Legal Services Commissioner v Cass
[2023] QCAT 320
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- Unreported Judgment
- Legal Services Commissioner v Cass[2023] QCAT 320
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Legal Services Commissioner v Cass[2023] QCAT 320
Legal Services Commissioner v Cass[2023] QCAT 320
QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL
CITATION: | Legal Services Commissioner v Cass [2023] QCAT 320 |
PARTIES: | LEGAL SERVICES COMMISSIONER (applicant) v MURRAY LESTER CASS (respondent) |
APPLICATION NO/S: | OCR207-22 |
MATTER TYPE: | Occupational regulation matters |
DELIVERED ON: | 25 August 2023 |
HEARING DATE: | 21 July 2023 |
HEARD AT: | Brisbane |
DECISION OF: | Hon Peter Lyons KC, Judicial Member Assisted by: Mr Ross Perrett, Practitioner Panel Member Mr Keith Revell, Lay Panel Member |
ORDERS: |
|
CATCHWORDS: | PROFESSIONS AND TRADES – LAWYERS – COMPLAINTS AND DISCIPLINE – PROFESSIONAL MISCONDUCT AND UNSATISFACTORY PROFESSIONAL CONDUCT – OTHER MATTERS – where a married couple engaged the respondent to act in the purchase of a property – where a conflict subsequently arose between his clients as to whether they should hold title as joint tenants or tenants in common – where the respondent submitted the transfer for registration on at least three occasions with the form of holding contrary to the instructions of one of the clients – whether the respondent’s failure to follow his client’s instructions, recognise her ability to change instructions, or the conflict of duty, should be characterised as professional misconduct or unsatisfactory professional conduct – whether the conduct subject of the charge should be considered a single course of conduct or consistent conduct – whether it was relevant that the same outcome was likely to be achieved even if the instructions had been given effect – whether a reprimand was warranted Legal Profession Act 2007 (Qld), s 418, s 419, s 452 Law Society of NSW v Moulton [1981] 2 NSWLR 736, cited Legal Services Commissioner v Astley [2019] QCAT 274, considered Legal Services Commissioner v Devery [2017] QCAT 155, distinguished |
APPEARANCES & REPRESENTATION: | |
Applicant: | A Angeli, legal officer of the Legal Services Commission |
Respondent: | C DoRozario, solicitor of Potts Lawyers |
REASONS FOR DECISION
- [1]The respondent to this Discipline Application acted for Mr and Mrs Thompson in the purchase by them of a property located at 1/29 Nankeen Avenue, Paradise Point. A dispute arose between Mr and Mrs Thompson as to the way in which the title was to be held. Nevertheless the respondent continued to act. The questions which arise are the characterisation of the respondent’s conduct, and what orders should be made as a consequence.
Background
- [2]Mr and Mrs Thompson were long standing clients of the respondent. They engaged him to act in the purchase in April 2020.
- [3]The respondent provided some advice about the form of the contract in a letter dated 15 April 2020.[1] The contract was signed in the latter part of April 2020. The settlement occurred on 22 May 2020.[2] The seller was located overseas. That had the consequence that there were special requirements for the signing and witnessing of the transfer documents. On four occasions, the Department of Natural Resources, Mines and Energy (“DNRME”) issued requisitions in relation to this, relating to problems with the documents provided by the seller’s solicitor. There was thus a delay in the registration of the transfer in favour of Mr and Mrs Thompson.
- [4]Mr Thompson spoke with the respondent in the period following the settlement of the contract. He informed the respondent that he had received an unfavourable diagnosis of prostate cancer. He was having difficulty with Mrs Thompson’s granddaughter, because of issues relating to her behaviour. He told the respondent that he had only agreed to the purchase of the Nankeen Avenue property on the proviso that the granddaughter was no longer to live with himself and Mrs Thompson. He had told Mrs Thompson that the granddaughter could not move in with them at the new property, and she would have to go and live with her mother, or her other grandmother (both of them were located on the Gold Coast), or with her father who lived in the United Kingdom.
