6.78 Costs orders may be made by the Tribunal against a practitioner who is found guilty of professional misconduct or unsatisfactory professional conduct or (if special circumstances so warrant) against the Public Purpose Fund if the Tribunal is satisfied the practitioner is not guilty.
6.79 In IP 18 the Commission asked whether the current provisions relating to costs before the Tribunal should be altered in any way (Issue 40) and considered a number of issues which generally relate to the position of practitioners who are found by the Tribunal to be not guilty of professional misconduct or unsatisfactory professional conduct, including whether:
the Tribunal should be given the power to award costs against
118. NSW Bar Association, Submission at 56-57.
119. I Zamir, The Declaratory Judgment (2nd edition, Sweet & Maxwell, London, 1993) at para 4.046.
120. I Zamir, The Declaratory Judgment (2nd edition, Sweet & Maxwell, London, 1993) at para 4.046.
121. See also para 3.52 and 3.53.
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the LSC or the Law Society or Bar Association;
the Tribunal’s powers with respect to costs should extend to interlocutory proceedings;
the power to award costs when a practitioner is found not guilty should not be limited to “special circumstances”; and
the costs to be awarded should be determined by an assessor rather than the Tribunal.122
6.80 One submission supported these proposals.123 The Law Society supported giving the Tribunal the power to order costs generally but suggested that a successful practitioner should be entitled to an order for costs against the Public Purpose Fund.124 The Bar Association proposed that an award of costs in favour of a practitioner should also be available when proceedings are only dismissed in part.125 The Law Society and Bar Association both supported the determination of costs being made by an assessor rather than the Tribunal.126
6.81 The Victorian provisions relating to costs orders are as follows:
(1) The Tribunal may order the payment of the costs of and incidental to any hearing under this Division.
(2) Subject to this section, the costs are in the discretion of the Tribunal.
(3) The Tribunal must not make an order for costs against an RPA,127 the Board or the Legal Ombudsman unless satisfied that special circumstances make it appropriate
122. NSW Bar Association, Preliminary Submission 1 at para 37.
123. R S Cuddy, Submission at 7.
124. Law Society of NSW, Submission at 19.
125. NSW Bar Association, Submission at 57.
126. NSW Bar Association, Submission at 57; Law Society of NSW, Submission at 19.
127. A recognised professional association under Legal Practice Act 1996 (Vic) s 299.
to do so.
(4) The Full Tribunal may fix the amount of costs itself or order that bills of costs be assessed or settled by the registrar or a deputy registrar.128
The Victorian Legal Ombudsman suggests that these provisions are working satisfactorily.129
6.82 The Victorian and New South Wales approaches to costs before legal disciplinary tribunals are quite different to those in relation to costs, for example, before the New South Wales Medical Tribunal:
The Tribunal may order the complainant, if any, the registered medical practitioner concerned, or any other person entitled to appear (whether as of right or because leave to appear has been granted) at any inquiry or appeal before the Tribunal to pay such costs to such person as the Tribunal may determine.130
The Court of Appeal has held that the power to order costs conferred on the Medical Tribunal is very broad and extends to the ordering of indemnity costs as well as party and party costs.131
6.83 The Victorian provisions go some way towards dealing with the substance of the issues outlined above. The Commission accordingly supports subsections (1) and (2) so far as they broaden the discretion of the Tribunal to make costs orders in relation to proceedings before it. Subsection (4) usefully allows the Tribunal to assess costs or to order that they be assessed outside the Tribunal.
6.84 However, with respect to subsection (3) the Public Purpose Fund is not available to meet a costs order in favour of a successful practitioner, and the “special circumstances” test is preserved.
128. Legal Practice Act 1996 (Vic) s 162.
129. Victorian Legal Ombudsman, Submission at 58.
130. Medical Practice Act 1992 (NSW) Sch 2 cl 13(1).
131. Walton v McBride (1995) 36 NSWLR 440 at 464 (Powell JA) and 474-475 (Cole JA), but see Kirby P’s dissent at 446-451.
