten JA) which adopted the test described in Allinson v General Council of Medical Education and Registration at [763]. The Law Society submitted that the concept of what constitutes professional misconduct has a very wide breadth - see Bechara v Legal Services Commissioner [2010] NSWCA 369 at [44]. In Bechara the Court stated that there are no fixed categories of professional misconduct. Much depends on whether the conduct falls outside generally accepted standards of common decency and common fairness [44]; 2. The solicitor's conduct should be found to amount to professional misconduct and that a relevant consideration is the purpose and need for the issue of the Notice. That purpose was set out in NSW Bar Association -v- Howen [2003] NSWADT 117 which stated: 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. 1. Although the decision in Howen concerned earlier legislation, the purpose of the notice in that case remains relevant to s 371 of the Uniform Law. Here, the purpose of the Notice was to facilitate an investigation being conducted by the Law Society and it was the solicitor's professional and legal obligation to assist. A broad statement of the general principle can be found in Veghelyi v The Council of the Law Society of NSW (1989 Supreme Court unreported) in which Smart J said: It is important that solicitors respond promptly to the Society when it asks for a reply in response to complaints which have been made. It will be an unusual and complex case when a delay of more than fourteen days is acceptable and often the reply should be delivered within a shorter period such as seven to ten days. Replies to the Law Society in respect of complaints warrants a high priority. Such replies should be full and complete and deal directly with the complaint made. 1. The solicitor's failure to comply with the notice, especially having been given additional time to do so, evidences such a failure as would be considered by any member of the profession as amounting to professional misconduct.

Solicitor's Submissions

1. The solicitor's submissions may be summarised as follows: 1. The solicitor did not intend to behave dishonourably. The Notice was complied with in stages. The solicitor acknowledged that the delay in fully complying with the Notice was not excusable; and 2. The solicitor's conduct should be categorised as unprofessional conduct rather than professional misconduct.
2. The above submissions should be considered in conjunction with the statements made by the solicitor in his affidavit (Exhibit 1) in which the solicitor stated that: 1. He forwarded a statutory declaration dated 16 August 2017 to the Law Society by mail believing it to comply with the Notice. Later he was made aware that the statutory declaration was not fully compliant and he rectified that by forwarding the statutory declaration dated 15 February 2018; and 2. The solicitor stated that the Notice was issued at a time when he had personal issues to deal with but that he accepts responsibility for failure to comply with the Notice and apologises unreservedly.

Fine?

1. Although the application included an order for a fine, the Law Society advised the Tribunal at the hearing that it did not seek a fine. This decision arose out of the fact that the form of resolution passed by the Council of the Law Society authorising commencement of proceedings against the solicitor did not authorise the seeking of a fine. Notwithstanding that, at the hearing, the Tribunal indicated that it would consider whether the imposition of a fine should be included as an appropriate order. The Law Society did not seek to dissuade the Tribunal and submitted that the imposition of a fine would be appropriate. The solicitor gave evidence from the bar table to the effect that he was suffering financial difficulties requiring him to sell the family home.

