Re A Solicitor

CACV000051/1992

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Coram: Hon. Sir.Derek Cons, V.P., Jones & Kaplan, JJ.

Date of hearing: 9th & 16th July 1992

Date of handing down judgment: 23rd July 1992

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J U D G M E N T

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Sir Derek Cons, V.P.:

1. On the 31st December 1991 Miss A, a solicitor, was found wanting in her profession by a disciplinary committee appointed under s. 9 of the Legal Practitioners Ordinance, Cap. 159. The committee concluded that she had been "guilty of serious misconduct, such as to bring the profession into disrepute". She was ordered to be censured, suspended from practice for 18 months, and thereafter not to be permitted to practise, other than as an employed solicitor, for a period of three years. She now appeals.

2. Miss A set up her own practice in March 1986, dealing mainly with conveyancing and general matters. By March 1988 she had a staff of about twenty, including four conveyancing clerks. She also employed two assistant solicitors, but for matters other than conveyancing.

3. In January of that year her firm was instructed by a husband and wife in connection with their purchase of a flat in Telford Gardens, Hong Kong. The transaction included a 12-year home loan from the Hong kong and Shanghai Banking Corporation. Accordingly, on the 2nd March, the husband and wife attended at the firm's office and executed the assignment and a legal charge of the property in favour of the bank. They duly satisfied the firm's bill of costs.

4. For reasons which are not clear the blank spaces which had been left for the dates of the two documents were not completed on the 2nd March. Neither were the documents registered with the Land Office, at least not until the 27th June, which date was then incorrectly put upon the documents in order to avoid a penalty for late stamping.

5. The misconduct was brought to light because in the meantime the husband had died and the wife had instructed other solicitors to deal with his estate. The other solicitors raised the matter first on the 29th December. There must have been further telephone calls, but the dialogue was not concluded until the 7th April 1989 when Miss A's firm forwarded to the other solicitors, under cover of a letter signed by herself personally, a copy of a statutory declaration made by her which the latter stated to have been already filed with the Land Office. That was untrue. So were the contents of the statutory declaration, insofar as it declared that the two documents had been executed in escrow.

6. The subsequent dialogue with the Law Society, prompted by a complaint from the wife in May 1989 lasted much longer, mainly because Miss A persistently delayed answering the Society's letters - six reminders were found to be necessary during the course of the correspondence - and was not very forthcoming when she did. A full explanation was not given until the 21st March 1990. Even then Miss A failed to deal with the specific and repeated queries from the Society regarding the suggested escrow, a matter which became one of the grounds of complaint in the subsequent enquiry. The letter of the 21st March contained yet another untruth, that the legal charge had been amended and registered. That was true of the assignment, but the legal charge was not amended and registered until January this year, i.e. after the enquiry had been concluded.

7. The complaints eventually laid before the disciplinary committee, by means of an affidavit from the Deputy Secretary General and Director of Professional Conduct, all of which were found proven, may be conveniently summarised as:

1.    persistent failure to reply promptly to the Law Society's letters and invitations for explanation;

2.    failure to answer sufficiently or satisfactorily the Society's questions as to what were the conditions of the escrow and when they had been fulfilled; and

3.    untruthful or misleading letters:

(a)    of the 21st March 1990 to the Society alleging that the legal charge had been amended and registered;

(b)    of the 7th April 1989 to the other solicitors, alleging that the statutory declaration had already been lodged;

(c)    of the 7th August 1989 to the Law Society, advising that the amended assignment would be lodged within that week (but in fact not until 19 days thereafter); and

(d)    of the 12th June 1989, advising that Miss A had agreed with the wife to amend the original documents (so that, the legal charge being still unamended, she had either misled the Law Society or had failed to keep a promise to the wife).

8. Although they are not attacked as such in the notice of appeal we feel bound to observe that in our view items 3(c) and (d) can hardly be said to be untruthful or misleading. Rather are they illustrations of the lack of responsibility displayed by Miss A throughout the entirety of this matter.

