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[2015] VSC 772
General information, not legal advice.
Supreme Court of Victoria
2015-12-24
RIORDAN J
Original judgment source is linked above.
PRACTICE AND PROCEDURE - Application for summary dismissal pursuant to Supreme Court (General Civil Procedure) Rules 2015 and s 63 of the Civil Procedure Act 2010 - Relief seeking merits review beyond Court's jurisdiction - Relief sought in the nature of certiorari hopeless - Relief seeking a declaration under Charter of Human Rights and Responsibilities Act 2006 beyond Court's jurisdiction - Plaintiff's draft amended originating motion vexatious and embarrassing.
1 By originating motion filed on 15 June 2015, the plaintiff seeks the following relief against the first defendant, the Legal Services Commissioner, and the second defendant, Mr Russell Daily, Executive Director of Complaints and Investigations of the first defendant.
a. s l.l.l(a)
b. s 2.3.l(a)
c. s 2.7.l(a), (b)
d. s 3.2.l(b)
e. s 3.3.l(a), (b)
f. s 3.4.l(a), (b), (c), (d)
g. s 4.4.l(a), (b), (c)
h. s 4.4.7
l. s 4.4.11
j. s 4.4.12
k. s 4.4.13(2)
1. s 5.5.l (a), (b)
m. s 6.2.3(a), (b), (c)
n. s 6.3.2(a), (b), (c).
2 By summons dated 24 July 2015, the defendants sought orders that the proceeding by stayed or dismissed pursuant to r 23.01(1) of the Supreme Court (General Civil Procedure) Rules 2005 and/or s 63 of the Civil Procedure Act 2010. Alternatively, an order that the endorsement on the originating motion filed 15 June 2015 be struck out pursuant to r 23.02 of the Supreme Court (General Civil Procedure) Rules 2005.
5. The proceeding be listed for mention on 25 September 2015 at 9.30 am.
4 On 25 September 2015, the matter was brought on for a mention before me and I was informed that the plaintiff had not filed or served an amended originating motion in accordance with the order of 29 July 2015. The plaintiff attended by telephone link and the Court provided the defendant with a copy of a draft amended originating motion which had been emailed to my Associate by the plaintiff on 24 September 2015. Counsel for the defendants explained that the plaintiff may have similarly emailed it to them but the plaintiff's emails had been blocked from the server and that the plaintiff had been informed that 'he could no longer send emails to the Legal Services Commissioner's office because of the vast volume of irrelevant material he was sending through'. The defendants objected to the plaintiff having leave to file the proposed amended originating motion out of time and, accordingly, orders were made as follows:
5 At the hearing, the plaintiff was informed that he would need to properly serve the defendants with a copy of the proposed amended originating motion and any material on which he intended to rely with respect to his application for leave to serve the amended originating motion out of time.
6 On 11 November 2015, the hearing of the applications originally scheduled for 8 December 2015 was adjourned at the defendants' request to 11 December 2015; and the plaintiff acknowledged receipt of the communication of the adjourned date on 10 December 2015.
7 The plaintiff did not appear on the adjourned date to apply for leave to extend the time for the filing and serving of the proposed amended originating motion and to defend the defendants' application for summary dismissal.
8 On behalf of the defendants, it was submitted that the originating motion should be dismissed for the following reasons:
(a) An order consolidating this proceeding with proceeding S CI 2014 02728 Andrew Garrett v The Legal Services Commissioner would be inappropriate because that proceeding was dismissed by Derham AsJ on 4 September 2015 and no appeal against that order has been filed.
(b) The second order sought by the plaintiff is for relief in the nature of certiorari and a merits review of the 'decisions' of the defendants in letters dated 30 April 2015 and 22 May 2015. It is not within the jurisdiction of this Court to undertake a merits review of the defendants' decisions.
(c) Relief in the nature of certiorari with respect to the 'decisions' of the defendants in letters dated 30 April 2015 and 22 May 2015 was not available for the reasons set out below.
(d) The application under the Charter of Human Rights and Responsibilities Act 2006 ('the Charter') was misconceived and bound to fail for the reasons set out below.
Defendants' submissions - Relief in the nature of Certiorari
9 The letter of the defendants to the plaintiff dated 30 April 2015 stated as follows:
Complaint about Mr Frank Cahill and Mr Peter Hambros - Notice of decision
Our ref: COM-2014-0818 & COM-2016-0167
I refer to the above matters and can now notify you of my decision.
Decision - the $5,000 payment 19 December 2011
In relation to the $5,000 payment on 19 December 2011, I am satisfied that there is a reasonable likelihood that the Victorian Civil and Administrative Tribunal ("VCAT") would both find Mr Cahill and Mr Hambros guilty of unsatisfactory professional conduct. As soon as practicable after receiving trust money, legal practitioners are required to deposit the money in a trust account and to hold it in trust for the person on whose behalf it is received.