- [5]On 5 June 2020, Mrs Thompson sent an email to the respondent. It included the following:-
“On another note Steve is taking [sic] about the set up of tenants in common which we have never done before. This puts me in a very precarious situation and is not in my best interests as I can see it. If I agree to this I would like to have my family inheritance monies of $350,000 that I put into the last property separated into my name as that was a substantial amount of money. This is a horrible position for me to be put in.”
- [6]The respondent suggested a meeting at his office on 11 June 2020, which duly occurred.
- [7]Mrs Thompson (whose complaint has led to the Discipline Application) gave evidence in the applicant’s case. She gave a brief description of what occurred at this meeting, stating that she had asked why title registration had not been completed at settlement, being told that registration did not always happen at the same time as the settlement of the contract. She also said that at the end of the meeting, it was decided that the property was to be registered in the names of herself and her husband as joint tenants.
- [8]The respondent and Mr Thompson also gave evidence about this meeting. The respondent said that Mrs Thompson identified the reasons why she proposed the property be held by Mr Thompson and herself as joint tenants. That appears to have been so that if either of the parties died, that party’s interest would automatically pass to the survivor. At the meeting, Mr Thompson said that he wanted to hold his half interest in the Nankeen Avenue property as a tenant in common, so that he would be in a position to leave his interest to his children from a previous marriage.
- [9]On the respondent’s evidence, he gave advice about the effect of each form of ownership. He also told Mr and Mrs Thompson about the effect of s 59 of the Land Title Act 1994 (Qld) (“LT Act”), advising that any joint tenant had a unilateral right to alter the ownership so that the property would be held by the owners as tenants in common in equal shares. There was also a discussion about how difficult Mr Thompson found it to live with the granddaughter, Mrs Thompson apparently agreeing. Mr Thompson confirmed that he had only been willing to purchase the property on condition the granddaughter no longer lived with them. At the meeting Mrs Thompson agreed that the granddaughter had to live somewhere else, and that she should not live with them when they moved into the Nankeen Avenue property. There was also some discussion about what might happen if Mr and Mrs Thompson separated, and divorced.
- [10]The respondent recommended that Mr Thompson might agree to the property being held as joint tenants, conditional on Mrs Thompson making arrangements for the granddaughter to live elsewhere. Mr and Mrs Thompson agreed to this. Agreement was reached that Mrs Thompson would take significant steps to relocate the granddaughter so that she would live with another family member, and on that basis the Nankeen Avenue property would be held by Mr and Mrs Thompson as joint tenants; they would meet at the respondent’s office in about six weeks to see how the matter was progressing; and that had Mrs Thompson failed to make arrangements for the granddaughter to live elsewhere, then Mrs Thompson agreed to the property being held by them as tenants in common, and not as joint tenants.
- [11]The respondent also gave evidence that at this time he thought that he had the agreement of both clients as to how to proceed in any eventuality, but said that that conclusion was incorrect. It appears that he considered this view to be incorrect because he assumed that the instructions then given were to be the ultimate instructions from the clients.
- [12]Mr Thompson also gave some evidence of this meeting. Although much briefer than the respondent’s evidence, on significant points it is to similar effect. Mr Thompson stated that at the meeting he agreed to hold the Nankeen Avenue property with Mrs Thompson as joint tenants, on condition she made arrangements for the granddaughter to move elsewhere; and that if the arrangements were not made, then the property was to be held by them as tenants in common. He also said that the parties had agreed to come back to the respondent’s office within six weeks to see how the arrangements for the granddaughter were going.
- [13]On 12 June 2020, the respondent wrote a letter to Mr and Mrs Thompson which included the following:-
“We refer to our meeting in conference in this office on Thursday 11 June 2020 to discuss Steve’s proposal to vary the property holding arrangements. We note that you both are not in agreement, and such matters were discussed towards receiving your conclusive instructions to formalise registration of the property in your names.
