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LAW5125 LAWYERS ETHICS AND SOCIETY


TOPIC 1: Admission
Legal Profession Act 2004 (Vic) AND Legal Profession (Admission) Rules 2008 (Vic)

s 2.3.6 (1) The Supreme Court may admit a person as a lawyer if


(a) The Supreme Court is satisfied that the person
(i)

is eligible for admission to the legal profession; and

(ii)

is a fit and proper person to be admitted to the legal profession; and

(b) The person takes an oath of office, or makes an affirmation of office, as required by the Court.
s 2.3.6(2) In determining to admit a person, the Court may rely on the recommendation of Board of Examiners.

As to (i):
s 2.3.2 ELIGIBILITY for admission
(1)A person is eligible for admission to the legal profession under this Act only if the person

(a)Is a natural person aged 18 years or over;


(b)Has attained approved academic qualifications (see r 2.01(1) approved institution + approved course
of study + approved subjects, approved by the Council of Legal Education); and

(c)Has satisfactorily completed approved practical legal training requirements (either an approved PLT
course, or supervised workplace training; r 3.01(1)).
As to (ii):
s 2.3.3 SUITABILITY for admission
(1) The Board of Examiners must, in deciding whether or not to recommend that a person is a fit and proper
person to be admitted to the legal profession under this Act, consider

(a) each of the suitability matters in relation to the person; and


(ab) whether the person is or has been the subject of disciplinary action however described arising out the
persons conduct in
(i)

attaining approved academic qualifications; or

(ii) completing approved PLT requirements; and

(b) any other matter it considers relevant.


(2) However, the Board of Examiners may recommend that a person is a fit and proper person despite a
suitability matter because of the circumstances relating to that matter.

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s 1.2.6 Suitability matters


(1) Each of the following is a suitability matter in relation to a natural person
(a) whether the person is currently of good fame and character;
(b) where the person is or has been an insolvent under administration;
(c) whether the person has been found guilty of an offence in Australia or a foreign country and if so(i)

the nature of the offence; and

(ii) how long ago the offence was committed; and


(iii) the persons age when the offence was committed;
(d) whether the person engaged in legal practice in Australia (i) when not admitted; (ii) if admitted, in
contravention of a condition of admission; (iii) in contravention of a condition of practicing certificate
or while certificate was suspended;
(e) whether the person has engaged in legal practice in a foreign country (i) when not permitted to do so;
(ii) in contravention of a condition;
(f) whether the person is currently subject to an unresolved complaint, investigation, charge or order
(under the LPA or corresponding foreign law);
(g) whether the person (ii) is the subject of a current disciplinary action in another profession or occupation
in Australia or a foreign country; or (ii) has been the subject of a disciplinary action in another
profession or occupation that involved a finding of guilt;
(h) whether the persons name has been removed from a roll (local, interstate or foreign);
(i) whether the persons right to engage in legal practice has been suspended or cancelled in Australia or a
foreign country;
(j) whether the person has contravened a law about trust money or trust accounts;
(k) ...
(l) ...
(m) whether the person currently has a material mental impairment.
(2) A matter is a suitability matter even if it happened before commencement of this section.
Process for admission:
i.

Person applies to the Supreme Court to be admitted as a lawyer (s 2.3.4(1)). The applicant must
pay the admission fee (s 2.3.4(2));

ii.

A notice of intention to apply must be served on the Board of Examiners and posted in the
Supreme Court (form in Schedule 5 Rules), at least one month prior to when the applicant intends
to apply for admission (r 5.01(1));

iii.

Documents in support of admission must be submitted not less than 21 days before the applicant
intends to apply for admission (r 5.02(1)). These documents include:
a.

A certificate from PLT provider, or affidavit by trainees employer and supervisor


(Schedules 6 and 7);

b.

An affidavit in support of application for admission (Schedule 8);

Clause 8 provides that the applicant swears that I have made full disclosure of
every matter which a reasonable applicant would consistent as not being

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favourable to admission, including whether or not I am a fit and proper person to


be admitted not being confined to formal charges;

If the applicant discloses no matters, the application must state that I have read
and understood the Disclosure Guidelines. I have not done or suffered anything
likely to reflect adversely on my good fame and character. I am not aware of any
matter or circumstance that might affect my suitability (Practice Direction No. 2
of 2012); and

The affidavit should also include a certificate of successful completion of an


approved course of study, a PLT certificate, a police report, and a report on any
disciplinary action by PLT provider or academic institution (r 5.02(1)(c)). Practice
Direction No. 3 of 2009 requires an applicant to seek a report from each tertiary
educational institution; and

c.
iv.

Two affidavits as to character (Schedule 9).

The Board can then give a recommendation under r 5.06(2), or require the applicant to provide
further evidence or appear in person before the Board (r 5.06(3)). Any decision is appealable to the
Supreme Court within 30 days (s 2.3.11);

v.

The Supreme Court then decides whether or not to admit the applicant (s 2.3.6(1));

vi.

If admitted, the person must sign the roll (s 2.3.7(2)). The admission is effective from the time of
signature (s 2.3.8). On admission, the person becomes an officer of the Supreme Court (s 2.3.9(1)).

Both good reputation and character and fitness will be presumed unless there is evidence to the contrary.
It is necessary to look to the case law to determine whether [X] is of good reputation and character and fit and
proper to practice. It should be noted that the Board will be at pains to prevent people from being admitted who
are more likely to engage in unethical conduct in order to maintain public confidence in the legal profession.

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What must be disclosed?


Fitness is assessed at the time of application for admission (Re B).
The following matters must be disclosed:
a.

Criminal conduct;

Express suitability matter under s 1.2.6(1)(c);

Current police report is required;

Not confined to formal charges (Clause 8, Schedule 8 Rules). Applicant must disclose acquittals
on serious charges (eg murder; Re Del Castillo);

Not fatal to admission:


o

Can be overcome by:

A subsequent blameless career (Ex Parte Lenehan). For example, in Lenehan, the
applicant was admitted despite monetary dishonesty, because 20 years had passed, he had
led an exemplary life since, and he disclosed the offence;

Remorse, understanding and contrition regarding the offence (Hinds must disclose).

But it will be decisive where:


o Applicant fails to disclose (Re Davis, Frugtniet and Re B). The applicant cannot rely on the
advice of others, if they tell him not to disclose (Re Del Castillo);
o The offence was a careful, premeditated and deliberate attempt to avoid the administration of
justice (Einfeld);
o The applicant may still break the law (in Re B, the court thought that Bacon remained
prepared to break the law if she thought that the cause was worthy enough);
o The applicant shows no remorse (Foreman, where applicant tried to justify misconduct); and
o The offence was too grave (in De Souza, the applicant falsified academic record, falsely
claimed to have completed articles in Kenya, forged a NSW Admission Board Certificate).

b.

Academic misconduct;

Must be considered under s 2.3.3(1)(ab) and university report must be provided under Practice
Direction No. 3 of 2009;

Applicant must disclose1 (Re OG here, a barrister who misrepresented the circumstances under
which he was awarded a zero mark for a non-law assignment was struck off);

However described in s 2.3.3(1)(ab) captures a wide variety of misconduct;

Even if the applicant discloses, he may be denied admission (in Re AJG, admission was
suspended for 6 months).

In Richardson, Crawford J refused to strike off Richardson for failing to disclose academic misconduct. This

was because R had sought advice from his parents (both lawyers) and the law school, and they advised him
disclosure was not required. This argument would be unlikely to succeed today given the emphasis on
misconduct in the disclosure requirements.
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c.

Personal standards

An applicants conduct may be inconsistent with good character (s 1.2.6(1)(a));

For example, a vexatious litigant who refused to admit her past errors was denied admission
(Wentworth);

Similarly, an applicant who had a history of family court and domestic violence proceedings,
failed to disclose bankruptcy, and did not show contrition was not admitted (Re Bell).

d.

Infringement and traffic offences;

Generally, do not need to be disclosed;

BUT, per Practice Direction No. 2 of 2012, these traffic or public transport offences may need to
be disclosed in circumstances where the frequency or number of fines (or failure to pay) may
give rise to concern in the eyes of the Board about the applicants respect for the law.

e.

Political activity;

The holding of extreme political views does not make a person unfit for practice, provided that
in expressing those views a person does not engage in unlawful activity (Re Julius and Re B) (in
Re Julius, it was not a bar to admission that the applicant was a member of the then Communist
Party of Australia).

f.

Substance abuse and mental illness;

Mental impairment is a suitability matter (s 1.2.6(1)(m)), and substance abuse is any other
matter relevant to whether the applicant is a fit and proper person (s 2.3.3(1)(b));

Ongoing psychiatric illness which means that the applicant is not fit to practice will be a bar to
admission (Trueman);

Illness only relevant to the extent it might impact on practice (S v Legal Practice Board WA);

Applicant should tender expert evidence to establish fitness to practice;

Remorse and contrition are essential (in Victorian Lawyers RPA v X, the applicant was not
admitted because she did not understand the significance of her actions, caused by a mental
disorder. Per Harper J, She cannot be admitted until she appreciates the significance of what
she has done);

g.

Applicant can be admitted once they have made a full recovery (Victorian Lawyers RPA v X).

Other matters: General misconduct, social security overpayment, tax offences, or corporate
insolvency (Practice Direction No. 2 of 2012).

What if the applicant fails to disclose? FATAL

The applicant is under no misapprehension that they must disclose everything (see Clause 8, Schedule 8
Rules and the statement required by Practice Direction No. 2 of 2012);

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The obligation is to inform the decision maker of everything that could bear upon the decision to admit
(Frugtniet per Pagone J);

Applicants should err on the side of excessive disclosure (Re Del Castillo).

Breach of the duty of candour and admission to practice are incompatible (Re B);

Failure to disclose excludes any possibility of holding that [the applicant] had become a man of good
character (Re Davis per Latham CJ).

Conclude: Fit and proper person?

Not fit and proper if:


o

Evidence of dishonesty;

Priors showing disregard for the law; and

Conduct indicating risk of harm to the public.

Unless mitigating circumstances.

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TOPIC 2: Ethical duties


Four Lawyer Types
1) Zealous Advocate
-

A lawyers duty is to advocate a clients interests as zealously as possible within the bounds of the law
(barest obligation to legality);

Focuses on the lawyers role as representative of the client;

What is the clients best legal outcome?

2) Responsible Lawyer (Officer of the Court)


-

Argues that lawyers ethics are governed by the role of facilitating justice according to law;

Lawyer is responsible to make law as fair and just as possible;

They advocate for clients interests, but will not breach ethical rules that could damage the profession.

3) Moral Activist
-

Lawyers should improve justice by: (1) Law reform activities in the public interest; and (2) Client
counselling, to persuade clients of the moral thing to do;

Personal beliefs of the lawyer are relevant;

They will zealously follow the just cause (by exposing loopholes and testing the law);

What is in the best interests of society?

4) Ethics of Care
-

Preserving relationships and avoiding harm are more important than legal justice;

The goal of the lawyer-client relationship is the moral worth and goodness of both lawyer and client;

An ethics of care lawyer will discard professional rules if the circumstances demand it;

A more holistic approach: they will counsel clients and prefer non-adversarial resolutions;

What is in the clients best interests?

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TOPIC 3: Duty to Obey the Law

Hierarchy of duties:
1.
2.
3.
4.

To the law/society
To the court
To the client
To others

Practitioners must comply with the law themselves

A practitioner or barrister must not engage in, or assist, conduct which is:
(i)

Dishonest or otherwise discreditable to a practitioner;

(ii)

Prejudicial to the administration of justice; or

(iii)

Likely to diminish public confidence in the legal profession, or in the administration of


justice, or otherwise bring the legal profession into disrepute.

(PCPR General Principles (B), Rule 30.1 and Vic Bar Rule 4)

Where the client wants to break the law

If the lawfulness is uncertain, the practitioner may advise the client to engage in that conduct provided:
a. The advice is given in good faith, to test the validity or scope of the law;
b. Client is informed of the likelihood and consequences if it is illegal; and
c. Client can choose whether or not to engage in conduct.

