Council of the Law Society of New South Wales v Nguyen

NCAT Occupational|2016-09-05

The application

On 13 October 2015, the Council of the Law Society of New South Wales ("the Law Society") filed an Application for Disciplinary Findings and Orders in the Tribunal alleging that the respondent solicitor, Mr Thai Le Huu Nguyen ("the Solicitor") was guilty of professional misconduct in that in each of the matters set out below he has: (i) Breached section 254 of the Legal Profession Act, 2004. (ii) Breached section 255 of the Legal Profession Act, 2004. (iii) Misappropriated trust funds. Matters: 1. Hong Quang Vuong 2. Quoc Thanh Kim 3. Anh Dung Doan 4. Danh Thi Nguyen 5. Quang Chung Nguyen 6. Thi Ngoc Tring Tran, Mary My Hanh Thi Nguyen and Stuart Cameron How Kein Walker Lo Particulars In these Particulars: 'ANZ Office Account' means the office bank account of the Law Practice held with Australia and New Zealand Banking Group Limited (being account number XXX XXX XXX.) 'CBA Office Account' means the office bank account of the Law Practice held with the Commonwealth Bank of Australia (being account number XXXXXXXX). 'Danh' means Ms Danh Thi Nguyen. 'Mr Doan' means Mr Anh Dung Doan. 'Mr Kim' means Mr Quoc Thanh Kim. 'Mr Vuong' means Mr Hong Quang Vuong. 'OLSC' means the Office of the Legal Services Commissioner. 'the Law Practice' means the law practice formerly known as Peaceful Lawyers, XXX, XXX Cabramatta, 2166. 'the Society' means the Law Society of New South Wales. 'the Solicitor' means Thai Le Huu Nguyen, the sole principal of the Law Practice. A. Hong Quang Vuong 1.The Solicitor acted on behalf of Mr Vuong in respect of the sale of a property located at XXX XXX, Bankstown [Bankstown property]. 2. On 1 November 2013, settlement of the Bankstown property took place. The proceeds of settlement were not deposited into the Solicitor's trust account, that account having been closed on 2 August 2013. 3. On settlement, the Solicitor received a number of cheques. Relevantly, one cheque was in the sum of $18,685 and another in the sum of $43,155.78. 4. After settlement, Mr Vuong received net sale proceeds totalling $61,840.78 in three (3) separate payments from the Solicitor as follows: (a) $43,155.78 on 7 November 2013. (b) $7,000 on 21 November 2013. (c) $11,685 on 29 November 2013 by cheque drawn on the ANZ Office Account (cheque no. 1009) 5. The payment of $11,685 made on 29 November 2013 by cheque to Mr Vuong (which was presented on 4 December 2013) was dishonoured on 5 December 2013. 6. Demands were made by Mr Vuong to the Solicitor for payment of the sum of $11,685. 7.On 16 December 2013, a complaint was made by Mr Vuong to the OLSC. 8. On 28 January 2014, the Solicitor deposited the sum of $11,800 into Mr Vuong's bank account held with Australia and New Zealand Banking Group Limited by a cash payment that included the sum of $115 on account of "interest". 9. The cheque in the sum of $18,685 received on settlement had been used for the payment of stamp duty in an unrelated matter involving a purchase by Mr Quang Chung Nguyen [see E. below]. B. Quoc Thanh Kim 1. The Solicitor acted on Mr Kim's behalf in respect of the purchase of a property located at XXX XXX, Chester Hill [Chester Hill property]. 2. Stamp duty payable on the purchase of the Chester Hill property was $14,410. 3. On 2 October 2013, Mr Kim paid the sum of $15,760 to the CBA Office Account by electronic funds transfer. This deposit was for the payment of the Stamp Duty on the purchase of the Chester Hill property and Council Rates. On that date the CBA Office Account was $494.70 in debit and by 10 October 2013, all the funds deposited by Mr Kim had been dissipated for purposes other than the payment of Stamp Duty and Rates. 4. On 20 December 2013, and in order to achieve settlement, Mr Kim attended to payment of the Stamp Duty and Rates. As at 20 December 2013, the balance of the CBA Office Account was $1,548.21. 5. On 14 January 2014, demand was made by Mr Kim to the Solicitor to refund the sum of $15,760 for the moneys into the CBA Office Account. 6. On 17 January 2014, a complaint was made by Mr Kim to the OLSC. 7. On 17 February 2014, the Solicitor refunded the sum of $15,760 to Mr Kim. C. Anh Dung Doan 1. The Solicitor acted on behalf of Mr Doan in respect of the purchase of a property located at XXX XXX, Springwood [Springwood property]. 2. On 24 May 2013, contracts on the purchase of the Springwood property were exchanged. 3. The purchase price for the Springwood property was $362,000 with a deposit of $36,200 payable. 4. Mr Doan deposited a total sum of $48,000 into the CBA Office Account as follows: (a) $20,000 on 15 May 2013. (b) $20,000 on 16 May 2013. (c) $8,000 on 17 May 2013. These funds were paid for the deposit and stamp duty on the purchase of the Springwood property. On the three dates above, the balance of the CBA Office Account was, respectively, $3,458.13 in credit; $19,427.13 credit and $24,912.63 credit. 