Amirbeaggi v NSW Legal Services Commissioner

1. [1]

   HIS HONOUR: The plaintiff Farshad Amirbeaggi, a solicitor, seeks judicial review under Supreme Court Act 1970 (NSW), s 69, of two decisions of the defendant, the Legal Services Commissioner, made on 13 September 2021, the first being to caution Mr Amirbeaggi (pursuant to Legal Profession Uniform Law 2014 (NSW) (“LPUL”), s 290(2)(a)) for a breach of the Legal Profession Uniform Law Australian Solicitors’ Conduct Rules 2015 (NSW) (“Solicitors’ Rules”), r 4.1.2 (which relevantly provides that a solicitor must be courteous in all dealings in the course of legal practice), and the second (pursuant to LPUL, s 292) to reduce the legal costs charged by him to the relevant client from $5,005 to $3,000.

Background

1. [2]

   On Friday 3 July 2020, Mr Amirbeaggi received a telephone call from Mr Eugene Evgenikos. Mr Evgenikos wished to engage Mr Amirbeaggi’s firm to act for him, on an urgent basis, in respect of the dissolution of a business in which Mr Evgenikos was a partner. At 10:41am that morning, Mr Amirbeaggi received an email from Mr Evgenikos with a bullet-point summary of the matter and enclosing relevant documentation (including a Deed of Dissolution, Amended Deed of Dissolution, Shareholders’ Agreement and Contract) for consideration.

2. [3]

   Mr Amirbeaggi says that he worked over the weekend of 4 and 5 July 2020 reviewing the documentation provided. On Sunday 5 July at 10:53pm, Mr Evgenikos sent Mr Amirbeaggi an email, asking “how did you go with this?”. On Monday morning 6 July 2020 at 12:17am, Mr Amirbeaggi responded that he had reviewed what had been sent, and identified a number of questions for discussion. He asked Mr Evgenikos to indicate what time suited him for a discussion, stating that he was available at 7:30am, 11:30am or 4:00pm, and that he would send a letter of engagement in the morning.

3. [4]

   Mr Evgenikos replied at 4:57am, answering the questions which had been asked, and asking whether 8:00am would work for a conference. Mr Amirbeaggi responded at 7:53am, that 8:00am was “too tight” but that he would call at about 10:00am.

4. [5]

   Meanwhile, at 7:48am, Ms Maniscalco of Mr Amirbeaggi’s firm sent Mr Evgenikos a letter of engagement. The letter stated the hourly rates that would be charged by members and employees of the firm, and identified the “scope of work” as follows:

5. [6]

   It estimated the total fees for undertaking the work, relevantly as follows:

6. [7]

   It requested a payment of $5,000 into trust on account of costs.

7. [8]

   As to “ending the engagement”, the letter relevantly provided:

8. [9]

   At 10:00am, Mr Amirbeaggi and Mr Evgenikos had a telephone conversation, apparently for about 45 minutes. Mr Evgenikos provided further background information and there was discussion about what further documentation Mr Amirbeaggi would need. According to Mr Amirbeaggi, he said he would have a draft letter to Mr Evgenikos on either Tuesday or Wednesday. Subsequently, Mr Evgenikos provided a further 160 pages of documentation.

9. [10]

   On Tuesday 7 July 2020, Mr Amirbeaggi’s firm received $5,000 into its trust account from Mr Evgenikos. Mr Amirbeaggi says that he spent the day, between other commitments, reviewing the documentation and preparing the draft letter.

10. [11]

    On Wednesday 8 July at 9:50am, Mr Amirbeaggi received a text message from Mr Evgenikos stating “can you please hold fire on my file until we speak? Thanks”. Mr Amirbeaggi almost immediately replied “yes of course. I’m in a conference for the next two hours but can we speak at say 12 noon?”. Mr Evgenikos responded “yes”. Mr Amirbeaggi endeavoured to call him, and sent him a text message at 1:47pm, in order to obtain further instructions but without success.

