A practitioner who worked as a corporate lawyer for more than two years without holding a current practising certificate has pleaded guilty to 16 charges of misconduct.

The Victorian Civil and Administrative Tribunal found that Mr Andrew Nguyen of Maribyrnong had not renewed his corporate practising certificate after it expired in June 2009. Despite this he continued to work as an in-house lawyer for a prominent retail chain, even being involved in litigation in the Supreme Court on behalf of his employer.

The Legal Services Commissioner brought two charges of misconduct at common law against Mr Nguyen for lying to a County Court Judge while under oath in a previous disciplinary hearing in 2011, where he falsely stated he was not practicing as a lawyer and that he had applied to renew his practising certificate. A further 14 charges of professional misconduct were also brought against him relating to seven counts of practising without a current practising certificate, and seven of representing that he was entitled to practise when he did not hold a current practising certificate. Mr Nguyen pleaded guilty to all 16 charges.

In making his decision, Senior Member Smithers found that Mr Nguyen had demonstrated a lack of knowledge of his ethical obligations as a legal practitioner and that he is “not a person of honesty”, therefore concluding that he is unfit to practise and likely to remain so for the indefinite future. An order was made that Mr Nguyen was not to be granted a practicing certificate before 1 April 2019 and he was ordered to pay the Commissioner’s costs, yet to be fixed.

The Tribunal also recommended that Mr Nguyen’s name be removed from the roll of practitioners.

This case is a salient reminder to corporate lawyers that they are responsible for renewing their practising certificates each year and cannot expect their employer to necessarily ensure a current certificate to practise exists.

For more information, see the VCAT decision.

A Kew solicitor was ordered to pay $11,000 in legal costs and had his practicing certificate suspended after being found guilty of eight charges of professional misconduct.

Mr Andrew Burgess, a partner at the firm Henderson &Ball, appeared in the Victorian Civil and Administrative Tribunal in March where the eight charges were heard before Her Honour, Judge Jenkins of the County Court.

Mr Burgess agreed to plead guilty to seven charges: two charges of failing to communicate with clients, two of gross delay in finalising two estates, and three of failing to provide a full written explanation to the Commissioner relating to other complaints.

Mr Burgess contested a further charge of statutory professional misconduct for failing to comply with an undertaking given to the Commissioner in 2011, which stated he would complete particular units of continuing professional development (CPD) training by a set date, in addition to the normal CPD requirement for legal practitioners.

While he acknowledged that he failed to comply with the terms of his undertaking, Mr Burgess argued that this was not caused by wilful or reckless behaviour but because he did not review the terms of the undertaking prior to carrying out the additional CPD. Judge Jenkins commented that it was “incomprehensible that a prudent solicitor would not have checked the very document containing the terms of the undertaking prior to its performance”, and found Mr Burgess guilty of professional misconduct.

Judge Jenkins described Mr Burgess’ conduct as “inevitably and deservedly” bringing the profession into disrepute, and noted that it warranted “sanctions sufficiently severe to reflect appropriate condemnation and send the clearest message to the legal profession that such conduct will not be tolerated.”

Judge Jenkins suspended Mr Burgess’ practising certificate for 9 months from May 2013, and ordered that for a further 12 months after the suspension period Mr Burgess should only be permitted to practise as an employee solicitor. Her Honour also reprimanded Mr Burgess and ordered that he pay the Commissioner’s costs fixed at $11,000.

For further information, see the VCAT Decision.

A Melbourne solicitor who lied to the regulator and falsified documents has been reprimanded and had his practising certificate cancelled. Mr Nabil El Hissi, of Narre Warren, pleaded guilty to 10 charges of professional misconduct in VCAT following an investigation by the Legal Services Commissioner.

Mr El Hissi acted for two clients in a joint property transaction; the first client was a company associated with his parents, and the second was a company associated with friends of his parents. The interests of both clients began to diverge when the first client successfully obtained finance but the second client could not. Despite this, Mr El Hissi continued to represent both parties and devised a new arrangement which allowed the purchase of the property to go ahead.