5. On 22 May 2013, the Solicitor withdrew the sum of $18,110 from the CBA Office Account. After this withdrawal, the CBA Office Account was in debit in the sum of $408.20. 6. The sum withdrawn on 22 May 2013 was comprised of a bank cheque made payable to Lister & Cole of Springwood for a 5% deposit on the purchase of the Springwood property by Mr Doan (totalling $18,100) plus a $10 fee for the bank cheque. 7. On 3 July 2013, the Solicitor withdrew the sum of $11,810 from the CBA Office Account, being the amount for Stamp Duty payable on Mr Doan's purchase of the Springwood property. This amount was covered by other unrelated deposits into the CBA Office Account. 8. On 3 July 2013, Mr Doan deposited the sum of $5,300 by Netbank to the CBA Office Account. 9. On 4 July 2013, Mr Doan deposited a further $1,000 into the CBA Office Account. 10. The deposits in paragraphs 8 and 9 were made by Mr Doan on the belief that further funds were required to complete the purchase. 11. On 4 July 2013, the Solicitor for the vendor M Ann Gillin, received the sum of $10,000 into her trust account from the Law Practice as part payment of the settlement sum for Mr Doan. 12. On 5 July 2013, the Solicitor withdrew the sum of $10,000 from the CBA Office Account and on the same day the sum of $12,371.75 was deposited to the trust account for Ann Gillin Solicitor as part payment of the settlement sum for Mr Doan. The source of the balance of payment of $2,371.75 is unknown. 13. Of the total sum of $54,300 paid by Mr Doan to the CBA Office Account, $52,291.75 was eventually used for the purchase of the Springwood property. Accordingly, a balance of $2,008.25 ought to have been held in trust on behalf of Mr Doan. 14. On 12 September 2013, the sum of $1,810 was refunded by electronic funds transfer from the Solicitor to Mr Doan. The balance was retained by the Solicitor on account of legal fees. D. Danh Thi Nguyen 1. On 4 November 2013, contracts were exchanged in respect of the purchase of Danh of a property located at XXX XXX, Smithfield [the Smithfield property]. 2. The purchase price of the Smithfield property was $458,000. 3. Stamp Duty payable on the purchase of the Smithfield property was $16,120. 4. On 18 November 2013, a cheque in the sum of $16,120 was deposited into the CBA Office Account. 5. On 21 November 2013, the sum of $16,000 was withdrawn from the CBA Office Account leaving that account in debit by the sum of $376.89. 6. On 30 January 2014, the Stamp Duty payable in respect of the purchase by Danh was paid by Westpac bank cheque. The source of the funds used for the purchase of the bank cheque is unknown. E. Quang Chung Nguyen 1. The Solicitor acted on behalf of Mr Nguyen in respect of the purchase of a property at XXX XXX, Hoxton Park [Hoxton Park property]. 2. The purchase price of the Hoxton Park property was $515,000. 3. Stamp Duty payable on the purchase of the Hoxton Park property was $18,685. 4. On 8 October 2013, a bank cheque was obtained by Quang Chang Nguyen in the sum of $18,685 and deposited into the ANZ Office Account. By 21 October 2013, the ANZ Office Account was in debit. 5. On 1 November 2013, the purchase by Mr Vuong [see A. above] was settled. On settlement a cheque in the sum of $18,685 drawn in favour of the Office of State Revenue was received. That cheque was used for payment of stamp duty on the purchase by Quang Chung Nguyen. F. Thi Ngoc Tring Tran, Mary My Hanh Thi Nguyen and Stuart Cameron How Kein Walker Lo 1. The Solicitor acted on behalf of the vendor, Thi Ngoc Tring Tran and the purchasers, Mary My Hanh Thi Nguyen and Stuart Cameron How Kein Walker Lo, in respect of the sale and purchase of a property situate and known as XXX XXX, Greystanes [Greystanes property]. 2. On 5 November 2013, a payment by internet transfer of $18,055 was made to the CBA Office Account by the purchasers of the Greystanes property for payment of stamp duty. 3. Between 6 November 2013 and 8 November 2013, cash withdrawals from the CBA Office Account were made totalling $17,854 and by 11 November 2013, the account was in debit in the sum of $297.68. None of those withdrawals was for the purpose of the purchase of the Greystanes property. 4. On the date of settlement, 21 March 2014, there was a shortfall of $18,055. 5. In a letter to the Society dated 1 May 2014 from the Solicitor's former legal representative, Mr Claude Bilinsky, he has relevantly stated: "These are two matters in which monies have not been repaid and these matters are:- ... In the matter of Thai Ngoc Tring Tran (a conveyancing matter) there is an amount due to the client of about $18,500. Our client expects to repay the full amount by the end of May 2014." 6. The Solicitor has not made any repayment of $18,055 representing the shortfall due to the vendor at settlement.

