N1443

PAPUA NEW GUINEA
[In the National Court of Justice]

AP 200 of 1991

BETWEEN:

MATHEW MAY
- Appellant -

AND:

LOANI HENAO, KIBI KARA & 4 OTHERS
- Respondents -

WAIGANI: Doherty, J.
1996: January 17th
July 15th

DECISION

Appeal against Law Society Statutory Committee - hearing - Natural Justice - interpretation of rule - jurisdiction.

The appellant appealed against a finding of the Statutory Committee that he was guilty of improper conduct contrary Rule 6 by sending a facsimile letter to a person overseas. The Committee received a letter of complaint from a person other than the recipient of the letter and refused to reveal its author or supply a copy but only read the content.

Held:

(1) The rules of Natural Justice included a right to face the accuser and such an anonymous complaint was a breach of those rules.

(2) There was no rebuttal of the facts averred to by the defendant and the finding was in error.

(3) A facsimile sent from Papua New Guinea relating to business in Papua New Guinea was within the jurisdiction of the Papua New Guinea Law Society.

(4) The last two lines of Rule 6 of the Professional Practice Rules do not apply to Rule 6(a).

Mr Payne, for the Appellant
Mr Riddell, for the Respondents

The appellant appealed on the 1st September 1991 pursuant to S.58 of the Lawyers Act against the finding made on the 15th August 1991 by the Respondents sitting as a Lawyers Statutory Committee when he was found guilty of improper conduct.

The notice of appeal was amended on the 21st April 1992 to include further grounds alleging that the Committee did not have jurisdiction to hold an enquiry as there was no evidence of a complaint, before it or alternatively the letter of complaint which he received was anonymous and the full nature of the complaint was not disclosed to the appellant.

The original grounds of appeal alleged that -

(1) the Professional Conduct Rules Rule 6 was unconstitutional and invalid as it infringes the right to freedom of expression and publication in S.46 Constitution; and

(2) that the actual events or act complained of occurred in United States of America over which the Committee had no jurisdiction;

(3) that the words and expressions complained of did not constitute "touting or as calculated to attract professional business unfairly" (viz on the grounds of the findings of fact).

There had been a hearing of the statutory committee of the Law Society (hereinafter "the Committee") following receipt of a letter complaining that the appellant had breached Rule R.6 of the Professional Conduct Rules of the Society. Rule 6 provides "Except as provided by these rules, the lawyers shall not, directly or indirectly -

(a) apply to a person who is not then or who has not been his client for instructions or professional business; or

(b) do or permit in the carrying on of his practice any act or thing,

(c) that may reasonably be regarded as touting or calculated to attract professional business unfairly.

The Committee had received a copy of a letter sent by the appellant to a Mr J. Pritzger it was annexed to the letter of complaint. The charge made against the appellant by the Statutory Committee was "that by a facsimile letter dated 3 April 1991 and addressed to Mr Pritzger, Hyatt Corporation, Chicago, you applied to a person who was not then your client for instructions for professional business contrary to Rule 6 of the Professional Conduct Rules."

Who the actual letter of complaint had emanated from was not made known to the appellant and this was raised as a preliminary objection at the hearing before the Statutory Committee. The record of the Committee stated "Voss indicates there are two reasons supporting the relevance of the letter of complaint. It was a document considered by the Committee on 15 May so that Mr May has no opportunity to contravert its contents. Other reason is the letter itself. There is no indication as to how it came to the attention of the Committee. Is it the only document which will be before the Committee in the enquiry?"

After deliberating on his objections the Committee refused to make known the author of the original letter of complaint but read out the content, it did not give any copies. The Committee then proceeded to hearing and the appellant stated that he and his firm had been acting for the Pritzger family "for some years". There was cross examination as to why, if this was so, there was a need to introduce the appellants firm.

The appellant replied "my understanding is that Pritzger himself is in touch re the negotiations. There is no agent on the record with whom it would be appropriate to deal". There were then submissions made.

The Committee chairman asked if there was a question of jurisdiction and if the letter was written in his capacity as a Partner in "the Australian operation" (viz the Australian branch of the appellant’s firm) and the appellants counsel replied it was "sent as part of PNG operation". It appears that the question of the jurisdiction and the place of publication in the letter, whether it was in Papua New Guinea or United States, was not raised as part of the evidence before the Committee although it is raised here. Some Committee members asked if there would be further evidence "to substantiate that Pritzger is your client". And were told "only evidence of that is Mr Mays" [sic]. This is answer for the appellant recorded in explanation.

