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Colonial Cases

Douglas v. Home, 1912

[legal practitioners]

Douglas v. Home, 1912

Selected, edited and transcribed by Douglas Clark, barrister, Hong Kong

HIS BRITANNIC MAJESTY'S
SUPREME COURT FOR CHINA

AT SHANGHAI

J.C.E. DOUGLAS

v.

N.C. HOME.

Before Havilland de Sausmarez, Judge

Mr. W. V. Drummond and Mr. H.S. Oppe represented the plaintiff.

The defendant appeared in person.

Date: 5 January 1912

Original Report:  North China Herald, 13 January 1912

Judge Havilland de Sausmarez:

There are two distinct questions in this case. The first concerns the status of an English barrister-at-law practising in His Majesty's Courts in China, and the control and jurisdiction of the Supreme Court over him and his acts of a professional nature. The second concerns the rights of the parties inter se. Both are matters of public interest, though in different degrees, for the rules which are applicable to persons engaged intimately in the administration of justice and the application of law, as well as in the commercial and other concerns of an important community are of general as well as personal interest to the public, as well as the profession.

Both parties are members of the Bar of England: and the defendant contended that this Court should only deal with them as such, dealing with them and their concerns only as the English Courts would deal with a barrister in England unless the China Order in Council 1904 gives to the Court extended powers.

In order to obtain a just view of the position of an English barrister practising in- China, and the rights which such position confers upon him, it is necessary to consider the law and custom which apply to them. Such custom may well be taken to be within the knowledge of the Court, but to guard myself I have consulted the Crown Advocate as to the practice of the profession, and I have shown my judgement to the Assistant Judge. He agrees generally with it. Until the China Order in Council, 1904 there was no direct legislation, save by rules of Court governing admission, but such legislation, while directly conferring on affected the rights and duties enjoyed and undertaken by members of the legal profession practising in China.

The term "legal practitioner" is, however, introduced. It "includes barrister-at-law, advocate, solicitor, Writer to the Signet, and any person possessing similar qualifications." (Art: 3). The words "barrister-at-law, advocate, solicitor, Writer to the Signet " cover the legal profession in Great Britain and Ireland, and the remainder of the clause has been construed to apply to persons who exercise the profession of the law in the King's dominions other than Great Britain and Ireland with qualifications similar to those enumerated.) Thus before the Order in Council there was admitted a member of the Bar of Victoria, and recently a solicitor qualified under the Ordinances of Hongkong has been admitted to practise as a legal practitioner, in this Court, the Court in the latter case requiring to be satisfied that a solicitor so admitted was entitled to the same privileges as those enjoyed by a solicitor with an English qualification practising in that Colony. When once admitted to practice, a legal practitioner has enjoyed the same liberties and rights and undertaken the same duties in China, whether before, his admission he was a barrister or a solicitor.

Partnerships between barristers and solicitors are common, and from earliest times the propriety of this arrangement has been recognized by this Court.

Barristers come to China to join these firms on salaries and on agreements in the same way as do solicitors. Admission to practice is no mere formality (Ex parte Harris "N .C. Herald" 27.11. 1909 -10.6.1910 and 24.6. 1910): the practice is the same now as it has always been and has been regulated by rules of Court since 1865.

This Court was established in 1865 by Order in Council, consequent to the Treaty of Tientsin, and within the knowledge of the Court persons with the qualification of barrister or solicitor have been indiscriminately admitted to practice, and when so admitted have practised as barristers and solicitors.

They have in non-contentious matters managed business as solicitors and given advice as barristers, and in contentious matters they, have acted as solicitors in preparing cases for trial, and in the same matter the same practitioners, whether originally a barrister or solicitor, has had right of audience in Court and has conducted the case up to judgement. A "legal practitioner" of this Court acts and has always acted as a solicitor with full right of audience in Court, and when conducting a case in Court has had the privileges of a barrister conducting a case in Court in England, and is expected to undertake the responsibilities of a barrister.

Turning to the China Order in Council 1904 we find two provisions dealing with legal practitioners, the first is Art. 3 and it defines "legal practitioners"; the second is Art 119(i) which gives the Judge of the Court power to make rules "for regulating the mode in which legal practitioners are to be admitted to practise as such, and for withdrawing or suspending the right to practise on grounds of misconduct, subject to a right of appeal to His Majesty in Council". Rules as to admission to practice have been made under this power which substantially re-enacts the old rules, no rules have been made to regulate the latter, viz: the withdrawal of a right to practise.