Relevant legislation

The legislation relevant to this application is the following:
Legal Profession Act 2004 ("the LP Act"): 1. Section 243 is as follows: 243 Definitions (1) In this Part: approved ADI means an ADI approved under section 280 (Approval of ADIs) by the Law Society Council. controlled money means money received or held by a law practice in respect of which the practice has a written direction to deposit the money in an account (other than a general trust account) over which the practice has or will have exclusive control. Note. See section 256 (6) (Controlled money), which prevents pooling of controlled money. controlled money account means an account maintained by a law practice with an ADI for the holding of controlled money received by the practice. deposit record includes a deposit slip or duplicate deposit slip. external examination means an external examination under Division 4 of Part 3.1 of a law practice's trust records. external examiner means a person holding an appointment as an external examiner under Division 4 of Part 3.1. general trust account means an account maintained by a law practice with an approved ADI for the holding of trust money received by the practice, other than controlled money or transit money. investigation means an investigation under Division 3 of Part 3.1 of the affairs of a law practice. investigator means a person holding an appointment as an investigator under Division 3 of Part 3.1. permanent form, in relation to a trust record, means printed or, on request, capable of being printed, in English on paper or other material. power includes authority. transit money means money received by a law practice subject to instructions to pay or deliver it to a third party, other than an associate of the practice. trust account means an account maintained by a law practice with an approved ADI to hold trust money. trust money means money entrusted to a law practice in the course of or in connection with the provision of legal services by the practice, and includes: (a) money received by the practice on account of legal costs in advance of providing the services, and (b) controlled money received by the practice, and (c) transit money received by the practice, and (d) money received by the practice, that is the subject of a power, exercisable by the practice or an associate of the practice, to deal with the money for or on behalf of another person. trust records includes the following documents: (a) receipts, (b) cheque butts or cheque requisitions, (c) records of authorities to withdraw by electronic funds transfer, (d) deposit records, (e) trust account ADI statements, (f) trust account receipts and payments cash books, (g) trust ledger accounts, (h) records of monthly trial balances, (i) records of monthly reconciliations, (j) trust transfer journals, (k) statements of account as required to be furnished under the regulations, (l) registers required to be kept under the regulations, (m) monthly statements required to be kept under the regulations, (n) files relating to trust transactions or bills of costs or both, (o) written directions, authorities or other documents required to be kept under this Act or the regulations, (p) supporting information required to be kept under the regulations in relation to powers to deal with trust money. Trustees means the Trustees of the Public Purpose Fund. (2) A reference in this Part to a law practice's trust account or trust records includes a reference to an associate's trust account or trust records. (3) A reference in this Part to a power given to a law practice or an associate of the practice to deal with money for or on behalf of another person is a reference to a power given to the practice or associate that is exercisable by: (a) the practice alone, or (b) an associate of the practice alone (otherwise than in a private and personal capacity), or (c) the practice or an associate of the practice jointly or severally, or jointly and severally, with either or both of the following: (i) one or more associates of the practice, (ii) the person, or one or more nominees of the person, for whom or on whose behalf the money may or is to be dealt with under the power. 1. Section 254 is as follows: 254 Certain trust money to be deposited in general trust account (1) Subject to section 258A, as soon as practicable after receiving trust money, a law practice must deposit the money in a general trust account of the practice unless: (a) the practice has a written direction by an appropriate person to deal with it otherwise than by depositing it in the account, or (b) the money is controlled money, or (c) the money is transit money, or (d) the money is the subject of a power given to the practice or an associate of the practice to deal with the money for or on behalf of another person. Maximum penalty: 100 penalty units. (2) Subject to section 258A, a law practice that has received money that is the subject of a written direction mentioned in subsection (1) (a) must deal with the money in accordance with the direction: (a) within the period (if any) specified in the direction, or (b) subject to paragraph (a), as soon as practicable after it is received. Maximum penalty: 100 penalty units. (3) The law practice must keep a written direction mentioned in subsection (1) (a) for the period prescribed by the regulations. Maximum penalty: 50 penalty units. (4) (Repealed) (5) A person is an appropriate person for the purposes of this section if the person is legally entitled to give the law practice directions in respect of dealings with the trust money. 1. Section 255 is as follows: 255 Holding, disbursing and accounting for trust money (1) A law practice must: (a) hold trust money deposited in a general trust account of the practice exclusively for the person on whose behalf it is received, and (b) disburse the trust money only in accordance with a direction given by the person. Maximum penalty: 50 penalty units. (2) Subsection (1) applies subject to an order of a court of competent jurisdiction or as authorised by law. (3) The law practice must account for the trust money as required by the regulations. Maximum penalty: 50 penalty units. 