Loans from family members of the second client were arranged for the balance of the property purchase. This involved the mortgaging of a property to raise capital. However the owner of the property was overseas at the time the transaction was to be finalised. The documents were instead signed by a member of the second party, and Mr El Hissi falsely executed and attested to the documents.

When the Law Institute of Victoria, on behalf of the Commissioner, questioned Mr El Hissi about the mortgage documents Mr El Hissi instructed his solicitor to provide false and misleading information about the attestation and execution of the documents. After further investigation and the discovery of new information, Mr El Hissi eventually admitted what he had done.

The Commissioner brought five charges against Mr El Hissi related to conflict of interest and false execution and attestation of mortgage documents, while a further five charges related to the breach of duty of candour to the regulator during the course of an investigation.

Senior Member Smithers of VCAT noted that “Practitioners are required to be scrupulously honest in their dealings with the courts, tribunals, the community, other practitioners and regulators. This fundamental requirement has been blatantly breached here”.

Mr El Hissi was reprimanded and his practising certificate cancelled for 9 months. He was also ordered to pay the LSC’s costs fixed at $16,293.84.

For more information, see the VCAT decision.

A solicitor working for a government agency has been found guilty of two charges of professional misconduct and prohibited from practising for three months in a decision handed down by VCAT.

Mr Elias Rallis, employed in a senior government position, was found to have breached an undertaking he gave to the Commissioner in 2012 involving payment of costs following an earlier misconduct finding. No misconduct occurred in connection to government work.

Mr Rallis was found guilty in 2009 of four counts of misconduct related to work undertaken before he commenced with the government agency. He was ordered to pay costs of $24,500 to the Commissioner by December 2010. After no payments were made, the Commissioner commenced court action in late 2011 to recover the costs. In mid-2012 Mr Rallis gave the Commissioner a $10,000 payment towards the outstanding costs and a written undertaking to pay the balance in line with an agreed payment schedule, in exchange for the Commissioner withdrawing further legal action at that time. However, no further payments were made and Mr Rallis did not respond to the Commissioner’s attempts to contact him by phone and in writing.

The Commissioner brought one charge of professional misconduct against Mr Rallis for his breach of a written undertaking, and one count of professional misconduct for failing to provide a full written explanation of his conduct during the Commissioner’s subsequent investigation.

Senior Member Smithers said that as a government lawyer, Mr Rallis was “under ethical obligations over and above those applicable to private solicitors, associated with the government’s obligations to act as a model litigant”. Given that Mr Rallis was employed by a government agency which protected peoples’ rights, this “further underlines the importance of compliance with his ethical obligations”.

While Mr Rallis paid the balance of the outstanding costs on the day of the hearing, Senior Member Smithers highlighted the need to protect the public by imposing a sanction which interfered with Mr Rallis’ right to practise.

Mr Rallis was found guilty of both charges and was prohibited from practising as a legal practitioner, whether as a government lawyer, or otherwise, for a period of three months, as well as being prevented from being granted a practising certificate for the same period. Mr Rallis was reprimanded and ordered to pay the Commissioner’s costs fixed at $3,945.30.

As a government solicitor, Mr Rallis is not required to hold a practising certificate to undertake legal work for his employer. This case demonstrates that even where holding a practising certificate is not required, the right to practice can be revoked by a court or tribunal in some circumstances where professional misconduct has occurred. Mr Rallis no longer works in a legal capacity with the government agency.

For further information see the VCAT Decision.

A Melbourne barrister has been found guilty of professional misconduct for failing to meet his tax obligations.

Mr Nigel Turner had been previously charged by the Legal Services Commissioner in 2012 with professional misconduct after being convicted on 27 tax offences in the Magistrates Court. The convictions covered a period of approximately 10 years and included failure to lodge income tax returns, failure to lodge business activity statements, failure to disclose income received, and failure to make provision for and pay income tax and GST. Mr Turner pleaded guilty to professional misconduct before the Victorian Civil and Administrative Tribunal and was reprimanded, fined $5,000 and ordered that he advise the Legal Services Board of his discharge from bankruptcy and the Commissioner of any future tax breaches. He was also ordered to pay the Commissioner’s costs of $8,233.76.

