A SOLICITOR v. THE LAW SOCIETY OF HONG KONG

CACV 107/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 107 OF 2005

(ON APPEAL FROM THE ORDER OF THE SOLICITORS
DISCIPLINARY TRIBUNAL DATED 15 MARCH 2005 AGAINST A SOLICITOR)

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REASONS FOR DECISION

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1.  This is the Appellant’s (the Solicitor) application to stay the order of the Solicitors Disciplinary Tribunal (the Tribunal) which, inter alia, suspended him from practice for 21 months, pending the determination of this appeal.

2.  The disciplinary began on 29 June 1999.  It was interrupted by judicial review proceedings brought by the Solicitor in March 2001 which was finally dispose of against the Solicitor by the Court of Final Appeal on 13 February 2003.

3.  The hearing of the Tribunal resumed on 10 June 2003 and the Tribunal invited submissions on the standard of proof.  The Solicitor and the Law Society supplied written submissions on 12 June 2003.  Counsel for the Respondent contended that in deciding on the standard of proof the relevant factor was the gravity of the complaints as a whole which included the seriousness of the potential consequences on the person facing the disciplinary action.  Hence, if the Tribunal took the view that the consequences for the Solicitor might be serious then the criminal standard or a standard that is so close to or indistinguishable from the criminal standard should be applied.  Moreover, procedures and rules of evidence appropriate to criminal proceedings should be adopted.

4.  The Tribunal gave its ruling in writing on 25 June 2003 (the Ruling).  The relevant passages are quoted below:-

“Having carefully considered the authorities and arguments advanced by counsel for the parties, the Tribunal considers it appropriate to adopt the civil standard of proof albeit with a higher degree of probability commensurate with the gravity of the allegations against the Respondent.  The Tribunal is not adopting here the criminal standard of proof nor a standard which is so close to the criminal standard as to be indistinguishable from it.

Mr Mok suggested that upon setting a high standard of proof, the Tribunal should adopt the criminal hearsay rules and the criminal order of speeches.  The Tribunal does not agree with or consider it appropriate to take those suggestions.  The Tribunal rules that the civil rules of evidence and order of speeches should apply.  The normal procedural rules stipulated in the Legal Practitioners Ordinance and the Solicitors Disciplinary Proceedings Rules will continue to apply.”

5.  The substantive hearing of the complaints commenced in September 2003.

6.  The Solicitor faced eight complaints.  The complaints, as summarised in the statements of findings of the Tribunal dated 13 September 2004 (the Findings), are as follows:-

“	25.	Complaints 1 to 5 (inclusive) comprise charges against the Respondent between October 1997 to July 1, 1998, of having publicised or otherwise promoted his practice or permitted his practice to be publicised or otherwise promoted, contrary to Rule 2AA of the Solicitors’ Practice Rules (“the Rules”) and the Solicitors’ Practice Promotion Code in force at the material time (“the Code”), more particularly, contrary to Paragraphs 6(b), 6(c), 6(h), 6(l) and 6(m) of the Code.
	26.	Complaint 6 charges the Respondent of having engaged in conduct unbefitting of a solicitor in or around January 1999 by posing nude or semi nude for the cover stories for the Next Magazine Issue No.463 dated 22nd January 1999 and in Sudden Weekly Issue No.183 dated 30th January 1999.
	27.	Complaint 7 also relates to such posing nude or semi nude for the Next Magazine and Sudden Weekly and charges the Respondent of having acted in contrary to principle 1.02 of the Hong Kong Solicitors’ Guide to Professional Conduct or Rule 2 of the Rules by which the Respondent did not conduct himself appropriately but conducted himself in a manner likely to bring the profession into disrepute.
	28.	Complaint 8 charges the Respondent for having acted in contrary to Paragraph 6(h), alternatively 6(l) or 6(m), of the Code as a result of the cover stories/article of the Respondent posing nude or semi-nude for the aforesaid 2 magazines being published on the interest and leading to other interviews and articles in other newspapers.”

7.  The Solicitor was found guilty of all the complaints.

8.  On 14 October, the Tribunal heard submissions from the Solicitor on mitigation.  As appeared from the Reasons and Order dated 15 March 2005 (the Order) it was towards the end of the hearing on 14 October 2004 that the Solicitor was invited to address the Tribunal on authorities bearing on suspension.  The Solicitor sought and was granted an adjournment.  Eventually there were oral submissions on 16 December 2004 by Mr Cheng Huan SC on the Solicitor’s behalf.