Whilst it was apparent that the decision as to the property holding was in part related to certain family issues and continuing stresses on the household (and between you both), it is our understanding that a reasonable course of action was proposed at our meeting, to each of your agreement. It is the writer’s hope that the household and the stresses between you will now diminish and result in a return to harmony for the long term benefit of you both…
We ultimately confirm your instructions to register the transfer in its current form to reflect your respective ‘holding’ as joint tenants.”
- [14]On 23 July 2020, Mr Thompson spoke by telephone with the respondent. His file note recorded the telephone conversation as follows:-
“Telephone call from Steve Thompson. He was pretty upset and very angry with his wife Angela. Steve advised that Angela has not undertaken any action as agreed at our meeting of 11/June (sic), particularly relating to finding a new place to live for the granddaughter.
…
He said ‘if she is not going to ‘effing’ do her bit, then I am sure as hell not agreeing to continue with any joint tenancy agreement’
Steve instructed MC [the respondent] to undertake severance of the joint tenancy, however it was pertinent to advise Steve that the transfer was just now in the process of lodgement to be affected (sic) the next day. MC [the respondent] advised that the principle of severance would apply, albeit the Transfer document can be amended for registration. Steve said to change the transfer to tenants in common. MC [the respondent] advised that we would need some written instructions from him and recommend that he advise Angela.”
- [15]The respondent gave evidence of this conversation. His evidence included the statement that Mrs Thompson had refused to come to the respondent’s office to discuss the relocation of the granddaughter, or how the title to the property should be held. He said that Mr Thompson said that he would have a discussion with Mrs Thompson to clarify the instructions for the respondent, and that he (the respondent) trusted Mr Thompson to do this.
- [16]Later that day, Mr Thompson sent an email to the respondent which included the following:-
“I refer to your email 6/6/20, meeting your office 11/6/20, and subsequent telecon todays date referring to lodgement ‘holding’ of property purchased – 1/29 Nankeen Avenue, Paradise Point QLD 4216. I request that the lodgement be submitted under TENANTS IN COMMON, as discussed today. I would also request a revision of my Will in the near future.”
- [17]The respondent did not obtain instructions from Mrs Thompson in relation to the change in the manner in which the title to the Nankeen Avenue property was to be held. He amended the Form 1 Transfer by crossing out the term “joint tenants”, and replacing it with “tenants in common in the interests of ½ and ½ respectively”. The amended document was then submitted to DNRME for registration the following day.
- [18]On 30 July 2020, Mrs Thompson was informed by the Land Registry Office that the Transfer form had been received on 27 July 2020, and that the Transfer had been altered so that the transferees appeared as tenants in common rather than as joint tenants. She then spoke to the respondent by telephone. She asked him why he had amended the Transfer to record the ownership as being as tenants in common. The respondent replied that he had no choice. Mrs Thompson also asked him why he failed to disclose the amendment to her. The respondent said that it was his understanding that Mr Thompson had told her on 23 July 2020. Mrs Thompson gave evidence that he had not done so. She also said that the respondent had not discussed the change with her before 30 July 2020.[3]
- [19]On 30 July 2020, a further requisition notice issued in relation to the Transfer.[4] On the same day, Mrs Thompson sent an email to the respondent which included the following:-
“I understand from the Land Registry Office that the forms sent to them to register the property have been returned to your office today as they were not completed correctly,
Can you ensure that when they are re-submitted the title is made out in Joint Names as originally agreed with you and Stephen in your office,
I fail to see why the property was not registered directly following the meeting in your office.”
- [20]On 3 August 2020, Mrs Thompson sent an email to the respondent which included the following:-
“Please can you confirm that the forms have been re-submitted to the land registry as per my instruction on the 30th of July 2020.”
- [21]The respondent replied by email of the same day. The email included the following:-
“We confirm the choice of tenancy holding of the property in the form of ‘Joint Tenants’ or ‘Tenants in Common’. We confirm that there was some difference of opinion between Angela and Steven as to that holding, and in the absence of reaching ready agreement, we proposed to meet in this office to discuss matters of dispute between you.