If the conduct would be unlawful:


o

Lawyer cannot assist, or seek to induce a breach of the law;

Lawyer must not advise a client of ways in which an unlawful purpose may be achieved, or suggest or
propose methods of breaking the law (Vic Bar Rule 109(d))

Eg in LPCC v Segler, lawyer advised the client to engage in building projects and this was an offence.
The lawyer knew it was illegal, but thought it was not enforced. Thus the lawyer was found guilty of
PM and suspended for 3 months. Per Chaney P, Lawyers have a duty to foster respect for the law
and its administration. It is inimical to the role and function of a legal practitioner that he or she
advise or encourage a client to breach the law, regardless of whether the breach might be detected or
prosecuted.

Where the client has broken the law


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The lawyer must avoid personal involvement, advise the client of their responsibilities, and if the client
persists terminate the retainer (PCPR Rule 6.1.3 practitioner can terminate for just cause).

Should a practitioner raise moral issues with the client?


James Hardie Case

JH made building products from asbestos for decades, knowing that its workers and consumers were likely
to contract fatal lung diseases, even from minor exposure;

JH enlisted AAR to restructure such that its funds were shifted to Netherlands, out of reach of claimants;

When asked why they had not stood back and asked themselves what they should be advising their client to
do, AAR responded to the effect that they were advising their client on the letter of the law, no more and no
less.

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TOPIC 4: Duty to the Court


The Duty to the Court has four components:
1. Duty of candour (to disclose the applicable law and not to mislead about the facts)
2. Not to abuse the court process
3. Not to corrupt the administration of justice
4. To conduct cases efficiently and expeditiously.
Scope: Duties are not owed to a particular judge or even to the courts as such, but to the broader community
which has in interest in the proper administration of justice. The duties are properly regarded as duties to the
administration of justice (Ipp J).
Independence: Practitioners must be in a position to objectively determine when duties are in conflict and make
an independent judgment about resolving that conflict. A practitioner cannot simply be a partisan advocate of
their clients cause (not a mere mouthpiece; PCPR 13.1, Vic Bar Rule 16).
A close personal relationship with a client may jeopardise both objectivity and independence (ie the
capacity to subordinate the clients interests in the event of a conflict with duty to court).

Apart from close personal relationships, a practitioner should not become involved with a clients case to
the degree it unbalances their professional judgment and identifies the practitioner too closely with the
clients cause; and

A practitioner should not act where it is known or becomes apparent, that he will be required to give
evidence in his clients case (PCPR 13.4);

Nor should a practitioner become the surety for the clients bail (PCPR 13.5).

Sanctions for breaching duties 1-4?

The Court may: suspend practising certificate, strike practitioner off the role, prevent them from
representing the client, overturn the verdict, order costs against the party or practitioner, or institute
disciplinary proceedings.

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1. DUTY OF CANDOUR / DISCLOSURE


General duties

Practitioners must:
o

Not engage in dishonest conduct (PCPR 30.1.1);

Not knowingly make a misleading statement to a court (PCPR 14.1, BR 19);

Must correct any misleading statement ASAP (PCPR 14.2, BR 20);

In civil proceedings,

Act honestly at all times (s 17 Civil Procedure Act2);

Not engage in misleading or deceptive conduct (s 21);

Disclose the existence of all documents of which the person is aware and are critical to the
resolution of the dispute (s 26);

Protect and not misuse discovered information (s 27); and

Must inform court of any misapprehension by court, if aware (PCPR 14.12, BR 28).

Specific duties

The practitioner has a duty:


1.

To fully inform the Court about the law;


o

Practitioners and barristers must inform the court of:


-

Binding authority;

Any authority decided by an Australian appellate Court, or on the same or materially


similar legislation that is in question in the case; and

Any applicable legislation.


That is directly in point against the clients case (PCPR 14.6, BR 24).

This continues until the final judgment is given (PCPR 14.8, BR 26);

Exceptions: where case is withdrawn or settling (PCPR 14.7, BR 25), or the court ruled
evidence inadmissible without calling on the defence and the evidence would render it
admissible (PCPR 14.9, BR 27);

Must keep up to date with recent authority;

Eg in Copeland, the trial judge questioned counsel as to whether there was authority on point
and counsel incorrectly said no. Matter needed to be reheard.

Comment on the CPA: The obligations apply to parties, legal practitioners and experts (s 10). They override

inconsistent obligations, including the obligation to act in accordance with the clients instructions (s 13). A
lawyer must not cause a client to contravene any obligation (s 14). Remedies include orders for costs and
expenses, that costs be payable immediately, for compensation and to remedy the breach (s 29).
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2.

3.

Not to mislead about the law


o

Part of the general duty not to make a misleading statement (PCPR 14.1, BR 19);

Eg in R v S(F), defence counsel misquoted a case and did not correct it.

Not to mislead about the facts


o

Part of the general duties (see above);

Practitioner need not disclose facts about the clients past (PCPR 14.10, BR 158);

The practitioner must not:

Mislead the court as to the existence of facts (in Meek v Fleming, the prosecutor
wrongly referred to a witness as chief superintendant he had been demoted to
sergeant, and this was important to credibility);

Mislead the court by withholding material facts or documents (in Piva, the lawyer
failed to provide discovery of an important email to an insurer = PM; similarly, in Guss,
the practitioner failed to disclose a relevant document to counsel and sat silently in
court while counsel said the document did not exist);

Knowingly submit a false document (a lawyer cannot produce false witness statements,
and should check the truth of their contents if they are put on inquiry; Kyle); or

Knowingly make a false statement to the opponent concerning the facts, evidence or
applicable law (BR 50).

4.

To correct innocent misstatements


o

See above, PCPR 14.2, BR 20;

Covers misstatements in court (in Re Foster, F told the falsely told the judge that he has been
instructed by a solicitor, although he thought it was true at the time) and in affidavits (Kyle).

Ex-parte applications: Require a higher duty to disclose. Lawyers seeking interlocutory relief in an ex
parte application must disclose to the court all matters within his knowledge, that he has reasonable grounds
to believe would support an argument against granting the relief or limiting its terms adversely to the client
(PCPR 14.4-14.5, BR 22-23).

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2. DUTY NOT TO ABUSE COURT PROCESS


Groundless allegations or suggestions

In civil proceedings, legal practitioners must not make claims that are frivolous, vexatious, an abuse of
process, or without proper basis (s 18 Civil Procedure Act). And the legal practitioner must certify that
there is a proper basis for the proceeding, when filing the SOC (s 42(1)).

Under PCPR 16.1, BR 31, a practitioner and barrister must not make allegations or suggestions in court
against any person:

Not reasonably justified by the material then available to the practitioner;

Not appropriate for the robust advancement of the clients case on its merits; or

Made principally in order to harass or embarrass the person.

AND a practitioner cannot make any allegation which they do not think will be supported by the evidence
(PCPR 16.3, BR 32, 35);

Eg in Clyne, allegations were made to intimidate the other side to not continue with the case.

Under PCPR 16.2, BR 34, practitioners and barristers must not allege criminality, fraud or other serious
misconduct:
o

If the factual material available does not provide a proper basis for the allegation;

If the evidence by which the allegation is to be made will be inadmissible in the case;

Unless the client wishes the allegation to be made, after having been advised of the seriousness of the
allegation and of the possible consequences for the client and the case if it is not made out.

A barrister shall not permit himself to be made the instrument by which publicity is obtained for
allegations which are scandalous or calculated to vilify, insult or injure the commercial or professional
reputation of another person or company (BR 37).

For XXN or closing address:


o

Under PCPR 16.4, BR 38, a barrister or practitioner must not XXN so as to suggest criminality,
fraud or other serious misconduct, unless: they believe on reasonable grounds that there is a proper
basis; and, the suggestion is part of the case for the client, or, the answers would diminish the
witnesss credibility;

Counsel cannot introduce unjustifiable allegations into the closing address, because the other side
does not get the opportunity to dispute them (Rees).

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Delay in proceedings

Where delay is the purpose of the proceedings, the proceedings will be an abuse of process (eg in Flower &
Hart, a property developer needed time to get more money so his solicitors, F&H, advised that he has a
weak case that the builders deceived him. Hearing went for 150 days, and by that time the property
developer was in liquidation. F&H were ordered to pay $1.65 million in costs).

Bringing hopeless cases

Distinguish hopeless from weak but arguable cases;

If hopeless: advise client not to proceed;

If weak: advise client of weakness, and the likely consequences of pursuing the case;

If the client still wants to litigate either case, the practitioner does not act improperly in doing so (Ridehalgh
v Horsefield).

Destruction of documents

Under r 29.01.1(3) Supreme Court (General Civil


Procedure) Rules 2005, the following documents must be discovered:
(a) Documents on which the party relies;
(b) Documents that adversely affect the partys own case;
(c) Documents that adversely affect another partys case; and
(d) Documents that support another partys case.

In McCabe, the Court of Appeal held that the document


destruction occurred before proceedings were on foot, hence BAT had done nothing unlawful;

NOW: Under s 254 Crimes Act 1958 (Vic), a person who


knows that a document is, or is reasonably likely to be, required in evidence in a legal proceeding, and
destroys it or renders it illegible, is guilty of an indictable offence and liable to level 6 imprisonment (5
years maximum) or a level 6 fine or both.

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3. DUTY NOT TO CORRUPT THE ADMINISTRATION OF JUSTICE


Client perjury

PCPR 15.1, BR 29: When informed by client at a time before judgment is delivered, that client has lied or
falsified a document that has been tendered, the practitioner must:
o

Advise the client that the court should be informed and request authority to tell the court;

Refuse to take any further part in the case, unless authorisation is given;

Promptly inform the court upon authorisation;

BUT not otherwise inform the court.

Client intends to disobey order

P must advise the client against that course and warn the client of its dangers, and not advise the client how
to carry out or conceal that course (PCPR 15.3, BR 30);

BUT P cannot inform the court, unless authorised by the client or the clients conduct constitutes a threat to
a persons safety (PCPR 15.3.3, BR 30(c)).

Communication with witnesses

P must not prevent or discourage a prospective witnesses from conferring with the opponent (PCPR 17.5,
BR 47), unless that witness is Ps client (PCPR 17.6.1) and P is informing the witness of their right not to be
interviewed by the opponent (PCPR 17.6.2).

Communication with other side

P must not confer or deal directly with any other party for whom another practitioner is currently acting,
unless the other practitioner consents, the circumstances are urgent, or P cannot locate the practitioner and is
simply asking to contact him (PCPR 25.1).

Communication with judge

P must not in the presence of any of the parties or other lawyers deal with a court on terms of familiarity
that may reasonably give the appearance that he has special favour with the court (PCPR 19.2, BR 83);

P must not without consent communicate to the judge a matter of substance in the absence of their
opponent, unless the Court first communicated with the barrister and opponent consents (PCPR 18.5, BR
54). AND P must promptly tell the opponent what passes between himself and the court (PCPR 18.6, BR
55).

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4. DUTY TO CONDUCT CASES EFFICIENTLY AND EXPEDITIOUSLY


General rules

Lawyers must screen hopeless arguments;

Practitioners and barristers must not act as a mere mouthpiece of the client, or the instructing solicitor, AND
must independently exercise forensic judgments during the case after considering the clients and instructing
solicitors wishes (PCPR 13.1, BR 16).

Under PCPR 13.2, BR 17, P will not have breached their duty to the client simply by choosing (contrary to
the clients or instructing solicitors wishes) to:

Confine any hearing to those issues which P believes to be the real issues;

Present the clients case as quickly and simply as may be consistent with its robust advancement; or

Inform the court of any persuasive authority against their clients wishes.

An advocates immunity has been justified on the basis that counsel is sometimes required, against the
clients wishes, to prune the case of irrelevancies and exercise independent judgment and management
(Rondel v Worsley and Giannarelli).

