Anderson v Hassett (No. 2) [2007] NSWSC 1444

New South Wales Supreme Court

CITATION : Anderson v Hassett (No. 2) [2007] NSWSC 1444

HEARING DATE(S) : 9 & 16 November 2007 JURISDICTION : Equity Division Expedition List

JUDGMENT OF : Brereton J

EX TEMPORE JUDGMENT DATE : 19 November 2007

DECISION : Defendant fined $1,500 and ordered to pay plaintiff's costs

CATCHWORDS : CONTEMPT – civil contempt – failure to comply with order for production – by solicitor – penalty – relevant consideration

LEGISLATION CITED : (NSW) Legal Profession Act 2004

Anderson v Hassett [2006] NSWSC 1058 Commissioner for Fair Trading v Partridge [2006] NSWSC 478 Principal Registrar of Supreme Court of New South Wales v Jando (2001) 53 NSWLR 527 Principal Registrar of Supreme Court of New South Wales v Tran (2006) 166 ACrimR 393; [2006] NSWSC 1183 CASES CITED : R v Razzak (2006) 166 ACrimR 132; [2006] NSWSC 1366 Registrar of the Court of Appeal v Maniam (No 2) (1992) 26 NSWLR 309 Wood v Staunton (No 5) (1996) 86 ACrimR 183 Texts: Contempt by Publication, NSWLRC 100 (2003) Whealy J, "Contempt: Some Contemporary Thoughts" (August, 2007)

PARTIES : Thomas James Anderson (plaintiff) James Trevor Hassett (defendant)

FILE NUMBER(S) : SC 1331/06

COUNSEL : G A Rich (plaintiff) M R Lawson (defendant)

SOLICITORS : Malcolm McDonald & Co (plaintiff) Hassetts Solicitors (defendant)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION EXPEDITION LIST