1. Section 497 is as follows: 497 Professional misconduct (1) For the purposes of this Act: professional misconduct includes: (a) unsatisfactory professional conduct of an Australian legal practitioner, where the conduct involves a substantial or consistent failure to reach or maintain a reasonable standard of competence and diligence, and (b) conduct of an Australian legal practitioner whether occurring in connection with the practice of law or occurring otherwise than in connection with the practice of law that would, if established, justify a finding that the practitioner is not a fit and proper person to engage in legal practice. (2) For finding that an Australian legal practitioner is not a fit and proper person to engage in legal practice as mentioned in subsection (1), regard may be had to the matters that would be considered under section 25 or 42 if the practitioner were an applicant for admission to the legal profession under this Act or for the grant or renewal of a local practising certificate and any other relevant matters. 1. Section 562 is as follows: 562 Determinations of Tribunal (1) Orders generally If, after it has completed a hearing under this Part in relation to a complaint against an Australian legal practitioner, the Tribunal is satisfied that the practitioner has engaged in unsatisfactory professional conduct or professional misconduct, the Tribunal may make such orders as it thinks fit, including any one or more of the orders specified in this section. (2) Orders requiring official implementation in this jurisdiction The Tribunal may make the following orders under this subsection: (a) an order that the name of the practitioner be removed from the local roll, (b) an order that the practitioner's local practising certificate be suspended for a specified period or cancelled, (c) an order that a local practising certificate not be issued to the practitioner before the end of a specified period, (d) an order that: (i) specified conditions be imposed on the practitioner's practising certificate issued or to be issued under this Act, and (ii) the conditions be imposed for a specified period, and (iii) specifies the time (if any) after which the practitioner may apply to the Tribunal for the conditions to be amended or removed, (e) an order reprimanding the practitioner, (f) an order that the name of the practitioner be removed from the roll of public notaries maintained under the Public Notaries Act 1997. (3) Orders requiring official implementation in another jurisdiction The Tribunal may make the following orders under this subsection: (a) an order recommending that the name of the practitioner be removed from an interstate roll, (b) an order recommending that the practitioner's interstate practising certificate be suspended for a specified period or cancelled, (c) an order recommending that an interstate practising certificate not be granted to the practitioner before the end of a specified period, (d) an order recommending that: (i) specified conditions be imposed on the practitioner's interstate practising certificate, and (ii) the conditions be imposed for a specified period, and (iii) the conditions specify the time (if any) after which the practitioner may apply to the Tribunal for the conditions to be amended or removed. (4) Orders requiring compliance by practitioner The Tribunal may make the following orders under this subsection: (a) an order that the practitioner pay a fine of a specified amount, (b) an order that the practitioner undertake and complete a specified course of further legal education, (c) an order that the practitioner undertake a specified period of practice under supervision, (d) an order that the practitioner do or refrain from doing something in connection with the practice of law, (e) an order that the practitioner cease to accept instructions as a public notary in relation to notarial services, (f) an order that the practitioner's practice, or the financial affairs of the practitioner or of the practitioner's practice, be conducted for a specified period in a specified way or subject to specified conditions, (g) an order that the practitioner's practice be subject to periodic inspection for a specified period, (h) an order that the practitioner undergo counselling or medical treatment or act in accordance with medical advice given to the practitioner, (i) an order that the practitioner use the services of an accountant or other financial specialist in connection with the practitioner's practice, (j) an order that the practitioner not apply for a local practising certificate before the end of a specified period. Note. This subsection is not an exhaustive statement of orders that must be complied with by the practitioner. (5) Ancillary or other orders The Tribunal may make ancillary or other orders, including an order for payment by the practitioner of expenses associated with orders under subsection (4), as assessed or reviewed in or in accordance with the order or as agreed. (6) Alternative finding The Tribunal may find that a person has engaged in unsatisfactory professional conduct even though the complaint or disciplinary application alleged professional misconduct or may find that a person has engaged in professional misconduct even though the complaint or disciplinary application alleged unsatisfactory professional conduct. (7) Maximum fine The amount ordered by the Tribunal under this section to be paid by way of fines by any one Australian legal practitioner in connection with the Tribunal's findings about a complaint must not exceed in total: (a) $10,000 in the case of unsatisfactory professional conduct not amounting to professional misconduct, or (b) $75,000 in the case of professional misconduct. If the Tribunal finds that the practitioner has engaged in both professional misconduct and unsatisfactory professional conduct not amounting to professional misconduct, the amount must not exceed $75,000 in total. (8) Reprimands If the Tribunal makes an order reprimanding the practitioner, the Tribunal is to publish the order and a statement of its reasons for making the order. (9) It is sufficient compliance with the requirement to publish an order under subsection (8) if the Tribunal provides to the Commissioner sufficient information to enable the Commissioner to exercise the Commissioner's powers or functions in respect of the Register of Disciplinary Action required to be kept under Part 4.10 (Publicising disciplinary action). (10) (Repealed)