9.  By the Order, the Respondent was censured, fined HK$50,000, suspended for a total of 21 months and ordered to pay two-thirds of the solicitor’s costs of the Law Society and the whole of the costs of the Law Society in its investigation and the costs of the Clerk of the Tribunal.

10.  A copy of the Order was delivered to the Solicitor’s firm in the afternoon on 15 March 2005 without any prior notice.

11.  On 17 March, the Solicitor’s solicitors wrote to the Clerk of the Tribunal formally applying for a suspension of the order of the Tribunal.  The Solicitor was told that the Order had been delivered to the Registrar on 15 March 2005.  That, in any event the chairperson of the Tribunal was going on a long vacation and would not be able to convene any meeting or liaise with other members of the Tribunal to determine his application.

12.  The Solicitor’s solicitors wrote to the Registrar asking him to withhold taking any further steps pursuant to section 15(2) of the Legal Practitioners Ordinance pending the ruling of the Tribunal and or further directions from the Court.  The Registrar was not in a position to withhold action.

13.  On 22 March in judicial review proceedings HCAL 33/2005 brought by the Solicitor against the Tribunal the Solicitor applied for the following interim relief:-

“	(1)	A removal of the filing of the Tribunal’s Order with the Registrar; and
	(2)	A removal of the note entered in connection with the applicant’s name in the Roll.”

14.  The application was dismissed by Madam Justice Chu on 22 March 2005.  Her Reasons for Decision was handed down on Maundy Thursday, 24 March 2005.

15.  Madam Justice Chu said:-

“	31.	The applicant indicates in his affidavit that he intends to appeal to the Court of Appeal against the Tribunal’s findings of guilt and the order imposing penalty.  Mr Mok also submitted that there are substantial grounds for the intended appeal.  Section 13(1) of LPO provides that the provisions of Order 59 of Rules of the High Court shall apply to an appeal to the Court of Appeal.  There is power under Order 59 rule 13 to stay the execution of the order or decision being appealed.
	32.	The applicant is therefore not without redress if he wishes to withhold the implementation of the Tribunal’s Order or to preserve the status quo pending the appeal to the Court of Appeal.  It is open to him to seek an interim or interlocutory stay of the Tribunal’s Order, including the suspension order.  This will also address the difficulties said to have given rise to the urgency of the matter.
	33.	I do not disagree with Mr Mok’s submissions that a decision to appeal is not a light decision and that time is needed to properly formulate an appeal.  But in exercising the discretion whether to grant ex parte interim relief, I consider the court is entitled to weigh the consequences of granting the application against those of refusing it.  The fact that the applicant can seek an interim stay from the Court of Appeal is therefore a relevant consideration.  There is no question of the applicant being forced to appeal or that his right to appeal within 21 days is being curtailed.”

16.  Not surprisingly, on Tuesday, 29 March 2005, immediately after the Easter vacation, the Solicitor applied to me for a stay as well as for abridgement of time.  The notice of appeal was dated 29 March 2005.  The application was heard by me at 2:30 pm on 30 March 2005.

17.  The Law Society was represented by Mr Mohan Bharwaney.  No objection was taken to the abridgement of time.

18.  Mr Johnny Mok appeared on behalf of the Solicitor.  Mr Mok contended that the Solicitor has good grounds of appeal. 

19.  Mr Mok’s principal submission was that the Tribunal had applied the wrong standard of proof.  He argued that if the Tribunal had regarded the complaints as sufficiently serious to warrant or require 21 months of suspension, the Tribunal ought to have adopted “the criminal standard or a standard that is so close to or indistinguishable from the criminal standard…” (the criminal standard).  He also said that the Solicitor had been misled by the Ruling into believing that the Tribunal had not regarded the complaints as of such gravity.  He also submitted that if the criminal standard had been adopted, there would have consequence in the admission of evidence as well as procedure to be adopted at the hearing.

