ethics
Being demanding Letters of demand must avoid abuse of lawyer authority and power Gino Dal Pont Professor, Faculty of Law, University of Tasmania
Membership of a profession evidently brings with it certain privileges. Otherwise, there may be little to distinguish a profession, or calling, from any other occupation. There would, moreover, be little explanation for the burgeoning claims to professional status across a wide variety of occupations. In the context of the legal profession, the core privilege is a monopoly on an entitlement to be held out as providing legal advice, or at least most forms of legal advice, whether or not for reward. The special skill and learning that underscores professional status ordinarily creates, at least in the legal field, a relevant inequality between lawyers and non-lawyers. It serves both to give the spoken or written word of lawyers a degree of authority, in a legal sense, and to vest in members of the profession a power in dealing with the legal system which exceeds that available to the layperson. As history reveals human nature is hardly immune from abuse of authority or power, it stands to reason lawyers may face temptations of this kind. This in turn explains why the law imposes fiduciary obligations on lawyers vis-à-vis their clients. It also explains the various professional constraints to which lawyers are subjected in dealing with unrepresented litigants.1 The ‘no contact rule’, which prohibits lawyers from making direct contact with an opponent who is legally represented, is likewise underscored by a concern to avoid abuse of power or authority. Consistent with this theme, it behoves lawyers to take care as to the use of their letterhead. It has been judicially observed, to this end, that “the use, by a practitioner, of his or her letterhead, in correspondence with a member of the public, may be a relevant consideration in the determination of whether the practitioner has unfairly used their professional position in order to gain a benefit over, or to intimidate, a member of the public”.2 If the lawyer is acting for himself or himself in the matter, and this 08 | Brief November 2014
is clear in the relevant correspondence, there may be little unethical in using the practice letterhead. The position may be different, however, if the evidence reveals that the letterhead is used chiefly in an attempt to flex his or her (perceived) legal authority as a lawyer. In instances where the lawyer is not a party to the matter, the issue has of late seen ventilation, on at least two separate occasions, in the specific scenario of lawyers who have allowed debt collection or mercantile agencies to utilise law practice letterhead in communicating with (alleged) debtors.3 On the most recent of those occasions, the Victorian Civil and Administrative Tribunal perceived “a significant difference in impact between a letter of demand from a debt collection agency, and a letter of demand from a solicitor”.4 The tribunal explained, “[t]he fact that a solicitor is acting in the matter and has sent a letter of demand on behalf of a client would generally signify that the matter has become more serious for the person alleged to owe the debt; that it has been escalated” and thus “signify that the matter is one step closer to legal proceedings”.5 Moreover, the fact that a lawyer has been engaged, and has been willing to write a letter of demand, brings with it the inference that the claim in question has substance. Though many laypersons may be unaware of it, the modern professional requirement not to pursue cases without reasonable prospects of success feeds into the legitimacy of this expectation. In each of the two cases the correspondence had contained false or misleading statements as to the entitlements of the (alleged) creditors, thus highlighting the need for lawyers also to vet carefully any correspondence being sent on their letterhead. The general trend of consumer protection law towards a more rigorous evaluation of conduct capable of being misleading or deceptive is hardly a matter from which lawyers, in professional practice,
can be immune.6 Once an exaggerated, inaccurate or even unfounded claim translates to the practice letterhead, there is no room to avoid a disciplinary consequence merely by pleading that it reflected client instructions. In such a scenario, the lawyer is no mere ‘hired gun’ or cipher through which to implement client wishes. It is no defence to plead that the letter was written by the relevant mercantile agency. Importantly, ethical goalposts may well have shifted in time. In one of the two decisions the tribunal accepted, in line with submissions from the relevant legal regulatory body and the Australian Competition and Consumer Commission, that some forms of letters of demand that in the past may not have resulted in disciplinary or regulatory action against lawyers now will.7 For instance, while it may once have been acceptable for lawyers to claim their costs incurred in writing letters of demand as well as the debt itself, this view can no longer be maintained. Such a practice is nowadays seen to be both misleading and an illegitimate abuse of the lawyer’s authority. Ultimately, the modern legal response aligns with professionalism being more about responsibility than about power. NOTES
1.
See G E Dal Pont, Lawyers’ Professional Responsibility, 5th ed, Lawbook Co, 2013, pp 719–21.
2.
Quinlivan v Legal Profession Complaints Committee [2012] WASCA 263 at [54] per Murphy JA.
3.
Legal Services Commissioner v Sampson [2013] VCAT 1177; Legal Services Commissioner v Nomikos [2013] VCAT 1682.
4.
Legal Services Commissioner v Nomikos [2013] VCAT 1682 at [521].
5.
Legal Services Commissioner v Nomikos [2013] VCAT 1682 at [522].
6.
See, for example, Australian Competition and Consumer Commission v Sampson [2011] FCA 1165.
7.
Legal Services Commissioner v Sampson [2013] VCAT 1177 at [35].