Legislative scheme and jurisdiction of the Tribunal

Under s 28(1) of the Civil and Administrative Tribunal Act 2013 (the CAT Act), the Tribunal has such jurisdiction and functions as may be conferred or imposed upon it by other legislation. The application sought the following orders: 1. The Solicitor's name be removed from the roll; 2. The Solicitor pay the costs of the Law Society as agreed or assessed; and 3. Any further or other order the Tribunal deems fit.
The above orders are orders which the Tribunal is able to make by exercising its powers under s 562 of the LP Act.
On 1 July 2015 the LP Act was repealed and the Legal Profession Uniform Law Application Act 2014 (Uniform Law) came into force. However, cl 26 of the Uniform Law provides that a complaint or investigation begun but not completed before the commencement of the Uniform Law is to continue to be dealt with in accordance with the old legislation, namely the LP Act. The Law Society submitted and we agree that this matter is to be decided pursuant to the provisions of the LP Act.

The Law Society's evidence

The Law Society filed the five affidavits described below in support of its application. There was no objection to the tender of the affidavits and cross examination of witness was not sought by the Solicitor. The five affidavits are: 1. The affidavit of Anne-Marie Foord dated 12 October 2016 (Exhibit A); 2. The affidavit of Frederic Albert House dated 4 August 2015 (Exhibit B); 3. The affidavit of Anthony Neary Walker dated 16 September 2015 (Exhibit C); 4. The affidavit of Anh Dung Doan dated 10 August 2015 (Exhibit D); and 5. The affidavit of Hong Quang Vuong dated 21 August 2015 (Exhibit E).
At the hearing the Law Society also tendered a document headed Application for disciplinary findings and orders (cross referenced), which was a copy of the Application into which particulars had been inserted of where the evidence in each affidavit could be located in support of each of the allegations in the application. For example, in paragraph 1 of the application, this document had included in it the following: See page 4, annexure A to affidavit of Hong Quang Vuong affirmed 21 August 2015.
The Solicitor did not object to the Tribunal receiving the above cross referenced application.

The Solicitor's evidence

On 29 April 2016 the Solicitor filed a Reply to application for disciplinary finding.
With respect to the three orders sought by the Law Society the Reply states: 1. Concerning the proposed order that the Solicitor's name be removed from the roll, the Solicitor states: Not agreeable. I would agree to a suspension period of three (3) to five (5) years; and after the prescribed suspension period by the Tribunal, I agree to be subjected to further training and supervision while practising. 1. With respect to the order concerning costs, the Solicitor agrees to pay the Law Society's costs as agreed or assessed; and 2. With respect to the proposed "further or other order the Tribunal deems fit", the Solicitor states: Agreed.
At the hearing the Solicitor (who appeared by a telephone call made from Vietnam) sought to tender a letter to the Tribunal dated 4 September 2016. This was received and marked Exhibit I. The Law Society raised objections to paragraphs of the letter and, subsequently in these reasons we will refer to those objections and our rulings. The letter deals with the Solicitor's personal background and does not seek to cavil with any of the assertions made by the Law Society concerning the Solicitor's conduct.

Law Society's submissions on evidence

The Law Society submitted that during the period between 2013 and 2015 the Solicitor received sums of money from clients in relation to six matters and in the course of acting for those clients appropriated some money, intermingled client money with the Solicitor's own money and that there continues to be a failure to account to a client for the sum of approximately $18,000.00. In order to understand better the nature and extent of the Solicitor's breaches of his obligations it is necessary to refer to parts of the application, which we do in the following paragraphs.

Hong Quang Vuong

The Solicitor acted for Mr Vuong in respect of the sale of a property at Bankstown. On settlement of the sale the proceeds of settlement were not deposited into the Solicitor's trust account. That account had been closed on 2 August 2013. Settlement took place on 1 November 2013.
One of the cheques received on settlement was for $18,685.00. That amount was not paid into the Solicitor's trust account. After settlement the Solicitor accounted to Mr Vuong for $43,115.78 (on 7 November 2013) and separately (some time later) paid to Mr Vuong two cheques for the balance of $18,685.00. One cheque, for $11,685.00 was dishonoured.
The cheque for $18,658.00 was used for the payment of stamp duty in an unrelated matter.

Quoc Thanh Kim

The Solicitor acted on the purchase of a property at Chester Hill. The client, Mr Kim paid to the Solicitor the sum of $15,760.00 (by electronic funds transfer to the Solicitor's office account). This was for stamp duty and council rates. On the date of receipt (2 October 2013) the office account was in debit to the extent of $494.70. The funds received were used for purposes other than the payment of stamp duty and rates.
On 17 February 2014 the solicitor refunded to Mr Kim the sum of $15,760.00.