BRERETON J

Monday, 19 November 2007

1331/06 Anderson v Hassett (No. 2) JUDGMENT (ex tempore) 1 HIS HONOUR: I have found the defendant Mr Hassett guilty of contempt of Court, in that in contravention of Order 4 made on 21 June 2006 he failed to produce to the Court by 26 July 2006 the copy statements of account from the Credit Union and the documents which now comprise DX-02 which were then in his possession, custody or power. Consideration of any penalty is to be based on that finding and not on other aspects of the case, some of which are mentioned in my judgment, however remarkable they at first sight be. 2 The purpose of a penalty in the context of a contempt of this type is primarily coercive, although some punitive and denunciatory element is involved, in order to emphasise to the defendant and others the importance and significance of compliance with orders of the Court. 3 As Kirby P, as his Honour then was, said in Registrar of the Court of Appeal v Maniam (No 2) (1992) 26 NSWLR 309 (at 314): Thus, in determining the punishment which is apt to the circumstances which have led to a conviction of contempt, it is appropriate to bear in mind the purposes of punishing the contemnor; deterring the contemnor and others in the future from committing like contempts; and denouncing the conduct concerned in an approximately emphatic way . 4 So far as the coercive aspect is concerned, in respect of DX-02 the contempt has been purged, the document having been produced to the Court, albeit very belatedly in the course of the hearing. In respect of the Credit Union statements, as I understand Mr Hassett's evidence they are no longer in his possession, custody or power – though they were at the relevant time – in the sense that he is no longer able to find them. It follows from what I have said about the purging of the contempt in respect of DX-02 and the additional circumstance that the Credit Union statements, while no longer in the defendant's possession, custody or power, have otherwise been produced to the Court and are otherwise available as a result, that no coercive purpose is to be achieved by any penalty. 5 That leaves only the punitive aspect. In that respect I cannot overlook that the defendant is a solicitor who ought to be aware of the requirement for punctilious compliance with orders of the Court, and of the consequences of non-compliance. That said, I accept that this contempt was not a contumacious one and that there was not a specific intention to disobey the order of the Court. The nature of the contempt here was one more in the realm of gross negligence than of deliberate intent. I say gross negligence, because it seems to me that the attitude that Mr Hassett manifested to the relevance of documents pertaining to the payment of rates is an astonishing one in the context of this case, and his failure to locate and produce DX-02 until the adjourned hearing, despite repeated assertions of thorough search in his affidavit and oral evidence, and despite having sought at the pretrial directions hearing time to conduct a detailed review of his file, bespeaks a manifestly insufficiently diligent search. 6 It is on that basis that I consider the appropriate penalty. In Wood v Staunton (No 5) (1996) 86 ACrimR 183, Dunford J (at 186) set out a list of ten factors relevant to the determination of the proper punishment for contempt. They were, first, the seriousness of the contempt proved; secondly, whether the contemnor was aware of the consequences to himself of what he did; thirdly, the actual consequences of the contempt on the relevant trial or inquiry; fourthly, whether the contempt was committed in the context of serious crime; fifthly, the reason for the contempt; sixthly, whether the contemnor has received any benefit by indicating an intention to give evidence; seventhly, whether there has been any apology or public expression of contrition; eighthly, the character and antecedents of the contemnor; ninthly, general and personal deterrence; and tenthly, the denunciation of the contempt. Those factors are now commonly considered by Judges sentencing for contempt [Principal Registrar of Supreme Court of New South Wales v Jando (2001) 53 NSWLR 527, 532-535 [17]-[35] (Studdert J); Commissioner for Fair Trading v Partridge [2006] NSWSC 478, [22] (Bell J); Principal Registrar of Supreme Court of New South Wales v Tran (2006) 166 ACrimR 393 [34]-[35]; [2006] NSWSC 1183 (Buddin J); R v Razzak (2006) 166 ACrimR 132; [2006] NSWSC 1366, [43], (Johnson J)]. 7 I must take the view that Mr Hassett, a solicitor, was well and truly aware of the consequences of not complying with the order. The actual consequences of the contempt have been relatively slight: the document DX-02 has ultimately been produced; and the Credit Union documents were otherwise available, having already been produced on subpoena by the Credit Union. Although it is said that the contempt has delayed the taking of accounts, I am bemused as to why the plaintiff has not obtained directions and an appointment for the taking of accounts, in which the plaintiff would have been well-served by the inability of Mr Hassett to produce relevant documents to support his claim. In a sense, the absence of such documents is likely to prove far more detrimental to Mr Hassett, ultimately, than to the plaintiff. 8 The contempt was not committed in the context of serious crime. The reason for the contempt, as I have already mentioned, was, in my view, insufficient attention to the importance of strict compliance, amounting to what might be described as gross negligence. 9 Dunford J's sixth consideration is not relevant. There has been no apology or expression of contrition, but there has been, at least, a partial purging of the contempt. There is no evidence before me as to the character and antecedents of Mr Hassett. I regard general and personal deterrence as an important consideration, particularly in the case of a solicitor, and denunciation is also an important consideration. 