Legal Services Commissioner v Spaulding

On 3 May 2007, the Commissioner received a complaint from a client or former client of Mr. Spaulding. The nature of the complaint is not relevant to the charge, but in general terms the complaint was that Mr. Spaulding had not properly handled an application to VCAT.
The Commissioner treated the complaint as including a disciplinary complaint, which she was obliged to investigate: s.4.4.7(1) Legal Profession Act 2004. As part of her investigation, the Commissioner had power to require Mr. Spaulding to provide a full written explanation of his conduct in relation to the subject matter of the complaint: s.4.4.11(1)(a).
The Commissioner wrote to Mr. Spaulding on 19 July 2007, 27 August 2007 and 17 September 2007 making formal requests under s.4.4.11(1)(a) that Mr. Spaulding provide a written explanation of his conduct within 16 days. The first letter enclosed a copy of the complaint.
Mr. Spaulding did not provide a written explanation of his conduct until yesterday, 30 January 2008.

I find that Mr. Spaulding contravened s.4.4.11(1)(a) of the Legal Profession Act 2004 by failing to provide to the Legal Services Commissioner a full written explanation of his conduct when required to do so.
Mr. Spaulding accepted that the contravention amounted to unsatisfactory professional conduct, but submitted that the contravention did not amount to professional misconduct.
A contravention of the Act is capable of constituting unsatisfactory professional conduct or professional misconduct: s.4.4.4. Mr. Spaulding made a submission based upon the various meanings of the words "misconduct" and "satisfactory" in Webster's Dictionary. The word "misconduct", as it applies to professional persons, has been the subject matter of many statutory definitions. A definition of misconduct at common law has been applied consistently both in England and Australia for more than 100 years. These definitions have been considered in thousands of cases involving professional persons, and I prefer to take account of cases of that kind, rather than definitions in a dictionary, that is not a legal dictionary, in deciding whether the conduct of Mr. Spaulding amounted to professional misconduct.
Until the commencement of the Legal Profession Act 2004 on 12 December 2005, the statutory distinction between misconduct and lesser disciplinary offences in Victoria was that statutory misconduct needed to be "wilful or reckless" and lesser offences did not need to be "wilful or reckless": see the respective definitions of "misconduct" and "unsatisfactory conduct" in s.137 of the Legal Practice Act 1996. That most helpful distinction was not retained in the 2004 Act, which applies to this case, but if it were necessary for me to do so I would find that Mr. Spaulding was at least reckless in failing to respond for several months to the three letters written to him by the Commissioner.
Mr. Spaulding also sought to rely upon ss.4.4.2 & 4.4.3(1)(a) of the 2004 Act. Section 4.4.2 is a general definition of "unsatisfactory professional conduct". Section 4.4.3(1)(a) then provides that unsatisfactory professional conduct will amount to professional misconduct if the conduct "involves a substantial or consistent failure to reach or maintain a reasonable standard or competence and diligence". Mr. Spaulding maintained that his conduct did not amount to a substantial or consistent failure to maintain a reasonable standard. These sections are of little assistance to me. They deal with unsatisfactory professional conduct, which might become professional misconduct, whereas Mr. Spaulding is charged with professional misconduct. In any case, s.4.4.3(1)(a) is not an exhaustive definition of professional misconduct.
Whether conduct of the kind described in s.4.4.4, which I have found to exist in the present case, amounts to professional misconduct or unsatisfactory professional conduct depends upon the seriousness of the conduct. The seriousness of the conduct will depend in turn upon all relevant factors brought to the attention of the Tribunal, and to the manner in which similar factors have been treated in previous cases.
The factors relied upon by Mr. Spaulding in his submission that there was no contravention of the Act also are relevant to his submission that the contravention amounted to unsatisfactory professional conduct rather than professional misconduct. I accept the evidence of Mr. Spaulding that he endured pressures in his practice and problems of a personal nature, although matters of that kind are endured by almost every legal practitioner from time to time, and are present in almost every case where a practitioner is charged with a disciplinary offence. I also accept Mr. Spaulding's evidence that he found it necessary to devote a great deal of time to his soil excavation business and his house construction business, although those obligations were self imposed in the knowledge that he also needed time to conduct a legal practice.
The other factor of primary importance is the failure to comply with the request made by the Commissioner, not just for the 16 days that she allowed but for six months. The factors relied upon by Mr. Spaulding might justify a short delay in complying with the request, but they do not justify a delay of anything like six months.
Mr. Spaulding referred me to the decisions of Member Butcher in Legal Services Commissioner v Nixon [2007] VCAT 1695 and Legal Services Commissioner v Morgan [2007] VCAT 2117. In both cases, Member Butcher found a contravention of s.4.4.11(1)(a) to amount to unsatisfactory professional conduct rather than professional misconduct. In Nixon, it was found that the practitioner suffered from a "psychological block", leading on occasions to an inability to perform the simplest of tasks required in legal practice. In Morgan, the practitioner had been diagnosed as suffering from depression, and the Tribunal accepted the diagnosis. To his credit, Mr. Spaulding informed me that he did not seek to rely upon any psychological problem of that kind. I distinguish the cases of Nixon and Morgan on that basis. I do not say that the existence of a psychological problem of some kind will automatically lead to a contravention of the Act being found to be unsatisfactory professional conduct rather than professional misconduct.
A person who lodges a complaint about a practitioner is entitled to a prompt response. The Commissioner is unlikely to have knowledge of the subject matter of the complaint, other than the information set out in the complaint. The Act therefore empowers the Commissioner to seek an explanation from the practitioner. This power has been entrusted to the Commissioner and her predecessors for many years, and almost all practitioners are well aware of its existence.
Furthermore it would be unfair, and a denial of procedural fairness, if the Commissioner took action against a practitioner without giving the practitioner an opportunity to explain. A failure to explain promptly hinders the investigation carried out by the Commissioner and, in turn, causes delay in dealing with the complaint. The failure to respond for six months in this case, even after taking account of the factors relied upon by Mr. Spaulding, is such a serious contravention of the Act that I find it to amount to professional misconduct.

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Judgment (11 paragraphs)

Legal Services Commissioner v Spaulding (Legal Practice) [2008] VCAT 318 (31 January 2008)

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