One man against the system: year 12 in Viscariello V Minters & Macks

by | Sep 13, 2017 | Business, Finance

His companies are long dead and his assets long bled. But tenacious small businessman, John Viscariello, has refused to yield in his epic fight against the establishment.

This is the story of this country’s most tortuous legal battle, a David and Goliath struggle whose latest turn is an interim victory by the underdog against the South Australia’s Legal Profession Conduct Commissioner (LPCC).

The LPCC is the body which presides over complaints about lawyers and any win against any legal conduct board is a win to be cherished. Lawyers have a penchant for looking after their own.

Life’s no picnic when the law is in the hands of lawyers

It all began in 2001 when Viscariello’s chain of retail stores went belly up and his the liquidator, Peter Macks, and his lawyers racked up bills of more than half a million dollars chasing a claim against his former girlfriend of just $28,000.

The ensuing slew of claims and counterclaims swung from the Magistrates Court, via the Federal and Supreme courts, to the High Court and back again as John Viscariello first defended his former partner then turned and pursued the liquidator for multiple breaches of the Corporations Act.

Recoveries from Viscariello’s companies were exhausted years ago but the lawsuits dragged on inexorably. It became a one-man fight against the system.

In early 2006, Viscariello took action against former PPB liquidator Peter Macks for breaches of the Corporations laws. He also petitioned the Legal Practitioners Conduct Board to investigate blue chip Minter Ellison and the Queen’s Counsel whom acted for Macks.

The Conduct Board took no action however. It went after Viscariello instead, launching a series of “own motions” investigations, peppering the businessman-turned-lawyer with demands for information – for years – amid a welter of threatened fines and 14-day deadlines to respond.

They finally took his livelihood in 2013, his licence to practise law. Besides sheer bloody-mindedness and a thirst for justice, John Viscariello’s licence to practice as a solicitor was the only thing that kept him fighting. Without it, he could never have borne the costs of suing Big Law and its allies in the rapacious insolvency profession.

His adversaries had counted on this. Viscariello had had a decisive win though in August 2012 when Chief Justice Chris Kourakis dealt the liquidator and his solicitors a heavy blow. “I have formed the view that the proceedings were prosecuted recklessly, indifferent to the possibility that they might be an abuse,” he found in an interim judgment.

SA judge lifts veil on legal professional privilege

In his final Judgment delivered on December 2014 Kourakis CJ He found Macks had fabricated documents, given “evasive and unconvincing testimony” to a creditors’ committee and engaged in multiple breaches of the Corporations Act. Corporate regulator, the Australian Securities & Investments Commission, finally swooped. Macks’ appealed to the Full Court. Judgment on Appeal has been reserved.

John Viscariello persisted in his claim against the LPCC.

After years of hard knocks trying to have the conduct of Macks’ lawyers examined by the Conduct Board, Viscariello won another “interim” victory in April 2014 when the Supreme Court’s Justice Kevin Nicholson gave the green light for Viscariello to proceed with his action for judicial review against the Conduct Board.

Viscariello’s chief claim was that the Board had failed to fulfil its statutory duty to investigate complaints against Macks’ lawyers as far back as early 2006. The Nicholson J decision opened the door for Viscariello to obtain orders compelling the Board to “perform its public duty to make an inquiry into the conduct of Mr [Mark] Livesey QC and Ms [Tyneil] Flaherty” and other lawyers at Minter Ellison.

Mark Livesey was, at the time, vice-president of the National Bar Association and Minter Ellison the most powerful law firm in the state. The “other lawyers” are or were partners at Minters including Greg May and Nigel McBride.

Ironically, on July 1, 2014, Greg May went on to be appointed as head of the LPCC and Viscariello claimed May had a conflict of interest as he had formerly been the Chief Operating Partner at Minters and was the subject of a complaint to the Board by Viscariello.

“(There are) now reasonable grounds to make inquiries with the management at Minter Ellison at the very highest level, including the board level,” wrote Justice Nicholson in his decision.

“It is apparent on the evidence given by Mr Macks at trial that these joint-venture/profit-sharing arrangements between insolvency practitioners and their lawyers are commonplace … It appears that the decision to cover up these arrangements and the unprofessional conduct as I have alleged was sanctioned by senior management at Minter Ellison Lawyers including by Mr Nigel McBride and Mr Greg May.”

McBride was formerly managing partner at Minters and went on to become chief executive of Business SA. May, as a partner at the firm for more than 20 years, was ironically appointed South Australia’s first Legal Profession Conduct Commissioner.

As new head of the LPCC, Greg May had inherited Viscariello’s complaints against him and other lawyers at his old firm, Minters. And last month, before the Full Bench of the Supreme Court, John Viscariello enjoyed another “interim” victory when the majority justices upheld his claim that Greg May had a conflict of interest and, in making delegations of power to a Mr T Bourne to investigate Viscariello’s complaints about Greg May and other lawyers at Minters, May had breached Section 17 of the Public Sector (Honesty & Accountability) Act.

Instead of declaring a conflict of interest and seeking advice from the Attorney-General, Commissioner May picked his own person to carry out the investigations into his own conduct and the conduct of other lawyers at Minters.

It is now up to the Public Prosecutor to determine whether or not he will carry out an investigation and, if appropriate, pursue charges, potentially criminal charges, against Greg May.

Both the LPCC and South Australia’s Attorney-General John Rau declined to respond to questions (declined to even acknowledge questions) but President of the Law Society of South Australia, Tony Rossi, did respond.

The Law Society was asked what it would do about the situation (a situation where a complaint against the head of the state’s legal complaints board had been upheld).

Rossi wrote that it was “important to understand what the Full Court decided in Viscariello and, perhaps more importantly, what the Court did not decide”.

The Law Society, said Rossi, did have a regulatory role when it came to the state’s lawyers but it had “no jurisdiction with respect to the office of the Legal Profession Conduct Commissioner”.

Further, Rossi quoted the findings of Justice Lovell who found “I do not intend to suggest that the Commissioner, in taking the course he did, acted in anything other than good faith”.

“The Commissioner is entitled, at law, to continue in his role”.

John Viscariello said yesterday ordinary citizens were held to a very different standard than people in power. “They (people in power) enjoy the presumption from the courts that they are the good guys”.

As for the media, despite the Viscariello affair being the longest and most bitter of challenges to the establishment of South Australia – and despite the serious findings as to the behaviour of prominent lawyers and liquidators – there has been virtually no word of it in the state press, Adelaide being a one-newspaper town … one Murdoch newspaper.

John Viscariello says battling big boys takes it toll


Michael West

Michael West

Michael West established to focus on journalism of high public interest, particularly the rising power of corporations over democracy. Formerly a journalist and editor at Fairfax newspapers and a columnist at News Corp, West was appointed Adjunct Associate Professor at the University of Sydney’s School of Social and Political Sciences. You can follow Michael on Twitter @MichaelWestBiz.

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