Ethics and Negotiation

Whilst researching a paper on ethics and mediation, I came across an interesting decision of the State Administrative Tribunal in Legal Practitioners Complaints Committee v Fleming [2006] WASAT 352.

The decision involved a complaint about a practitioner sent to the Tribunal by the West Australian Legal Practitioners Complaints Committee, that the practitioner was guilty of unprofessional conduct, in that in the course of professional communications with another practitioner, he made representations to the other practitioner which were, to his knowledge, misleading.

By way of background, the Australian Solicitors Conduct Rules ( ASCR ) which commenced to apply in Queensland on 1 June 2012 now provide a framework for ethical conduct by solicitors in their daily practice. A breach of these Rules is capable of constituting unsatisfactory professional conduct or professional misconduct and may give rise to disciplinary action by the relevant regulatory authority which in Queensland is of course the Legal Services Commission ( LSC).

The conduct complained of in the West Australian instance, could well now be subject of a complaint to the LSC if it arose in Queensland.

The interesting aspect of the West Australian decision was that the conduct complained of occurred in the course of settlement negotiations and communication between the two practitioners.

The Tribunal found the practitioner's conduct unprofessional and further found it was no answer to the complaint that the practitioner was merely acting on his client's instructions. In holding as it did, the Tribunal emphasised the importance of practitioner's acting ethically in settlement negotiations stating inter alia as follows :

At paragraph 74, "....just as in litigation a practitioner may not use dishonest or unfair means or tactics to hinder his opponent in the conduct of his case ( D'Orta-Ekenaike v Victoria Legal Aid (2005) 223 CLR 1 at [111], per McHugh J ), so he ought not do so in other areas of practice. Arguably perhaps for a number of reasons, the proscription against such conduct is more important in settlement negotiations. "

And at paragraph 76, " Honesty, fairness and integrity are also of importance in such negotiations because they are conducted outside the court and are beyond the control which a judge hearing the matter might otherwise exercise over the practitioners involved. Outside the trial process,there is no impartial adjudicator to " find the truth" between the opposing assertions. Dishonest or sharp practice by the practitioner to secure an advantage for his client might go undetected for some considerable time or for all time. A level of trust between the advisers involved is therefore essential".

For the same reasons these principles and cautions would also apply to mediation.Clearly the duties of fairness and honesty owed to the court in relation to the conduct of litigation are also owed to practitioners in other areas of practice.

Bonds for Overseas Travel- Size Does Matter.

In Lau & Feizhou and Anor [2014] FamCA 182, Justice Aldridge sitting in the Sydney registry of the Family Court had to decide whether two young children should be permitted to travel to mainland China, a non-convention country,with their maternal grandmother with whom they resided in Australia.

The real issue for the court was whether or not the children would be returned.

The grandmother had proposed that a bond of $50,000 be lodged in her lawyer's trust account with that sum to be available for use by the father to secure the children's return to Australia should that become necessary.

The grandmother, was a Chinese citizen and deposed to having homes in both Australia and China however did not adduce evidence of her financial position.

The husband's evidence was that, from his observations, the maternal grandmother was very wealthy and had considerable property and business interests in China.

In providing a number of reasons for dismissing the grandmother's application, His Honour held that the value of providing a bond, hinged upon the relationship between the amount of the bond and the amount of the person's property, the court noting as follows:

"

15.Very wealthy people may be prepared to lose significant sums of money if it enables them to achieve a particular end that they seek. Thus, the value of a bond is directly dependent upon the amount of wealth available to the person providing the bond. In this case, there is no way to judge the value of the proposed bond because there is no evidence provided by the maternal grandmother as to her wealth. "

Having regard to the evidence the court could not be satisfied that the proposed bond of $50,000 was adequate.