Anh Dung Doan

The Solicitor acted for Mr Doan on the purchase of a property at Springwood. Mr Doan deposited a sum of $48,000.00 into the office account of the Solicitor. The money was paid for the purpose of paying the deposit and stamp duty. This sum was paid by three separate payments, namely $20,000 on 15 May 2013, $20,000 on 16 May 2013 and $8,000 on 17 May 2013. On those dates the balance in the account was respectively $3,458.13 in credit; $19,427.13 in credit and $24,912.63 in credit.
On 22 May 2013 the Solicitor withdrew the sum of $18,110.00 from the office account, the account was then in debit to the extent of $408.20.
The sum withdrawn on 22 May 2013 was used to pay a 5% deposit on the purchase of the Springwood property.
On 3 July 2013 the Solicitor withdrew $11,810.00 from the office account for stamp duty payable on Mr Doan's purchase. This amount was covered by other unrelated deposits in the office account.
On 3 July 2013 Mr Doan deposited $5,300.00 in the office account and on 4 July 2013 Mr Doan deposited $1,000.00 into the office account. On 4 July 2013 the solicitor's law practice paid $10,000.00 to the solicitor for the vendor. On 5 July 2013 the Solicitor withdrew $10,000.00 from the office account and on the same day paid the sum of $12,371.75 into the trust account of the solicitor for the vendor as part payment of the settlement sum for Mr Doan. The source of the balance of the payment, namely $2,371.25 is unknown.
Of the total sum of $54,300.00 paid by Mr Doan to the office account, $52,291.75 was eventually used for the purchase of the Springwood property and a balance of $2,008.25 ought to have been held in trust on behalf of Mr Doan. On 12 September 2013 the sum of $1,810.00 was refunded by the Solicitor to Mr Doan and the balance was retained by the Solicitor on account of legal fees.

Danh Thi Nguyen

On 4 November 2013 contracts were exchanged in respect of the purchase by Danh Thi Nguyen of a property at Smithfield. On 18 November 2013 a cheque in the sum of $16,120.00 was deposited into the office account. On 21 November 2013 the sum of $16,000.00 was withdrawn from the office account leaving that account in debit by the sum of $376.89. On 30 January 2014 stamp duty payable in respect of the purchase by Danh Thi Nguyen was paid by Westpac bank cheque. The source of the funds used for the purchase of the bank cheque is unknown.

Quang Chung Nguyen

The Solicitor acted on behalf of Mr Nguyen in respect of the purchase of a property at Hoxton Park. On 8 October 2013 a bank cheque was obtained by Mr Nguyen in the sum of $18,685.00 and deposited into the office account of the Solicitor. By 21 October 2013 the office account was in debit. On 1 November 2013 the purchase by Mr Vuong (referred to earlier) was settled. On settlement a cheque in the sum of $18,685.00 drawn in favour of the Office of State Revenue was received and that cheque was used for payment of stamp duty on the purchase by Mr Nguyen.

Thi Ngoc Tring Tran, Mary My Hanh Thi Nguyen and Stuart Cameron How Kein Walker Lo

The Solicitor acted on behalf of Thi Ngoc Tring Tran as vendor and for Mary My Hanh Thi Nguyen and Stuart Cameron How Kein Walker Lo as purchasers in respect of the sale and purchase of a property at Greystanes.
On 5 November 2013 a payment by internet transfer of $18,055.00 was made to the office account by the purchasers of the Greystanes property for payment of stamp duty. Between 6 and 8 November 2013, cash withdrawals from the office account were made totalling $17,854.00 and by 11 November 2013 the account was in debit in the sum of $297.68. None of these withdrawals was for the purpose of the purchase of the Greystanes property.
On the date of settlement, 21 March 2014, there was a shortfall of $18,055.00.
By a letter dated 1 May 2014 the Solicitor, via his former legal representative, acknowledged that there were then two matters in respect of which monies had not been paid. One of these matters was the sum of $18,055.00 referred to above. The Solicitor has not made repayment of the sum $18,055.00 representing the short fall due to the vendor at settlement.

The Solicitor's evidence

As stated earlier the Solicitor sought to put into evidence his letter dated 4 September 2016. That letter became Exhibit 1. Otherwise, the Solicitor had nothing to say concerning the assertions made by the Law Society other than that he had cooperated with the Law Society's investigator. So far as Exhibit 1 is concerned, the Law Society raised a number of objections to the letter. We ruled that the third paragraph on page one should not be admitted but that otherwise the paragraphs contained in the letter ought to be admitted.
The basis for the Law Society's objections may be summarised in these terms: 1. Directions had been made that the Solicitor ought to provided evidence by affidavit by 29 April 2016 and he had not availed himself of that opportunity; 2. Statements are contained in the letter which the Law Society has not had a reasonable opportunity to test or examine by reason of the late provision of the letter; and 3. Paragraph three of the letter referred to the Solicitor's difficulties with gambling, seeking medical advice and guidance concerning depression, alcohol and gambling. The Law Society was not in a position to test or examine those assertions.
We upheld the objection of the Law Society with respect to paragraph three and its reception was rejected. Insofar as the other paragraphs of the letter are concerned they were not rejected on the basis that they should be given appropriate weight given the fact that the Law Society has not had a reasonable opportunity to consider the assertions or to put forward other evidence. Nevertheless, it is relevant in our view, to record those paragraphs of the letter which we allowed and we provide the following summary as follows: 1. The Solicitor came to Australia as a refugee in the 1980's when he was then approximately 11 years old. He was "a boat person" and described himself as an "unaccompanied refugee minor" without an accompanying parent. He lived in foster care and became a ward of the state. He is now 42 years of age; 2. He practised on his own for about a year before "things became messy". He opened a trust account but could not manage the account and then closed it. He placed all funds into the office account; 3. The Solicitor admits that his actions were "stupid" and were "disgraceful and dishonourable". He wishes he had not "done it" but at the time there was pressure and personal stress; 4. The Solicitor says he was carried away by drinking and gambling, and depression; 5. The Solicitor has tried to find alternative employment but "could not find anything because I do not have the work experience and suitable qualification for other occupations". He left Australia for Vietnam where he presently resides. He hopes to be able to earn money so that he can refund money outstanding to clients; 6. The Solicitor undertakes not to repeat the mistakes he has made and requests the Tribunal to give him another chance to redeem himself. He is willing to engage in formal training and have strict supervision. 7. The Solicitor says he is remorseful but remains depressed and disappointed with himself. He has given up drinking and gambling; 8. The Solicitor submits that he is not a danger to the public and therefore the protective measure of removing his name off the roll is not necessary. He wishes the Tribunal would give him a chance to rebuild his life again. He has not been working as a solicitor for about a year and a half; and 9. He requests the Tribunal to consider suspending him from practise for a period of three to five years and after the suspension period to be subjected to further training and strict supervision, and/or pay a fine. He states he will pay back all the arrears or debts within the next seven months. He agrees to pay the costs of the Law Society and any incidental costs of the proceedings within six months of those costs being agreed or assessed.