The Committee then withdrew to consider and announced its decision that the allegation had been proved that they were satisfied that Mr Pritzger was not a client of the appellant’s firm and held "Rule 6 the last sentence relates only to (b) and not to (a)". Full reasons for decision were subsequently published. The committee considered in law that Rule 6 requires the evidence of touting and adopted a dictionary definition of this but that Rule 6(a) did not use "touting" and the word was not before it for consideration. Further that Rule 6(a) required evidence that the recipient have been a "client". They considered all of Rule 6 should be interpreted in a "commonsense way" and that part of Rule 6 incorporating the words "that may reasonably be regarded as touting or calculated to attract professional business unfairly" applies to Rule 6(b) only and not Rule 6(a) of the Rules. They addressed the problem is to whether the matter was Papua New Guinean or an Australian matter and decided that the appellants firm operated in both countries so considered that it was a single firm.

The Committee found that the letter was sent to Mr Pritzger himself and no-one else and held that on the evidence that he was not a client of the firm, had never been a client of the firm within the meaning of that term used in Rule 6 and that the word "client" should not be given a broad interpretation - "As to do so would be to weaken the force of the rule and fail to give effect to its obvious intention". They noted this applied in particular to this case because "there was some sixty companies associated with the Pritzgers" and considered there was no evidence of a documentary nature to support the oral assertions that the appellant’s firm was associated with Pritzger family. The Committee relied on the introductory nature of the letter sent by the appellant which was the subject of some questions put to Mr May.

Before this court there was a preliminary question relating to how the matter came before the Committee. I made interim rulings on its production in the course of the appeal which are not now relevant but the method of the complaint coming before the Committee and the anonymous nature was a ground of appeal. Clearly it did not emanate from Mr Pritzger or anyone on his behalf. The Committee did not contact him in any way. They refused to reveal the author but read the content, they did not indicate how a letter sent from the appellants firm was received by the complainant.

A hearing of the Committee or any judicial tribunal charged with the duty to rule on issues of integrity and ethical standards must ensure that it is dealing with a proper complaint. How the complaint reached the Committee may not be relevant to the question of touting but it is relevant to both ethics of how the information was received and to the concepts of Natural Justice. The concept of natural justice is as much binding upon a judicial Committee such as this as upon any other tribunal or Court dealing with allegations against an individual and fundamental to the principles of Natural Justice is the right to face the accuser and be informed of his complaint. In reaching this conclusion I have given considerable thought to a situation where a complainant is afraid, under duress etc but concluded that this does not alleviate the Committee from, at least, informing the Counsel of the person charged while ensuring protection of the complainant.

I consider the Committee erred in adopting this procedure and uphold the appeal on this ground.

Ground 3 dealt with the extra territorial operation of the letter sent by the appellant to Mr Pritzger. Counsel submitted that the facsimile was received in United States and therefore the Committee imposed a penalty for an action that occurred in another place and the Law Society Rules have no effect outside Papua New Guinea by virtue of S.1 of the Lawyers Act.

I consider that the letter was written in Papua New Guinea and referred specifically to business in Papua New Guinea. If his actions do not come within the jurisdiction of the Papua New Guinea Law Society, it must follow by converse application that they would come within the ambit of the powers of the American Bar Association. Mr Payne says this could not apply either.

If I were to accept that argument then it would appear he would be exempt in both jurisdictions which I do not consider a logical situation. Further the intent of Rule 6 is to prevent touting for business. The business would be business within Papua New Guinea. That is clearly the intention of the facsimile in question and I consider it was also the intention of Rule 6. To say that it is an action that occurred overseas does not face the reality of the situation. I do not uphold the appeal on this grounds.

Further grounds related to the interpretation of Rule 6 itself and its form of wording which I have set out above. The Committee considered the interpretation of Rule 6 and decided -

"The allegation in this enquiry does not use the word "touting" and it is obviously drafted on the basis of Rule 6(a) alone. It recites the words of Rule 6(a). Mr Voss argued that, on its true interpretation, Rule 6 should be read so that the last two sentences of the Rule apply to both 6(a) and (b). The difficulty with this interpretation ... is that reading the last two sentences with Rule 6(a) leads to a very awkward result. The result is as follows:

"Except as provided by these Rules, a lawyer shall not, directly or indirectly apply to a person who is not then or has not been his client for instructions for professional business; that may reasonably be regarded as touting or as calculated to attract professional business unfairly."

Mr Payne says that the draftsman deliberately phased Rule 6 so that the final expression "that may be reasonably regarded as touting or as calculated to attract professional business unfairly" applied to Rule 6(a) as well as to Rule 6(b) and points to the way the rule is laid out. He relies on Hanlon v. The Law Society [1981] AC 124 were Lord Lowry considered the failure to take account of punctuation disregards the reality that literate people punctuate using grammatic principles and punctuation should be used in interpretation also.

Adopting this premise, with which I respectfully agree, Mr Payne suggests that the proper interpretation of Rule 6 made it incumbent upon the Committee to find both improper conduct under Section 6(a) and that the action would be reasonably regarded as touting or as calculated to attract professional business unfairly. He said "there must be both elements for the offence under Rule 6".

Mr Riddell says there was a slip in the preparation of the Professional Conduct Rules and that the last two lines (referred to by the Committee as 2 sentences) should form part of Rule 6(b) only and not govern both 6(a) and 6(b).

