The Full Court of the Supreme Court of South Australia in Legal Practitioners Conduct Board v Patterson1 struck off a practitioner who had maintained a secret client base while employed by a legal practice.
This decision highlights the fundamental duties:
- we should be absolutely transparent in our dealings with our employers. Secret client bases and payments under the table are dishonest and public interest would demand such behaviour is not to be tolerated.
- if we wish to do pro bono work outside our work environment then we discuss this with our employers. This is again to ensure transparency and to avoid conflicts either of duty or personal interest.
- we have a duty to understand the restrictions (if any) on our entitlement to practise and to comply with such restrictions.
- the failure to open client files, to record time properly, to bill in accordance with the disclosure made to the client and the cost agreements entered into could be either unsatisfactory professional conduct or professional misconduct.
- although the employer-employee relationship is not a deemed fiduciary relationship there are many indicators that a court will consider the principal / legal practitioner director / legal practice and employee solicitor relationship as having fiduciary characteristics. The relationship requires the employee to undertake to act in the best interests of the employee’s legal practice by promoting the work the employee performs for the legal practice’s client base and to grow that client base. This decision highlights the vulnerability of the employer as against that of the employee. There are implied obligations of fidelity, good faith, trust and confidence. Secret profits made from secret client bases could be recoupable due to our obligation to account to our employers.
1 [2011] SASCFC 102.