20.  Mr Mok has referred me to the decision of the Court of Appeal in Nicholas Pirie v the Bar Council, CACV 744/2000, 21 September 2001.  There, the Barrister’s Disciplinary Tribunal correctly adopted the criminal standard of proof however in relation to the rules of criminal evidence and procedure the Tribunal decided that there would be some flexibility over the criminal rules.  And this is what Le Pichon JA said in paragraph 73 of her judgment:-

“A direction that criminal rules should apply “with flexibility” appears to me to be entirely unsatisfactory inasmuch as it creates considerable uncertainty as to the extent the rules actually apply.  A party who has to defend himself against serious allegations which are tantamount to the commission of a criminal offence and which have serious repercussions on his professional career should not be placed in a situation where the ground rules for defending himself are elastic and the boundaries imprecise.”

21.  He also relied on the judgment of Keith J (as he then was) in Dr Lai King Thong v Medical Council of Hong Kong [1996] 1 HKC24 at 28A.  Mr Mok argued that the criminal standard was not limited to complaints which amounted to criminal offences.  It should be adopted for grave charges.  The gravity of the charge should be measured by the seriousness of the repercussions on the professional career of the Solicitor. 

22.  Mr Mok also complained that the ruling was misleading in that the solicitor was not aware that he was vulnerable to suspension of practice.  He has also referred me to various passages in the ruling where he submitted that the Tribunal had reversed the burden of proof.

23.  Mr Bharwaney submitted that no stay should be granted unless there are strong grounds of appeal.  He relied on the notes to 59/13/1 in the second cumulative supplement to the 2004 Edition of the Hong Kong Civil Procedure.

“The most important consideration in respect of whether a stay of execution should be granted is whether there are strong grounds of the proposed appeal: World Trade Centre Group Ltd & Another v. Resourceful River Ltd & Another, Civ App No. 70 of 1993, May 12, 1993.  That hurdle is higher than that of chances of success for considering whether leave to appeal should be granted.  See also Asha Harkishin Premsingh v Harkishin Isarsingh Premsingh Kishinani M.P. No. 3436 of 2000, November 12, 2000, unreported.”

24.  World Trade Centre Group was a decision of Litton JA (as he then was).  The learned judge said that the jurisdiction to order a stay under Order 59 rule 31 was a flexible one.  But that in a case where the Applicant was able to demonstrate that he has very strong grounds of appeal then the Court would be inclined to order a stay and that in those circumstances Court might not examine very closely the financial situation of the Appellant.  He then went on to say:-

“on the other hand if the grounds of appeal appear weak then the court will look more closely into the alleged impecuniosity and prospective financial ruin.”

Thus it is not authority that a stay would only be granted if there are strong grounds of appeal.  As for the other authority cited in the notes, that decision simply illustrated the obvious point that the fact that leave to appeal had been given did not necessarily mean a stay would be granted pending appeal.

25.  Strong grounds of appeal would be an important consideration, but it is not a condition to a stay.

26.  It is sufficient for the purpose of this application for me to say that I believe that the Solicitor has seriously arguable grounds of appeal.

27.  Mr Mok has submitted that if a stay is not granted then the appeal would be rendered nugatory.  It is obvious that if a stay is not granted the Solicitor would have served a substantial period of suspension for which he would receive no compensation even if he were to succeed on appeal.  As appears from the complaints, this is not a case involving dishonesty or incompetence of a solicitor in his practice.  This is not a case where protection of the public requires immediate suspension.

28.  On an application for a stay, an important consideration is that the successful party should not be deprived of the fruit of his success.  But that’s not a consideration here.

29.  It is perhaps unfortunate that the Solicitor could not apply to the Tribunal for a stay of the order under rule 16 of the Solicitors Disciplinary Tribunal Proceedings Rules (the Rules).  Their views on a stay would have been highly valuable.  But it was not the fault of the Solicitor that he could not apply for a stay to the Tribunal.

30.  Mr Bharwaney argued that in the submission on mitigation on 16 December 2004 counsel appearing for the Solicitor ought to have submitted to the Tribunal that in the event a suspension was ordered it should not take effect immediately.  I do not believe this is relevant to whether or not a stay should be grant pending appeal.  If rule 15 of the Rules had been followed and notice given to the parties “of the date when the findings and order would be pronounced” then the Solicitor would have had an opportunity to apply for a stay.  This would be so whether or not the pronouncement of the order was required to be done in the presence of the Solicitor or his representative.