11. [12]

    At 9:22pm, Mr Amirbeaggi received a text message from Mr Evgenikos “hope you had a nice day. Has there been a letter drafted up by any chance?”. Mr Amirbeaggi answered at 9:24pm:

12. [13]

    At 9:25pm, Mr Evgenikos responded:

13. [14]

    At 9:28pm Mr Amirbeaggi replied:

14. [15]

    Mr Evgenikos responded at 9:30pm:

15. [16]

    On Thursday 9 July 2020 at 7:11am, Mr Amirbeaggi’s firm issued a memorandum of fees to Mr Evgenikos in the following terms:

16. [17]

    The memorandum was forwarded under cover of an email which stated:

17. [18]

    At 9:00pm that evening, Mr Evgenikos sent Mr Amirbeaggi an email, as follows:

18. [19]

    At 9:12pm, Mr Amirbeaggi answered:

19. [20]

    Mr Evgenikos responded at 10:00pm:

20. [21]

    Mr Amirbeaggi replied at 10:07pm:

21. [22]

    Mr Evgenikos responded at 10:41pm:

22. [23]

    At 10:58pm, Mr Amirbeaggi rejoined:

23. [24]

    On 14 July 2020, Mr Evgenikos made a complaint to the Office of the Legal Services Commissioner (“OLSC”). The OLSC notified Mr Amirbeaggi of the complaint on 24 July 2020 and sought his response for the purposes of a preliminary review. The notification summarised the complaint as follows:

24. [25]

    In requesting a response for the purpose of preliminary assessment, the notification also stated (emphasis in original):

25. [26]

    At 12:36pm the same day, Mr Amirbeaggi responded:

26. [27]

    On 28 August 2020 the OLSC requested Mr Amirbeaggi’s response, for which time was extended from 14 August 2020 to 18 September 2020. On 7 September 2020, Mr Amirbeaggi responded that he was happy to provide any further submissions sought, but had assumed that no further response was required after his email of 24 July. On 11 September, the OLSC asked for a “fulsome” response by 25 September. At Mr Amirbeaggi’s request, extensions were subsequently granted to 7 October 2020.

27. [28]

    On 7 October 2020, Mr Amirbeaggi provided his detailed response to the notification. On 28 October, the OLSC forwarded to him a response from Mr Evgenikos dated 22 October 2020, and sought responses to three questions by no later than 18 November 2020. Mr Amirbeaggi responded to the questions on 30 November 2020.

28. [29]

    On 31 March 2021, the OLSC informed Mr Evgenikos of the Commissioner’s preliminary view (that Mr Amirbeaggi had not complied with Rule 4.1.2 of the Solicitors’ Rules, nor with Rule 13.1, and that the fees charged were not fair and reasonable in all the circumstances). Mr Evgenikos responded on 19 April 2021 stating:

29. [30]

    On 20 April 2021, the OLSC sent Mr Amirbeaggi an email informing him of the Commissioner’s preliminary view, setting out his reasons, and requesting any submissions by 13 April 2021. The letter included the following:

30. [31]

    After being granted an extension, Mr Amirbeaggi responded on 7 June 2021 with detailed submissions.

31. [32]

    On 13 September 2021, the OLSC notified Mr Amirbeaggi of the Commissioner’s determinations and reasons for them. The Commissioner expressed himself to be “satisfied that it is fair and reasonable in all the circumstances to resolve this consumer matter by making a determination under section 290 of the LPUL”. He concluded that the text message of 8 July 2020 at 9:28pm was not necessary or appropriate and was in breach of Rule 4.1.2 which requires solicitors to be courteous in all dealings in the course of legal practice, as were the emails sent the following evening. However, he concluded that the conduct did not reach the threshold of unsatisfactory professional conduct, and that it was fair and reasonable in all the circumstances to resolve the matter by making a determination under section 290 of the LPUL. That determination was:

32. [33]

    The letter confirmed that the caution would not be listed publicly on the register of disciplinary action, and that such determinations are not publicly available.

33. [34]

    In respect of the costs dispute, the Commissioner made a determination under LPUL s 292, as follows:

34. [35]

    Again, that determination was accompanied by the reasons for it.

35. [36]

    Mr Amirbeaggi filed his summons for judicial review on 13 October 2021.

36. [37]

    On 29 July 2022, he also applied to the Commissioner pursuant to LPUL s 313 for internal review of the determinations. That application was acknowledged on 1 August 2022. The acknowledgement explained that the first step was the Commissioner’s consideration (at his absolute discretion) whether it was appropriate to conduct an internal review, and the second, which arose only if the Commissioner so decided in his absolute discretion, was the conduct of the review. The OLSC indicated that consideration of an application for an internal review could take up to six months, and that it would seek submissions relevant to the first stage following and subject to the outcome of “the show cause hearing”, which appears to be a reference to the present proceedings. The Commissioner did not consent to an adjournment of the present proceedings pending any internal review.