The Commissioner appealed the decision on the basis that the sanction was not appropriate for the seriousness of the conduct. The Commissioner argued that a period of suspension from practice was an appropriate sanction.

Justice Emerton of the Victorian Supreme Court heard the appeal and found that Mr Turner’s conduct demonstrated ‘an absence of the honesty and integrity that the public is entitled to expect from a legal practitioner’. Her Honour also noted that Mr Turner’s conduct over an extended period of time ‘reflects the practitioner’s hypocrisy in purporting to practise and uphold the law while at the same time committing serious breaches of the law’.

Justice Emerton ruled that the Tribunal made a material error of law in its finding that its role as being protective of the public was minimal in the matter because Mr Turner’s actions were not directly involved with clients. Her Honour ruled that this error had the capacity to affect the severity of the sanction. Further, Justice Emerton stated that the Tribunal’s reference to Mr Turner being in the twilight of his career and having few prospects if he could not carry on practice, had served no purpose other than to display sympathy, which was not a proper consideration for the sanction applied. Her Honour directed VCAT to rehear the matter.

In April 2013 Member Butcher of VCAT presided over the rehearing and determined the previous sanction was appropriate to act as a general deterrence for legal practitioners by demonstrating that they would face a sanction for non-compliance with tax obligations. Although Mr Turner did not have a diagnosed mental illness, Member Butcher deemed that Mr Turner’s ‘head in the sand attitude’ towards meeting his tax obligations was influenced by ‘powerful mitigatory factors, particularly his mental condition at the time of his default and delay’. He considered that Mr Turner’s conduct, though it had brought the legal profession into disrepute and damaged the public confidence in the system, had been reformed and therefore a suspension of Mr Turner’s practising certificate was not warranted.

Member Butcher reaffirmed the original VCAT finding and orders, with the addition that costs as per the previous order were to be paid by 16 May 2013.

For more information, see the VCAT decision.

The Commissioner has released a new fact sheet for consumers of legal services: Meeting a lawyer – your first appointment. You can download the fact sheet from the Fact Sheets page.

A solicitor who was denied a practising certificate by the Legal Services Board in 2010 has had his appeal against the Board’s decision dismissed by the Court of Appeal.

Mr David Forster of Frankston law firm Whistleblowers Lawyers, and also previously of the law firm Hollows Lawyers (in receivership), was refused a practising certificate by the Board in 2010 due to concerns about his fitness and suitability to engage in legal practice. The Board determined that Mr Forster was not a fit and proper person to hold a practising certificate because of the way he conducted himself with clients of his law practice and because of his behaviour during a 2009 Supreme Court hearing where the Board sought to appoint a receiver to Mr Forster’s law practice. The application to appoint a receiver resulted from allegations that Mr Forster had committed breaches of trust accounting requirements under the Legal Profession Act 2004, and breaches of the Legal Profession Regulations 2005.

Mr Forster appealed the Board’s decision to refuse him a practising certificate to the Victorian Civil and Administrative Tribunal and failed. In his orders, VCAT President Ross noted that Mr Forster had ‘failed in his duty of honesty and candour to the Court’ in the 2009 Supreme Court receivership proceedings. He further noted that Mr Forster showed a ‘reckless disregard towards his duty of candour to the Tribunal’ during the VCAT appeal by being ‘evasive and changing his evidence when confronted with contradictory material’. Justice Ross dismissed the appeal, finding that Mr Forster was not a fit and proper person to hold a practising certificate.

Mr Forster then lodged an appeal against the VCAT decision with the Supreme Court on 12 grounds, arguing that Justice Ross made numerous errors of law in his judgement. In February 2013 Justices Harper, Weinberg and Kyrou heard the matter. In their decision handed down in April 2013, their Honours also found that there was overwhelming evidence to suggest Mr Forster’s conduct during the receivership proceedings constituted a failure to comply with his duty of honesty and candour to the Court. Further, they found that Justice Ross’ decision was carefully considered and without any of the errors alleged by Mr Forster. The Court dismissed Mr Forster’s appeal and awarded costs to the Board.

