A SOLICITOR v. THE LAW SOCIETY OF HONG KONG

CACV 92/98

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 92 OF 1998

(ON APPEAL FROM SOLICITORS DISCIPLINARY TRIBUNAL)

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J U D G M E N T

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Liu, J.A.:

1. On 31 March 1998, a Solicitors Disciplinary Tribunal ordered (1) that the appellant be censured, (2) that he be suspended from practising as a solicitor for a period of four months commencing from the expiration of the time limited for lodging an appeal, and (3) that on the expiration of that period he be thereafter barred from practising as a partner or sole-proprietor of a solicitors' firm for a period of twelve months. At the conclusion of the Tribunal hearing, these orders were made under section 10(2)(c) of the Legal Practitioners Ordinance after the appellant had been found guilty, on his own plea, of 17 charges. Eight of the charges concerned breaches of professional undertakings given by the appellant. Another eight concerned the failure of the appellant to respond, promptly or at all, to the Law Society's inquires consequential upon the incidents particularised in the former eight charges. The remaining charge concerned the appellant's breach of Rules 2 (d) and (e) of the Solicitors' Practice Rules in his commission of the other 16 violations, that is to say, his conduct was said to have compromised or impaired, or likely compromised or impaired, his own reputation or the reputation of the profession and or the standard of work expected of a solicitor.

2. The appellant feels aggrieved and appeals against these orders. Facts particularised in these charges involved the appellant's shortfalls or omissions in the conveyancing transactions he handled as a solicitor, over a period from December 1996 to June 1997. The appellant failed to honour his undertakings given in conveyancing and failed, for the same number of occasions, to respond to the Law Society's inquiries made in respect of those undertakings. Both are, needless to say, offences of a serious nature. Funds were released against two undertakings. The appellant prayed in aid lack of supervision for the sudden increase in volume of work, but before us, the appellant states that those releases of fund were deliberate but that his clerk, though told to speak to "the other side", failed to carry out his instructions. The appellant still maintains that the failure of his clerk so to notify "the other side" of his releases of fund was part and parcel of his inadequate supervision during the charge period.

3. The appellant acted in person and his plea in mitigation would seem to have been fully taken into account by the Tribunal and it is this: he is 35 and was then the sole-proprietor of Messrs. Kelvin W H Ng & Co. He ran two offices, one in Central, another in Tuen Mun. When his Tuen Mun office opened in September 1996, he was assisted by only two staff members. Tuen Mun, according to the appellant, was intended for, mostly if not exclusively, signing of conveyancing documents. His Tuen Mun office was about 300 sq. ft. In November 1996, the intake of his Tuen Mun office jumped dramatically with more than 70 new files being opened daily. He had to work long hours but unfortunately his attempts to recruit new staff for his Tuen Mun office proved unsuccessful, and it was not until May 1997 that he finally succeeded in engaging a few more clerks. Most of the eight breaches of undertakings in the charges he faced arose from conveyancing transactions done in Tuen Mun during this trying period from November 96 to May 97, in which his recruitment exercise failed. For the heavy workload, the appellant's health and his family relationship suffered. In August 1997, he underwent an operation and was confined in hospital for a week. In that period, the appellant's earnings were around $400,000 per month. But for the past seven months prior to the Tribunal hearing of the complaints against him, due to the recent economic downturn, the appellant had been running his law firm at a loss of about $350,000 per month. He told the Tribunal that he had little alternative but to close down his Tuen Mun office. He even had to seek rental reduction for his Hong Kong office. The appellant had no savings and was driven to subsidise his expenses by loans. His wife is not working and his three children are young. The appellant is the only breadwinner of the family and he has his retired parents to care for and support.

4. In five out of the 16 breaches of undertakings, the appellant had returned all the outstanding title deeds and documents to the complainants. He assured the Tribunal that he would attend to matters uncompleted and he tendered his apologies to the Law Society. The Tribunal also took into consideration that the appellant was co-operative with the Law Society and frankly admitted to the charges and the attendant agreed facts. He was accepted by the Tribunal to be remorseful. The Tribunal believed the appellant to have taken measures to improve supervision and operational facilities. There was no outstanding complaint of professional misconduct against the appellant.

5. The Grounds of Appeal are straightforward. It is complained that the penalty imposed by the Tribunal was manifestly excessive and wrong in principle and that the Tribunal failed to give any or any sufficient weight to matters of mitigation. Before us, the appellant claims that the orders made by the Tribunal were defective because Rule 16 of the Solicitors Disciplinary Tribunal Proceedings Rules was contravened.