A conference was held in this office on 11 June 2022 with Angela and Steven in attendance, with the Principal. The purpose of the meeting was to discuss matters under dispute between you, including the issue of tenancy holding for the new property…
Angela advised that she wanted to protect her half interest and preferred to hold the property as ‘joint tenants’, noting that any rights of share would devolve upon death.
Steven advised that it was his preference to hold the tenancy as ‘tenants-in-common’, noting that his interest entitlement share would then be distributed in accordance with the terms of (sic his) Will.
It was agreed by the parties at this conference that Steven would concede that the property may be held as ‘Joint Tenants’, for the time being, but otherwise subject strictly to the granddaughter not residing in the family home. Angela agreed to source alternative living arrangement (including arrangements for the daughter (sic granddaughter) to reside with her father in the UK) within 4-5 weeks of that conference. We are advised that the step-granddaughter remains in the new home, and further that Angela has not made other arrangements, or application for the granddaughter to join the daughter’s (sic granddaughter’s) father.
Specifically, this office has received advice by telephone and in writing on 23 July 2020, from Steven Thompson advising that the terms of the agreement between he and Angela had not been achieved, and setting out his fresh directions that the registration of title holding be so amended to be and become, ‘tenants-in-common’.”
- [22]Mrs Thompson replied by email saying:-
“I do take exception to the point made about buying the new property conditional on [granddaughter] moving out – that is not something I would have been naïve enough to agree to and I did say that in our meeting.
The agreement was that we purchased rather than rent whilst the Covid 19 situation was unfolding and that we would review the situation in a year. Stephen did suggest this himself saying that at the time that [granddaughter] was fine and the only issue he had with her was that she did not do any cleaning around the house.
I did in fact try to see if [granddaughter] could go to the UK but as you will be aware there are travel restrictions currently in place.
…
The property should be registered as tenants in common[5] as we all agreed at the meeting and if this had been submitted as you said it would as per your letter dated 12th June 2020 then this discussion would not be necessary.
If there is no difference in the equity holding then why is it necessary to change it??”
- [23]On 7 August 2020, Mrs Thompson sent an email to the respondent, stating:-
“I see that you are addressing letters regarding this matter correctly to both Stephen and myself as you were engaged to represent us jointly however you seem to only be taking instruction only [sic] from Stephen, does that mean that you see Stephen as your client and not me as I feel this could be a conflict of interest. Please can you clarify your understanding of who your client is I would appreciate a response by close of business today.”
- [24]The respondent’s reply of the same date included:-
“Yes I’m addressing letter to you both, and yes I act for your both in relation to your conveyance and the completion of that matter. I have endeavoured to provide you both with advice in equal terms, particular in relation to finalising the transfer of title and registration at the Department of Natural Resources, Mines & Energy. Notwithstanding, having regard to the issues between you I have confirmed that you each have an equitable right to hold a ½ share interest of the property.”
- [25]Later that day Mrs Thompson responded:-
“That’s interesting. So if you are acting for both of us you should be registering the property in Joint Names as we all agreed in the meeting on the 11th of June 2020 in your office and that you put in writing to that effect. You have yet to explain to me why this was not actioned at the time and that I only found out over a month later that this had not happened when I received the Rates Notice form [sic] your office in the previous owners name. It would have been courteous for you to let me know that you had changed your mind and in fact had not actioned the agreement regarding the registering of the property as expected. I once again request the property is registered in Joint Names.”
- [26]The respondent replied on 8 August 2020:-
“For the record we note that it was agreed at our meeting (on 11/06/2020) that you (or the father of your granddaughter) would commence the process to re-home and relocate your granddaughter, including to make application to the UK so that she may join her father. I recall at the meeting that you said that the father was willing, able and interested for his daughter to come and live with him in the UK. At the time, you also advised that you had a friend who could take your granddaughter in for the time being.