9. The finding of guilt under head 1, questioned by the first ground of the notice of appeal, is no longer attacked. But it is said by Mr. Swaine, Q.C., now appearing for Miss A who was unrepresented before the committee, that the committee were wrong to find guilt under head 2, because the answers to the questions on escrow were sufficiently to be found in the letter of the 21st March 1990 and in the affidavit which Miss A had lodged before the committee. We accept that the latter makes clear that the signing in escrow was no more than a figment of some person's imagination. But nothing of that kind can be found in the letter of the 21 March. In our view the committee were fully justified in the conclusion to which they came.

10. Apart from this aspect the appeal has been substantially directed to establishing that Miss A was not deliberately dishonest, as the heavy penalty imposed indicates that the committee thought her to be, but rather that her conduct was really dictated by her belief in the truth of what she had been told by her staff. It is accepted that she may have been negligent in not making fuller enquiries, or probing what was told to her, but submitted that she should be excused to some extent by the fact that she was not well, due to pregnancy, throughout the period in question. In particular, it is suggested that the committee wrongly took into consideration, as aggravating her misconduct, what were said to be nine further matters in her affidavit that-were also misleading or untruthful. It is emphasised that there was at the time no direct challenge to her affidavit, nor was any request made that she should be cross-examined thereon.

11. Insofar as the nine matters rest, as most do, upon the evidence of the particular conveyancing clerk in question, we have to agree with Mr. Swaine. We appreciate the advantage that the committee enjoyed in seeing and hearing that clerk give his evidence. But having been taken carefully through the inconsistencies and contradictions therein, which are clearly apparent from the transcript, we feel bound to say that the allegations he made against Miss A cannot be accepted as having been made out to the standard required in proceedings of this nature: see Bhandari v. Advocates Committee [1956] 1 WLR 1442.

12. However there is other conduct in which Miss A has exhibited little, if any, concern for the truth. Mr. Yu, for the Law Society, has in particular drawn-our attention to three instances:

1. In her affidavit Miss A said that the registration clerk, who had been blamed by the conveyancing clerk for mislaying the particular file, had been dismissed in March 1989 "for persistent failures to perform his duty which led to a number of conveyancing files not being registered within the prescribed time". Nevertheless she gave him a testimonial which stated that "he resigned of his own accord" and that

"during his stay with our firm in the present capacity, he had proved himself to be dutiful and hardworking. In general, we are happy with his performance".

Miss A stated to the committee that it was her practice to give similar testimonials to all staff who left her employ, whether they had been dismissed for misconduct or not. Mr. Swaine very properly conceded that this was the biggest obstacle that he had to overcome in seeking to establish the integrity of his client. It is perhaps not surprising that the committee preferred the clerk's evidence that he had not been dismissed.

2. In her statutory declaration Miss A alleged that the documents were executed in escrow "according to my firm's record". It is clear from her own affidavit that she had never seen any such record.

3. In explanation of her failure to make full enquiry as to the escrow said to have been reported to her by her conveyancing clerk Miss A sought to rely, inter alia, on the fact that

"I was then newly pregnant and was suffering from frequent nausea and other personal discomforts even when I was working in office".

However the medical report annexed to her affidavit shows that at that time she was not yet pregnant.

13. We accept, as Mr. Swaine observed in his reply, that the two latter points were not made at the hearing and could perhaps have been met by Miss A as, for example, the last mentioned can be met, as Mr. Swaine is instructed, by evidence that Miss A was then suffering from a phantom pregnancy. Nevertheless we are satisfied that there was sufficient before the committee to justify their taking a serious view of Miss A's conduct.

14. We do not wish it to be thought that we view her conduct any more lightly. But having regard to other orders that have been made following calculated financial dishonesty, - see, for example In re a Solicitor Civil Appeal No. 134 of 1987 - we do feel, with respect, that in the circumstances the period of suspension was manifestly too long. We therefore allow the appeal to the extent of setting aside the order for suspension for 18 months and substitute a similar order for a period of six months. We see no reason to interfere with the order for censure or with the period during which Miss A should not be able to practise otherwise than as an employed solicitor. We make an order nisi that there should be no order of costs as to this appeal.

Representation:

John Swaine, Q.C., & Simon Chiu (M/s. Li & Cheung) for the appellant

Denis Yu (M/s. Lo & Lo) for the Law Society of Hong Kong/ respondent