Decision

1. The factual assertions are not in dispute and are contained in the document headed "Particulars of Grounds of Complaint". Those facts are set out in paragraph 3 of these reasons. In essence, the Law Society served the Notice on the solicitor on 7 June 2017. Compliance was required by 28 June 2017. Ultimately, full compliance was not achieved until February 2018. In the meantime, a short extension of time was granted to the solicitor requiring compliance by 6 July 2017 and the solicitor provided partial compliance by a statutory declaration mailed (and emailed) to the Law Society in August 2017.
2. In our view, the requirements of the Notice were not onerous and despite that, responses to important questions (questions 5 and 6) in the Notice were not responded to until February 2018 and nor were the documents referred to in schedule 2 of the Notice supplied until February 2018.
3. In our view, the delay is significant, unacceptable and occurred notwithstanding communications from the Law Society reminding the solicitor of the need to complete compliance with the Notice. The question which arises is whether the circumstances of the solicitor offer an excuse for his non-compliance. The solicitor has chosen to give very little detailed evidence in support of the explanation that personal and family issues impeded on his ability to respond to the Notice. Accepting that there were such pressures upon the solicitor, the fact remains that in the period when he had recovered (namely since early 2018 according to Rev. Dr. Fanous) he has continued to display some lack of interest in complying with his professional obligations. Two examples suffice in support of this conclusion: 1. On 1 August 2018 the Tribunal made directions for the solicitor to provide a Reply on or before 23 August 2018. The Reply was not provided until at least 4 September 2018. The same directions provided for the solicitor to provide evidence to the Law Society before 24 August 2018. The solicitor provided an affidavit dated 12 December 2018 (Exhibit 1) at or shortly prior to the hearing in December 2018; and 2. The solicitor sought an adjournment at the December 2018 hearing and directions were made for the provision of the evidence which the solicitor foreshadowed. The evidence was not supplied within the timetable contained in the directions, but instead, Exhibit 2 was provided on or about 26 February 2019.
4. We are not dismissive of the fact that the solicitor may have had difficulties by reason of personal and family issues in complying with the Notice fully and in a timely way, but we are not persuaded on the basis of the evidence before us that those pressures provide an adequate explanation or an excuse for non-compliance. The documents said to explain his conduct are lacking in detail and provide no evidence other than in the most general terms of personal difficulties. The delay in achieving full compliance was approximately six months. This delay is, in our opinion, inexcusable given the Law Society's statutory responsibilities and the explanations offered are inadequate.
5. We are of the opinion that the solicitor's conduct constitutes professional misconduct rather than unsatisfactory professional conduct for the following reasons: 1. The conduct falls outside generally accepted standards of common decency and common fairness in that the delay impeded or potentially impeded the Law Society's investigation. The delay was extensive and neglectful. The conduct fits within the broad description referred to in the Bechara case. It is also sufficiently significant to justify the description as disgraceful or dishonourable as referred to in the Allinson case; 2. The conduct of the solicitor fits within the description contained in s 298 of the Uniform Law, because the solicitor contravened s 371. Section 298(a) states that the following conduct is capable of consisting unsatisfactory professional conduct or professional misconduct: "(a) Conduct consisting of a contravention of this law, whether or not - (1) the contravention is an offence or punishable by way of pecuniary penalty order"
6. We also rely upon s 466(6) of the Uniform Law which, as the Law Society's submissions state, provides that a failure by an Australian lawyer to comply with the requirements of the various notices referred to in the section (including a section 371 notice) is capable of constituting unsatisfactory professional conduct or professional misconduct.
7. The solicitor submitted that his conduct should be categorised as unsatisfactory professional conduct. Section 296 of the Uniform Law provides: 296 Unsatisfactory professional conduct For the purposes of this Law, unsatisfactory professional conduct includes conduct of a lawyer occurring in connection with the practice of law that falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent lawyer.
8. When one compares s 296 (concerning unsatisfactory professional conduct) with s 297 (concerning professional misconduct) it can be seen that unsatisfactory professional conduct includes conduct which falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent solicitor, whereas s 297 includes conduct involving a substantial or consistent failure to reach or maintain a reasonable standard of competence and diligence. In our view, the solicitor's conduct in this case was substantial and consistent in the sense that it continued for approximately six months notwithstanding reminders from the Law Society. As we have stated above, the terms of the Notice were not onerous and the solicitor was less than forthcoming in his explanation for the lengthy period of non-compliance, which was inadequate.
9. In all of the circumstances, we agree with the Law Society that a finding of professional misconduct is appropriate and we make that finding. Accordingly, we are able to make one of the orders contemplated by s 299 of the Uniform Law. Section 299(1)(b) permits the Tribunal to make an order reprimanding a legal practitioner and s 299(1)(f) enables the Tribunal to order that the legal practitioner pay a fine.
10. We are in agreement with the Law Society that the appropriate remedy in this case is the issue of a reprimand. This is not a case where a more severe order should be thought appropriate.
11. We are also of the opinion that it would be appropriate to impose a fine upon the solicitor. In coming to this conclusion, we are mindful of the judgment of Beazley JA in Law Society of New South Wales v Walsh [1997] NSWCA 185 where her Honour said at page 40: "it is relevant to take into account the effect the order will have upon the understanding in the profession and amongst the public of the standard of behaviour required of solicitors. In this sense, any penalty imposed should contain an element of general deterrence". The fine is not imposed for punitive reasons, but rather for the purpose indicated by her Honour, namely to act as an element of general deterrence.
12. The solicitor gave brief evidence as to his financial impecuniosity and there was no objection to such evidence from the Law Society. For the purposes of considering the level of the fine, we are content to assume that the solicitor would have grave difficulty in paying a significant amount. Whilst we wish to impose the fine for the purposes indicated by Beazley JA, we also do not wish to impose an unreasonable burden upon the solicitor. Accordingly, we believe a fine of $1,000.00 to be appropriate.
13. The Law Society sought costs and the solicitor did not oppose such an order. Indeed, the Tribunal must order costs unless exceptional circumstances exist - see s 303 of the Uniform Law. No such circumstances were put to us.

Orders

1. The Tribunal makes the following orders: 1. The solicitor is reprimanded; 2. The solicitor is to pay a fine of $1,000.00 within three months of the date of these orders; and 3. The solicitor is to pay the costs of the Law Society as agreed or as assessed.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 19 March 2019