Rules for civil proceedings

The overarching purpose of the Civil Procedure Act 2010 (Vic) is to facilitate the just, efficient, timely and
cost-effective resolution of the real issues in dispute (s 7(1));

The Courts must give effect to this purpose when exercising its powers (s 8(1));

Under s 9(1), in making any order or direction, the Court shall have regard to: the public interest in the
early settlement of disputes; the efficient conduct of the business of the court; the efficient use of judicial
and administrative resources; minimising delay; and the timely determination of the civil proceeding.

The duties on legal practitioners include:


o

To take only reasonably necessary steps (s 19);

To use reasonable endeavours to resolve a dispute, including by dispute resolution (s 22);

To narrow the issues in dispute (s 23);

To ensure costs are reasonable and proportionate to the complexity or importance of the issues in
dispute and the amount in dispute (s 24); and

To act promptly and minimise delay (s 25).

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Examples

In R v Wilson and Grimwade the Court of Criminal Appeal was highly critical of the prodigal conduct of
defence counsel who brought up every single argument and led to a 22 month trial;

In Saragas, the lawyer lodged a frivolous appeal, to delay the case so that the tenant did not have to move
out immediately. = Abuse of appellate process.

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TOPIC 5: Duty to the Court Special cases


CRIMINAL PROCEEDINGS
Prosecution (includes DPP and police)

The prosecutor is not a zealous advocate the prosecutor must fairly assist the court to arrive at the truth,
must seek impartially to have the whole of the relevant evidence placed intelligibly before the court, and
must seek to assist the court with adequate submissions of law to enable the law properly to be applied to
the facts (PCPR 20.1, BR 134);

Must act with fairness and detachment, with the objective of establishing the truth (Whitehorn).

Duties:
1.

Calling witnesses
o

Prosecution has sole discretion (only in exceptional circumstances will a court set aside a
decision because of the failure to call a witness; Apostilides);

Must call all witnesses necessary to present the full picture (PCPR 20.7, BR 139);

Exceptions: No need to call witness if the opponent consents, the matter has been dealt with
by the accused, or the witness is unreliable (PCPR 20.7, BR 139).

2.

Not to suppress evidence


o

All relevant and credible evidence must be given to the defence (PCPR 20.5, BR 141);

In Mallard, the prosecution failed to disclose a forensic report to the defence, which was
crucial to the defendants innocence;

Exceptions: it would seriously threaten the integrity of the administration of justice, it would
seriously threaten a persons safety, OR it is clearly contrary to public interest AND the
prosecution reasonably believes that the threat cannot be avoided by conditional disclosure
(PCPR 20.5.1-20.5.2, BR 141). The prosecutor should then consider whether, in light of this
non-disclosure, the charge should be withdrawn or downgraded (PCPR 20.6, BR 142).

3.

Inflaming the jury


o

Prosecution must not seek to inflame or bias the court against the accused (PCPR 20.3, BR
136);

They must present facts impartially and without concern for outcome (Livermore and R v
DDR). For example, in McCullough, the Crown counsel emphasised the sanctity of life,
compared the accused to the Yorkshire ripper, would wipe out a community etc = these
remarks prejudiced the jury.
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4.

Seeking a vindictive sentence


o

A prosecutor must not seek to persuade the court to impose a vindictive sentence or a sentence
of a particular magnitude but may inform the court of an appropriate range of severity of
penalty by reference to authority (PCPR 20.12, BR 147).

Defence

The duty of the defence is to protect the client from conviction except by a competent tribunal and upon
admissible evidence sufficient to support a conviction (Tuckiar v The King, BR 149). Whether guilty or
not, an accused is entitled to an acquittal if the evidence is insufficient (Tuckiar).

Relevant Rules:
5.

Practitioners personal opinion


o

A barrister is under a duty to defend the person irrespective of any belief or opinion the barrister
may have concerning their guilt or innocence (PCPR 13.3, BR 150);

P must seek and advance clients interest to best skill and due diligence uninfluenced by the
clients activities or unpopularity of the case (PCPR 12.1).

6.

Client perjury (see page 15)

7.

Confessions of guilt by the client


o

Where a confession of guilt is made to defence counsel during the proceedings, the practitioner
should continue to act and do all he honourably can do, in the clients defence (PCPR 15.2, BR
161) [note: the practitioner can cease to act if there is enough time for another practitioner to
take over the case properly; PCPR 15.2.1, BR 162];

The practitioner may:

Ensure that the prosecution is put to proof of its case (BR 161(d));

Argue that the evidence as a whole is insufficient to prove guilt (PCPR 15.2.2(c), BR
161(e));

Argue that for some reason of law the client is not guilty of the offence charged (eg
insanity) (PCPR 15.2.2(d), BR 161(f)); and

Argue that there was a mitigating factor (PCPR 15.2.2(e), BR 161(g)).

BUT the practitioner must not:

Falsely suggest that some other person committed acts (PCPR 15.2.2(a), BR 161(b)
and Neilan, where counsel tried to lay blame elsewhere despite knowing of his
clients guilt);

Set up affirmative case inconsistent with confession (PCPR 15.2.2(b), BR 161(c)); or

Continue to act if the client insists of giving evidence denying guilt, or wants the
barrister to assert that the client is innocent (BR 161(h)).
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Counsel cannot reveal this confession to the Court (Tuckiar).

o
8.

Where client is innocent but wants to plead guilty


Counsel can continue to act but only after advising the client of the consequences including the

fact that submissions in mitigation will have to be made on the basis that the client is guilty (BR
155);
Counsel is not entitled to ignore the clients instructions on the nature of the defence to be

conducted, at least where the defence is properly open on the evidence (R v McLoughlin).
9.

Disclosure of prior convictions


Where counsel NOT asked

Where counsel is aware of a clients prior convictions which have not been made
known to the court by the prosecutor, the barrister is under no duty to correct the
omission (PCPR 14.3, BR 159);

BUT the duty not to mislead the court means that counsel cannot make any
inconsistent submissions (see page 11).

Where counsel asked

Under the duty not to mislead the court (page 11), counsel must disclose.

ALTERNATIVE DISPUTE RESOLUTION

Duties:
o

Must advise clients about ADR (PCPR 12.3);

Misrepresentations:

Practitioner cannot knowingly make a false statement in negotiations (PCPR 18.1);

BUT a practitioner does not have to correct errors by the opponent (PCPR 18.3).

However, the practitioner cannot then take advantage of this error by more than mere silence
(eg in Chamberlain v Law Society of ACT, a lawyer received a income tax assessment of
$255,000 but was then issued with a writ for only $25,000. The lawyer improperly took
advantage of this mistake by procuring a consent judgment, creating an estoppel against the
DCT. He should have told the DCT, paid the amount (without creating estoppel), done
nothing, or sought a consent judgment for the right amount);

Similarly, in some cases the practitioner must correct. Eg in Mullins, in mediation, Mullins
failed to correct an incorrect assumption that his client had a normal lifespan, and insurer
settled. Mullins claimed he was entitled to remain silent as long as he did not positively
mislead the insurer as to life expectancy. Mullins was fined $20,000.

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FAMILY LAW DISPUTES

The best interests of the child is the paramount consideration (s 60CA Family Law Act 1975 (Cth)). The
interests of the child will come before those of the client;

This may include breaching confidentiality where a child is at risk (Clarkson v Clarkson);

An Independent Child Lawyer can be appointed if the Court feels best interests of child not being given
affect to (s 68L). The ICL must act impartially, like a prosecutor.

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TOPIC 6: General Duties to the Client


FIDUCIARY DUTIES
Source of the duty to client
1.

Under the client contract (retainer): An implied term in all retainers is the duty to protect Cs interests,
exercise reasonable care, and follow Cs instructions;

2.

Tort: P may be liable under negligence;

3.

In equity (fiduciary relationship): P is a fiduciary to C hence duty of undivided loyalty; and

4.

By statute: especially in relation to costs.

BUT not Rules (eg PCPR, BR), because they do not create an enforceable liability.
Fiduciary Duties:
1. To avoid conflicts of interest

To avoid situations where a personal interest of the lawyer conflicts with the interests of a client, or the
interests of two or more clients conflict;

See PCPR 9.1.1: a practitioner must not allow an interest of the practitioner to conflict with the clients
interest. And a practitioner must not accept instructions from, or continue to act for, a client if they
become aware of a conflict (PCPR 9.2).

2. Not to make an undisclosed profit


A practitioner must not make an undisclosed personal profit from his position, or appropriate opportunities
or confidential information belonging to the client (Regal (Hastings));
See PCPR 9.1.2: a practitioner must not exercise any undue influence intended to benefit the practitioner in
excess of fair remuneration.
3. Loyalty

To make full disclosure to the client of all material information in the practitioners possession relevant to
the clients affairs. Includes the duty to disclose any conflicts of interest.

See PCPR 1.1: A practitioner must act honestly and fairly in the clients best interests and maintain
clients confidences.

4. To maintain confidentiality

To maintain the confidentiality of information provided by the client to the practitioner in a professional
capacity;
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See PCPR 1.1 (above) and PCPR 3.1: A practitioner must never disclose any confidential information
acquired by the practitioners firm during the clients engagement, unless it is authorised by the client, P
is compelled by law, or the information has lost its confidentiality.

5. To account to the client

To account for money held on behalf of the client and for the costs of the matter for which P is retained.

DUTY TO REPRESENT
Duties to accept work and continue to act:

Cab Rank Principle: Barristers are professionally bound to accept a brief in a court in which they
practice (BR 86).

Exceptions:
(a) Barrister is not competent (brief not within barristers capacity, skill and experience);
(b) Barrister is not available (already committed to other professional or personal engagements
which may, as a real possibility, prevent the barrister from acting to the best of their skill and
diligence);
(c) Fee offered is not acceptable (but a barrister must not increase their fees just to avoid a brief
they dont want to accept, BR 88); OR
(d) There is a conflict of interest.

There is NO EQUIVALENT principle applicable to solicitors or solicitor advocates


o

There is no equivalent principle for solicitors (Arthur J S Hall v Simons);

A practitioner should not accept retainer unless they can serve the client honestly and fairly, with
competence and diligence and attend to work with reasonable promptness (LCA Model Rules).

Representation in CRIMINAL TRIALS:

No absolute right to legal aid


An accused in Australia does not have an absolute right to be provided with counsel at public expense, nor
an absolute right to legal aid (R v McInnis).

BUT: There is a right to a fair trial and lack of legal representation may mean an accused is unable to
receive this (Deitrich);

Under s 360A Crimes Act, if it becomes apparent that a person will not receive a fair trial unless getting
representation, the Court can order Vic Legal Aid to provide assistance.

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Representation of Co-accused: Not recommended. Most problems concern the likelihood that at some
stage in any trial, the interests of one defendant will diverge from those of the other(s) and if there is finding
of guilt, a judge will have to decide the degree of culpability between the co-accused.

TERMINATION OF SOLICITOR-CLIENT RELATIONSHIP

P has an obligation to follow clients instructions, unless to do so would involve acting unlawfully or would
be in breach of their overriding duty to the court. P must not act without instructions from client.

SOLICITOR: Termination occurs by


1.

Agreement between the parties (PCPR 6.1.1);

2.

Discharge by the client (PCPR 6.1.2)

3.

By the practitioner, for just cause and on reasonable notice to the client (PCPR 6.1.3):
o

Just cause is a circumstance that impedes representation sufficiently to override the public policy
consideration that practitioners should not ordinarily be able to terminate a retainer before
finishing the job;

4.

Excessive workload is not just cause, nor where C is merely offensive;

Generally, the practitioner is entitled to fees for work done.

Practitioners engagement is terminated by the firm (PCPR 6.1.4).

