I started out as a tremendous fan of Gillard. I wanted her to win when Kevin Rudd attempted to overthrow her. (Sorry to my Queensland Labor friends, I have just never understood Rudd’s appeal. He’s the Pointy-Haired Boss from Dilbert to me.) But I have to say that the allegations surrounding Gillard in relation to the AWU do worry me.
Over the last couple of days, I’ve seen some of my more Labor-oriented friends decrying the allegations made against Gillard in The Australian($), with the suggestion that it’s a mud-flinging witch hunt and she’s being persecuted for her taste in men. I must say that if all women were held to account for Bad Boys we’ve dated in the past, I think many of us would be tainted. But to me, it’s not about who Gillard was in a relationship with. Yes, she was in a relationship with Bruce Wilson, against whom allegations of fraud have been made in relation to the Australian Workers’ Union (AWU). That’s immaterial. I don’t really care who she was living with or sleeping with in the past.
What I do care about is the legal work Gillard did for Wilson while working at Slater & Gordon as a salaried partner. So, I’ll start out with my position on the issue, which is this: on the evidence we have available, Gillard’s actions were not unethical in the legal sense, but her actions in failing to open a file on the firm’s system in relation to the work done on the formation of the AWU Workplace Reform Association showed poor judgement and poor office management.
The impetus for writing this post was a non-legal friend asking me, “So what does it matter if she didn’t open a file on the firm system?”
When you take on a matter at a law firm, you open a file. This means that you get a manila folder and typically you stick some colourful letter and number stickers on the side – maybe three identifying initials for your client and three identifying initials regarding the matter. What do I mean by initials? Let’s say your client is the AWU and you’re opening a file to form an association for them. You might put the initials AWU ASN on the spine and edge of the file (standing for AWU and association – I was going to say ASS for association, but that doesn’t look so good). It’s a quick way of identifying files easily.
Then you get a file number which is allocated to the file (these days most likely by a computer system, or perhaps in those days it was allocated manually by the finance department). Let’s pretend the file number is 046782. So then you stick the numbers 046782 on the spine and the other edge of the file so that no matter which way it’s filed on your shelf, people can see what it is. You then enter various details about the matter into the firm’s central database or records (who the client is, what the work is about broadly, who’s responsible for it, is it pro bono and so forth.) In the actual physical file (a.k.a. the labelled manila folder mentioned before) you put all the correspondence, bills, file notes and relevant documentation. If the file is on the system, it means that other people can see what you’re doing. Then, if you leave, if you’re on holiday, if you’re hit by a bus, or if someone else needs to read it, they can easily find the file, read what’s happened so far, and get up to speed. I don’t know whether Slater & Gordon’s technology was up to it in the early 90s when Gillard’s particular matter arose, but certainly when I was in practice some ten years later, we had computer databases, such that if you had a file number you could also easily look at all work that had been done on the file via computer (eg, memos, pleadings, contracts etc) and look at the billings on the file.
According the timeline supplied by The Australian, what seems to have happened($) in this case is that Gillard was the lawyer for the AWU at Slater & Gordon from 1991 onwards. Around this time she also entered into a relationship with Bruce Wilson, an AWU official. In early to mid 1992, Gillard helped Bruce Wilson and another AWU union official, Ralph Blewitt to set up an entity known as the AWU Workplace Reform Association. The purpose of the association was stated to be the promotion of safety on construction sites. At that time, Gillard did not open a file on the firm system for this service, although evidently she did have some kind of physical file in her office. Wilson and Blewitt sought payments from various construction companies for the AWU Workplace Reform Association, purportedly to promote safety on site. Meanwhile the rest of the AWU was unaware that this Association existed or that it was raising hundreds of thousands of dollars. In her interview($) with then-Slater & Gordon partner Peter Gordon, Gillard said that she believed that the fund was in fact ‘a re-election fund, slush fund, whatever, which is the funds that the leadership team, into which the leadership team puts money so that they can finance their next election campaign’.
In 1993, Blewitt (through Wilson) purchased a house in Fitzroy with funds allegedly embezzled from the Association. Gillard was with Wilson when he bought the house at auction for Blewitt. In 1995, the AWU became aware of certain irregularities in its accounts and begin to pursue Wilson and Blewitt. It did not become aware of the existence of the AWU Workplace Reform Association until 1996. Wilson and Blewitt were made redundant by their branch in August 1995, against the wishes of some who felt that they had been fraudulent. Meanwhile, Slater & Gordon realised that the firm’s actions might be under scrutiny because of Gillard’s involvement with the creation of the AWU Workplace Reform Association, and started investigating. In September 1995, the firm questioned Gillard. A redacted version of the transcript($) of that questioning has since become available.