Mr Forster now no longer holds a practising certificate and is not entitled to engage in legal practice.

For more information, see the 2009 Supreme Court decision, the 2011 VCAT decision and the 2013 Court of Appeal decision.

A former solicitor, Mr Anthony Coleman of Yarraville, has been sentenced to nine months in prison (suspended for 18 months) after pleading guilty to nine charges in the Melbourne Magistrates Court on 14 May 2013 for breaches of the Legal Profession Act 2004. Mr Coleman was also fined $13,000 and ordered to pay $20,000 in costs to the Legal Services Board.

The charges related to Mr Coleman’s unauthorized use of ‘regulated property’, unqualified legal practice and failing to cooperate with the Receiver of his former law practice, Coleman Lawyers.

In 2011, the Supreme Court made Orders that a Receiver be appointed to Coleman Lawyers, following findings of serious financial irregularities in the running of the law practice. Immediately prior to the appointment of the Receiver, Mr Coleman advised the Legal Services Board that he would not re-apply for a practising certificate after 30 June 2011, and did not, and has not done so.

Following the Receiver’s appointment, however, Mr Coleman did not cooperate with the Receiver and obstructed the Receiver in the discharge of its functions. Subsequent investigations revealed that Mr Coleman unlawfully retained a number of legal files from the former law practice and sought to continue to act in these matters in conjunction with licensed legal practitioners, even though by this time he did not hold a practising certificate, and was therefore not entitled to practise law.

The Board worked closely with the Office of Public Prosecutions and the Victoria Police on this matter, but as the offences were committed under the Legal Profession Act, the agencies agreed the Legal Services Board would undertake the prosecution.

Magistrate Collins told Mr Coleman that if he had not pleaded guilty to the charges, she would have imposed an immediate custodial sentence.

Legal Services Commissioner and Board CEO, Michael McGarvie said: ‘This is the first time that these particular criminal provisions have been used against a lawyer; no-one is allowed to stop a court-appointed Receiver from doing their job.

‘These are very powerful provisions. The maximum penalty for each unauthorised dealing with property of a law practice, either immediately before or after the appointment of a Receiver, is six years imprisonment,’ Mr McGarvie said.

‘These provisions will be used when and where we need to protect consumers of legal services and the reputation of the legal profession as a whole.’

Mr Coleman also received a four month prison sentence (suspended for 12 months) after pleading guilty to charges brought by the State Revenue Office arising out of the failure to pay stamp duty on transactions in 2007 and 2008, was fined $5,000.00 and was ordered to pay costs.

This post appeared originally on 29 January 2013, but has been updated with penalty details.

A solicitor pleaded guilty to misconduct charges before VCAT in November 2012 for misleading his client.

Mr John Powell, of Doncaster East, told his client that he had issued a writ and was proceeding with a personal injuries claim for his client’s son who was injured in 2001 at a Primary School. The solicitor pretended for nine years that the case was in hand and progressing normally. He dishonestly advised his client that the delay was caused by the other side’s lawyer. In fact the solicitors representing the Primary School had already closed their file due to inaction.

Mr Powell pleaded guilty to conduct that was short of the standard the public is entitled to expect of a lawyer, and which involved a substantial and consistent failure to act competently and diligently. At a penalty hearing in April 2013, Senior Member Davis suspended Mr Powell’s practising certificate until 30 November 2013 and ordered Mr Powell to pay the Commissioner’s costs. Mr Powell has now sold his law practice to another solicitor.

A lawyer who falsified his academic transcript in order to obtain a job has pleaded guilty to six charges of professional misconduct in the Victorian Civil and Administrative Tribunal.

The lawyer, granted the pseudonym of PFM by the Tribunal due to considerations for his current mental health, was brought to the attention of the Legal Services Commissioner through a complaint made by his former employer. Following a lengthy investigation, the Commissioner brought six charges of professional misconduct against PFM relating to supplying recruitment agencies with forged academic transcripts, providing false information on a CV, making false representations about his employment status and making a false statutory declaration to the Law Institute of Victoria.