EXCEPTION: Serious criminal cases


Where C is to stand trial for a serious criminal offence, P cannot terminate retainer for failure of C to

make payment of Ps costs unless P has given notice, a reasonable time before trial, of at least 7 days
to make payment and has given notice to the Registrar of the Court (PCPR 6.2);
A barrister must not return a brief in a serious criminal case unless the circumstances are

exceptional and compelling and enough time is available for another barrister to take over, or the
client gives informed consent (BR 101, 162).

DUTIES IN RELATION TO COMMUNICATION

A practitioner, in the course of engaging in legal practice, must communicate effectively and promptly with
clients of the practitioner (PCPR 39.1);

A practitioner must: provide the client a written estimate of the settlement amount, prior to settlement
(PCPR 39.2(a) and s 3.4.13 of the Act) and inform the client of any rights they may have to apply for legal
aid, when taking instructions or as soon as possible thereafter (PCPR 39.2(b)).

Under the Family Law Act 1975:


o

P must to inform clients of the legal and possible social effects of proposed proceedings
including the consequences for children (s 14D, s 62B);
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P representing a party to divorce proceedings must consider, from time to time, the possibility of
reconciliation [s 14D] and counselling for marital breakdown [s 16C(1)];

s14G provides that P must consider whether or not to advise the parties about the dispute
resolution methods that could be used to resolve a matter in dispute.

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TOPIC 7: Duty to Clients Confidentiality


Source of duty

PCPR 1.1: A practitioner must act honestly and fairly in the clients best interests and maintain clients
confidences;

PCPR 3.1: A practitioner must never disclose any confidential information acquired by the practitioners
firm during the clients engagement unless an exception applies;

BR 62: A barristers obligation to maintain the confidentiality of a clients affairs is not limited to
information which might be protected by LPP, and is a duty inherent in the fiduciary relationship between
barrister and client.

The duty arises from the fiduciary relationship between P and C, as an implied term of the retainer, and
from the equitable doctrine of confidential information;

The rationale is to encourage full and frank disclosure by clients, free of apprehension of being prejudiced
by its subsequent disclosure and in so doing, to assist in the administration of justice. A second rationale is
the maintenance of public confidence in legal representation and the legal system.

Scope of the duty

It survives the termination of the retainer;

It covers all information received by the practitioner in the course of acting for a client (whether from the
client or from a 3rd party);

The duty is much wider than privilege.

EXCEPTIONS to the duty of confidentiality


Permissive (P may disclose)
1.

When the client consents (expressly or impliedly) (PCPR 3.1.1, BR 63(c));

2.

Where the information has lost its confidentiality (PCPR 3.1.4, BR 63(a) make sure the info has actually
lost confidentiality; Tampoe);

3.

Where information was obtained from another person not bound by confidentiality (PCPR 3.1.5, BR 63(b));

4.

Where disclosure is required to conduct the matter eg it may be disclosed to partners and employees of
Ps firm (unless provided to P personally and exclusively) (PCPR 3.1, BR 65);

5.

Where the law would probably compel its disclosure, and the sole purpose is to avoid the probable
commission or concealment of a serious criminal offence (PCPR 3.1.3);
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6.

Where a client informs P that they intend to disobey a court order and the practitioner reasonably believes
the clients conduct constitutes a threat to a persons safety (PCPR 15.3.3(b), BR 30);

7.

Public interest defence? (Not settled in Australia, HC in Kumar).

Mandatory (P must disclose)


8.

Where P is compelled by law to disclose (PCPR 3.1.2, BR 63) eg through disclosure orders;

9.

Where disclosure is made in response to an inquiry by a body exercising disciplinary powers, eg, the Legal
Services Commissioner (Legal Profession Act 2004).

Remedies for breach

Remedies include:
o

An injunction, to prevent a threatened breach;

Damages, if breach has occurred; or

Destruction of confidential information.

Narrower subset Privileged information


Evidence is not to be adduced if adducing the evidence would result in the disclosure of:
o

A confidential communication between client and lawyer, or 2 or more lawyers; or the contents of a
confidential document prepared by the client, lawyer or another person; for the dominant purpose of
legal advice (s 118 Evidence Act 2008 (Vic)); or

A confidential communication between client and another, or lawyer and another; or the contents of a
confidential document; for the dominant purpose of the client being provided with professional legal
services relating to actual or anticipated proceedings (s 119 Evidence Act).

Privilege information must not be disclosed. Whereas confidential information, which is not privileged,
must be disclosed in legal proceedings (Baker v Campbell).

Limits of client legal privilege:


o

It will be an abuse of process to unreasonably claim privilege as a delaying tactic in litigation;

Identity of proposed witnesses cannot be protected (but statements may be privileged);

A clients name and address are not privileged (but are confidential); and

Trust records are not privileged.

Policy Issues Relating to Privilege

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Commercial secrets: The operation and effect of privilege is under challenge from regulators (ACCC, ATO,
ASIC) and academics, who argue that there is a greater public interest in disclosure than in commercial secrets,
especially when major corporations are involved and the major law firms which service them are not themselves
prosecuted for conduct offences when those clients misbehave, (eg AAR in James Hardie, Minters in HIH).
Document destruction: Document Destruction occurs when a client (with or without their lawyers assistance)
destroys its own documents in order to prevent their use against it in later, likely litigation (McCabe v BAT).
Document destruction may be considered allied to privilege because such destruction attempts to take the issue
of controlled secrecy beyond the reach of the court

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TOPIC 8: Duty to Clients Conflicts of Interest


1.

Conflict with the personal interests of the practitioner

2.

Conflict with the interests of another client (concurrent conflict)

3.

Conflict with the interests of a former client (successive conflict)

Conflict with personal interests

PCPR 9.1.1, BR 72(a)(i): a practitioner must not allow an interest of the practitioner to conflict with the
clients interest. And if P becomes aware of a conflict, they must not accept instructions from, or continue to
act for, the client (PCPR 9.2, BR 72(b)).

1.

Receiving benefits
o

A practitioner must not exercise any undue influence intended to benefit the practitioner in
excess of fair remuneration (PCPR 9.1.2, BR 72(a)(ii));

Wills:

P as executor: If P is to draw a will appointing themselves or an associate as an


executor, they must inform the client in writing before C signs of: Any entitlement of
P or the firm to claim commission; to charge legal costs in relation to administration
of the estate; and, Cs ability to appoint someone who might not charge (PCPR 10.1);

P as beneficiary: If P is to draw a will (PCPR 10.2.1) or other instrument (PCPR


10.2.2) under which they, or their firm, will receive a substantial benefit3 other than
commission, P must decline and offer to refer the person to another practitioner for
advice [unless the client is a member of Ps family, or a practitioner].

Referral fees:

Where P intends to refer C to another practitioner and will receive a fee or


commission for the referral, P must obtain Cs written consent and advise C that they
will be paid a commission for the referral (PCPR 34).

2.

Transacting with a client outside of the professional relationship

P should avoid transactions which involve intermingling personal and client affairs, including
the affairs of companies and ventures in which the practitioner has a personal connection
(Harvey);

Substantial benefit means a benefit which has substantial value relative to the financial resources and assets of

the person intending to bestow the benefit (PCPR 10.3).


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In Harvey, the solicitors clients lent money to three companies of which the solicitor was a
director and shareholder. The investments were speculative and he deliberately kept details
from the clients. This was a gross abuse of the fiduciary relationship;

P must only deal with a client if they have fully and candidly disclosed their interest and taken
steps to ensure the client has given fully informed consent (OReilly) eg by ensuring they
obtain independent advice.

3.

Borrowing from clients

It is prohibited for a practitioner to directly or indirectly borrow from a client, or knowingly


permit or arrange a client loan to associated persons or entities (PCPR 11.1);

This does not apply to: banks, an associate of the practitioner (and there was disclosure and
consent), and Ps employer (PCPR 11.2).

4.

Lending to clients

Scrupulous care is required to avoid a conflict where a P or associated person or entity lends
money to C;

P must fully and candidly disclose their interests, seek independent advice for C, and advise
on alternative sources for funds (OReilly);

P should never act as a surety or guarantor for clients (PCPR 13.5, regarding surety for the
clients bail; and R v B).

5.

Purchasing a clients property

o P must ensure that C seeks independent expert advice and must also disclose the interest P is
acquiring if the client/vendor is unaware of it (Re a Barrister and Solicitor).
6.

Transactions with former clients


o

Generally, practitioners are free to transact with former clients (Re a Barrister and Solicitor);

However, if there is a continuing client-lawyer relationship, a prima facie duty of disclosure


and to advise the client to seek independent advice will arise (per Clarke JA).

7.

Intimate personal relationships with clients


o

No express rules;

Usually involves conflict of interest, because independent professional judgment affected by


personal interest;

Examples:

Defence counsel in a relationship with Crown prosecutor = defendant successfully


appealed against conviction, because he may not have received independent legal
advice and there was a perception of miscarriage of justice (R v Szabo);

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Lawyer forming personal relationships with her imprisoned clients (3 occasions) =


the relationships were found to have adversely impacted upon her representation of
the clients, and she lied to obtain visiting rights unfit to practice (LPCB v Morel);

Lawyer in personal relationship with defendant pressured a witness to withdraw his


evidence = attempting to pervert the course of justice struck off (LPCC v Pepe).

10.

Practitioner as witness

Practitioners must not, unless exceptional circumstance exist, appear for a client in the hearing
or continue to act where it becomes apparent the practitioner be required to give evidence
(PCPR 13.4);

A conflict of interest arises where a practitioner is a material witness in a matter in which he


or she is acting because the duty to the client may conflict with the practitioners duty of
candour to the court;

For similar reasons, practitioners should avoid acting in cases where a partner, employee or
close family member is likely to be called as a substantive witness.

11.

Independence

Important for in-house counsel

Practitioners and barristers must not act as a mere mouthpiece of the client, or the instructing
solicitor, AND must independently exercise forensic judgments during the case after
considering the clients and instructing solicitors wishes (PCPR 13.1, BR 16);

For example, in the Enron collapse, Enrons lawyers Vinson and Elkins derived most of their
revenue from Enron. They only exercised their duties in favour of Enrons management, and
not their shareholders, creditors or employees, and participated in deceiving the market about
Enrons financial position;

Where P has another business

Where P conducts another business concurrently, but not directly in association with their
legal practice, they must ensure the independence of their service to C by disclosing mutual
financial interests and ceasing to act where conflicts emerge (PCPR 32).

Barristers can advise the instructing solicitor of a client that a conflict may exist between the client and the
instructing solicitor. If the solicitor does not agree, the barrister can discuss it with the client in the
solicitors presence (BR 73). If the solicitor continues to disagree, the Ethics Committee of the Bar can be
consulted.

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Concurrent conflict (two or more clients for whom P is currently acting)

A practitioner must avoid conflict of interest between two or more clients of the practitioner (PCPR 8.2);

A solicitors loyalty to his client must be undivided (Farrington).

For non-contentious work:


a.

A practitioner can act for two or more parties to a matter if each party consents (consent must be
fully informed) (PCPR 8.3, BR 70);

b.

C should receive independent legal advice (Harvey) and P must be completely candid (OReilly);

c.

P cannot act for both vendor and purchaser, or lessor and lessee, or financier and borrower, or
mortgagor and mortgagee, unless P obtains the written consent of each party using Form 1 and fully
informs the parties as to the potential disadvantages (PCPR 8.5);

d.

BUT: P cannot act where


i.

A material conflict has arisen (PCPR 8.1B(i)); or

ii.

P reasonably believes that a material conflict is likely to arise (PCPR 8.1B(ii)); or

iii.

P cannot act in the interests of all the parties. P must immediately cease to act for all
parties (PCPR 8.4).

For contentious work:


e.

P cannot act for both parties;

f.

A fiduciary cannot at the same time act both for and against the same client (Bolkiah v KPMG).

Risks vs benefits in non-contentious matters

The risks include:


1.

P cannot fulfil the duty of absolute loyalty to each client in any litigation arising from the
representation, the onus is on the practitioner to show that the client has received the best assistance
and this may be hard to prove. In addition, even the act of trying to obtain one clients consent may
breach the duty to the other client because full disclosure is required (Council of LIV v A Solicitor);

2.

