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.