During the Tribunal hearing, Senior Member Smithers of VCAT noted that PFM had provided false and misleading information to the investigators, causing the investigation to be significantly drawn out. He also described the conduct about which PFM was charged as comprising ‘systematic dishonesty, rather than a momentary or aberrant lapse’.

In his defence, PFM presented psychiatric reports as evidence that he was suffering from a major depressive disorder, and that this had affected him in his wrongdoing.  Assessing the evidence, Senior Member Smithers found that there was no causal link between PFM’s illness and his lack of candour to the Tribunal. Further, he found PFM was ‘not a fit and proper person, and that it is likely he is unfit to practise permanently, or at least, for the indefinite future, because he is not a person of honesty’.

The Tribunal found “…in order for penalty to be mitigated due to mental illness, there must be cogent and compelling evidence of the requisite relationship between the mental condition and the offending conduct. Here, the evidence falls well short of that.”  On the evidence presented, the Tribunal found that “PFM’s mental health status did not have any effect relevant to the determination of penalty…” of five of the charges, and only marginally at best about the sixth.

The Tribunal recommended that the PFM be referred to the Supreme Court for his name to be struck from the roll of practitioners. He was ordered by the Tribunal not to be employed by or consult for a law firm without the approval of the Legal Services Board, that he may not be granted a practising certificate before 27 May 2020, and was ordered to pay the Commissioner’s costs fixed at $25,000.

For further information, see the VCAT decision.

A young solicitor who represented both sides of a property transaction before representing one client in court action against the other, has been found guilty of four counts of professional misconduct.

The Victorian Civil and Administrative Tribunal heard that Ms Sapna Khan of Dandenong was handling the conveyancing of a property sale on behalf of the owner, before also agreeing to act for the purchaser. Both clients were aware of the arrangement, although no formal acknowledgement was signed by either client.

The owner intended to sell the property and then lease it back from the purchaser at a verbally agreed rent. However within a few months of settlement taking place, a dispute arose about the rent, renovations and other issues. When the landlord-tenant relationship continued to degrade, the new owner sought to remove the tenant and Ms Khan was asked to commence court proceedings for possession of the property. When Ms Khan told the new owner that she had no experience in that area of law she was pressured to continue, even to the point of accepting instructions and pursuing a course of action which went against her legal advice. When the application was struck out by the court, the new owner made a complaint to the Legal Services Commissioner.

In her decision, Member Wentworth of VCAT noted that Ms Khan had fully cooperated with the investigation by the Commissioner, that she was remorseful and had pleaded guilty to four counts of professional misconduct. The Member accepted that Ms Khan had been placed under significant pressure to act for the new owner and commented that the errors of judgment reflected “a relatively new practitioner who was out of her depth”. However, regardless of that pressure, Member Wentworth noted that “… her best course would have been to seek advice, either independent legal advice or advice from the Law Institute’s various services for solicitors in need of advice on a practice-related or ethical issue”.

Member Wentworth reprimanded Ms Khan, fined her $1,000 and ordered her to pay the Commissioner’s costs of $6,206. Ms Khan was also ordered to undertake five additional hours of continuing professional development in the areas of ethics and legal management. Ms Khan accepted the need for professional guidance and agreed to the appointment of a formal mentor to assist her with her practice for a half-day per fortnight for a minimum of six months, at her own cost.

For further information see the VCAT decision.

A solicitor who failed to honour undertakings has been found guilty of professional misconduct in the Victorian Civil and Administrative Tribunal.  Mitcham solicitor, Mr Paul Simon of the firm MW Law, was charged by the Legal Services Commissioner with two counts of professional misconduct for failing to honour undertakings he gave to a finance company.

Mr Simon represented two clients in separate personal injury claims. Prior to the settlement of each claim, Mr Simon referred the clients to a finance company so they could obtain loans, the repayments of which would come from their expected settlement monies. Mr Simon signed what the Commissioner asserted were two undertakings, which stated that the law firm would repay the finance company loan monies by a specified date.

When the loans fell due for repayment, the settlements for both claims had not been finalised and the loans could not be repaid. The finance company subsequently complained to the Commissioner.