The conflict may have been unforeseen at the start of the matter, and if it arises P may need to cease
acting for both parties, meaning the firm gets no more revenue from either party (see PCPR 8.4);

3.

If a conflict arises, one client will need independent representation (this will cause additional costs,
delay and inconvenience). The firm also risks alienating the dropped client (eg in the AAR example,
AAR had to drop Mayne in order to keep Pfizer Mayne then sued AAR for breach of retainer,
which resulted in a settlement of an unknown amount); and

4.

There is always a risk the matter will become litigious. And, for example, if P prepares a contract
between two clients, P will be unable to act for either client in a subsequent dispute over its terms
(Yunghanns).

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The benefits include: double the fees, lower cost, greater speed, and more convenient for the client.

Best approach to two-party representation


If it appears from the outset that conflict is even possible, do not act for one or more parties.
If you are not in a position as an employee to make that decision, where actual or potential conflict arises
during the retainer, advise your employer of the issues and seek to counsel the clients of the conflict and of the
advisability of obtaining independent advice.
A prudent practitioner will then withdraw from acting for all parties, in case either former client is
disadvantaged (Wan v McDonald).

Sanctions
-

Liability for breach of fiduciary duty;

Liability for negligence;

Disciplinary sanctions;

Problems recovering costs from clients eg if client is not happy, they might not pay the bill and
dispute the representation;

Client dissatisfaction / Loss of clients; and

Higher excesses on professional indemnity insurance.

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Successive conflict (current client conflicts with former client)


Where it arises

Successive conflict arises where there is a conflict between a practitioners duty of loyalty owed to a
current client, and the duty of confidentiality owed to a former client;

It occurs where:
-

Same practitioner has acted for both clients;

One firm has acted for both clients, but via different practitioners; or

Practitioner acted for a client at one firm, and moved to a firm that acts for the other party.

[Note: an information barrier could only apply to situation 2]

The Rule

Under PCPR 4, P must not accept an engagement to act for another client in any matter against a former
client:
(a) Where P (or his current firm, or former firm) has acted previously and has acquired information
personally4, confidential to the Former Client and material to the matter; and
(b) If the Former Client might reasonably conclude that there is a real possibility the information will be
used to the Former Client's detriment.

Can the former client intervene?

The former client can apply to the Court for an injunction.

The Court has jurisdiction to intervene on the following bases:

i.

Protection of former clients confidential information (Bolkiah and World Medical);

ii.

Breach of duty of loyalty owed to former client (ie it persists, Spincode per Brooking JA); and

iii.

Inherent jurisdiction of the Supreme Court to supervise its officers (Spincode per Brooking).

The Court weighs the former clients interest in maintaining the confidentiality; the current clients interest
in the freedom of choice of legal representative; and the public interest in maintaining the appearance of
justice and the integrity of the profession.

[X] may argue that the use of the word personally in PCPR 4 means that because he himself was not involved

in [former client]s case personally, but rather others at the firm were, that there is no reason why [X] should not
be able to act for [current client].
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In World Medical, Gillard J accepted the test from Bolkiah, under which the court should intervene unless
it is satisfied that there is no real risk of disclosure of the former clients confidential information. Gillard
J outlined a five step test:
(1)

Is there confidential information?

PCPR 4 requires P to have acquired confidential information;

Burden of proof lies on the former client (Carindale);

The information must:


a.

Be specific and be identified by the former client (Mancini v Harrison per Bryson J but
depends on the circumstances, Yunghanns);

b.

Have been communicated in confidence by the former client to P;

c.

Remain confidential; and

d.

Be capable of being recalled.

AND it includes the Getting to know you factors (ie impressions of character, personality and
attitudes that could be used to the advantage of a current client: Yunghanns);

Includes information imparted to clerks or secretaries (McMillan).

However, the possession of confidential information by a practitioner may readily be inferred (Bolkiah). In
some cases, the circumstances of the retainer and the nature of the legal work will be sufficient to establish
the nature of the confidential information (Yunghanns).

Family law: Former client can simply swear that the lawyer received confidential information (McMillan).

Has there been consent by the former client?

The former client may give informed consent;

However, even where consent is given, the courts may still consider that it is improper for P to continue to
act because of the appearance of conflict and the damage this does to the public perception of the integrity
of the profession.

(2)

AND, is or may the information be relevant to the new matter?

PCPR 4 requires the confidential information to be material to the current matter;

Is the information relevant to the new matter in which the interests of the current client are adverse to the
interests of the former client? OR may the information be relevant to the new matter?

Consider how closely related the former and new matter are;

Often the relevance of the information to the new matter will be obvious (Bolkiah).
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.
(3)

IF YES to both, is there a real risk of disclosure?

Is there a risk which is real and not merely fanciful or theoretical that there will be disclosure?

Family law: The Court will intervene even if there is only a theoretical risk of disclosure (McMillan).

(4)

If YES, can P show that there is no risk?

If there is a risk of disclosure, then a heavy evidential burden rests on the practitioner to establish that there
is no risk of disclosure;

Unless clear and convincing evidence is available that all effective measures have been taken, there is a
presumption that the practitioners firm is disqualified from acting (Bolkiah).

Family law: There is a strong tendency towards an appearance of injustice so that the presumption becomes
virtually irrebuttable (Gagliano). Same for quasi-criminal offences (Mallesons v KPMG).
Information barriers

There is a strong interference that practitioners who work together share information. The court should draw
the inference that knowledge will be shared, unless satisfied on the basis of clear and convincing evidence
that all reasonable measures have been taken to ensure that no disclosure will occur (MacDonald Estate).

Is the information barrier sufficient to rebut this presumption?


o

An information barrier is designed to prevent the movement of confidential information within firm;

The onus is on the firm to show that no disclosure will occur because of the IB;

Factors the Court will consider:

Was the IB erected ad hoc (only for that retainer)? If so, it is considered less effective
because they are unlikely to change cultural norms and be properly integrated (Marks and
Spencer and Bolkiah; cf. Feez Ruthning, where IB in place). But this is not always fatal
(PhotoCure);

Was the IB erected in a single department? If so, less effective because the members in that
department are accustomed to work with each other and to share information and expertise
(Bolkiah). Was the IB erected in one office? If so, less effective because there is higher risk
of inadvertent disclosure (caused by eg overhearing something, or during social functions).
If erected between two offices, more likely to be effective (Tasman Liquor Traders);

How long was the former client with the firm? The longer the time, the more likely it is that
the entire firm has been exposed to confidential information (Yunghanns);

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Was there delay in erecting the IB? If so, less effective because seepage of information could
have already occurred (Newman). However, evidence can be led showing that during the
period of delay, none of the CI was accessible by the firm (PhotoCure);

Have undertakings been given?5 The stronger the undertakings, the more likely that the IB
will be effective (Feez Ruthning and Guideline 5 however, remember that even the
strongest undertakings can be accidentally breached if the proper procedures are not in
place, see Optus Networks);

What is the standing and reputation of the individual practitioners who possess the
information, or those who seek to act on the new matter? This is relevant to whether they
can be trusted to adhere to the IB (Mallesons).

LIV Guidelines for Information Barriers:


1.

The law practice should have established, documented protocols for setting up and
maintaining information barriers and carefully control access to any client
information;

2.

The law practice should nominate a compliance officer to oversee each IB;

3.

Law practice should ensure the client in the current matter consents in writing that
the law practices duty of disclosure to that client does not extend to any confidential
information of the former client;

4.

All screened persons should be clearly identified and the compliance officer must
keep a record of all screened persons;

5.

Each screened person should provide the appropriate undertakings to the law practice
and the court (undertaking to have limited contact with personnel, not to disclose any
CI, and to report to the compliance officer);

6.

Personnel involved with the current matter should provide undertakings (undertaking
that no CI will be disclosed, they will have limited contact with screened person, they
will not seek or receive CI, and they will report to compliance officer);

7.

Contact between personnel involved in the current matter and screened persons
should be appropriately limited;

Effective undertakings from PhotoCure:

"I,.............................. , Solicitor, undertake to the Court and [the former client] as follows:
1. Not to discuss, or seek to discuss, with [persons who acted on old matter], any matter relating to: [the current
matter, or the old matter]
2. Not to seek or obtain access to any files or documents, including electronic files and documents, in the
possession or custody of [the firm] relating to advice previously provided;
3. Not to work from any floor in the [office in which the team who worked on the old matter] is located;
4. Not to store any hard copy documents drafted or obtained by me, or under my control, in relation to the [the
current matter] in the office [who worked on the old matter];
5. To restrict access to all documents created by me or at my direction and stored electronically so as to permit
access only to those persons [who are working on the current matter].
.......................................

Signed

Date:"
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8.

Must take steps protect the confidentiality of all correspondence and other
communications related to earlier matter;

9.

Any files held by the law practice relating to the earlier matter should be stored in a
secure place, and technological protection should be put in place to ensure that
personnel cannot access former clients files; and

10.

Firm should have an ongoing education program in place, including firm protocols
and sanctions for disobeying.

Examples: IB sufficient?

Feez Ruthning: FR was retained to act against a former client whose work had been carried
out by a discrete section of the firm. The new retainer was handled by a different section, with
different partners and support staff, an IB already existed, and undertakings were given;

Tasman Liquor Traders: IB sufficient because it was between two different offices
(Melbourne and Brisbane) and the matters were unrelated;

Yunghanns: Ad hoc IB = Gillard J had no confidence that the IB could withstand seepage of
information. And Yunghanns was a substantial client to Corrs and would have had contact
with many lawyers in the firm;

Newman v Phillips Fox: Ad hoc IB and there was delay in erecting the IB (4 months);

Optus Networks: The IB existed on the same floor of a Clayton Utz office and was
insufficient to prevent an associate (working with the current client) to get a partner (who
worked with the former client and had signed an undertaking) to sign a document regarding
the matter.

(5)

If NO, should a permanent injunction be granted?

Bolkiah: KPMG, a firm of chartered accountants, undertook work (Project Gemma) which was
potentially adverse to the interests of one of their former clients, Prince Jefri (former project called Project
Lucy auditors were akin to solicitors). KPMG established procedures to prevent leak of CI; eg set up a
Chinese wall, made sure no one who worked on Project Lucy would work on Project Gemma, it was
headed by a Partner who did not work on Project Lucy, and staff were put in a separate building with
restricted access;

Spincode: Look Software was a start-up software company. It had 2 directors, who each owned a company
(Moore owned Spincode). Kirton, a solicitor, acted for LS in all legal matters. When a dispute arose, M left
the co and commenced proceedings using K to get LS wound-up. Court held that K could not act. Brooking
JA said No experienced solicitor of sound judgment would have done what has been done in this case.

McMillan: A law clerk worked on a family law case at one firm. The law clerk was then employed by
another firm as secretary. The client of the 1st firm objected to the 2nd firm acting on the same matter. An
injunction was granted, because a theoretical misuse of confidential information is sufficient in family law
matters. It makes no difference whether the person with the knowledge was legally qualified or not.

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TOPIC 9: Costs
Disclosure requirements in the Act
What are legal costs?

Legal costs means amounts that a person has been or may be charged by, or is or may become liable to pay
to, a law practice for the provision of legal services including disbursements, but not including interest (s
1.2.1);

Disbursements are expenses specifically incurred on behalf of a client (barristers fees, filing fees etc).
Professional fees are the costs of engaging the lawyer. Note: overheads (electricity, rent, stationary etc) are
not disbursements and are impliedly included in the professional fees.