The Law Society's and the Solicitor's submissions at the hearing

The Law Society submits that the appropriate orders are those sought in the application, namely: 1. The Solicitor's name be removed from the roll; 2. The Solicitor pay the costs of the Law Society as agreed or assessed; and 3. Any further or other order the Tribunal deems fit.
The Law Society made submissions in support of the proposition that the appropriate course is for the Solicitor's name to be removed from the role. In the course of so doing the Law Society referred to a number of cases, to which we make reference below.
The Solicitor submitted that he should be suspended (as he stated in the Reply) rather than have his name removed from the roll.
After the hearing the Tribunal received a written submission from the Solicitor dated 16 September 2016. That submission was received without leave and was not in response to any invitation given by the Tribunal. It has not been considered by the Tribunal.

Decision

The Law Society's submission is that the Solicitor has been guilty of professional misconduct in that in relation to the matters described in some detail above the Solicitor breached obligations set out in ss 254 and 255 of the LP Act and, in addition, misappropriated trust funds.
Section 254 of the LP Act in summary requires trust money to be deposited into a general trust account of the Solicitor's practice. The exceptions to that general requirement are not relevant to the facts of this matter.
Section 255 provides that a law practice must hold trust money deposited in a general trust account exclusively for the person on whose behalf it is received and disburse the trust money only in accordance with a direction given by the person. The section also requires a law practice to account for the trust money as required by the relevant regulations.
On the facts asserted (which are not disputed by the Solicitor) and having regard to the evidence provided by the Law Society (which we find supports the facts asserted in the Application) there has occurred multiple breaches by the Solicitor of his obligations set out in ss 254 and 255 of the LP Act. The facts also establish in our view the fact that the Solicitor has misappropriated trust money and that there is a continuing misappropriation of trust money.
Accordingly, we find that the breaches alleged by the Law Society in the Application are proven.
The significant contested issue in these proceedings is whether the Solicitor's name should be removed from the roll (as the Law Society contends) or whether the Solicitor should be suspended from practice for a period (as the Solicitor contends).
The power of the Tribunal to make the orders referred to above is contained in s 562 of the LP Act. It provides that if, after it has completed a hearing in relation to a complaint, the Tribunal is satisfied that the practitioner has engaged in unsatisfactory conduct or professional misconduct the Tribunal may make such orders as it thinks fit, including an order that the name of the practitioner be removed from the local roll (S562(2)(a)), or an order that the practitioners local practising certificate be suspended for a specified period or cancelled (S562(2)(b)). Further provisions identify other orders which the Tribunal may make.
The Law Society submitted that the evidence establishes professional misconduct by the Solicitor within the meaning of the LP Act and relied upon a number of cases to which we will briefly refer.
The Law Society submitted that the Solicitor's conduct satisfied the common law test as to what constitutes professional misconduct as propounded in Allinson v General Council of Medical Education and Registration [1894] 1 QB 750, namely conduct which would reasonably be regarded as disgraceful or dishonourable by the Solicitor's professional brethren of good repute and competency. We are satisfied that the Solicitor's conduct was disgraceful and dishonourable and would be so regarded by his brethren of good repute and competency.
We were taken to the decision of the New South Wales Court of Appeal in the Law Society of New South Wales v Jones [unreported decision dated 27 July 1978] in which Street CJ stated: Reliability and integrity in the handling of trust funds are fundamental prerequisites in determining whether an individual is a fit and proper person to be entrusted with the responsibilities belonging to a solicitor. Members of the public, many of them wholly inexperienced and unskilled in matters of business or of law, inevitably must put great faith and trust in the honesty of solicitors in the handling of moneys on their behalf. The Court must ensure that this trust is not misplaced.
Having regard to our finding that the breaches alleged by the Law Society have been proven and having regard to the principles described in the above cases, we find that the Solicitor is guilty of professional misconduct. This brings us to the question of whether the Solicitor's name should be removed from the roll or whether a suspension will suffice.
We were taken to the decision of the New South Wales Supreme Court (Court of Appeal decision) in Dupal v the Law Society of New South Wales [1990] NSWCA 56 in which Kirby P stated that a finding that a solicitor has misused moneys received by him on behalf of other persons ordinarily requires a finding that the solicitor should be removed from the roll. Although the Court, in that case dealt with some exceptional cases the Court also stated that it would be departing from a long course of authority if it were to substitute a period of suspension for the order of the Tribunal removing the appellant from the roll. The Law Society referred to a case where an exceptional order was made, namely a decision of the Solicitor's Statutory Committee in 1980 in the matter of Colin Walter Peck. In that case the order was that the solicitor be reprimanded and suspended from practice for a period of two years. However, that case involved a very small sum of money.