6. Suffice it to say that the orders made by the Tribunal were within the ambit of Rule 16. In any case, the alleged defect is not raised in his Notice of Appeal. The appellant could have himself taken steps for further suspending the orders of the Tribunal until the ultimate determination of this appeal. The fresh matter raised by the appellant today has really no substance. The appellant also complains that the Tribunal should not have found that he had taken on more clients than he could properly cope with. The Tribunal expressed the view that as many as 70 new conveyancing cases a day were beyond the capability of the appellant with his two offices. There was evidence from which the Tribunal could draw the inference that the appellant had been over-ambitious for self gratification. The appellant concedes before us today that during the period he had been overwhelmed with work and that he attempted to take remedial measures only after the charge period. It was open to the Tribunal to conclude that prudence required him "to turn away his clients and ....... not [to] take up more business than he could properly handle" during that period. The Tribunal was entitled to comment on the absence of explanation as to why his Hong Kong office offered little or no back-up at the material time. It was the view of the Tribunal that the conduct of the appellant caused immense difficulty and extra expense to the complainant solicitors and that it was unfair, in the circumstances, to as well the profession as the public consumers. The Tribunal laid stress on the importance of strict adherence to undertakings given in conveyancing transactions, on which the entire profession depended. There would seem to be no sound reason for the appellant's failure to respond, promptly or at all, to the Law Society's inquiries consequential upon the breaches of his said undertakings in the charges. The misconduct to which the appellant pleaded guilty was repeated over a relatively extended period.

7. Members of the profession are best judges in sanctions. The Tribunal took into consideration the appellant's plea of mitigation and was at liberty to give what weight they regarded as proper to the features therein identified. The appellant is obliged to demonstrate that the Tribunal was plainly wrong or unjustified or out of tune with the evidence upon which the Tribunal could properly act. That is trite law. This court is not primarily concerned with cases in which what would appear to be a more lenient penalty was imposed. In my view, the Tribunal has not been shown to be, in any way, in error. I would dismiss this appeal.

Rogers, J.A. :

8. I agree that this appeal must be dismissed.

9. The charges against the Appellant were serious, particularly the breaches of professional undertakings which the Appellant had given to other firms of solicitors. Those undertakings in conveyancing matters related in two respects to the retention of moneys handed over to his firm which were not to be paid to his clients until certain events had happened. Those undertakings in principle are extremely important for conveyancing generally. They enabled money to be paid and documents to be executed without delay. It is very important both for the reputation of the solicitors' firms in Hong Kong and for the proper conduct of conveyancing that such undertakings are observed.

10. The failure to reply to the Law Society's inquiries has already been referred to by Liu, J.A.

11. The Appellant pleaded guilty to the charges. The Tribunal accepted that the non-fulfilment of the professional undertakings appeared to have caused no loss or damage to either the Appellant's clients or the counterpart solicitors. The Tribunal also accepted that there was no element of dishonesty in the complaints. The Tribunal took into account the fact that the sentence which it imposed might have a catastrophic effect on the Appellant's sole proprietorship practice and that his firm was likely to be forced to close down with staff being laid off and becoming jobless. The penalty which was imposed was severe, but I cannot say that it was wrong in principle. I would however say, our attention having been drawn to other decisions where more lenient sentences were given in cases apparently involving dishonesty; it is important that with professional bodies there is a consistency of approach in relation to penalties which are imposed.

12. I too would dismiss this appeal.

Godfrey, J.A. :

13. I have some sympathy for the appellant in this case, but in all the circumstances to which Liu and Rogers, JJ.A. have referred, I am unable to conclude that the orders made against the appellant by the Disciplinary Tribunal of the Law Society here, although perhaps harsh, were wrong or unjustified. I appreciate that in other cases, some of which might be thought to have been worse than this, solicitors have been subjected to orders less severe than those made here. But that is not enough in itself to warrant interference by this court with the decision of the Disciplinary Tribunal in the present case. The Disciplinary Tribunals of the Law Society are better placed than we are to appreciate what sanctions it may, from time to time, be appropriate to impose in order to maintain proper professional standards within the profession. It may well be that nowadays more, rather than less, severe sanctions are needed for that purpose.

14. I too would dismiss this appeal.