Imagine how the other partners at Slater & Gordon must have felt. One of its partners comes under question for certain legal services rendered to the AWU in relation to the AWU Workplace Reform Association, and allegations of fraud are made. Slater & Gordon go to find the relevant file…and the file is not on the firm system. Thus, they have no way of knowing what has happened on this file, where it is, or what its contents are. No wonder they called in Gillard for questioning. I imagine they must have been panicking.
From the redacted transcript of the questioning($), Peter Gordon, then a partner at Slater & Gordon, asks Gillard, ‘what are the circumstances in which we only got that [file regarding the incorporation of the Association] last week?’ Gillard readily admits that she did not open a file on the system saying, ‘…I must admit my recollection about the incorporation file was that I hadn’t opened a file on system and that I had had some papers and at some point I had given the papers to (name redacted).’ Gordon then asks Gillard why the file wasn’t opened on the system. Gillard responds as follows:
I don’t think there’s any great scientific explanation for that, I didn’t have an intention to charge on it, and from time to time I’ve done bits of work on files that I haven’t opened up where I’ve just done relatively small jobs for unions that I wasn’t intending to charge for. Ordinarily they would be kept on the union’s file.
We have a file for each union where we put little bits of free work or telephone attendances of advice we give, or they’re kept on my personal file JEG general. This, this was a more substantial job than that and really ought to have been opened on system, but I think, well, I don’t have a specific recollection of thinking to myself should I open it on system or shouldn’t I open it on system, but apparently I didn’t.
[my emphasis added]
Now, I should note that at this point there is no suggestion that Julia Gillard was involved in Wilson and Blewitt’s alleged fraud, or that she knew that the Fitzroy property was purchased from allegedly embezzled funds. Indeed, Slater & Gordon seems to have accepted that the failure to open a file was a genuine error on her part, and that she was not involved with and had no knowledge of the alleged fraud of Wilson and Blewitt. Nonetheless, in October 1995, Gillard left the firm and some months later she became an adviser to John Brumby, then Labor opposition leader in Victoria. There are conflicting accounts amongst Slater & Gordon’s partners and former partners on what their view of Gillard was when she left. One former firm partner, Nick Styant-Browne, now living in the United States, has alleged that the firm took a “very serious view” of Ms Gillard’s conduct, while the present managing director of Slater & Gordon has denied this, and has criticised Styant-Browne. Meanwhile, Peter Gordon (who now works with another firm) has released a statement in which he says, ‘I believed at the time that there was no explicit or indirect evidence that she [Gillard] was involved in any wrongdoing and that remains my view today.’ Nonetheless, he concedes that the relationship between the firm and the two industrial relations partners (Gillard and Bernard Murphy) was no longer a happy one, saying:
It is relevant to understand that these events occurred in the immediate aftermath of the Harris/Smith case, which had placed relations between the industrial department and the rest of the partners under great strain and damaged relationships. Ms Gillard’s previous public statement that after these events “working there wasn’t as much fun, to be honest” can hardly be doubted in the circumstances. Likewise, it is true that the balance of the partnership were less than thrilled with how our relations with Bernard Murphy and Julia Gillard had deteriorated. It was a partnership falling out and like many of them, individuals will have their own take on what happened, especially seventeen years later.
I have to say that if I had been a partner of the firm, it is likely that I would have been deeply disappointed with Gillard’s conduct because it shows very poor office management which may adversely affect the reputation of the firm. It is essential to the proper running of a firm that files are kept in a manner which allows other people at the firm to access them easily if needed, particularly if problems arise with a file. That’s not to say that mistakes don’t occur from time to time. I know I made some when I was in practice. That being said, I never failed to open a proper file – including when a partner asked me to do work on his wife’s personal matters. Maybe I’m just neurotic, but I like to cover my back by keeping proper records of things.
No, there’s nothing in the information we have which suggests that Julia Gillard has been in any way been unethical or fraudulent or anything of the like, and there’s nothing to suggest that she should stand down as Prime Minister (contrary to the calls from some of my friends on the Right). But to me, this whole thing underscores a certain lack of judgement on Gillard’s part which is deeply disappointing.