Appearing before the Tribunal, Mr Simon argued the letters he signed were merely an acknowledgement of clients’ authorities, and amounted to no more than a promise to pay if and when settlement of the personal injury claims had been effected. However Member Buchanan of VCAT disagreed, determining that Mr Simon should not have made settlement of the claims a condition of the loan repayments, particularly as the third party – from whom the settlement was expected – was not a party to Mr Simon’s undertakings. While Mr Simon had not expressly promised that his firm would receive settlement monies, Member Buchanan found that the undertaking, as written, led the finance company to believe the money would be forthcoming; a factor influencing the finance company’s decision to approve the loans.

VCAT acknowledged that Mr Simon’s failure to honour his undertakings was due to influences beyond his control but that this was part of his failure. Member Buchanan regarded the breaches as significant, quoting the 2011 decision of LSC v Johnston that a breach by a solicitor of an undertaking was “a matter of the greatest concern”. The Member also remarked on Mr Simon’s apparent lack of contrition.

Member Buchanan found Mr Simon guilty of two charges of professional misconduct. Mr Simon was reprimanded, ordered to undertake three additional continual professional development units in ethics, and ordered to pay the Commissioner’s costs of over $9,000.

For more information, see the VCAT decision.

RPA Alert 4, June 2013 is now available for download (454KB PDF). This Alert covers the new Financial Services and Investments Notification Rules 2013.

The Legal Services Board has issued RPA Alert 4, June 2013. Download the Alert from the RPA Alerts page.

The Magistrates Court has found a former lay associate of a law firm guilty for failing to disclose a previous dishonesty offence.

From January 2009 to September 2012 Mr John Lelleton of Fitzroy was employed as a paralegal by an East Brighton law firm. Because Mr Lelleton had been found guilty of receiving property by deception in 1996, he was required to inform the law practice that he had a previous finding of guilt for a dishonesty offence. Mr Lelleton had also been found guilty in 1994 of unqualified legal practice. However his employer was not informed of either prior conviction, as required by law.

As covered in RPA Alert 1, 2012, it is unlawful for a person who has been found guilty of a relevant offence to seek or commence employment in a local law practice, unless they have first informed their prospective employer of the offence. The employer must then seek permission from the Legal Services Board if they wish to employ that person.

The Board learned of Mr Lelleton’s convictions in mid-2012 and subsequently charged him with unlawfully working for a law practice. In March 2013, Mr Lelleton pleaded guilty before His Honour Magistrate Hassard of the Melbourne Magistrates’ Court to having worked as a lay associate with a law firm without disclosing his previous criminal conviction. Mr Lelleton was fined $1,000 and ordered to pay the Board’s costs of $3,000.

The Board also sought an order in the Victorian Civil and Administrative Tribunal that Mr Lelleton be listed as a disqualified person indefinitely, and in late May 2013 the Tribunal made that order.

For further information on prohibited lay associates, see the Board’s Prohibited Lay Associates Guidelines and Frequently Asked Questions.

A solicitor who was ordered by the Victorian Civil and Administrative Tribunal to undertake a period of supervised legal practice has been reprimanded and fined $5,000 for breaching her supervision orders.

In January 2012, sole practitioner Ms Margaret McAuley of Brighton pleaded guilty to two charges of professional misconduct and one charge or unsatisfactory professional conduct before the Tribunal. The charges related to her receiving trust money from a client when not entitled to do so, failing to provide relevant information to the Legal Services Commissioner and failing to follow her client’s instructions. Ms McAuley was ordered by the Tribunal to undertake a period of 12 months supervised legal practice, and to meet with an appointed supervisor at least once a month.

The conditions of the supervision order were breached when, over a ten month period, Ms McAuley only met with her supervisor twice and failed to cooperate with him.  During that time, Ms McAuley did not provide her supervisor or the Commissioner with an adequate explanation for her breach of the supervision order.  When the supervisor indicated to the Commissioner that he no longer wished to supervise Ms McAuley, a new supervisor was appointed in late November 2012. Ms McAuley has since cooperated with her new supervisor, including having regular meetings with him.