…
Seven weeks following our meeting (on 27 July 2020), this office received a written direction from Steven to amend the holding, principally as we understand it because of continued unresolved issues between you both, and also to accommodate some small savings were the change otherwise to be instigated at a later date. Nonetheless, please be assured that your half (1/2) share interest holding remains the same and has not been diluted.”
- [27]There were two subsequent requisitions on the Transfer from the DNRME. The Transfer was ultimately accepted for registration on 24 September 2020.[6]
- [28]The respondent has accepted that “…lodgement at the DNRME of the amended (Transfer) ultimately represented lodgement contrary to (Mrs) Thompson’s instructions, where conflict ensued between the clients.”[7] He also accepted that he should have realised that the existence of continuing conflict between the clients overrode and took priority over previous instructions, and that he should not have submitted the amended Transfer to the DNRME, and should have withdrawn from acting for both clients.[8]
Discipline Application
- [29]The Discipline Application alleges that the respondent failed to maintain reasonable standards of competence and diligence while acting for Mrs Thompson. It recites a number of the facts which have been previously referred to. It contends that the respondent submitted the amended Transfer to the DNRME on four occasions contrary to Mrs Thompson’s instructions given on 11 June 2020, and on three occasions, he submitted the Transfer in amended form contrary to her instructions given by emails between 30 July 2020 and 7 August 2020. It is alleged that he failed to maintain reasonable standards of competence and diligence in that he failed to obtain instructions from Mrs Thompson prior to making amendments to the Transfer; he acted contrary to her instructions by registering the Transfer as recording the title to be held as tenants in common; he preferred the instructions of one client over those of the other; and he continued to act for two clients in the same matter where their interests were adverse.
Submissions on the characterisation of the respondent’s conduct
- [30]It was submitted for the applicant that the respondent should have informed Mr Thompson and Mrs Thompson about the risks and consequences of representing them both, prior to agreeing to do so.
- [31]It was submitted that, when the respondent became aware there was a conflict between the instructions of Mr Thompson and Mrs Thompson, he should have ceased acting for both parties. Once he became aware of the change in instructions from Mr Thompson, contrary to the instructions of Mrs Thompson, he ought to have realised he could no longer act in the best interests of both parties simultaneously, and he should not have preferred the interest of one client over the other. The respondent’s client agreement enabled the practice to terminate the agreement if it was believed on reasonable grounds that the clients had a conflict of interest. The respondent had multiple opportunities in which to correct the Transfer documents (to reflect the instructions of Mrs Thompson), but persisted with the lodgement of the Transfer, contrary to Mrs Thompson’s instructions. He acted contrary to Mrs Thompson’s instructions on a number of occasions, and without informing her that he was doing so. His conduct should be characterised as professional misconduct.
- [32]The respondent’s submissions accept that when Mrs Thompson found out that the Transfer had been amended to record that the Title was to be held as tenants in common and she made that clear to the respondent, he should have recognised he was in a position of conflict. He continued to act on the basis of the joint instructions given on 11 June 2020. He did not appreciate that Mrs Thompson was entitled to change her view about whether the Title should be recorded as being held by tenants in common in the event that the granddaughter was to continue to live with them. The conduct should not be characterised as professional misconduct, because it does not comprise substantive or consistent failures; rather it was a single failure to recognise the ability of Mrs Thompson to change instructions, with the consequence that the new instructions necessarily created a conflict.
Statutory definitions
- [33]The applicant relied upon the following statutory definitions found in the Legal Profession Act 2007 (“LP Act”):-
- “418Meaning of unsatisfactory professional conduct
Unsatisfactory professional conduct includes conduct of an Australian legal practitioner happening 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 Australian legal practitioner.