What must be disclosed?


s 3.4.9 Disclosure of costs to clients

(1) A law practice must disclose to a client


(a) How legal costs will be calculated, including whether a practitioner remuneration order or scale of
costs applies to any of the legal costs (##);
(b) The clients right to
(i)

Negotiate a costs agreement with the law practice (**);

(ia)

Receive a bill from the law practice (**); and

(ii)

Request an itemised bill within 30 days after receipt of a lump sum bill (**); and

(iii)

Be notified under s 3.4.16 of any substantial change to the matters disclosed [under s 3.4.16,
the firm must disclose in writing any substantial change to anything disclosed ASAP];

(c) An estimate of the total legal costs, if reasonably practicable (##);


(d) OR If not reasonably practicable to estimate, a range of estimates of the total legal costs and an
explanation of the major variables that will affect the calculation of those costs;
(e) Intervals at which the client will be billed (##);
(f) The rate of interest on overdue legal costs (if any), and whether that rate is a specific rate of interest
or is a benchmark rate;

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(g) If a litigious matter, an estimate of


(i) The range of costs that may be recovered if the client is successful in the litigation; and
(ii) The range of costs the client may be ordered to pay if the client is unsuccessful; and

Per s 3.4.9(2), disclosure must also include:


o

A statement that order of costs will not necessarily cover whole of clients loss; and

If applicable, a statement that disbursements may be payable by the client even if the
client enters a conditional costs agreement.

(h) The clients right to progress reports under s 3.4.186 (**);


(i) Details of the person to contact to discuss the legal costs;
(j) The following avenues that are open to the client in the event of a dispute in relation to costs (**)
(i)

Costs review under Division 7;

(ii)

The setting aside of a costs agreement under s 3.4.32; and

(iii)

Making a complaint under Chapter 4;

(k) Any time limits on above actions (**);


(l) That the law of this jurisdiction applies to legal costs in relation to the matter; and
(m) Information about the clients right (**)
(i) To accept under a corresponding law a written offer to enter into an agreement with the law
practice that the corresponding provisions of the corresponding law apply to the matter; or
(ii) To notify under a corresponding law (and within the time allowed by the corresponding law) the
law practice in writing that the client requires the corresponding provisions of the corresponding
law to apply to the matter.

Matters marked with (**) are satisfied if the firm provides a written statement in the form prescribed by the
regulations (s 3.4.9(3)).

Where first law practice intends to retain another law practice (CLP1LP2): The first law practice
must disclose to the client the details marked with a (##) in relation to the other law practice (s 3.4.10(1)).
Does not apply if LP1 ceases to act for the client when LP2 is retained (s 3.4.10(3)).

How is disclosure to be made?

In writing, before or as soon as practicable after the firm is retained (s 3.4.11(1)).

Under s 3.4.18(1), a law practice must give a client, on reasonable request, (a) a written report of the progress

of the matter and (b) the legal costs incurred to date. Firm can charge for (a), but not (b) (s 3.4.18(2)).
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It must be in clear plain language and in a language other than English if the client is more familiar with
that language (s 3.4.15(1)). If the client cannot read and the firm is aware of this, they must convey the
information to the client orally (s 3.4.15(2)).

Exceptions to disclosure

Disclosure under s 3.4.9 or 3.4.10 is not required where:


i.

s 3.4.12(1)(a): If the total legal costs in the matter, excluding disbursements, are not likely to exceed
$750 (exclusive of GST) or the prescribed amount (whichever is higher);
o

Where it becomes apparent that costs will exceed $750, the firm must disclose the matters
ASAP (s 3.4.12(2)).

ii.

s 3.4.12(1)(b): Where the client has received one or more disclosures from the firm in the last 12
months; and has agreed in writing to waive the right to disclosure; and a firms principal decides on
reasonable grounds that the further disclosure is not warranted, having regard to the nature of the
previous disclosures and the relevant circumstances;
o

A written record of the principals decision has to be in writing and kept with the file (s
3.4.12(3));

If the decision is made on anything other than reasonable grounds, it may constitute UPC or
PM (s 3.4.12(4)).

iii.

s 3.4.12(1)(c): If it is a sophisticated client;


o

Includes a law firm, an Australian Legal Practitioner, public companies, liquidators


administrators or receivers, joint ventures, Ministers and public authorities.

iv.

s 3.4.12(1)(d): Legal costs agreed to on a tender process; or

v.

s 3.4.12(1)(e): Where the firm is not charging, ie pro bono.

Failure to disclose

If the firm does not provide disclosure:


o

The client does not have to pay the legal costs unless they have been reviewed (s 3.4.17(1)), and the
firm cannot sue the client for the costs (s 3.4.17(2));

The client can apply for the costs agreement to be set aside under s 3.4.32 (s 3.4.17(3));

The amount of the costs may be reduced on review, by an amount considered by the Costs Court to
be proportionate to the seriousness of the failure to disclose [around 15%] (s 3.4.17(4)); and

Failure to comply may constitute UPC or PM (s 3.4.17(6)).

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Recovery of legal costs

Legal costs may only be recovered:


o

Under a costs agreement;

OR if no agreement [set aside], in accordance with practitioners remuneration order or scale of


costs;
OR if no scale available, according to the fair and reasonable value of services provided.

Costs agreement
Requirements

Formalities
o

Must be written or evidenced in writing (s 3.4.26(2));

Can be accepted in writing or by other conduct (s 3.4.26(3));

The offer must clearly state that it is an offer to enter a costs agreement, that the client may accept in
writing or by other conduct, and the type of conduct that will constitute acceptance (s 3.4.26(4)); and

It cannot exclude costs review under Div 7 (s 3.4.26(5)).

Conditional costs agreements


o

A costs agreement may provide that payment is conditional on the successful outcome of the matter
(s 3.4.27(1)). Except: for criminal or family law proceedings (s 3.4.27(2));

Requirements for validity:

A conditional costs agreement must set out the circumstances that constitute a successful
outcome7 (s 3.4.27(3)(a));

May provide that disbursements are to be paid regardless of the outcome (s 3.4.27(3)(b)). This
must be done under PCPR 2A.2(a), (b);

Must be in writing, in clear plain language and signed by the client (s 3.4.27(3)(c));

Must contain a statement that client has been informed of right to seek independent legal
advice before entering agreement (s 3.4.27(3)(d));

Must contain a cooling-off period of 5 clear business days (s 3.4.27(3)(e));

If a sophisticated client, no need for (c)(iii) [signature], (d) and (e) (s 3.4.27(4A)).

Successful outcome, win and success mean that the client will receive an amount of money, after

payment of all liabilities incurred in the matter (PCPR 2A.1(a)).


No fee and no charge mean that the client will not be liable for costs (PCPR 2A.1(b)).
If other meanings are intended, these must be fully explained (PCPR 2A.3).
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Conditional costs agreement with FEE UPLIFT


o

A conditional costs agreement may provide for an uplift fee (s 3.4.28(1));

That is, if the lawyer wins they are entitled to a bonus;

An uplift allows a premium of a specified percentage of the legal costs otherwise payable (not
including disbursements) under the agreement to be charged in the event of success, in addition to
the costs otherwise payable;

It must not exceed 25% of the legal costs (s 3.4.28(4)(b));

The agreement must also contain an estimate of the uplift fee, or a range of estimates and an
explanation of what variables will affect the calculation (s 3.4.28(3)). And an agreement cannot
provide for an uplift fee unless the firm reasonably believes that a successful outcome is likely (s
3.4.28(4)(a));

Penalty = 60 PU (s 3.4.28(5)).

Contingency fees are otherwise prohibited


o

Contingency fees are those that provide for payment of a percentage of any award or settlement;

These are prohibited (s 3.4.29(1));

Penalty = 120 PU (s 3.4.29(1)).

If VALID, costs agreement can be enforced


Enforced the same way as any other contract (s 3.4.30(1)) unless void, or set aside.

If BREACH, costs agreement is void


Costs agreements which contravene provisions of Div 5 (3.4.26-3.4.32) are void (s 3.4.31(1)). It cannot be
enforced as a contract. Hence see top of page 44.

Reviewing the costs agreement

A costs agreement may be set aside by VCAT


o

On application by a client, VCAT may order that the costs agreement be set aside if satisfied that the
agreement is not fair or reasonable (s 3.4.32(1));

Must be fair and reasonable at the time of entering the contract (s 3.4.32(2)(d));

VCAT may consider:

Whether the client was induced to enter it by fraud or misrepresentation (s 3.4.32(2)(a));

Whether the practitioner is guilty of PM or UPC in relation to the legal services (s 3.4.32(2)
(b));

Whether cost disclosure was not made (s 3.4.32(2)(c)); and

The circumstances and conduct of the parties before and when the agreement was made (s
3.4.32(2)(d)), and after it was made (s 3.4.32(2)(e)).

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For example, charging a flat hourly rate irrespective of the experience or seniority of the lawyer is
indicative of unreasonableness (Singleton). Eg everyone who works on the matter is charged out at a
rate of $x per hour.

If SET ASIDE
o

If the costs agreement is set aside, VCAT may make an order in relation to the payment of legal costs
the subject of the agreement (s 3.4.32(4));

In making an order, VCAT:

Must apply the applicable scale of costs, or PRO (if any) (s 3.4.32(5)(a));
-

Scale of costs:

Is this a litigious matter? If no, there is no scale;

Does the court have a scale? All the Courts do, except VCAT and Boards;

No scale for criminal work.

Practitioner remuneration order:

For non-litigious matters.

OR if there is none, it must determine the fair and reasonable costs (s 3.4.32(5)(b)), taking
into account:

The seriousness of the conduct (s 3.4.32(5)(b)(i));

Whether it was reasonable to carry out the work (s 3.4.32(5)(b)(ii));

Whether the work was carried out in a reasonable manner (s 3.4.32(5)(b)(iii));

Whether the Act or rules were complied with (s 3.4.32(7)(a));

Whether disclosure was complied with (s 3.4.32(7)(b));

Any advertisement of the firms costs (s 3.4.32(7)(c));

The skill and labour required (s 3.4.32(7)(d));

Whether the work done was within the scope of the retainer (s 3.4.32(7)(e));

The complexity of the matter (s 3.4.32(7)(f));

The quality of the work (s 3.4.32(7)(g));

Place where work was done (s 3.4.32(7)(h));

Time constraints (s 3.4.32(7)(i)); and

Any other relevant matter (s 3.4.32(7)(j)).

The amount determined by VCAT cannot exceed the amount under the costs agreement (s 3.4.32(6)).
This must ignore any illegal uplift fee eg if uplift of 50% and charged $500, if on scale it comes to
$600, the court can only charge $500.

Bill of costs
Requirements

A bill of costs may be itemised or lump sum (s 3.4.34(1));

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If lump sum bill, an itemised bill may be requested within 30 days after receiving the lump sum bill (s
3.4.36(1)), and the firm must comply with the request within 21 days (s 3.4.36(2)). If practitioner fails to
comply within 60 days, the client can demand any moneys or document the practitioner holds regardless of
any lien the practitioner has (PCPR 38). Practitioner cannot charge for the itemised bill prepared under this
section (s 3.4.36(5)).

Commencing legal proceedings

Where no request for itemisation


Proceedings to recover costs can be commenced after 65 days after a lump sum bill has been given (s
3.4.33(1)). A court may authorise a firm to commence proceedings sooner if satisfied that the person is
about to flee (s 3.4.33(2)).

Where there has been a request for itemisation


Recovery cannot be commenced until at least 35 days after providing itemised bill (s 3.4.36(4)). This is 86
days after providing lump sum bill (30 days for request + 21 days to comply + 35 days to commence = 86
days).

This applies whether or not a costs agreement is in place (s 3.4.33(4)).

Costs review
Procedure

A client may apply to the Costs Court for a review of the whole or any part of legal costs (s 3.4.38(1));

Even if the costs have been paid (s 3.4.38(3)), or there was no bill (s 3.4.38(4));

Application must be made within 12 months after the bill was received (s 3.4.38(5)).

o However, if an application is made out of time and the applicant is not a sophisticated client,
the application may be dealt with by the Costs Court if the Supreme Court determines that it is
just and fair to do so (s 3.4.38(6)).