In adopting what Lord Lowry said concerning punctuation and the reality of grammatical principles I look at the wording of Section 6(a) if these last two lines are added. I agree with the Committee that to read them in this way is awkward and I cannot make real sense of the complete sentence. I consider that there was slip when drafting the Rules and commonsense and grammar must be applied. I consider that Rule 6(a) is not governed and is not conjunctive with the last two lines "that may be reasonably regarded as touting or as calculated to attract professional business unfairly" and therefore I do not uphold the appeal on this ground.

A further ground of appeal relate to the evidence and the meaning of the word "client".

The appellant’s defence was that Mr Pritzger was in fact the client and therefore he was not applying to a person who was not then or had not been a client. Before the Committee he quite categorically stated that his firm had been handling Pritzger matters for some years and that instructions had been received through agents of the Pritzgers rather than the principles of the Pritzger family.

The Committee put considerable weight on the wording of the facsimile to Mr Pritzger itself. They particularly stressed, and returned several times to the fact that there was an introductory paragraph to the facsimile. They considered that if he had been a client of the firm in the past then that would be complete defence to the allegation and with this I agree.

In his evidence before the Committee the appellant said that his firm had acted for the company associated with Pritzgers before and his Australian counterparts had also acted for the companies before and "when I sent the fax on the 3 April 1991 BDW (PNG) and BDW (Australia) had current instructions to act for families associated with Pritzger and matters in which the Pritzger family had an interest".

Questions were put to the appellant by Committee members and he replied as I have quoted above. In fact it was never put to the appellant that Mr Pritzger was not himself a client despite the Committee’s decision was that the letter was addressed to Mr Pritzger personally and that there was no evidence that Mr Pritzger was a client. The Committee also seem to put considerable emphasis on the introductory paragraphs of the facsimile which used terminology such as "my purpose in writing to you is to make you aware of our firm" ... it then went on to inform of the number of lawyers, the presence of the related offices in other countries etc. It also noted that the appellants firm and the appellant in particular had acted for companies of which Mr Pritzger was a director.

The Committee considered that the appellant had not tendered any documentary evidence to support his allegation that he had acted for the Pritzger family before, and this with the introduction and the failure to refer to any companies associated with Mr Pritzger for which the firm acted were "a contradiction to Mr May’s evidence". This would appear to overlook the company named in the letter.

Counsel for the appellant stresses that the rule in Browne v. Dunn must apply. At no point that the Committee put as a fact that Mr Pritzger was not a client to give the appellant an opportunity to speak on it. They called no evidence in rebuttal and there was no comment or evidence from Mr Pritzger.

I agree with the submission that in dealing with the complaints the Committee is required to adopt a high standard of proof. As was said in Toll v. Kara & Others [1990] PNGLR 71 where Hinchliffe J adopted the description of the duty of a tribunal was to require high standard of proof, not the standard of proof required by the Criminal Courts but one which falls slightly short of it.

I consider that the Committee put emphasis on the introductory nature of the paragraphs in the facsimile and adopting those as a form of circumstantial evidence, decided that the applicants claims that Mr Pritzger was not a client were refuted by that wording.

However there was no actual evidence before the Committee to refute the appellants own evidence, the Committee had sought no evidence itself in rebuttal. The only evidence they had before it was the evidence of the appellant and they appeared to made a decision that evidence and the introductory wording contradicted each other, they made a finding "It is apparent from the evidence that Mr May’s firm did not act for Mr Pritzger himself" on the basis of the wording I have noted above and because they narrowly interpreted Mr Pritzger’s position treating the letter as an application to him personally whereas the appellant’s evidence was he did act for the firms Mr Pritzger was associated with and it was addressed to him as Mr J. Pritzger, Hyatt Corporation.

I consider that this narrow interpretation of the facts overlooks the fact that the evidence was and the letter itself showed that the person was addressed in his corporate capacity and work had been done for him before as a director of a corporate entity.

I consider that the Committee misdirected itself when deciding that there was no evidence that the appellant had acted before. I consider there was evidence that he had acted for the recipient in his corporate capacity before and the intention was to address the recipient in that same capacity. In this way I consider that the Committee did misdirect itself and I uphold the appeal on this ground also.

In submission Counsel for the appellant first argued the provisions of S.38 and S.46 of the Constitution to Rule 6 stating that "any rule which seeks to restrict a persons entitlement or ability to communicate with another is contrary to the right of freedom of expression" and so is contrary to S.46 Constitution.

Having upheld the appeal on other grounds it is not necessary to rule in this matter but I can indicate to Counsel that having researched similar provisions in other jurisdictions I consider there was insufficient material before me. If the parties wish to pursue the matter further I will fix a separate hearing.

Lawyers for the Plaintiffs: BLAKE DAWSON WALDRON
Lawyers for the Respondents: GADENS RIDGEWAY