Legal Services Board v Gabriel Werden [2011] VCS 74 – Applications for compensation under the Sentencing Act 1991
On 15 March 2011, Beach J delivered his decision in the application by the Legal Services Board for a compensation order under section 86 of the Sentencing Act 1991 against Mr Werden.
The Facts
Mr Werden was a solicitor. On 27 October 2006, he was sentenced to a term of imprisonment after having pleaded guilty to various counts of theft and obtaining of financial advantage by deception in relation to the misapplication of trust monies in his trust account.
The Legal Services Board (which is the successor of the Legal Practice Board) made payments to various former clients of Mr Werden through the Legal Practitioners’ Fidelity Fund. Those payments were made between 1998 and 2001.
The Legal Services Board then sought to recover the monies paid out by it by application made under section 86 of the Sentencing Act 1991. That section provides a victim of the offending the opportunity to make an application for compensation. Critically, an application for compensation must be made “as soon as practicable after the offender is found guilty, or convicted, of the offence”.
To date, there has been very little judicial consideration of the practical effect of the words “as soon as practicable” in the context of such applications.
The Findings
In dismissing the application by the Legal Services Board, Beach J made the following observation at [65]:
“Section 86 is a provision designed to enable a summary recovery of compensation. Its purpose is to enable awards of compensation to victims of crime in relatively clear and non-complex cases, and not to bog down the criminal list in longer compensation claims. Further, section 86(10) provides that nothing in section 86 takes away from, or affects a right to recover damages or to be indemnified against any loss as a result of the offence. These considerations provide further grounds for rejecting the notion that an application for compensation under section 86 might be brought years after the offender has been convicted and sentenced – even if the delay is capable of explanation. The central question remains: “Was the application made as soon as practicable?”. The answer in this case is “No”.”
The practical effect of the decision
Practitioners acting on behalf of victims seeking to make applications for compensation under section 86 of the Sentencing Act 1991 need to be aware that they must make those applications “as soon as practicable” after the offender is found guilty, or convicted.
Practitioners acting on behalf of persons who have had their property restrained for the purpose of a compensation order, in circumstances where no application for compensation has been made within a reasonable period after the offender is found guilty or convicted (and provided that the restraining order serves no other purpose) ought to consider making an application to have the restraining order set aside on the basis that it will serve no further purpose.