- 419Meaning of professional misconduct
- (1)Professional misconduct includes –
- unsatisfactory professional conduct of an Australian legal practitioner, if the conduct involves a substantial or consistent failure to reach or keep a reasonable standard of competence and diligence; and
- conduct of an Australian legal practitioner, whether happening in connection with the practice of law or happening otherwise than in connection with the practice of law that would if established, justify a finding that the practitioner is not a fit and proper person to engage in legal practice.
- For finding that an Australian legal practitioner is not a fit and proper person to engage in legal practice as mentioned in subsection (1), regard may be had to the suitability matters that would be considered if the practitioner were an applicant for admission to the legal profession under this Act or for the grant or renewal of a local practising certificate.”
Characterisation of conduct considered
- [34]The applicant’s submission that the respondent should have informed Mr and Mrs Thompson about the risks and consequences of his representing them both simultaneously, prior to his retainer, does not relate to a matter raised by the Discipline Application. It will not be considered further.
- [35]The evidence establishes that a conditional agreement was reached between Mr and Mrs Thompson at the meeting at the respondent’s office on 11 June 2020. The effect of that agreement was that the title to the property would be held by them as tenants in common, subject to a condition, that Mrs Thompson was to make arrangements for the relocation of her granddaughter; and if the condition was not satisfied, then it was agreed that the property would be registered in their names as joint tenants. That agreement identified the instructions to the respondent at that point in time.
- [36]While emails from Mrs Thompson about the beginning of August indicate that she then held a different view, she did not herself give any further evidence on this matter, beyond what was recorded earlier. Neither the respondent nor Mr Thompson was cross-examined to suggest that their evidence of the meeting was incorrect. In those circumstances, it is appropriate to accept the evidence of the respondent and Mr Thompson.
- [37]As a result of the communications from Mr Thompson on 23 July 2020, the respondent had reason to believe that the condition had not been satisfied; and that in accordance with the agreement his instructions now were that the Title to the property was to be held by Mr and Mrs Thompson as tenants in common. It was in those circumstances that he amended the Transfer, and submitted it, as amended to DNRME for registration on 24 July 2020.[9] That resulted in the first requisition from DNRME on 28 July 2020.
- [38]However, on 30 July 2020, Mrs Thompson made it clear that her instructions were that the title was to be held by Mr and Mrs Thompson as joint tenants. At that point, the respondent knew of the conflict. Yet he continued to act, in accordance with the instructions from Mr Thompson. He thereby failed to carry out the instructions from Mrs Thompson.
- [39]The respondent’s email to Mrs Thompson on 3 August 2020 stated that the respondent at that time considered that the agreement by Mr Thompson that the title be held by them as joint tenants was conditional on the change of living arrangements for Mrs Thompson’s granddaughter, and that that condition had not been satisfied. He then took the view that, because Mr Thompson was entitled in any event to sever a joint tenancy under s 59 of the LT Act, Mr Thompson’s instructions should prevail, without the need later to sever the tenancy. His email of 7 August 2020 indicates that he believed he was giving effect to the equitable interests of the parties. His email of 8 August 2020 appears to confirm this view, and noted that there was some small savings, because the cost of severing the tenancy at a later date would be avoided.
- [40]The applicant’s primary submission appears to be that, because the respondent had multiple opportunities to correct the Transfer documents, the conduct should be characterised as professional misconduct. That appears to be based on the reference in the definition to a constant failure to reach or maintain a reasonable standard of competence and diligence. This submission also relied upon “repeated opportunities to take appropriate action”, and the number of times that the respondent acted on the instructions of Mr Thompson, and contrary to the instructions of Mrs Thompson without informing her that he was doing so.
- [41]It is correct to say that, at least on three occasions, the respondent submitted the Transfer for registration in its amended form; and that by then he had received instructions from Mrs Thompson that she wished the Transfer to record their interests as held jointly. However, the Tribunal considers this to be a single course of conduct, which is the product of a mistaken view taken by the respondent about the correct manner in which to carry out his duties. The Tribunal does not consider that this failure can be described as a consistent failure on the part of the respondent to reach or maintain a reasonable standard of competence and diligence.
