King v Queensland Law Society Incorporated [2012] QCAT 489

[1] Ms King has, until recently, practiced as a solicitor. The Law Society has refused to renew her practicing certificate for the 2012-2013 year.

[2] Ms King has applied to QCAT to have that refusal reviewed. She has also sought an order that, until the review is determined, the Society's decision is stayed. In effect she is seeking an order that would allow her to continue in practice for the time being.

[3] She was first admitted to practice in New South Wales in 1986. She was admitted in Queensland in 2001, she has conducted her own law practice since 2002 and she been annually granted what the Legal Profession Act 2007 ('LPA') calls a Local Practicing Certificate ('LPC') until August this year.

[4] She practices from her home in Southport, almost solely in the area of family law. She is a widow, with two young children. Her late husband, a real estate principal and property developer died in 2005 as the result, she believes, of medical negligence. She is prosecuting an action arising out of his death.

[5] In April 2008, in circumstances which are not clear, accountants and a lawyer employed by the Society were appointed to supervise trust monies received by her law practice, and that supervision continues. She consented to that appointment and since that time has rarely used her trust account and there have been no adverse reports from the supervisors.

[6] In October 2010 the Legal Services Commissioner brought disciplinary proceedings against her. Six charges proceeded to a hearing before Fryberg J (sitting with panel members) between 18 and 20 October 2011. The Tribunal's decision has not yet been delivered. The charges involved the allegedly unlawful transfer of $87,000.00 from Ms King's trust to her general account for costs and outlays in a matrimonial matter; failure to provide an itemised account for those costs; allegations of associated misconduct about those costs; failures to respond to a written notice from the Commissioner; and, also, the alleged breach of an undertaking to counsel to pay fees.

[7] In May 2011 Ms King was made bankrupt. A second bankruptcy order was made in December 2011, on the application of a different petitioner.

[8] Ms King is also the subject to what is called an 'unresolved' matter involving alleged breaches of the bankruptcy legislation. The Society has recommended to the Legal Services Commission that these matters ought be the subject of the further disciplinary proceedings.

[9] In deciding whether or not to renew Ms King's LPC the Society had to consider whether or not she is a fit and proper person and, for that purpose, to take into account what the LPA calls 'suitability matters'[1]. Under s 9 of the LPA those matters include whether the practitioner is insolvent; whether a supervisor has been appointed to the practitioner's legal practice; and, whether the practitioner is currently subject to any unresolved investigations or charges.[2]

[10] The Society's decision is what the QCAT Act[3] calls a 'reviewable decision' - meaning that the Tribunal may review it, by way of a fresh hearing on the merits, to produce the correct and preferable decision.[4]

[11] Under s 22(3) of the Queensland Civil and Administrative Tribunal Act 2009 ('QCAT Act') the Tribunal may make an order staying the operation of a reviewable decision but only if it considers the order is desirable having regard to the interests of any person whose interests may be affected by making of the order; any submissions made to the Tribunal by the decision makers; and, the public interest[5].

[12] As the Honourable James Thomas AM QC has observed in this Tribunal, s 22(4) of the QCAT Act spells out three particular factors the Tribunal must consider before granting a stay but, in doing so, does not exclude the application of standard principles, procedures and tests to be applied in applications for stays.[6] The matters to be considered under those tests will include the applicant's prospects of success in the review proceedings, the effect of any stay on them, and whether irremediable harm might be suffered by the applicant if a stay is not granted.[7]

[13] It has also been said, in the context of review proceedings of this kind, that the tests will also include whether a stay order is desirable and appropriate to secure the effectiveness of the review hearing, having regard to the interests of any persons who may be affected by it. The Administrative Appeals Tribunal Act 1975 uses the word 'desirable' in s 41(2) in a context said to require a 'positive aspiration', and requires that the public interest be weighed against the personal interest of the applicant.[8]

[14] The Queensland Court of Appeal has observed that, in cases involving lawyers and their right to practice, the factors that would justify a stay must be such as to outweigh the public interest which is to be afforded 'particular significance'[9]. The Court also observed that an applicant must show a cogent reason for a stay, and cannot do so merely by showing that she would be unable to practice until (in this instance) her appeal is heard.[10]

[15] Ms King's application must also be considered within the statutory context of the LPA, the objects of which are to provide for the regulation of legal practice in Queensland in the interests of the administration of justice, and for the protection of consumers of the services of the legal profession and the public generally.[11]

[16] The submissions of the parties focus upon, and the central issues in this case are, the interests of Ms King and her clients, balanced against the public interest.