10 This is a case in which in some circumstances it might have been appropriate to deal with the matter by making an order that the defendant pay the plaintiff's costs of the application on an indemnity basis. However, as I have foreshadowed in the course of argument, much of the evidence relied on by the plaintiff was irrelevant, and more was formally inadmissible. The pretrial outline of the plaintiff's submissions seemed to focus on irrelevant issues, and did not direct attention to the crucial issues in the hearing – namely, what documents within the order for production could be proved to have been in the defendant's possession, custody or power at the relevant time. As I commented in paragraph 17 of the substantive judgment, the case seemed largely to proceed on the misconceived basis that, an order having been made and production not having taken place, a contempt was established. 11 In those circumstances, I do not think justice would be served by ordering the defendant to pay the plaintiff's costs on an indemnity basis. On the other hand, the plaintiff is entitled to some costs order in his favour, having had to commence the proceedings, and having ultimately succeeded to some extent, though not on all grounds, and no concession of breach having been made at any stage. 12 I have come to the conclusion that the appropriate punitive sanction containing the necessary elements of deterrence and denunciation to reflect the nature of the contempt, is a fine. In determining the amount of that fine, I have given consideration, in a general sort of way, to the fines available to disciplinary tribunals for professional misconduct and unsatisfactory professional conduct: the (NSW) Legal Profession Act 2004 empowers disciplinary tribunals to impose fines of up to $75,000 for professional misconduct, and up to $10,000 for unsatisfactory professional conduct. In the context of this case, it seems to me that the lower scale rather than the higher scale is the more relevant. 13 I have also had regard to the fines which have been imposed in other cases of contempt, some of which are listed in Appendix F to the Law Reform Commission's report on Contempt By Publication NSWLRC 100 (2003), a review of which suggests that, in the context of breaches of undertaking or sustained failure to comply with Court orders that I would regard as more serious than the contempt here, monetary sanctions of in the order of $5,000 have sometimes been imposed, and in the context of the much more serious contempt of failing to answer questions in a criminal trial, fines of $10,000 in conjunction with six month fixed terms of imprisonment have been imposed. 14 Another useful summary of penalties that have been imposed is to be found in a table in Whealy J's paper "Contempt: Some Contemporary Thoughts" (August, 2007) indicating that for criminal contempts (not disobedience to Court orders) fines ranging from £100 (in 1900) up to $25,000 for an individual (the then Premier Mr Wran) and $200,000 for a corporation (Nationwide News) (in 1986). Before hearing the parties' submissions, I had in mind that having regard to those considerations, a fine in the order of $1500 might be appropriate. Coincidentally, perhaps, that falls in the middle of the range which Mr Lawson, for the defendant, suggested, and I remain of the view that that is an appropriate sum for a fine. However, contrary to Mr Lawson's submissions, I think that the plaintiff is also entitled to its costs, but only on a party-party basis. 15 The plaintiff submitted that I should refer the matter to the Legal Services Commissioner. In my view that course would be wholly inappropriate. First, it is unnecessary; if there is a matter worthy of complaint to the Legal Services Commissioner, then that complaint can be made by the plaintiff. The Court is, of course, aware that there has been some complaint to the Legal Services Commissioner already, although the precise detail of it is not clear. The Court is also aware that a previous unsuccessful attempt has been made to relieve the plaintiff from its implied undertaking not to use documents produced on compulsory process in these proceedings for any collateral purpose, so that they might be forwarded to the Legal Services Commission [Anderson v Hassett [2006] NSWSC 1058]; I see not the slightest reason for departing from the view which Gzell J took on that occasion. 16 Secondly, any such reference would be entirely premature. Although courts do sometimes refer the conduct of legal practitioners to disciplinary authorities, conventionally that occurs at the end of proceedings, not during the proceedings. In my view, in circumstances where there are going to be ongoing disputes concerning Mr Hassett's management of the estate in this Court, it would be quite inappropriate now to give an impression of prejudgment by referring the matter for investigation. 17 Finally, although I am, of course, well-aware that the circumstance that a solicitor is convicted of a crime or of a contempt does not mean that disciplinary proceedings may not also be brought, there can be an inappropriate overlap of punishment for the offence and discipline, particularly when one has regard to the particular penalties that might be involved. For example, if a fine is imposed in one context, it may well be inappropriate for a disciplinary tribunal then to impose a fine. 18 The proceeding before me has been concerned with a particular contempt of Court. This Court will deal with that contempt of Court. It does not seem to me that the same conduct needs to be reviewed in another forum for disciplinary purposes: the discipline is effectively administered in this case by this Court over its officer. 19 For those reasons, I make the following orders: 1. Order that the defendant pay the Registrar a fine of $1500 within 28 days 2. Order that the defendant pay the plaintiff's costs of the proceedings, assessed on a party-party basis. 3. Direct that, by Friday 7 December 2007, the plaintiff file and serve its statement of objections, surcharges and falsifications. 4. Adjourn the proceedings for further directions on 14 December 2007 before me at 10am, to follow the expedition list that day.

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