- [42]To the extent that the applicant may have relied on a contention that the respondent’s conduct amounted to a substantial failure to reach or maintain a reasonable standard of competence and diligence, the Tribunal considers that a failure to comply with instructions is to be assessed by reference to relevant facts and circumstances. The respondent appears to have believed that Mrs Thompson will have no right to insist on the registration of the interests of the parties as a joint tenancy in the circumstances which occurred.
- [43]In Law Society of NSW v Moulton,[10] Hope JA said that, in considering the gravity of misconduct by a solicitor, the fact that the client, in the ultimate event, suffers no loss is of little, if any, relevance; and that if acts or omissions of a solicitor constitute professional misconduct, they do so at the time when they occur. It would seem to follow that the gravity of the respondent’s conduct is to be assessed by reference to the facts and circumstances as they were at the time of the conduct. The agreement which was reached between Mr and Mrs Thompson is accordingly relevant, particularly to his failure to act in accordance with the instructions of Mrs Thompson. The significance of his acting in accordance with Mr Thompson’s instructions, contrary to those of Mrs Thompson, it seems to me, must be assessed by reference to the fact that the outcome was one likely to be achieved even if the instructions of Mrs Thompson had been given effect too. It does not amount to a substantial failure to achieve reasonable standards of competence and diligence.
- [44]The applicant relied on the decision of this Tribunal in Legal Services Commissioner v Devery.[11] In that case, the solicitor acted for two persons who purchased a property as tenants in common. One of the purchasers advanced to the other the sum of $20,000, being the balance of purchase monies payable at settlement, to enable that purchaser to complete the purchase of his half share. A transfer of the borrower’s share in favour of the lender was executed but not registered, and was held by the solicitor in safe custody pending repayment of the amount advanced. A deed was prepared by the solicitor recording the terms of the agreement between the purchasers, and held by her in safe custody, together with the unregistered Transfer. Some two years later the solicitor prepared a contract for sale of the borrower’s interest in the property to a third party, together with a Transfer. She acted for the borrower in the transfer, which subsequently occurred. It was an agreed fact that she knew, or ought to have known, that the lender held an equitable interest, mortgage or charge over the borrower’s half share of the property. There is some suggestion that an explanation for the solicitor’s conduct lay in a failure in “cross-referencing” safe custody packets. The Tribunal in that case found that the conduct amounted to unsatisfactory professional conduct, noting that it occurred on just one occasion and in the context of one matter. In the present case, the Tribunal considers the conduct of the present respondent to be less serious than the conduct of Ms Devery. It considers that the failure to protect a security interest, as the solicitor was to do, is more serious than acting on the instructions of one client contrary to the instructions of another, when the ultimate position is one which was likely to be reached, regardless of the conduct of the solicitor. While decisions about facts in other cases are not decisive, the decision in Devery does not, in this Tribunal’s opinion, support a finding of professional misconduct in the present case.
- [45]The submissions for the respondent refer to the decision of this Tribunal in Legal Services Commissioner v Astley.[12] In that case, the solicitor was prosecuting another solicitor for a failure to make costs disclosure in accordance with s 308 of the LP Act. However, the respondent had previously received the solicitor’s file which included a letter from the solicitor to the client enclosing for her signature copies of a costs disclosure and costs agreement, a copy of a conditional costs agreement, and a copy of a costs disclosure (for different pieces of litigation); and she then included them as an exhibit in an affidavit she filed in this Tribunal. The Tribunal found that, in that case, the respondent had failed continuously over a period of some 12 months to properly comprehend the evidence in the prosecution.[13] It also recorded that on four occasions, she had been alerted to the fact that the material included the relevant documents.[14] Nevertheless, the Tribunal considered the conduct to be the product of the solicitor’s ignorance of the existing of something, and characterised it as unsatisfactory professional conduct.[15] The Tribunal accepts that there is an analogy between the approach taken in Astley, and the conclusion which has been reached, supportive of that conclusion.