Ms McAuley agreed to a statement of facts admitting her breach of the supervision order and pleaded guilty to the charge. Member Butcher of VCAT reprimanded Ms McAuley, fined her $5,000 and ordered her to pay the Commissioner’s costs of over $10,300. The Tribunal also extended the supervision order for a further 12 months.

A Kew solicitor who had his practicing certificate suspended for nine months has had an appeal against his penalty allowed in the Court of Appeal.

Mr Andrew Burgess, a partner at the firm Henderson & Ball, appealed the penalty decision made by Judge Jenkins in the Victorian Civil and Administrative Tribunal in March, 2013.

In the VCAT hearing, Mr Burgess had agreed to plead guilty to seven charges: two charges of failing to communicate with clients, two of gross delay in finalising two estates, and three of failing to provide a full written explanation to the Legal Services Commissioner relating to other complaints.

Mr Burgess had contested a further charge of statutory professional misconduct for failing to comply with an undertaking given to the Commissioner in 2011, which stated he would complete particular units of continuing professional development (CPD) training by a set date, in addition to the normal CPD requirement for legal practitioners.

While he acknowledged that he had failed to comply with the terms of his undertaking, Mr Burgess argued that this was not caused by wilful or reckless behaviour but because he did not review the terms of the undertaking prior to carrying out the additional CPD. Judge Jenkins commented at the time that it was “incomprehensible that a prudent solicitor would not have checked the very document containing the terms of the undertaking prior to its performance”. Judge Jenkins found Mr Burgess guilty of professional misconduct on all eight charges.

In her judgement, Judge Jenkins described Mr Burgess’ conduct as “inevitably and deservedly” bringing the profession into disrepute, and noted that it warranted “sanctions sufficiently severe to reflect appropriate condemnation and send the clearest message to the legal profession that such conduct will not be tolerated.” As part of the penalty, Judge Jenkins suspended Mr Burgess’ practising certificate for a period of nine months. She further ordered that for the subsequent 12 months, Mr Burgess only be allowed to practise under supervision by restricting him to an employee practising certificate.

Mr Burgess appealed to the Court of Appeal, arguing that he should undergo a period of informal supervision as opposed to a suspension and a restriction placed on his practising certificate. His Honour Justice Nettle and Her Honour Justice Neave reviewed Judge Jenkins’ original decision on penalty and found it did not adequately take into account the evidence Mr Burgess’ provided on his psychological condition at the time of the conduct in question. Justices Nettle and Neave set aside Judge Jenkins’ nine month suspension of Mr Burgess practising certificate, instead ordering that Mr Burgess’ practising certificate be restricted to an employee practising certificate for the full 21 month period.

Judge Jenkins’ reprimand of Mr Burgess and her order that he pay the Commissioner’s costs fixed at $11,000 were unchanged.

This post was originally titled Delayed work and breach of CPD undertaking prove costly for Kew lawyer and was published on 4 April 2013.

For further information, see the original VCAT Decision and the Court of Appeal decision.

The Victorian Civil and Administrative Tribunal has ruled that lawyers who exaggerate and mislead by over-stating their client’s entitlements risk misconduct findings.

On Wednesday, 10 July, VCAT made a precedent-setting finding of professional misconduct against a debt collection lawyer, Ms Pippa Sampson, of the law firm Goddard Elliot. The Legal Services Commissioner brought charges against the Glen Waverly lawyer, alleging Ms Sampson breached the professional conduct rules that restrict lawyers from misleading and intimidating others by over-stating the rights of her clients.

Ms Sampson acted for prominent DVD hire chains as their debt-recovery solicitor. Her work involved pursuing customers for small debts they owed to the stores. In his decision, Senior Member Jonathan Smithers of VCAT, found that by sending misleading letters of demand and official-looking notices when acting for the DVD stores, Ms Sampson had breached the legal profession rules and was found guilty of professional misconduct.