The Caution Decision

1. [38]

   Mr Amirbeaggi impugns the decision to impose a caution under LPUL s 290 for jurisdictional error and/or error on the face of the record on three grounds, namely:

2. [39]

   LPUL s 315 (Duty to deal with complaints) provides:

3. [40]

   For this State, the Commissioner is the “designated local regulatory authority”.

4. [41]

   Section 285 provides that Part 5.3 (Consumer matters) applies to consumer matters, and that Division 2 applies to all consumer matters subject to Division 3 in relation to costs disputes. The subject complaint was a consumer matter, within s 269, which relevantly provides:

5. [42]

   The fulcrum of Mr Amirbeaggi’s argument in respect of ground (a) was s 286 (Prerequisite to resolution action by local regulatory authority), which provides as follows:

6. [43]

   Mr Amirbeaggi submits that neither party made a reasonable attempt to resolve the matter, that it would not have been unreasonable to expect Mr Evgenikos to be involved in an attempt to resolve it, and that the Commissioner did not form the opinion referred to in s 286.

7. [44]

   It was common ground, and in my opinion correctly so, that the Commissioner’s formation of the opinion referred to in s 286 is a jurisdictional prerequisite to the exercise of power under s 290. It is also correct that there is no direct evidence that the Commissioner formed that opinion or adverted to the necessity to do so. However, the Commissioner submits that it does not follow that the requisite opinion was not formed.

8. [45]

   Where a jurisdictional prerequisite is expressed as a subjective criterion, such as the formation of an opinion by the decision-maker, it is the opinion, rather than the underlying circumstances, that provides the criterion conditioning the exercise of power. [1] In such a case, judicial review is limited to determining whether the relevant opinion was formed genuinely (or at all), upon a proper view of the law, with consideration of and only of relevant factors, and whether formation of the requisite opinion was reasonably open in the circumstances. [2]

9. [46]

   As to whether the opinion was reasonably open in the circumstances, a question arises as to whether an attempt at resolution before a complaint is made to the Commissioner is eligible for consideration under s 286(a). It seems to me that “the matter” in s 286(a) refers back to the “consumer matter” in the chapeau. The definition of “consumer matter”, set out above, refers to “so much of a complaint …”. On one view, there can be “a matter”, and thus an attempt to resolve it, only after a “complaint” has been made.

10. [47]

    On the other hand, disputes are commonly settled before litigation commences. The purpose of s 286 is to ensure that a complaint is not acted on unless there has been a reasonable attempt to resolve it (or it would be unreasonable to expect the complainant to be involved in any such attempt). Any of the means of resolving a consumer matter referred to in s 287 (Informal resolution), s 288 (Mediation) and s 289 (Settlement agreements) involves action by the Commissioner towards resolving the matter, which could not be taken unless the s 286 opinion had first been formed. As those steps include informal resolution and mediation, it seems unlikely that s 286(a) was concerned only with attempts made after the complaint; otherwise, the Commissioner could not even embark on informal resolution unless at least one of the parties first made an attempt at resolution after the complaint was lodged. Rather, its purpose is to deter the making of complaints until there has been an attempt at resolution. In my opinion, therefore, the better view is that s 286(a) is not confined to attempts at resolution made after the complaint is lodged with the Commissioner. It can be satisfied by any attempt made to resolve the issues in the complaint, whether before or after the complaint is lodged.

11. [48]

    As has been noted, on 9 July at 10:00pm Mr Evgenikos sent an email to Mr Amirbeaggi stating:

12. [49]

    That was an attempt to resolve the matter. Mr Amirbeaggi responded:

13. [50]

    The attempt was, therefore, unsuccessful.

14. [51]

    There was, therefore, material on which it was open to the Commissioner to form the opinion referred to in s 286(a). Indeed, were the Court required to decide for itself the underlying factual issue (whether one of the parties had made a reasonable attempt to resolve the matter and the attempt was unsuccessful), I would have been of that opinion.