The failure to deal with trust money can often amount to professional misconduct. In this case I note that the money has not been lost or not later accounted for, as it was used in part payment of the bill dated 16 January 2012. Given this, and the short period of time that it was not dealt with properly, I am not satisfied that VCAT would find either practitioner guilty of professional misconduct.
Where I am satisfied that there is a reasonable likelihood that VCAT would find a practitioner guilty of unsatisfactory professional conduct, section 4.4.13(3)(b) of the Legal Profession Act 2004 (the Act) provides that I may, with the consent of a practitioner, reprimand or caution that practitioner.
Mr Hambros
Mr Hambros has consented to this course of action. By accepting this reprimand, he acknowledges his conduct fell short of the standards expected of the profession and that he will ensure that such conduct does not occur again. A disciplinary outcome is recorded against his name for future reference.
Mr Cahill
Mr Cahill has not accepted that he has breached any obligation of the Act and accordingly declined to accept a caution or reprimand.
Under section 4.4.13(3)(a) of the Act I have decided to apply to VCAT to have orders made regarding Mr Cahill. This is done under Division 4 of the Act. VCAT will schedule my application for hearing. You will be notified of a hearing date in the future, and you may be required to give evidence at that time. Further information about this is outlined below.
Decision - other matters
In relation to the other parts of your complaint, I am satisfied that there is no reasonable likelihood that VCAT would find either Mr Cahill or Mr Hambros guilty of professional misconduct or unsatisfactory professional conduct, and therefore I must take no further action against either.
My Powers
The central question that I must consider when deciding what disciplinary action I may take is:
Is there a reasonable likelihood that VCAT would find the legal practitioner guilty of professional misconduct or unsatisfactory professional conduct?
This question requires me to consider whether the available evidence is likely to satisfy VCAT that on the "balance of probabilities" (civil standard) the practitioner is guilty of a disciplinary breach. While the standard of proof is the civil standard, the more serious the allegation against the practitioner, the more compelling must be the evidence before VCAT finds that an allegation is established.
Where I am satisfied that there is a reasonable likelihood that VCAT would find the practitioner guilty of unsatisfactory professional conduct, the Act provides that I may apply to VCAT for an Order in respect of the practitioner. Other options are also available to me should the practitioner consent.
Where I am satisfied that there is no reasonable likelihood that VCAT would find the practitioner guilty of professional misconduct or unsatisfactory professional conduct, the Act provides that I must take no further action against the practitioner.
Investigation and reasons for decision
As you were advised on several occasions, the investigation under this complaint number was not a re-investigation of matters examined under complaint number COM-2012-1941. This investigation was limited to a potential error in COM-2012-1941 relating to the payment of $5,000 made on 19 December 2011, together with the matters set out in our letter to you dated 16 June 2014, referred to below.
The $5,000 payment made on 19 December 2011
In relation to the $5,000 payment, I advise my findings are:
Accordingly it is the view of this office the $5,000 is trust money pursuant to part 3.3 of the Act.
Following a meeting on 2 May 2014 with you, Robert Nowak, Christine Bell and Maggie McNamara and a further meeting on 5 June 2014 with Robert Nowak, Ms McNamara and Greg Trewin, you raised three additional matters you sought to be investigated. You stated that:
1. HC Legal Pty Ltd, HC Legals Pty Ltd and Dynamic Legal Pty Ltd were trading whilst insolvent. You were advised that this office was not the appropriate organisation to conduct an audit to make such a determination and the appropriate forum for that complaint was the Australian Securities and Investment Commission (ASIC). You were advised that if any information was provided by ASIC to support your complaint, the matter could then be looked into. Mr Trewin contacted Greg Hackett and was informed ASIC would not comment directly on investigations or matters raised by the liquidator. Mr Hackett recommended you lodge a formal complaint to them if you had concerns. This was conveyed to you in a letter from this office on 14 August 2014.
Without information from ASIC showing wrong doing, this office cannot take the matter further and no disciplinary findings can be made.
2. The second issue you raised at this meeting was the lack of documentation in relation to a $20,000 payment. As you were advised in the letter dated 16 June 2014, that money was accounted for by HC Legal Pty Ltd, even though you believe that the recipient was HC Legals Pty Ltd.
As you were advised, it is not improper for a practitioner to have a client pay money into a different account, be it an account of an associated entity or other entity provided that the money is not trust money. This $20,000 was not trust money because it was remitted after the giving of a bill.