We were also taken to some other cases where the solicitor's name was not removed from the roll, namely the following: 1. Barry John Penfold [1997] NSWLST 23. There, the Tribunal suspended the issue of a practicing certificate for two years and referred to cases where the offences were isolated, where there was no evidence of prolonged deliberate conduct and where, to the full extent possible, the funds of clients were restored. The Tribunal referred to a theft of client money which was a "single slip from the right path"; 2. Law Society of New South Wales v Goold [2001] NSWADT 171. This case involved a relatively small sum of money. In addition factors inducing stress (namely the solicitor's ill health and the ill health of his wife) were no longer present. The Tribunal suspended the solicitor's ability to practice as a partner for a period of three years; 3. Law Society of New South Wales v McNamara [2007] NSWADT 162. That case resulted in the solicitor being suspended from practice for five years and involved the solicitor receiving payments in cash from clients for the purposes of paying anticipated disbursements. The funds were misappropriated by the solicitor for his own use. The Tribunal was satisfied that the solicitor was probably not permanently unfit to practice and that if faced with the same difficulties which had been previously experienced by the solicitor, would take a very different course. That conclusion was based upon medical evidence; and 4. Law Society of New South Wales v McCarthy [2003] NSWADT 198. In this case the Tribunal suspended the solicitor's practising certificate for three months but imposed restrictions on the ability of the solicitor to practice after that period. The conduct in question involved one transaction. Moneys used to pay counsel were not used for that propose but eventually counsel was paid. The solicitor had practiced for twenty three years prior to the offence and during that period his record was unblemished.
The Law Society submitted that the evidence in support of the Solicitor's contention that a suspension would be appropriate was unsupported and of little persuasion. The Solicitor's own explanation is that he initially lost control of his practice (by which we think he means that he found trust account compliance difficult to adhere to) and that he commenced drinking alcohol excessively and gambling. The Solicitor referred to his depression and that he had sought medical help. The Solicitor asserts that he has given up drinking and gambling but concedes that he remains depressed. The difficultly which we have in being persuaded by the Solicitor's contention that a suspension would be appropriate is that there is no strong evidence that the Solicitor would not yield again were he faced with a similarly busy practice with the requirement to strictly adhere to the provisions of the LP Act. We cannot be satisfied on the evidence provided that the Solicitor would behave differently if given another opportunity to practice again.
This brings us to the purpose behind the provisions of the LP Act. It is generally understood and was explicitly stated in the decision of the New South Wales Court of Appeal in Law Society of New South Wales v Walsh [1997] NSWCA 185 that disciplinary proceedings are concerned with the protection of the public. Beazley JA said that it is "undisputed that disciplinary proceedings are concerned with the protection of the public" and that the "Court's duty to protect the public is not confined to the protection of the public against further misconduct by the particular practitioner who is the subject of the disciplinary proceedings. It extends to protecting the public from similar defaults by other practitioners. Thus, it is relevant to take into account the effect the order will have upon the understanding in the profession and amongst the public of the standard of behaviour required of solicitors". The Law Society contended that having regard to these principles the Solicitor's name should be removed from the roll. The Solicitor was not precluded from applying in the future for his name to be reinstated to the roll.
The Solicitor has overcome significant hurdles in his life and his ability to educate himself notwithstanding those difficulties deserves respect and admiration. However, in our view the submissions of the Law Society that removal from the roll is the appropriate order must be accepted. On the proven facts and having regard to the cases to which we have referred, we find that the appropriate order is that the Solicitor's name be removed from the roll. The relevant considerations which dictate this conclusion are the protection of the public, the effect of the order upon the understanding in the profession (as expressed by Beazley JA in Law Society of New South Wales v Walsh) and our lack of confidence in the Solicitor's ability not to repeat the kind of conduct which has given rise to this application.

Orders

Accordingly, we make the following findings and orders: 1. Thai Le Huu Nguyen is guilty of professional misconduct; 2. The name of Thai Le Huu Nguyen be removed from the roll of local legal practitioners; and 3. The Solicitor pay the costs of the Law Society as agreed or assessed

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 18 November 2016

At a glance

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Decision date

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Judgment (17 paragraphs)

Parties

Cases Cited (2)