15. [52]

    Further, Mr Amirbeaggi’s email responses of 9 July 2020 at 9:12pm, 10:07pm, and 10:58pm manifested an intransigent position. In their light, it was open to the Commissioner to form the opinion referred to in s 286(b), that it was not reasonable to expect Mr Evgenikos to be involved in further attempts at resolution. Such a conclusion would be fortified by the later correspondence between Mr Amirbeaggi and the OLSC, in which Mr Amirbeaggi manifested not the slightest inclination to compromise. And again, were the Court required to decide for itself the underlying factual issue (whether it would be unreasonable to expect the complainant to be involved in any further attempt at resolution), I would have been of that opinion.

16. [53]

    However, there is an issue as to whether the Commissioner adverted to and formed the requisite opinion at all. As is submitted for Mr Amirbeaggi, the Commissioner does not explicitly state in his reasons that he formed the requisite opinion under s 286.

17. [54]

    The burden of establishing facts showing an absence of jurisdiction rests on the party who asserts that a jurisdictional prerequisite has not been satisfied. [3] As Gummow J (with whom Heydon J and Crennan J agreed) said in Minister for Immigration and Citizenship v SZGUR: [4]

18. [55]

    Whether an inference should be drawn from the absence of reference to the question in the Commissioner’s reasons is informed by an appreciation of what is expected of reasons in administrative decision-making. The reasons of an administrative decision-maker are not required to be extensive. [5] They are to be given a "beneficial construction", [6] and are not to be construed "minutely and finely with an eye keenly attuned to the perception of error". [7] They must be regarded in the light of the conduct of the matter and the issues which have been raised in submissions. [8] Even in the context of judicial decisions, and as has recently been observed by this Court in Prouten v Chapman: [9]

19. [56]

    Thus it does not necessarily follow, from the circumstance that reasons do not refer to a relevant matter, that the matter was not considered. That will especially be so if the matter was not one which was agitated in submissions.

20. [57]

    Particularly in the context of a relatively informal procedure for the resolution of consumer complaints at a relatively low level, by an administrative decision-maker who can be assumed to be familiar with the procedural and jurisdictional requirements of the applicable legislation, I do not accept that the reasons must state or contain a finding of every uncontroversial jurisdictional prerequisite. A finding that the jurisdictional prerequisites are satisfied is implicit in the final decision to impose a sanction under s 290. It might have been otherwise had an issue in respect of s 286 been raised in submissions, but it was not. Nowhere in Mr Amirbeaggi’s submissions to the Commissioner – neither in his detailed response of 7 October 2020 to the complaint, nor in his submissions of 7 June 2021 in respect of the preliminary finding – was any suggestion made that there was a bar to further action by reason of s 286. In those circumstances, the Commissioner was entitled to proceed on the basis that s 286 was not an issue which required reference in his reasons.

21. [58]

    Accordingly, in circumstances where there was in my opinion material on which it was open to him to form that opinion, and on which I would have formed the relevant opinion, I am not prepared to infer that the Commissioner did not form the opinion referred to in s 286.

22. [59]

    Ground (b) turns on LPUL s 287 (Informal resolution of consumer matters), which provides as follows:

23. [60]

    Mr Amirbeaggi submits that the Commissioner did not do this, and in particular did not engage the procedures provided by s 288 (Mediation) or 289 (Settlement agreements). This was characterised as a failure to perform his statutory duty.

24. [61]

    It is far from clear that an attempt at informal resolution under s 287 is a jurisdictional prerequisite to making a determination under s 290. Unlike s 286, it is not expressed to be a “prerequisite”. Nor does it contain such words as appear in s 286 as “Despite any other provision of this Division.” Similarly, s 290 is not expressed to be subject to s 287. It would be curious if the Commissioner was precluded from taking action under s 290 in circumstances where no attempt to resolve the matter by informal means was made because it was recognised to be futile or inappropriate. The words “as soon as practicable” in s 287 themselves indicate some flexibility in the requirement.