3. You have asserted that Mr Hambros and Mr Cahill were involved in an alleged fraudulent attempt to secure $7.5 million in the form of a GST credits [sic]. You have pointed to the comments made by Burchardt J on 19 January 2015 say [sic] the scheme "was consistent with an elaborate scam". Again you were advised this office is not the appropriate organisation to conduct such an investigation. The ATO is the appropriate body and as you are aware they had commenced an investigation. They were contacted by this office but were not prepared to provide any information in regards to the investigation, citing privacy reasons. Again you were advised of this in letters dated 16 June 2014 and 14 August 2014 and in various telephone conversations with officers of this office.
Without information from the ATO, this office cannot take the matter further and no disciplinary findings can be made.
Conclusion
As mentioned above my office will contact you when VCAT notify us of a hearing date if you are required to give evidence. If you have any queries about VCAT's processes or require any further information, you can check VCAT's website www.vcat.vic.gov.au or call on 9679 8001.
10 The decisions referred to in the letter of 30 April 2015 in summary are:
(a) findings that the Legal Services Commissioner was satisfied that there was a reasonable likelihood that the Victorian Civil and Administrative Tribunal ('VCAT') would find Mr Cahill and Mr Hambros guilty of unsatisfactory professional conduct;
(b) to reprimand Mr Hambros on his consent to accepting a reprimand;
(c) in the absence of Mr Cahill's consent, to apply to VCAT to have orders made against Mr Cahill; and
(d) the Legal Services Commissioner was not satisfied that there was a reasonable likelihood that VCAT would find either Mr Cahill or Mr Hambros guilty of professional misconduct or unsatisfactory professional conduct with respect to 'the other parts of your complaint' and therefore no further action would be taken.
11 No jurisdictional error or error on the face of the record is apparent from the indorsement on the originating motion or reading the letter of 30 April 2015.
12 The originating motion was supported by an affidavit of Andrew Morton Garrett sworn 25 May 2015. Paragraphs 20 to 22 are relevant and read as follows:
13 The letter dated 7 May 2015 exhibited as 'AMG5' to the affidavit is an 18 page letter in which the plaintiff invites the defendants 'to immediately review the materials in your possession and control with a view to reconsidering your decision'. The content of the letter relates to a merits review.
14 It was submitted that nothing in the affidavit in support of the plaintiff's letter of 7 May 2015 indicated grounds for relief in the nature of certiorari with respect to the decision of the defendants in the letter of 30 April 2015.
15 The letter of 22 May 2015 from the defendants to the plaintiff read as follows:
I refer to your letter dated 7 May 2015, in which you request a review of the decision reached in the following files COM-2014-0818 and COM-2015-0167.
You will now have my letter dated 19 May 2015.
Failure to find invoice was bogus
It is noted that you were previously advised by this office that disputing the quantum of the invoices is a costs dispute. Given legal fees were over $25,000, this office does not have jurisdiction to deal with the costs dispute, and accordingly you issued proceedings in VCAT to dispute the bills. You were advised this office could not investigate your complaint that the invoices were bogus unless VCAT had made comments or findings in that regard.
On 31 March 2014, a decision was made by this office in relation to COM-2012-1941 that was premised on the basis that the invoices were genuine. That decision is currently subject to judicial review, being Proceeding No SCI 2014-02728.
Notwithstanding this you place reliance on the email from Mr Cahill to you dated 15 February 2012. I note that the email states "it was only yesterday that our firm was placed into funds that will now allow us to vigorously pursue your matters". This email does not suggest that no work was done on your file prior to 15 February 2012. Rather, this email implies that work was done on your file prior to 15 February 2012, albeit not in a vigorous manner.
Failure to find wrongdoing in relation to the $4,500,00
Furthermore, you claim that this office has not investigated your claim that the $4,500,000 received from HC Legal Pty Ltd by the Australian Taxation Office ("ATO") as a GST credit was trust money, but was not treated as such by Mr Cahill and Mr Hambros.
The $4,500,000 does not fit the definition of trust money. The $4,500,000 was paid by the ATO to HC Legal Pty Ltd. Accordingly, it was not your money, and it is nonsensical and illogical to classify the money as trust money. Moreover, as previously advised, the ATO is the appropriate body to investigate issues associated with the GST credit.
Current Proceedings on foot
There are currently proceedings before the Supreme Court, being Proceeding No SCI 2014-02728.
Therefore, it would be entirely inappropriate, a waste of Court resources and a breach of your obligations under the Civil Procedure Act 2010 to ventilate the same issues in fresh court proceedings. In this respect, I note that in the case of Blair v Curran [1939] HCA 23; (1939) 62 CLR 464, the High Court held that "a judicial determination directly involving an issue of fact or of law disposes once for all of the issue, so that it cannot afterwards be raised between the same parties or their privies."
Any application made by you under Order 56 of the Supreme Court General Civil Procedure Rules 2005 will be defended by this office.