No distinction is made in those rules between barristers and solicitors. In 1910 the Judge made rules regarding the taxation of costs in which; the term "legal practitioners" is extended for the purpose of the rules, and includes a person entitled or allowed to practise before the Court, that is to say, a person who having been admitted as a legal practitioner is entitled to practise or a person who by international courtesy is allowed to do so in accordance with the terms of Rule 314 (4) having been admitted to practice in a foreign Consular Court in China. The Rules clearly indicate that the title to practise depends on admission. The "Taxation of Costs Rules, 1910", apply sections 4 to 15 of "the Attorneys' and Solicitors' Act, l870" to legal practitioners, and deal with legal practitioners throughout as such, without any distinction between barristers and solicitors. Rule 23 implicitly recognizes the right of a barrister to recover the amount due to him on a bill of costs and disbursements.

I have reviewed the position of the legal profession at considerable length as it is material to the case, and it seems desirable in-view of the questions which have arisen that that position should be fully understood both by its members and by layman. It is quite clear from this review that the right to practise depends on admission to practice and not on the possession of certain qualifications, though the Court will never refuse admission to a properly qualified person who is fit to practise (Ex parte Harris) and as a result that the Court which admits should and can exercise control over members of the Bar practising before it independently of the practice which prevails in England and the rights of the Inns of Court over their members.

Such being the position of the parties is there any reason why the Court should not entertain an action between them arising out of a contract to dissolve partnership?  An English Court would entertain such an action in the case of two solicitors, such a contract between two barristers in England is impossible. I can see no reason why such a contract being not only possible but usual between legal practitioners of this Court, the Court should not enforce it.

In justice to the defendant I should say that he has always been ready, and has so expressed himself in chambers, to abide by any direction which the judge or judges sitting as a domestic tribunal might give, and to submit if they thought right to an injunction; it is therefore beside the mark for plaintiff's counsel to say, that the defendant was seeking to burke inquiry.

Indeed, I have always thought and still do so, after having heard the case, that the plaintiff would have been better advised to have been content with that course.  Sufficient publicity to secure his position could have been given to the judges' findings. Before dealing with the remainder of the case, I must refer to the attack made upon Mr. Home by the plaintiff's counsel in his reply on the whole case. It seemed to me unnecessary and it was not justified by the facts. Mr. Home may have been injudicious and wrong headed and I think that he was, but to designate as blackmail a threat to commence an action to assert his rights though he may not have contemplated its coming to trial is more than inaccurate, unless I assent to the suggestion that Mr. Home exaggerated circumstances connected with Mr. Douglas's practice in order to drive him to consent to his recommencing practice in Shanghai. The case is an unfortunate one, but the importation of bitterness does not in any way tend to its solution, unless the Court were persuaded that the plaintiff had resorted to underhand and immoral tactics. By offering to submit to my ruling, as it were in foro domestico, and by his attitude at the trial the defendant has removed any suspicions that may have existed in my mind.

Divested of prejudice the case is simple, the parties practised here in partnership for some months when the defendant decided to sell his interests and to return to practise at the bar in England. A sum of Tls. 12,000 was to be paid to him by Mr. Douglas, and there was a restraint clause prohibiting him from practice in Shanghai for five years. Mr Home found that his practice in London was not so successful as he anticipated, and from certain circumstances which came to his knowledge attributed his want of success to his connexion with Mr. Douglas; consequently he wished to dissociate himself as publicly as possible from him. Eventually he came to Shanghai during the long vacation in order to investigate matters, and decided that he could best obtain his end by practising separately from Mr Douglas in Shanghai, where they had previously practised together. Mr. Douglas was then absent from Shanghai. It was, I think, Mr. Home's want of success in England, and the delay beyond his expectation of his getting a practice in the English Courts, which led to his adopting an exaggerated and mistaken view of the circumstances and taking the consequent injudicious steps of threatening an action and starting in practice in Shanghai. Mr. Home alleges a collateral verbal agreement that he might return to Shanghai before the expiration of the five years on terms, and Mr. Douglas acknowleges that it was in the contemplation of the parties to the written agreement that some such situation might arise.  There has been no agreement proved, and the point only becomes material in deciding what is the proper, order to make.