25. [62]

    In any event, an attempt at informal resolution can be seen in the Commissioner’s letter of 24 July 2020 to Mr Amirbeaggi, which included an invitation to provide “any suggestions you may have as to how this dispute could be resolved”. Another such attempt may be found in the Commissioner’s letter of 28 October 2020, which included amongst the questions to which Mr Amirbeaggi was invited to respond:

26. [63]

    Mr Amirbeaggi’s response of 30 November 2020 was that he was not willing to reduce the tax invoice, and that the dispute may be resolved by Mr Evgenikos being more respectful to those he engages, and the file being closed:

27. [64]

    Further, the provision of the Commissioner’s preliminary decision to both Mr Evgenikos and to Mr Amirbeaggi provided another opportunity for resolution before proceeding to formal resolution.

28. [65]

    In my opinion, therefore, the Commissioner did not fail to attempt to resolve the matter by informal means.

29. [66]

    Mr Amirbeaggi further submitted that the decisions were affected by a failure to give proper and genuine concern to dispute resolution mechanisms of mediation and settlement agreements referred to in s 288 and s 289. It suffices to say that while the legislation provides those mechanisms, it does not make consideration of their availability a mandatory consideration for the purposes of a determination under s 290. And in the light of Mr Amirbeaggi’s intransigence when any invitation to propose some means of resolution was extended, it was reasonable for the Commissioner not to give further consideration to formal mediation.

30. [67]

    Ground (c) contends that the imposition of a caution was “erroneous and unreasonable”.

31. [68]

    For Mr Amirbeaggi it was argued that, commencing from the duty imposed on the Commissioner by s 316 “in exercising or considering whether or how to exercise any applicable discretions when dealing with a complaint … to act in a fair manner, having regard to the respective interests of the complainant and the respondent and to the public interest”, the Commissioner should, when exercising powers under s 290, act in a manner that is proportionate, and does not involve a substantial disparity between outcomes in respect of comparative conduct by other practitioners. It was submitted that in this case, it was relevant that the comments were not made in a public forum and were not “gratuitously insulting or offensive”, [10] that Mr Amirbeaggi firmly believed that he had a reasonable basis for making the comments, and that the comments were made in the course of correspondence with a client regarding the client’s own conduct and discourtesy and unreasonableness. A comparison was sought to be made with Lander v Council of the Law Society of the ACT, [11] in which the solicitor was charged with a breach of a rule equivalent to Rule 4.1.2. While a disciplinary tribunal found him guilty of unsatisfactory professional conduct, stating that “the language of the respondent’s letter of 24 October 2006 contains in several paragraphs discourteous remarks and offensive and provocative language”, the Full Court overturned the decision, holding that although solicitors have an obligation to deal with all persons, whether legal practitioners or the public, with honesty and fairness, the issue of courtesy varies depending on the circumstances; [12] that where the conduct of public officials, which is reasonably considered to be rude, unhelpful or any similar characterisation, adversely impacts on a client, it is no breach of the obligation of courtesy to raise the subject with those in authority; [13] and that it is not professional misconduct or unsatisfactory professional conduct for a solicitor to raise such matters where the criticisms are true or fair comment as understood in defamation law. [14]

32. [69]

    It is of course well established that to impugn an administrative decision on the basis that it was manifestly unreasonable is a large task. Essentially, it involves showing that the decision is one to which no person reasonably exercising the relevant function could have come, or is made in a manner so devoid of plausible justification that no reasonable person could have taken that course. [15] Far from being of that view, it seems to me that it was plainly open to the Commissioner to be satisfied that Mr Amirbeaggi’s text of 9 July and subsequent correspondence was unnecessarily and inappropriately discourteous. So holding, and imposing a very modest sanction for it, serves the proper purpose of maintaining the reputation of the profession, by “calling out” discourteous behaviour. The submissions for Mr Amirbeaggi proceed largely on the basis that his response, and persistence in it, was a justifiable or at least understandable one in the circumstances. However, it is far from evident that Mr Evgenikos’ query which provoked the initial response was (as contended by Mr Amirbeaggi) itself discourteous or unreasonable, as distinct from purely inquisitive. The provocation – if there was any – was slight, and it was followed immediately by an apology from Mr Evgenikos for any offence caused. In such circumstances, practitioners are expected to show moderation and restraint. I do not accept that the pressures of modern practice are such that it is acceptable for practitioners to be other than courteous to their clients. Mr Amirbeaggi’s seniority and experience is not a mitigating factor in this respect. Given that the caution is not included in the public register, the submission that it will have a lasting adverse effect on his standing or advancement is not a powerful one. It suffices to conclude that it was open to the Commissioner to determine that imposition of a caution was in all the circumstances fair and reasonable.