31.  Mr Bharwaney also submitted that the solicitor had been guilty of delay.  I do not believe there has been sufficient delay to influence the exercise of my discretion.  This is not a case where delay shows that a stay was not needed.  Nor is this a case where the successful party or any innocent thirty party, has been prejudiced.  However, Mr Bharwaney submitted that having regard to the publication of the Solicitor’s suspension, it would confuse the public if the suspension were stayed.  I do not believe that to be a serious consideration.

32.  Now in the affirmation of the Solicitor filed in support of the application dated 29 March 2005, this is what he said about his hardship if a stay is not granted:-

“	28.	The Order imposing inter alia my suspension from practice, if to be given effect immediately, has caused and will cause grave hardship to me and the firm of Paul W. Tse.  As the Senior Partner of the firm at all material times prior to the Order, I was responsible for the overall management of the firm.  The firm has 3 offices.  The firm has 62 staff (excluding me) at present.  As at 15 March 2005, there are over 11,831 files being handled by the firm.  I myself was having conduct of 227 files and was responsible for the supervision of essentially all the matters in the firm’s Central head office.
	29.	There was in fact a case listed for 18 March 2005 which was adjourned part-heard from 4 March 2005.  It was a chamber’s hearing at the High Court.  I was having conduct of the matter without counsel.  As the client was attending medical treatment in California, I was unable to contact him in time to let him know about the Order and to take his instructions on the remedial actions.  One of my assistant solicitors had to take over the matter on an urgent basis.  The outcome of that hearing was far from satisfactory.
	30.	Apart from the aforesaid matter, there are many other files which I was handling that would require an orderly passing over of the files to the other partners and assistant solicitors in the firm.  It would be grossly prejudicial and unfair to the interests of the clients if I were to be deprived of the opportunity to properly transfer the files and communicate with the relevant clients about the handover.
	31.	I am one of the 3 authorised signatories of the firm without a ceiling.  The firm currently has 51 bank accounts.  Any changes in the signatories would require substantial paper works and time.
	32.	The firm has been advertising in various media and, in particular, public transport vehicles and facilities such as minibuses, buses, trams and MTR station.  For minibuses alone, there are currently 58 of them involved.  The Order would require immediate changes to the representations on these advertisements.  As any modification to the advertisements on transport vehicles would have to be carried out at night when they are not in operation, the process would take quite some time.  Very substantial costs would have to be incurred for such modification works.
	33.	There are 2 trainee solicitors of the firm who are attached to me as their principal.  Immediate suspension without the opportunity to make alternative arrangements would affect their interests and unfairly prolong their duration of training.
	34.	Apart from the share of profits from the firm, I have no other material source of income.  Once suspended, the firm will be prohibited from distributing any further proceeds to me.  Nor would I be able to derive any salary from the firm even as a non-qualified employee.  Any such employment requires the prior approval of the Law Society.  I will suffer immediate and serious financial hardship.
	35.	Now produced and shown to me marked “PWT-8” is a true copy of a letter dated 24 March 2005 from Messrs. Haldanes for the Law Society.  The Law Society is demanding for an immediate assurance from all the partners of the firm to confirm in writing inter alia that I will not be permitted to occupy the office premises at the head office or any of the branch offices.  This, in my view, would be unreasonable if not outright oppressive.  Such prohibition would prohibit me from properly handing over all the files hitterto handled by me to the other partners and solicitors of the firm.  This would unduly and unjustifiably affect the interests of all the clients involved.  Further, since the firm is currently handling the Judicial Review proceedings and the present Appeal for me, such prohibition as demanded by the Law Society would unreasonably deprived me of the freedom to attend the office premises of the firm even in the capacity as a visitor or a client.
	36.	Further, the Law society also demands a confirmation that all the offices are attended to daily by solicitors of suitable seniority in order to comply with Rule 4A of the Solicitors Practice Rule.  If a stay of the Order were not granted, the firm would face a dilemma in deciding whether to immediately close down one or more of its offices, with dire financial consequences and also jeopardizing the employment of many of its employees, or whether to face a potential breach of Rule 4A.  Restructuring of its partnership or replacement of solicitors of suitable seniority would require a reasonable period.”

33.  It is clear that if a stay is not granted, the consequences might be ruinous.

34.  I believe, having regard to the circumstances a stay was justified and I ordered a stay.  Mr Mok has informed me that the Solicitor would pursue the appeal with diligence.  No doubt the Law Society would be able to ensure that it is prosecuted with diligence, also ordered that cost of the application be in the cause of the Appeal.