[17] Ms King must support herself and her children. Her practice employs two staff and in the last twelve months had a gross turnover of $450,000.00 and a net profit of approximately $200,000.00. She has a practice consisting of approximately sixty substantial ongoing matters. She says that if a stay is not granted the effect upon her clients and other third parties would be substantial, and irreversible.

[18] In particular she has three matters due to go to trial in the next three months all them involving complex issues, and clients who have received or are receiving psychiatric treatment. She has acted in all three matters for at least eighteen months and says each client is a vulnerable woman who has suffered substantial abuse and that two of the matters involve children, and allegations of abuse.

[19] If she cannot represent these parties, she says, these trials would have to be adjourned, for a long time; evidence including valuations and reports would become stale, adding to costs; children associated with the litigation would be substantially affected; and, her clients would suffer the cost and inconvenience of having to engage other lawyers.

[20] It is also said that each bankruptcy order is contestable and that she is working, through her current solicitors, to have them set aside. She contested the disciplinary charges and, it is submitted, the delay in the decision concerning them is indicative of the difficulty facing the learned Judge who heard them and has now reserved his decision for almost one year. While the supervision of her trust account continues, her use of it has not been criticised and she has offered an undertaking not to use it.

[21] In all of these circumstances, it is submitted, the balance of convenience - ie, the exercise of weighing her client's interests, and her own, against the public interest - tells in her favour.

[22] The importance, and weight, to be attached to the public interest (emphasised in Baker[12] and the decisions referred to by Chesterman J (as he then was) in his judgment in that case) place a considerable onus upon an applicant to establish cogent and persuasive reasons which will overcome its obvious importance.

[23] That is not to say, however, that doing so is impossible. In Legal Services Commissioner v Madden [2008] QCA 52 the practitioner appealed from a decision of a Legal Practice Tribunal removing his name from the roll and, pending his appeal, sought a stay from Fraser JA who was persuaded that the solicitor's appeal was, at least, arguable; and, that the practitioner's own circumstances (he was the sole practitioner in a small country town) meant that particular prejudice to him, and to his many elderly clients in the town, would be very substantial - more so, his Honour said, that in other similar cases. Ultimately, the solicitor was granted a stay on condition that he not undertake legal work and step aside from the day to day conduct of his practice, and allow his staff to continue to operate the practice under the supervision of another solicitor. All of the practitioner's clients would be advised of these restrictions.

[24] The imposition of these conditions was, in the view of Fraser JA, sufficiently effective to mitigate damage to the integrity of the disciplinary processes and outweigh the strong public interest opposed to a stay.

[25] Ms King's circumstances are markedly different. Accepting that she is an experienced practitioner and that her views about the potential prejudice to her clients are to be afforded appropriate respect, her concerns must be balanced against the public interest in circumstances that are not unique - in particular, where she practices in a region with a large number of other lawyers who, if might reasonably be expected, could take her files over with reasonable expedition. Her circumstances are no different from those of any practitioner in a large urban area, well served by her fellow professionals.

[26] Her claims of prejudice, in light of those circumstances, are to be weighed against the public interest and the prospect that public confidence might be undermined if a bankrupt practitioner, whose right to practice is also the subject of current disciplinary proceedings, is nevertheless permitted to continue.

[27] Like the courts, the Tribunal:

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Judgment (32 paragraphs)

King v Queensland Law Society Incorporated [2012] QCAT 489 (28 September 2012)

Parties

Legislation Cited (3)