The Costs Decision

1. [70]

   The Commissioner’s determination on the costs question was impugned on the ground that it was affected by error on the face of the record and/or jurisdictional error, in that it was said to be unreasonable being premised upon a wrong principle, permitted extraneous or irrelevant matters to inform it, and did not take into account a material consideration, in particular:

2. [71]

   For Mr Amirbeaggi it was submitted that the decision to reduce his costs by $1550 was legally unreasonable because the decision was one that no reasonable decision-maker could have reached, was devoid of “evident and intelligible justification”, [16] and provided “no logical connection between the evidence and the inferences or conclusions drawn”. [17]

3. [72]

   LPUL s 292 provides that the Commissioner may make a binding determination about costs where he is unable to resolve a costs dispute and the total amount of legal costs in dispute is less than $10,000. The determination must specify the amount payable and must be less than $10,000. The determination is to be based on the Commissioner’s assessment of what is fair and reasonable in all the circumstances. In considering what is fair and reasonable in all the circumstances the Commissioner must have regard to LPUL s 200 (which identifies the factors to be taken into account in a costs assessment).

4. [73]

   The Commissioner’s reasons state that he had had regard to the factors in s 200. Essentially, his reasoning was that:

   1. (1)

      the costs disclosure estimated a cost of up to $10,000 for “early resolution”, which would have required performance of three of the tasks identified in the scope of works, namely (a) review instructing materials and advise, (b) represent interests, and (c) negotiate dissolution;

   2. (2)

      Mr Amirbeaggi should be paid for the work undertaken on an urgent basis over the weekend after taking instructions on Friday 3 July up to Monday 6 July 2020, for which he had claimed $2,450 plus GST;

   3. (3)

      Mr Amirbeaggi claimed $2,100 plus GST for “further review of emails provided and revisit employment agreement and shareholders’ agreement to extract areas of demand i.e. restraint and duties and attendances upon you”. Mr Amirbeaggi had been provided with additional documentary material and was instructed to draft a letter. When he terminated the retainer, he had not completed the draft letter, although he says that he had started drafting it. Mr Evgenikos did not receive the benefit of the work for which Mr Amirbeaggi billed $2,100 plus GST;

   4. (4)

      of the tasks set out in the scope of works relating to early resolution, (a) may have been completed, but there is no evidence that (b) or (c) had been commenced. Yet the bill for $5,005 exceeded half of the estimate of up to $10,000 for early resolution.

5. [74]

   To my mind, that is an entirely rational decision, and one which was entirely open to the Commissioner. Essentially, the Commissioner determined that Mr Evgenikos should not have to pay for work the benefit of which he did not receive, in circumstances where Mr Amirbeaggi terminated the retainer other than in accordance with its terms (which required that he give 14 days’ notice). Indeed, some might have thought that Mr Amirbeaggi’s peremptory termination of the retainer other than in accordance with its terms disentitled him from recovering any costs at all. The decision was not made without reference to the terms of the retainer; it plainly had regard to the rates chargeable – and to the provisions for termination – contained in it. Nor was it “arbitrary”; it had regard to the time spent by Mr Amirbeaggi and the nature, scope and complexity of the work, but it disallowed part of what he claimed, because it was effectively wasted.

6. [75]

   The attack on the costs decision therefore also fails.

Conclusion

1. [76]

   My conclusions may be summarised as follows:

   1. (1)

      It is not established that the Commissioner did not form the opinion referred to in LPUL s 286;

   2. (2)

      Compliance with the requirement in s 287 to attempt informal resolution is not a jurisdictional prerequisite to making a determination under s 290. In any event, the Commissioner did attempt informal resolution;

   3. (3)

      The options of mediation and settlement agreements provided by s 287 and s 288 are not mandatory considerations in the Peko-Wallsend sense; [18]

   4. (4)

      It was entirely open to the Commissioner to conclude that Mr Amirbeaggi contravened Rule 4.1.2 and that a caution was a fair and reasonable sanction;

   5. (5)

      The costs decision was not made without reference to the terms of the retainer, nor arbitrary, but rational and open to the Commissioner.

2. [77]

   It follows that no ground for judicial review is established. The summons is dismissed with costs.