No money need be paid into Court (cf lodging a complaint with the Legal Services Commissioner) (s
3.4.41(1)(a)) and application prevents the law firm from commencing proceedings (s 3.4.41(1)(b)).

What happens?

The Costs Court assesses what is a fair and reasonable amount of legal costs;

See factors on page 46 (for s 3.4.32(7); and cite as s 3.4.44(2)(a)-(c), and (e)-(k)).
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Who pays the costs?

If a bill is reduced by 15% or more, or costs disclosure has been breached, the legal practitioner must pay
the costs of the review (s 3.4.45(2));

Otherwise the client pays (s 3.4.45(2A)).

The Cost Court must refer gross overcharging to the Legal Services Commissioner for investigation, and
disciplinary action might be taken (s 3.4.46(1)).

Legal Services Commissioner

A person who has a civil dispute with a lawyer may make a complaint to the LSC (s 4.2.4(1));

There is a 60 day time limit, after legal costs payable or 30 days after request for an itemised bill was
made (s 4.2.7(2)). LSC can extend this period, if there was a reasonable cause for the delay and legal
proceedings have not been commenced for the recovery of the debt or review of the costs [but not beyond
an extra 4 months] (s 4.2.7(4)).

Limitations:
o

ONLY for costs less than $25,000 (s 4.2.2(2)(a)); and

Client must lodge amount in dispute with the LSC within 28 days (s 4.3.3(1)). LSC may excuse
lodgement of amount wholly or in part, if LSC is satisfied that lodgement would cause the
complainant undue hardship (s 4.3.3(2)). Otherwise complaint is dismissed (s 4.3.3(3)).

After a complaint has been made, and before resolution, the practitioner cannot sue (s 4.3.2(1));

The LSC must attempt to resolve the dispute and may take any action he considers necessary (s 4.3.5(1)).
Including by referring the dispute to mediation, or arranging for a non-binding assessment of legal costs (s
4.3.5(2));

If mediation fails, either party can apply to VCAT (s 4.3.15(1)). VCAT may order that the client pay the
amount of legal costs, or reduce the costs, or the firm waives or repays the clients legal costs, or any other
order it thinks fit (s 4.3.17(1)).

Costs recovered in litigation

Costs indemnity rule: successful party recovers costs from unsuccessful party (costs follow the event);

Three different scales:


1.

PARTY AND PARTY COSTS: all costs necessary and proper for the attainment of justice (the minimum
costs necessary for running the action);
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2.

SOLICITOR AND CLIENT COSTS: all costs reasonably incurred; or

3.

INDEMNITY COSTS: all costs except unreasonable ones.

Generally, costs are taxed on a party and party basis.

See s 3.4.9(2): it is important to explain that success does not mean all costs can be recovered.

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TOPIC 10: Regulation of the Profession


The client can make a complaint

Under s 4.2.1(2), a complaint may involve a:


1.

Civil complaint (includes civil disputes, which are costs disputes [see page 48], claims of financial loss
as a result of an act or omission of a lawyer, or any other genuine dispute arising out of the provision of
legal services; ss 4.2.2(1), (2));

2.

Disciplinary complaint (a complaint about conduct that, if established, would amount to UPC or PM; s
4.2.3(1)); or

3.

Both.

A person may:
o

Make a civil complaint against a law firm, or a practitioner (s 4.2.4(1));or

Make a disciplinary complaint against a practitioner (s 4.2.4(2)).

The person need not specify which type of complaint it is (s 4.2.6(3));

The person is deemed to have waived privilege to the extent necessary (s 4.2.15).

The complaint is made to the LSC (s 4.2.5);

It must be in writing (s 4.2.6(1)) and made within 6 years after the conduct, for disciplinary complaints (s
4.2.7(1)). This can be extended if there was reasonable cause for the delay or it is in the public interest (s
4.2.7(3)).

Complaints process

The LSC may investigate a practitioner even without a complaint (s 4.4.8);

The LSC must first obtain the lawyers comments (Byrne);

The LSC may then:


o

Investigate the disciplinary complaint (s 4.4.7(1));

Refer it to the Law Institute or the Victorian Bar for investigation (s 4.4.9(1)); or

Dismiss it (s 4.2.10) for example, if it is vexatious, misconceived, frivolous or lacking in


substance; it has previously been dismissed; the conduct is the subject of another complaint; or the
LSC thinks it requires no further investigation.

Generally, the LSC refers the complaint to the LIV or VB:


o

The investigating body investigates the complaint and reports to the LSC (s 4.4.10(1));
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The body may require the lawyer to provide a full written explanation of their conduct, and any
other information or documents (s 4.4.11(1)). There is no privilege against self-incrimination
during the investigation;

The LSC may require the body to investigate further or investigate the complaint himself (s
4.4.10(3)(b),(c)).

AFTER investigation:
o

If there is a reasonable likelihood8 that VCAT would find the practitioner guilty of PM, the LSC
must apply to VCAT for an order (s 4.4.13(2));

If there is a reasonable likelihood that VCAT would find the practitioner guilty of UPC, the LSC
may: apply to VCAT, reprimand or caution the practitioner, or take no further action (if they are
generally competent and diligent, and there has been no other substantiated complaint within the
last 5 years) (s 4.4.13(3));

Otherwise, the LSC must take no further action (s 4.4.13(5)).

If sent to VCAT:
o

VCAT must hear and determine any application by the LSC (s 4.4.15);

If, after the hearing, VCAT is satisfied that the practitioner is guilty of UPC or PM, it may make
any order it thinks fit (s 4.4.16);

Including:

P be removed from the Supreme Court roll (s 4.4.17(a));

Ps local practising certificate be cancelled or suspended (s 4.4.17(b));

An order amending the conditions of Ps practising certificate (s 4.4.17(d));

An order that P pays compensation, not exceeding $25,000 (s 4.4.19(a));

An order that P pays a fine (not exceeding $10,000 for UPC and $50,000 for PM) (s
4.4.19(b));

An order that P undertake and complete a legal education course (s 4.4.19(c));

An order that P is supervised (s 4.4.19(d));

An order that P do or refrain from doing something (s 4.4.19(e));

An order that Ps practice be subject to periodic inspection (s 4.4.19(h));

An order reprimanding P (s 4.4.19(k));

And other order VCAT thinks fit (s 4.4.19(n)).

The purpose is protective, not punishment.

Removal of practitioner from the roll

The standard of proof is on the balance of probabilities (although the more serious the case, the greater the

clarity of proof required to satisfy the civil standard; Reifek v McElnoy).


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If the lawyers practising certificate has been cancelled, OR the lawyer is found guilty of an offence, s
2.4.42 applies (s 2.4.42(1));

The Board may serve on the lawyer a notice stating that it will apply to the Supreme Court for an order that
the lawyers name be removed from the roll (s 2.4.42(2));

The lawyer must show cause why his name should not be removed (s 2.4.42(2)). The lawyer will be given a
reasonably opportunity (s 2.4.42(4)).

If the lawyer does not satisfy the Board, the Board will apply (s 2.4.42(3)) and the Supreme Court may
order that the lawyers name be removed from the roll (s 2.4.42(5)). The lawyer is entitled to appear before
the Supreme Court at a hearing (s 2.4.42(6)).
o

The question is whether the lawyer is a fit and proper person at the time of the hearing
(McGrath);

While an offence is a precondition for an order, it does not necessarily follow that the lawyer
will be removed (McGrath).

Application for readmission

Practitioners who are disbarred can apply for re-admission after the expiration of any exclusion period;

The applicant must honestly disclose all matters must approach court with candour (in Re S (a solicitor),
the solicitors application for re-admission 18 years after he was jailed was dismissed, because he gave a
misleading account of the misconduct);

In an application for re-admission the applicant must show that he can safely be trusted to conduct himself
with honesty and propriety (Re S (a solicitor)9). The applicant must prove that there is no significant
prospect of repetition of the conduct which resulted in him being removed (Re Stokes);

Eg in Re Stokes, the practitioner was struck off because he was suffering a psychiatric condition this
condition had subsided, and character evidence was entered = re-admitted.

Per Nathan J: Repayment of misappropriated funds made to support a claim for re-admission should be

prompt, motivated by a sense of obligation to those persons defrauded, and above all adequate in the
circumstances. Brooking J, however, was prepared to re-admit S despite the late restitution even though it was
motivated by self-interest rather than remorse [the critical factor here for him was the failure to disclose].
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Disciplinary complaint

Unsatisfactory professional conduct (UPC):


o

Includes conduct 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 (s 4.4.2).

Professional misconduct (PM):


o

Includes:
(a) UPC that involves a substantial or consistent failure to reach or maintain a reasonable standard
of competence and diligence; and
(b) Conduct, that if established, would justify a finding that the practitioner is not a fit and
proper person to engage in legal practice (s 4.4.3(1)).

Need not be dishonest or unlawful (Kennedy).

What might constitute UPC or PM?

The following conduct is capable of constituting UPC or PM:


s 4.4.4 (a)

(b)

Charging excessive legal costs;

(c)

Being found guilty of a serious offence, a tax offence, or a dishonesty offence;

(d)

Becoming insolvent;

(e)

Becoming disqualified from managing a corporation;

(f)

Failing to comply with an order of VCAT under this Act; or

(g)

Failing to comply with a compensation order.

The following conduct constitutes UPC:


s 4.4.5 (1)

Conduct that contravenes this Act or the rules;

Failing to comply with a condition of his practising certificate.

The following conduct constitutes PM:


s 4.4.6 (1)
(2)

Wilful or reckless failure to comply with a condition of his practising certificate; or


Wilful or reckless failure to comply with an undertaking given to a court, VCAT, LSC or the
Board.

Examples of conduct that might constitute UPC or PM


A. Trust account irregularities

The provisions:

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After receiving trust money, the firm must deposit the money in a general trust account of the
firm ASAP (s 3.3.13(1));

The firm must hold the trust money exclusively for the person on whose behalf it is received,
and disburse the money only in accordance with a direction given by the person (s 3.3.14(1));

Funds can only be withdrawn by cheque or EFT (s 3.3.14A(1));

Trust money cannot be used to pay debts of practice or any of its practitioners (s 3.3.18(1));

Trust money cannot be mixed with other money (s 3.3.19(1));

If a practitioner becomes aware of irregularities in any of his trust accounts, they must give
written notice to the Board ASAP (s 3.3.22(1));

A practitioner is guilty of an offence if he, without reasonable excuse, causes a deficiency in


any trust account or a failure to pay or deliver any trust money (s 3.3.21(1)). Penalty = 15
years imprisonment maximum.

Use s 4.4.4(a) (conduct that contravenes the Act);

Irregularities can either be:


o

Accidental = UPC; or

Dishonest = PM. Whenever a clients money is deliberately used for a purpose other than the
purpose for which the client entrusts it to the practitioner, there is an act of dishonesty (In Re a
Practitioner per King CJ). Trust account irregularities amounting to misconduct will usually
result in disbarment.

B. Failure to supervise

The extent of a practitioners responsibility to supervise depends on the competence and integrity of the
employee and the nature of the transaction (Foreman);

The duty to supervise extends at least to having sufficient knowledge of transactions handled by
employees to be satisfied that:

Transactions are handled competently and efficiently;

Trust accounting requirements are observed; and

Ethical obligations such as those relating to conflict of interests are properly observed.

If the employer is on notice, the duty to supervise is stricter:

Eg in Foreman, a clerk had previously lent clients money to a 3rd person without adequate
security and F had to make good the loss to the client. Subsequently, the clerk again lent
money without security. The Law Society found that Foreman should have supervised the
clerk more, and imposed a fine and suspended him for 18 months); and

In Re Mayes, Mayes (partner) noticed a trust account irregularity at his other partners office.
He consulted the partner about it, and the partner said he would correct it immediately. Mayes
made not further inquiries. This was held to be wilful misconduct because Mayes was put on
notice, and he failed to investigate = guilty of PM. Negligence can amount to PM.

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For partners: Each partner has a responsibility to see that proper systems are in place and to check that
the systems are operating properly (Re Mayes). The extent to which a partner should concern himself
personally varies with the size of the firm (if large, a partner is not expected to check other offices).

C. Commission of crimes

See s 4.4.4(c) (P found guilty of a serious offence, tax offence, or dishonesty offence);

A conviction is not conclusive proof of UPC/PM (must look at circumstances; In Re a Solicitor);

Note: It may still be UPC/PM, even if the P is not found guilty (eg if the conduct can be established on
the BOP but not beyond reasonable doubt; Re Sawley).

Was it committed in a professional capacity?


o

An offence committed in a professional capacity is PM;

Q: By reason of the conduct, is the practitioner still a fit and proper person? (Re Crowley)

In Re Crowley, a legal officer at the Cth DPP offered some confidential documents to Bonds
family in exchange for money. He was sentenced to 5 years imprisonment and struck off the roll.
Crowleys offences struck at the very heart of the administration of justice and it was obvious he
was no longer fit and proper to practice.

Or in a personal capacity?
o

Depends on the nature, character and frequency of the offending behaviour;

In Ziems, a barrister was found guilty of involuntary manslaughter and imprisoned for 2 years,
after killing a motor cyclist whilst driving drunk. The High Court (3-2) suspended him (but
overturned the decision to strike him off). The conduct did not indicate that Ziems was unfit to
practice it was an isolated incident, it was not premeditated, and did not indicate a tendency to
violence or lack of probity.

D. Personal misconduct

When can personal misconduct amount to PM?


Two situations (Cummins, per Spigelman CJ):
i.

Acts which are sufficiently connected with actual practice albeit not occurring in practice (eg a
tax lawyer who avoids tax); or

ii.

Conduct outside of practice which manifests the absence of qualities incompatible with, or
essential for, the conduct of practice.

Examples:
o

Forming relationships with clients: See Morel (page 32);

Tax evasion: In Cummins, Cummins QC was removed from the roll after evading the payment
of income tax for 40 years. He had tax debts of $1m and then bankrupted himself to avoid the
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ATO. This amounted to PM. See ss 4.4.4(c), (d). It is irrelevant that the practitioner led an
otherwise exemplary career (Young);
o

Operating a brothel; and

Consorting with criminals (Re Foster).

E. Gross overcharging

See s 4.4.4(b) (charging excessive legal costs);

It is insufficient that the fees are merely excessive;

The question is whether the practitioner has charged fees which are grossly in excess of those that
would be charged by lawyers of good repute and competency (Re Melvey);

It may be misconduct even if the client is satisfied with the fees;

Generally, will only amount to UPC.

F. Gross neglect or delay

May amount to UPC (s 4.4.2);

In Blazevic and Treby, a practitioner failed to respond timely to requests from the LSC as to conduct
regarding disciplinary complaints = UPC.

G. Deliberate lying and dishonesty

Lying to a Tribunal or Court


o

A finding of deliberate lying to a disciplinary tribunal or court in a matter material to its inquiry
= PM and could warrant disbarment (OReilly);

A high degree of satisfaction is required before finding that a practitioner has lied ie the Court
must reach the affirmative opinion that the practitioner deliberately lied (Kirby P). Remember:
the more serious the case, the greater the clarity of proof required to satisfy the civil standard of
on the BOP (Reifek v McElnoy);

Integrity is of the first and most indispensable necessity for a legal practitioner. The forgery of
any document clearly is a grave offence against that obligation of integrity and honesty (Johal).

Withholding discovery
o

In Guss, a solicitor deliberately failed to disclose a document and allowed counsel to stand in
open court and assert that no such document existed = PM and solicitor struck off;

And in Piva, the solicitor deliberately withheld discovery = PM. However, he was not struck off
(practising certificate cancelled for 4 years), because it was not of the gravity to conclude that he
was not a fit and proper person.
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H. Sexual misconduct

May also involve a CONFLICT OF INTEREST (see page 32);

No general rule;

Examine all the circumstances with meticulous care (Ziems and A Solicitor);

The personal misconduct must indicate an unfitness to practice;

Failure to disclose a sex offence history is generally considered evidence of a failure to rehabilitate (but
see A Solicitor);

Examples:
o

The High Court has held that sexual relations with a client prior to the completion of
matrimonial proceedings, although reprehensible, fell short of professional misconduct showing
unfitness to practise (Bar Assoc Qld v Lamb);

In A Solicitor, a practitioner who molested his step-daughters was allowed to reapply for a
practising certificate after 5 years of non-practice. The court forgave his failure to disclose
further allegations of sexual abuse. This was because of extraordinary circumstances (the
isolated nature of the offences, and mitigating factors).

I. Mental illness

Mental incapacity may be a ground for disbarring because it may show that a person labouring under a
defect of reason is not a fit and proper person to practise (Himmelhoch per OBryan J);

The court is more likely to suspend Ps practicing certificate if rehabilitation is likely, rather than strike
P off the roll (in Re B (a solicitor), a solicitor shot at another car, while suffering a severe personality
disorder and believed he was John the Baptist he was found not guilty of murder, but detained at the
Governors pleasure. Brooking J refused to strike P off, rather suspended his certificate during his
detention);

A practitioner will only be struck off if the misconduct was sufficiently grave (Himmelhoch per
OBryan J. In this case, H demanded that the client repay a fictitious debt of $6,500. H was suspended
for 6 months. H then did it again. Tribunal cancelled his practicing certificate, and referred the matter
to the SC, which refused to strike him off he was suffering from a mental illness, exacerbated by a
number of factors, but he had shown remorse).

What to consider when deciding between UPC and PM?

Look at the definitions in s 4.4.2 and s 4.4.3(1):


o

If repeated or substantial UPC =PM;

If P not fit and proper = PM;


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But if Ps behaviour fell short of accepted standards = UPC.

Examples (from Michael McGarvie):


o

Johal: Forged a work medical certificate, and had previously been dishonest with the Board (at
admission) = PM;

Spicehandler: False resume for OPP job and engaged in legal practice without certificate =
reprimanded and no certificate for 5 years;

McCristal: Trust account irregularities, but overwhelmed by work load, showed remorse and of
good character = PM with $25,000 fine;

Keough: Practitioner who deliberately submitted a plagiarised research paper in Masters degree =
PM, and PC cancelled for 6 months.

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TOPIC 11: Professional Liability


Liability in tort (negligence)

Scope of the duty:


o

Not limited to the retainer;

The DOC may require the taking of positive steps beyond the specifically agreed professional task or
function to avoid a real and foreseeable risk of economic loss being sustained by the client
(Hawkins).

Standard of care:
o

To exercise a reasonable degree of skill and care;

The relevant standard is that of a qualified, competent and careful lawyer in the given circumstances
in the practice of his or her profession (Hawkins v Clayton per Deane J);

For example, failure to advise the client that they had a cause of action in contract or tort
was a breach of the duty (Kolavo v Pitsikas).

Practitioner will be held to their level of expertise or the expertise they hold themselves out as
having.

Liability after counsel is retained:


o

A solicitors DOC does not end when counsel is retained;

A solicitor lacking specialist expertise in a field is entitled to rely heavily on counsels advice, but
cannot blindly follow the advice. The solicitor must still turn her or his mind to the issue under
consideration (Yates).

Cannot exclude liability for negligence (s 7.2.11).

Liability to third parties (a non-client)

Duty: There is a duty to take reasonable care to avoid acts or omissions which a practitioner could
reasonably foresee would be likely to harm another person;

Thus a practitioner who creates a reasonable expectation in a 3rd party in circumstances where it is
reasonable for the 3rd party to rely on that expectation, assumes a tortious responsibility to that person
(Hawkins v Clayton).

Three circumstances:
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4.

Negligent misstatements to friends


o

A lawyer who advises a person who he knows or should know will rely on that advice
assumes a duty of care to use proper care in giving that advice (Hedley Byrne v Heller). If the
advice is negligent and loss results, the lawyer will be liable for damages in tort (or possibly
for misleading and deceptive conduct). [see 21.30]

2.

Failure to notify an Executor of a will


o

If a law firm has custody of a will, and they have reason to believe that disclosure by them to
the executor is needed so that the will is made effectual, the firm is under a duty to take
reasonable steps to find the executor (Hawkins v Clayton per Brennan J);

In Hawkins v Clayton, solicitors retained custody of a will for 6 years after the testatrixs death
and did not locate the executor. The solicitors were found to be liable in tort to the executor.
The executor could recover damages for the deterioration of the house and its contents, loss of
rent, loss of income derived from the house, and penalty for late lodgement of a return for
death duty.

3.

Duty to disappointed beneficiaries


o

In Hill v Van Erp, H was instructed to prepare a will for his client, leaving a house jointly to
her son and to her friend (Mrs Van Erp). At the signing of the will, he negligently allowed the
husband of Mrs VE to witness the will. This nullified the will. Mrs VE sued H, claiming her
lost share in the estate. The High Court found H to be liable to Mrs VE in negligence.

Immunity

Barristers and advocate solicitors have immunity from negligence (DOrta-Ekenaike);

What does it cover?


o

The immunity covers the advocates conduct and management of a case in court (Giannarelli);

AND work done out of court which leads to a decision affecting the conduct of the case in court
(Giannarelli) work that is intimately connected with court work (eg settlement advice; Goddard
Elliott10);

BUT the immunity does not cover negligent failure to advise on the existence of a cause of action,
because it has no relevant connection with the in-court conduct of counsel (Saif Ali).

This immunity is preserved by s 7.2.11(1).

Liability under contract

10

In Goddard Elliott, plaintiff settled Family Court proceedings on the advice of senior and junior counsel and

his solicitor. Bell J found there was preparation negligence (delays in drafting documents, dealing with matters,
getting valuations, putting in evidence in answer etc) and capacity negligence (plaintiff did not have capacity to
settle). However, the work was intimately connected with court work, and hence the solicitor was immune.
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Liability for breach of implied term to exercise reasonable care and skill.

Contributory negligence
o

While the practitioners liability in tort can be reduced if the client was negligent, contributory
negligence does not apply to contractual claims (Astley v Austrust). However, this has been rectified
by statute (see Wrongs Act 1958 (Vic) Part IVAA it applies to contractual liability).

Immunity

The Court in Giannarelli found that a barristers contract does not contain the implied term to exercise
reasonable care and skill. However, clients can now brief barristers directly without a solicitor;

Therefore, it is unclear whether barristers have immunity from liability under contract;

The prudent position for barristers is to assume that liability exists [ie no immunity].

Note: In Attard v James Legal, Simpson J of the NSW SC held that the reasoning of the High Court in
Giannarelli and DOrta-Ekenaike makes it plain that immunity extends to any cause of action based upon
the conduct of litigation (at [67]). Hence the immunity extends to contractual liability.

Should there be immunity?

For immunity:
o

Barristers need to present cases without concern for liability (It is impossible to expect an advocate
to prune his case of irrelevancies against a clients wishes if he faces an action for negligence when
he does so; Rondel v Worsley per Lord Reid);

Undesirability of re-litigating cases (the judicial process is not assisted if disputes can be re-litigated
via collateral attack on ones former advocate the only argument that found favour with the High
Court in DOrta-Ekenaike).

Against immunity:
o

The public interest is satisfactorily protected by independent principles and powers of the court such
as res judicata, issue estoppel and abuse of process (Arthur J S Hall & Co per Lord Steyne);

The exposure of isolated acts of incompetence at the Bar will strengthen rather than weaken the legal
system, by identifying negligent barristers (Arthur J S Hall & Co);

Overseas evidence suggests there are no floodgates breached where the immunity does not apply
(eg Canada);

Professional indemnity insurance is now standard;

In criminal matters, no civil claim in negligence is possible unless the conviction is set aside on
appeal or on a petition for mercy;

Everyone else is accountable and it is not conducive to respect for justice to exempt its practitioners.
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