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6.85 The question of the availability of the Public Purpose Fund and whether the Tribunal should be given the power to award costs against the LSC or the Law Society or Bar Association is a difficult one. Given the primacy accorded to the protection of the public in the current disciplinary system, it would not be desirable for an institution with meagre resources, like the Bar Association, to have to be concerned about costs in cases that may be lengthy, complex or otherwise expensive to run. Provisions allowing for costs to be awarded against, say the Bar Association, might, therefore, hamper, if not prevent, the bringing of some complaints before the Tribunal. The Law Reform Commission is, therefore, not convinced that the current arrangements with respect to the Public Purpose Fund being made available to meet the costs of successful practitioners should be altered.
Special circumstances
6.86 As to the question whether special circumstances exist warranting an order for costs in favour of a successful practitioner, the Tribunal has not often been called upon to decide the issue.
In the matter of Legal Services Commissioner v di Suvero132 the Tribunal considered previous decisions of the Tribunal relating to costs and noted that while it was not governed by principles applied in the courts, it could be guided by decisions of courts where indemnity costs were awarded against a party who had
“maintained proceedings that had no real prospect of success”.133 In that case the Tribunal held that the factors warranting the finding of special circumstances were:
1. At best this was a complaint which could have gone either way and accordingly the Commissioner could not have been satisfied to the requisite standard that it had reasonable likelihood of success;
132. [1999] NSWADT 138.
133. Legal Services Commissioner v di Suvero [1999] NSWADT 138 at para 14.
2. The proceedings were delayed and protracted by the actions of the Commissioner to the detriment of the Barrister.
6.87 The Law Reform Commission is not convinced that there is a reason for overturning what appears to be a reasonably well accepted approach to granting costs when a practitioner successfully defends proceedings before the Tribunal, especially if professional liability insurance is available to practitioners in such cases.
6.88 The compulsory insurance policies available to members of the Bar Association currently extend to the payment of costs where a barrister successfully defends proceedings before the Tribunal. No barrister need be out of pocket so long as he or she has fulfilled the obligations under the relevant insurance policy. However, the insurance policies available to members of the Bar are currently under review and it is possible that from 1 July 2001 the current position may not be preserved.134 The situation will need to be reviewed once the extent of any changes becomes known.
6.89 The payment of costs where a solicitor successfully defends proceedings before the Tribunal is not presently covered by the LawCover professional indemnity insurance scheme. However, there is an optional product – professional practice insurance – that is available to cover the costs of solicitors who are brought before various tribunals, including the ADT. This optional product has been available now for the past year.135
6.90 Given that not all practitioners will necessarily be insured against the costs of successfully defending proceedings before the Tribunal, the Commission is of the view that in considering whether special circumstances exist the Tribunal should have
134. Possible outcomes include: coverage for costs in Tribunal matters becoming optional; and the amounts covered being reduced:
Information provided by Helen Barrett, Director, Professional Conduct Department, NSW Bar Association (5 March 2001).
135. Information provided by Matthew Gosling, General Manager, Business Development/Insurance, LawCover (12 March 2001).
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regard to the length and complexity of the proceedings. While it may be acceptable for a successful practitioner to bear the cost of one day’s appearance before the Tribunal in a simple case, it may not be acceptable for a successful practitioner to bear the cost of, say, one week’s hearing before the Tribunal in a case that involved lengthy preparation.
Recommendation 33
1. The Legal Services Division of the Administrative Decisions Tribunal should be empowered to order the payment of costs of, and incidental to, any hearing under Part 10.
2. Orders for costs should be subject to the discretion of the Legal Services Division of the Administrative Decisions Tribunal.
3. In the event that the Legal Services Division of the Administrative Decisions Tribunal is satisfied that a practitioner is not guilty, an order for costs should be made against the Public Purpose Fund, but only when the Tribunal is satisfied that special circumstances exist warranting such an order.
In considering whether special circumstances exist the Tribunal should have regard to the length and complexity of the proceedings.
4. The Legal Services Division of the Administrative Decisions Tribunal should be empowered either to fix the amount of costs itself or to order that costs be assessed.