No Further Response
The matters you have raised in your letter dated 7 May 2015 are ones that we have responded to previously. As such I advise that until such time as the Supreme Court delivers its judgment on the proceedings you have brought, this office will not be responding any further to your correspondence about these issues. Any further such correspondence will simply be placed on your file and will not be responded to.
I confirm my previous advice that if you are not satisfied with the manner in which the Legal Services Commissioner has handled your complaint you may contact Ombudsman Victoria. In the event that you refer the matter to the Ombudsman I will of course co-operate with any enquiries that they wish to undertake.
16 The substance of the letter is a review of a number of previous findings and it is not apparent which of the statements in the letter constitute a decision or, in respect of which decision or statements relief is sought. In any event, a reading of the letter does not disclose any apparent error on the face of the record or jurisdictional error.
17 Paragraphs 25 and 26 of the plaintiff's affidavit in support relate to the defendants' letter of 22 May 2015 and read as follows:
18 The letter which is exhibit 'AMG8' referred to in paragraph 26 is a four page letter from the plaintiff dated 24 May 2015 in which he invites the defendants 'to review the decisions expressed in your letter dated 22nd May 2015'. The letter contains a number of contentions relevant to the merits of the content of the letter of 22 May 2015, or more accurately, the decisions that have been made prior to, and are referred to, in that letter.
19 It was submitted that nothing in the originating motion, the plaintiff's affidavit in support dated 25 May 2015 or the plaintiff's letter of 24 May 2015 indicates grounds for relief in the nature of certiorari with respect to the defendant's letter of 22 May 2015.
Defendants' submissions - Relief under the Charter
36 Declaration of inconsistent interpretation
(1) This section applies if -
(a) in a Supreme Court proceeding a question of law arises that relates to the application of this Charter or a question arises with respect to the interpretation of a statutory provision in accordance with this Charter;
...
(2) Subject to any relevant override declaration, if in a proceeding the Supreme Court is of the opinion that a statutory provision cannot be interpreted consistently with a human right, the Court may make a declaration to that effect in accordance with this section.
(3) If the Supreme Court is considering making a declaration of inconsistent interpretation, it must ensure that notice in the prescribed form of that fact is given to the Attorney-General and the Commission.
21 The relief sought by the plaintiff appears to be misconceived. The plaintiff seeks a declaration that the defendant has interpreted the purposes and objectives of the Legal Profession Act 2004 in a manner that is inconsistent with the Charter. This would require the Court to review the defendants' conduct to identify any inconsistencies with the human rights identified in Part 2 of the Charter. If that is what is intended, it misconceives the jurisdiction of the Court under s 36 of the Charter. Further, the relevant interpretations relied upon and the human rights affected are not identifiable by reference to the originating motion or the plaintiff's affidavit in support.
22 Accordingly, the defendants sought the relief set out in their summons.
23 I am mindful of the need to exercise caution prior to the termination of a proceeding under either r 23.01 of the Supreme Court (General Civil Procedure) Rules 2015 or s 63 of the Civil Procedure Act 2010.
24 In Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd,[1] Warren CJ and Nettle JA stated the relevant approach as follows:
(a) the test for summary judgment under s 63 of the Civil Procedure Act 2010 is whether the respondent to the application for summary judgment has a 'real' as opposed to a 'fanciful' chance of success;
(b) the test is to be applied by reference to its own language and without paraphrase or comparison with the 'hopeless' or 'bound to fail test' essayed in General Steel;
(c) it should be understood, however, that the test is to some degree a more liberal test than the 'hopeless' or 'bound to fail' test essayed in General Steel and, therefore, permits of the possibility that there might be cases, yet to be identified, in which it appears that, although the respondent's case is not hopeless or bound to fail, it does not have a real prospect of success;
(d) at the same time, it must be borne in mind that the power to terminate proceedings summarily should be exercised with caution and thus should not be exercised unless it is clear that there is no real question to be tried; and that is so regardless of whether the application for summary judgment is made on the basis that the pleadings fail to disclose a reasonable cause of action (and the defect cannot be cured by amendment) or on the basis that the action is frivolous or vexatious or an abuse of process or where the application is supported by evidence.
25 I accept each of the submissions of the defendants and consider that, for the reasons submitted by the defendants, the plaintiff's claims are either hopeless or for relief beyond jurisdiction. However, before determining the appropriate orders I have had regard to the content of the plaintiff's draft amended originating motion for the purpose of assessing whether the document threw light on the basis of the relief sought by the plaintiff or otherwise indicated that the termination of the proceeding might lead to an injustice. In my opinion, to the extent that the indorsement on the draft amended originating motion is comprehensible, it is embarrassing and vexatious.
26 Accordingly, I propose to dismiss this proceeding with costs.
[1] (2013) 42 VR 27, [35].
Garrett
Legal Services Commissioner [2015] VSC 772
(1939) 62 CLR 464
(2013) 42 VR 27