88 All of the other services to be provided by Mr Carr under the JVA are within the scope of services customarily provided by solicitors who advise clients on investments generally and select and manage those investments for the clients: Dooby v Watson (supra); Clauses 2(B), 4.
89 In the JVA Mr Carr expressly proffers his services "as solicitor" and thereby, at the very least, acknowledges that his professional capacity is material to his engagement: see the references to "Solicitor" in Clauses 2(A), 2(B), 4, 7 and 8.
90 All of the above factors point strongly to the conclusion that Mr Carr was engaged to perform the services required of him under the JVA in his capacity as a solicitor.
91 I now turn to Mr Pritchard's submissions that I should hold that Mr Carr did not act as a solicitor for the purposes of the Policy.
92 Mr Pritchard says that Mr Carr's actions, considered as a whole, were those of a entrepreneur not a solicitor: what Mr Carr did in organising investors to contribute pooled funds, in finding an investment, and in transferring funds into that investment could have been done by someone who was not a lawyer.
93 The point, however, is that Mr Carr contracted with Mr Swart that in doing what he was required to do under the JVA he would act "as Solicitor" for Mr Swart. Mr Pritchard says that "Solicitor" is merely a definition which refers to Mr Carr. That construction could work in some clauses but not in the critical clauses. Substituting "Mr Carr" for "Solicitor" in Clause 2(A) makes no sense: how can Mr Carr promise to act "as Mr Carr to the parties". Similarly, how can one sensibly read Clause 2(B) as meaning "the function of [Mr Carr] as such Mr Carr shall be to ..."? In truth, the only definition in the JVA which refers to, and is interchangeable with, Mr Carr is "Managing Partner", as Mr Carr is described at the very commencement of the JVA. Making the necessary substitution, it makes perfect sense to read Clause 2(A) as "Mr Carr shall act as solicitor to the parties ..." and to read Clause 2(B) as "the function of Mr Carr as such solicitor shall be ...".
94 Further, in promising in Clause 2(B) that he would act "as such Solicitor", Mr Carr undertook duties such as are designed to safeguard Mr Swart's interests in a manner consistent with the prudence which a solicitor would advise a client to adopt. Mr Carr did not simply organise the investment and leave it to Mr Swart to get his own legal advice as to how the investment could be prudently administered and supervised, as an entrepreneur might have done.
95 The statement in Clause 7 of the JVA that "the Solicitor" is acting only in a "custodial and account providing capacity" cannot stand alone and out of context. The very next sentence in the clause refers to Mr Carr's "responsibilities as set out herein" and the responsibilities specified in Clause 2 go far beyond mere custodial duties.
96 Mr Pritchard says that the JVA was a "one-off transaction" and, therefore, not part of Mr Carr's continuous stream of activity, so that it could not be part of "the business of practising as a solicitor".
97 I do not think that this circumstance, if true, is to the point. One might just as well say that the first conveyance undertaken by a neophyte solicitor is not within the cover of the Policy because the solicitor has not already established his or her business as a conveyancer.
98 "The Practice" is defined in the Policy not as "the insured's practice as a solicitor" so that one identifies the scope of cover by examining the types of professional matters actually conducted by the assured in the course of his or her practice at any particular time. The definition is generic. The words "the business of practising as a solicitor" mean "the type of practice carried on by a solicitor as a business", so that indemnity is given in respect of a claim incurred in connection with a practice carried on as a business by an assured which is a practice of the type carried on by a solicitor.
99 As I have held, the finding and implementing of investments is within the type of practice carried on by solicitors. Mr Carr carried on his practice as a solicitor as a business. It does not matter whether, in the course of Mr Carr's particular practice he had previously, on behalf of clients, selected and implemented investments generally or this type of investment in particular.
100 If Mr Carr incurred his liability to Mr Swart in connection with his practice as a solicitor, the exclusion provided in Clause 5(b)(vii) of the Policy cannot apply since it is clear that Mr Carr conducted his practice as a solicitor at Sutherland in Sydney.
101 I will now deal with the points made by Mr Pritchard and set out in paragraph 65 to the extent that those points have not already been discussed.
102 It is of no consequence whether Mr Carr correctly understood the implications of the JVA which he had drafted or regarded himself as acting as solicitor for Mr Swart, if indeed he gave any thought to that matter until a claim against him had been made. The point is that the capacity in which Mr Carr dealt with Mr Swart was spelt out in the contract between them.
103 Mr Pritchard lays heavy emphasis on the fact that Mr Carr was himself an investor in the scheme. He says that this fact indicates that Mr Carr was acting in the capacity of entrepreneur. However, the JVA does not refer to Mr Carr as an investor at all and Mr Swart says that he was not aware at the time that he entered into the JVA that Mr Carr was himself going to be an investor. In any event, whether or not Mr Carr was also an investor does not detract from the terms upon which he engaged to provide services for Mr Swart in the JVA.
104 It is of no consequence that Mr Carr did not issue a fee disclosure and fee agreement to Mr Swart, or open a controlled money account as required under the Legal Profession Regulation, or open a client file or keep file notes or have conferences with Mr Swart in his office, or issue a memorandum of fees at any particular time. If Mr Carr contracted to provide services as a solicitor it was a matter for him as to how he provided those services. It was a matter for him as to whether, in providing those services, he complied with the requirements of the Legal Profession Regulation and with good solicitors' practice. If he did neither, he could be guilty of professional misconduct and of professional negligence, but that circumstance would not mean that the capacity in which he had engaged was changed from a professional capacity to a non-professional capacity.
105 It is of no consequence that the transaction of the investment under the JVA was to be carried out outside Australia and with the assistance of English solicitors. Solicitors in Australia frequently advise on and effect transactions outside Australia with the assistance of foreign lawyers.
106 Clause 8 of the JVA does not indicate that Mr Carr is not to do the work of a solicitor. All that it says is that Mr Carr is entitled to deduct from funds under his control an agreed fee "representing his reasonable time charges to date" in performing his duties under the JVA. If anything, that provision supports the conclusion that Mr Carr was being remunerated for services as a solicitor under the JVA and for his time and efforts as such rather than being given a share of profits as an entrepreneur or investor.
107 Clause 11 does not exclude the relationship of solicitor and client between Mr Carr and Mr Swart. Clearly, the clause is intended to remove the investment scheme from classification as an offer to the public for the purpose of the prospectus requirements of whichever regime regulating corporations might be applicable. Further, the words "a private business transaction" are not inapt to describe the relationship between a solicitor and a client, particularly when the solicitor is investing the client's money on the client's behalf.
108 Clause 20, which provides that the proper law of the JVA is that of England and Wales, governs only the construction and enforcement of the JVA. It does not specify where the contract is to be performed: it does not prevent Mr Carr from performing the services required of him under the JVA in New South Wales in his capacity as a solicitor carrying on practice here.
109 For these reasons, I conclude that: