Legal Regulation & Professional Standards Michael McGarvie Legal Services Commissioner Deakin University School of Law Research Seminar Thursday 14 August 2014 Michael McGarvie •  Solicitor and Partner – Holding Redlich for 23 years •  CEO Supreme Court of Victoria 2006-09 •  Commissioner and Board CEO since Dec 2009 Outline •  Who we are and what we do •  New Uniform Law •  Case examples The wisdom of Aristotle ‘A wise person knows when to improvise. And most important, a wise person does this improvising … in the service of the right aims’ Legal Services Commissioner •  •  •  •  •  2000 complaints per annum 500 Family (25%) 200 Probate + estates (11%) 175 Conveyancing (9%) 175 Small commercial (9%) Legal Services Commissioner •  •  •  •  •  •  Complaints handling Education and outreach Costs v. Conduct Conciliate and mediate Communicate Meet and visit Legal Services Board •  •  •  •  •  •  •  •  Public Purpose Fund Trust account oversight Fidelity Fund [case 1 – Camilleri] Rule-making External interventions [case 2 - Coleman] Licensing + Suitability + Conditions Policing unqualified practise [case 3 – McClure] ILPs and MDPs Legal Services Board •  •  •  •  •  •  •  Supervised legal practice Continuing Professional Development Policy development Insurance requirements Financial management Grants + funded entities Incorporated Legal Practice audits Commissioner Conduct complaints •  •  •  •  •  •  •  Dishonesty & neglect vs relationship breakdown Duty to court v duty to client Tip: follow conduct rules + communicate, provide service Early attempt to assist in resolution If not resolved: dismissal or further investigation Major misconduct always fully investigated If warranted, prosecute in VCAT [case 4 – “PLP”] Legal Profession Uniform Law changes •  Commissioner –  Determination powers –  Costs threshold $100,000 + costs orders to $10,000 •  Board –  Law firm audits –  Rules advisor, not maker Legal Profession Uniform Law changes •  Costs –  –  –  –  –  –  Fair + reasonable Look at skill, complexity, urgency, quality and instructions Must be proportionate and reasonably incurred Simplified written disclosure above $750 Full written disclosure above $3000 Failure to disclose = void agreement + misconduct Legal Profession Uniform Law changes •  Consumer matters - Commissioner’s determination –  –  –  –  –  Cautions Apologies Redo work Training or supervision Pay up to $25,000 compensation Legal Profession Uniform Law changes •  Disciplinary investigations - Commissioner’s determination –  –  –  –  –  –  –  Search warrants + Enter premises Cautions Apologies Redo work Training or supervision Reprimand Pay up to $25,000 fine, enforceable as a court judgement Case 1 – Fidelity fund claims The Age: 13 June Joe Camilleri sues over dodgy lawyer's theft Case 1 – Camilleri v. Fidelity Fund - stolen trust money •  140k stolen by corrupt solicitor running a “Ponzi” scheme •  Right to be compensated for stolen trust money •  Investment exception •  Claim denied •  Appealed, then settled Case 2 – Coleman – handling regulated property Herald Sun: 9 Oct 2013 'Homer Simpson' impostor jailed for $400k fraud Case 2 – Coleman – handling regulated property •  Illegally claimed first home buyers grant under 4 fictitious names •  Serious financial irregularities – receiver appointed to firm, relinquished license •  Kept client files and kept acting •  Unqualified legal practice – kept acting without license •  Interfering with regulated property •  Obstruction of receiver Case 2 – Coleman – handling regulated property •  Pleaded guilty •  LSB prosecution: 9 months gaol, suspended for 18 months •  Fine $13,000 •  Costs order $20,000 •  State Revenue Office prosecution: Five years’ gaol over trust fraud, theft and obtaining financial advantage by deception Case 3 – Malcolm McClure - Licence to operate The Age: 19 June 2014 'Charlatan' fined over legal advice to racing legend Bob Jane Case 3 – McClure – Licence to operate •  Acted for Bob Jane unlicensed. Gave legal advice and lodged court docs. •  Court imposed default orders on Bob Jane (defaulted on McClure’s advice) •  Claimed: “never said I was a lawyer” •  Represented himself in LSB prosecution •  Challenged constitutionality of prosecution •  Vowed to “smash the Cartel” of LSC •  Ejected from court first day •  Failed to appear third day –arrest warrant issued from the bench Case 3 – McClure – Licence to operate •  Justice North: “in the documents he has drawn, and his advocacy in the court, Mr McClure has demonstrated a complete lack of understanding, matched only by his self confidence” •  “By his incompetence, he has caused (the parties) to incur tens of thousands of unnecessary costs” •  a “persuasive charlatan” •  Magistrate Collins: conviction and $10,000 fine Case 4 – LSC v. PLP (VCAT J204/2013) - Misconduct The Age:10 July 2014 Lawyer barred and fined for secretly filming and sexually harassing trainee Case 4 – PLP - sexual harassment - misconduct •  Supervisor of a female trainee lawyer •  Trainee needed 80 days training – acquaintances •  Asked for sex 78 times – showed videos and images •  Sought sex to sign training papers •  Denied, but filmed himself •  Disqualified 8 months + pay 100k compensation How does a good regulator improvise? •  Consult and test –  Eg managerships •  Fill gaps –  Eg Mental illness policy •  Take criticism –  Ombudsman Vic •  Expect some setbacks –  Penalties for delay Legal Regulation & Professional Standards Michael McGarvie Legal Services Commissioner Deakin University School of Law Research Seminar Thursday 14 August 2014