VCAT said “Any lawyer who sent out letters of demand, asserting that there is an entitlement to legal costs of preparing letters of notices of demand, (in the absence of a contractual entitlement) would be liable to having disciplinary proceedings brought against them.” VCAT found that the letters sent by Ms Sampson that demanded legal costs in the absence of a contractual right to do so, “grossly exceeded the legitimate assertion of the rights of the video store owners” and that Ms Sampson’s misconduct was magnified by the fact that she sent thousands of offending letters of demand out to consumers each month.

“Practitioners must avoid notices being made to appear as if they are some sort of court or official document”, VCAT said, also finding that Ms Sampson’s letters were “drafted with deliberate ambiguity in part, so as to scare debtors into paying the full amount … immediately”.

Legal Services Commissioner, Michael McGarvie, observed of the finding: “The important message for lawyers is they have no right to exaggerate and over-state their clients’ entitlements when making requests on behalf of their clients”.

Mr McGarvie further said that “Lawyers must strive for clarity and accuracy in the way they put their client’s cases. Where they are deliberately ambiguous, as in this case, they can be found guilty of misconduct.”

VCAT noted that regulatory thinking about lawyer misbehaviour has evolved over the decades and lawyers face guilty findings when they fail to move with the times.

“My office had warned Ms Sampson in 2009, and I also issued a communique to all debt collection lawyers in June 2011, reminding them that they had to meet higher standards of ethical conduct to stay within the rules,” Mr McGarvie said.

Mr McGarvie also pointed out consumers were not without support if they were being pursued for small debts. “Consumers should seek advice from a lawyer, a local community legal service or consumer advice service if they are concerned about letters of demand they receive, and make contact with the debt collector to clarify how the amount claimed has been calculated.

“However if the contract you sign with the retailer says you will be charged legal costs on top of the debt if you fail to pay, then you may be lawfully requested to pay both the debt and the additional fees, if the fees are reasonable. If the contract does not mention these legal fees, then the debt collector is not entitled to demand them of you,” he said.

The penalty for professional misconduct by a lawyer can involve Court-imposed public reprimands, fines, legal costs orders, damaging publicity and sometimes loss of a licence. VCAT Senior Member Smithers adjourned the case to a later date to hear submissions from the parties on an appropriate penalty.

For further information, download the VCAT decision and the Commissioner’s media release.

A Melbourne solicitor was ordered to pay a fine and costs totalling $22,000 after he was found guilty of professional misconduct for breach of an undertaking.

The Victorian Civil and Administrative Tribunal made a judgement relevant to all lawyers in that it is not necessary for a person to actually use the word ‘undertaking’ for another person to expect that they have been given an undertaking and to rely upon it.

The decision comes after the Legal Services Commissioner charged Mr Timothy Kaine (also known as Mr Efthimios Karagiannidis), of the CBD law firm Kaine Lawyers, with professional misconduct for breaching an undertaking given to another solicitor during a property sale.

Mr Kaine and his mother were co-owners of a property which they decided to sell in August 2010, after falling behind in their mortgage repayments. Mr Kaine arranged for the early release of the deposit monies paid by the purchaser, telling the solicitor for the purchaser those funds would be forwarded to the bank to reduce the outstanding mortgage debt.

When the estate agent provided a cheque for $57,500, Mr Kaine promptly deposited it into his firm’s trust account before transferring the funds to his personal account for his own use. No payments were made to the bank, and the bank eventually took control of the property settlement, leaving the purchaser’s solicitor to negotiate with the bank directly. This delayed settlement by over a month, significantly inconveniencing the purchaser.

Mr Kaine pleaded guilty before VCAT, however in his defence he submitted that he initially believed that the correspondence with the purchaser’s solicitor did not amount to an undertaking as he had not used that specific term. Judge Jenkins of VCAT found that Mr Kaine ‘did indeed give an undertaking to the effect that, if the Purchaser agreed to an early release of the deposit, then it would be wholly and immediately paid to the Bank to reduce the mortgage debt’.

Judge Jenkins found Mr Kaine guilty of professional misconduct. Mr Kaine was reprimanded, fined $10,000 and ordered he pay the Commissioner’s costs fixed at $12,000. Mr Kaine was also ordered undertake an additional point of continuing professional development training in ethics.

For more information, download the VCAT decision.