- [46]A similar outcome was reached in Legal Services Commissioner v McClelland,[16] Legal Services Commissioner v Anderson[17] and Legal Services Commissioner v Krebs.[18] The assistance provided by these cases is very limited. In McClelland, the definition for professional misconduct was in different terms. In Anderson and Krebs, the applicant did not allege that the conduct amounted to professional misconduct.
- [47]Nevertheless, in the present case, the Tribunal is satisfied that the respondent’s conduct does not amount to professional misconduct. It should be characterised as unsatisfactory professional conduct.
Orders
- [48]The applicant submitted that the respondent should be the subject of a public reprimand, and that he be ordered to pay a pecuniary penalty of $5,000. It was submitted that the conduct was significantly worse than that of the respondent in Devery. Reference was also made to the need for personal and general deterrence; and the need to protect the profession’s standing.
- [49]The respondent submitted that the orders sought by the applicant were inappropriately severe. Reference was made to the applicant’s co-operation in these proceedings and his admission of the charges; the assistance he had provided to the applicant and the Tribunal by his affidavit which contained a full, frank and comprehensive explanation of his conduct; he had demonstrated insight and provided an apology to the complainant; he had practised for 28 years, reaching the age of 66, without previously being the subject of disciplinary proceedings; he was a well-respected and long standing member of the legal fraternity; and he had provided pro bono legal services to a number of community groups including to a project for homeless youth. No financial loss had been suffered. Nevertheless he had reached an agreement with Mrs Thompson for the provision of a substantial amount by way of compensation. No malice or dishonesty had been involved in the respondent’s conduct. This was not a case which warranted a reprimand. The respondent had shown insight at least from September 2022. His conduct had not caused any personal material loss or damage. It is apparent from the respondent’s affidavit that he is very regretful of his conduct. He has altered the standard letter issued to conveyancing clients where he is acting for more than one of them, to record the fact that it may be necessary to cease acting if at some point the clients do not agree with each other.
- [50]In the present case, given the respondent’s previously unblemished career, and his regret, there does not seem to be any need to take personal deterrence into account. While it is necessary to take into account the need for general deterrence, the weight to be given to this consideration must vary with the seriousness of the misconduct. In the present case, the Tribunal considers that the misconduct is towards the lower end of the scale. Nor is this a case where the respondent’s conduct is likely to have any real effect on the standing of the legal profession. The Tribunal does not consider that a reprimand of any kind is warranted. Because in principle it is important for solicitors to recognise the need to withdraw when a conflict arises, and because of the nature of the error which the respondent made by continuing to act, and to act in accordance with the instructions of one client rather than the other, it is appropriate to order the respondent to pay a pecuniary penalty in the sum of $1,000.
- [51]Finally, the applicant seeks its costs, an order not opposed by the respondent.
Conclusion
- [52]The following orders will be made:-
- The Tribunal determines that the respondent’s conduct identified in the Discipline Application is unsatisfactory professional conduct;
- The respondent is ordered to pay a pecuniary penalty in the sum of $1,000;
- The respondent is to pay the applicant’s costs of and incidental to the Discipline Application, such costs to be assessed on the standard basis as if this were a matter before the Supreme Court of Queensland.
Footnotes
[1]See Hearing Book (“HB”) p 97.
[2]See Statement of Agreed Facts (“SOAF”), exhibit 1, p 2.
[3]See HB p 89.
[4]See HB p 159.
[5]The parties agreed that when Mrs Thompson wrote “tenants in common” in this email she was confused and intended to write “joint tenants”.
[6]See HB p 160.
[7]SOAF para 32.
[8]SOAF para 33.
[9]SOAF p 4.
[10][1981] 2 NSWLR 736, at 740.
[11][2017] QCAT 155.
[12][2019] QCAT 274.
[13]Astley at [23].
[14]Astley at [26].
[15]Astley at [30] and [33].
[16][2006] LPT 13.
[17][2009] LPT 001.
[18][2009] LPT 11.