The defendant, however, has pleaded lapses in professional conduct which he has all along attributed to the plaintiff, and has given particulars of four, some of which he discovered after his return to Shanghai. The first is what he has called a pawnbroking transaction, and though he has said that he accepts Mr. Douglas' explanation, it is my duty, and one which I am glad to do; to state that in that transaction, the particulars of which I cannot well go into for, the sake of a third party, there is nothing that does not do credit Mr. Douglas. The second paragraph in the particulars deals with the agreement between Mr. Douglas and a clerk by which he paid the clerk a percentage, and the third deals with the plaintiffs intention to advertise his own and the defendant's names as having dissolved partnership.  What I have said as to the status of legal practitioners here and the evidence of Mr. Douglas entirely disposes of these two points.

I wish, however, before parting with the particular as to the payment of a percentage on fees, to say that it is not to my mind an entirely satisfactory arrangement. I am afraid that there can be little doubt that Chinese interpreters do, without the knowledge of their employers, make money out of their employers' clients. It was to prevent this that, as Mr. Douglas explained, he adopted the plan of paying a commission on the fees he took. Even so, however, touting for business by interpreters is not prevented, it is at best regulated, and the consequences which are supposed to follow the payment of a commission, viz, activity in pressing a business, are inferentially encouraged. I have no doubt that such an intention never entered Mr. Douglas's mind, and that he acted in a manner which he thought most likely to prevent the illicit taking of commissions from clients. His clerk was a British subject and was therefore unlikely by taking secret commissions to render himself liable to the criminal law, whereas such considerations do not apply with Chinese, who consider such an operation not only convenient but proper. It must always be most difficult for a professional man to check what is done in this way outside his office, but on the other hand it is his duty to prevent to the utmost such reprehensible practices.

The propriety of Mr. Douglas' action in paying a percentage on his fees must in the circumstances be judged by the test as to whether he was entering into a partnership with an unqualified person, or whether the transaction was such that he was lending his name to an unqualified person so as, in effect, to enable such person to do acts which he was not entitled to do. The nature of the relationship between him and the clerk absolutely negatives the second test, and I am quite clear that there was no partnership. The share in the profits was a small one.  There was no liability to share in losses, and the relationship of employer and servant was maintained throughout. The clerk was warned that he would be instantly dismissed if he took outside commissions. On the whole, the arrangement, though it is not one which I care to approve of, was not ill calculated to prevent an evil which Mr. Douglas suspected, and probably quite rightly, to be rife amongst Chinese interpreters.

The fourth paragraph deals with a prospectus in which "Home and Douglas" are called the solicitors of the proposed company.  The use of the word "Solicitors" is certainly inaccurate, and it may have been annoying to Mr. Home, but in view of the fact that Mr. Douglas was in fact, doing a solicitor's business at the time, and had on May 4, 1910, the right to use the firm name of "Home and Douglas" I can see no real impropriety in it. The use of the name on September 25 1911, when the right to use the firm name had expired, was due to no action of Mr. Douglas, as the report complained of was issued without his knowledge and was rather due to the defendant's refusal to allow Mr. Douglas to advertise his name out of the partnership business.

A fifth charge was withdrawn.

All the charges of professional misconduct on which the defendant seeks to avoid the contract have failed. If Mr. Douglas had been guilty of misconduct and had used the firm name of which the defendant's name formed a part to cover them, I think the contention, that it was an implied term of the contract that the business carried on under the name of "Home and Douglas" should be conducted in a professional manner, would have been well worthy of consideration, as it is, the position does not arise.

The plaintiff is therefore entitled to his injunction. The remedy is an equitable one and should not be granted if he has acted unreasonably in refusing to acquiesce in the defendant's returning to practice on terms. In view of what I cannot but hold to be the unreasonable conduct of the defendant, in trying to force the position, I do not think his conduct in any way unreasonable. As regards the account asked for, the remedy appears inapplicable, and damages which the defendant offered to pay although not asked for have not been proved, nor do I see that they could be more than hypothetical, unless Mr. Home were to remain in practice in Shanghai. The injunction is granted, the account refused, the defendant must pay the plaintiff his costs.

Published by Centre for Comparative Law, History and Governance at Macquarie Law School