//
© 2026 Zoe. All rights reserved.
Zoe is a legal information platform. Always consult the Federal Register of Legislation for authoritative text.
[2011] VCAT 2216
Victorian Civil and Administrative Tribunal
2011-12-08
Emerton J, Iain Ross J
Original judgment source is linked above.
(i) The handwritten notation on Annexure DBF94 to the Applicant's affidavit of 5 November 2009
(i) The Applicant's conduct towards the Board's Senior Counsel; Mr Batrouney and Mr Mann
(ii) The Applicant's conduct in court and towards Emerton J
"Criteria for grant or renewal of local practising certificate
(2) The Board must not renew a local practising certificate if it is satisfied that the applicant -
(a) was not eligible to apply for the renewal when the application was made; or
(b) is not a fit and proper person to continue to hold the certificate."
"What a judge must do to assist a litigant in person depends on the litigant, the nature of the case, and the litigant's intelligence and understanding of the case." [4]
"Suitability to hold local practising certificate
(1) The Board, in considering whether or not the person is, or is no longer, a fit and proper person to hold a local practising certificate, may take into account any suitability matter relating to the person, and any of the following, whether happening before or after the commencement of this section -
(c) whether the person has contravened this Act or a corresponding law or the regulations or legal profession rules under this Act or a corresponding law;
(f) any other matter the Board thinks appropriate."
(1) (a) whether the person is currently of good fame and character;
(f) whether the person is currently subject to an unresolved complaint, investigation, charge or order under any of the following -
(i) this Act or a previous law of this jurisdiction that corresponds to this Act; or
(ii) a corresponding law or corresponding foreign law;
(j) whether the person has contravened, in Australia or a foreign country, a law about trust money or trust accounts;
(k) whether, under this Act, a law of the Commonwealth or a corresponding law, a supervisor, manager or receiver, however described, is or has been appointed in relation to any legal practice engaged in by the person;"
"(a) to provide a scheme for the discipline of the legal profession in this jurisdiction, in the interests of the administration of justice and for the protection of consumers of legal services and the public generally ..."
"Understandably, the defendant and his staff at the law practice were placed under considerable pressure during this period."[14]
"[173] However, the errors in question were not trivial. In one instance, the double billing of disbursements involved counsel's fees of $53,375.70. The Chun Report notes that the law practice did not receive full payment of the invoices in question and wrote off an amount of $512,417.93. Nonetheless, the double billing of disbursements creates a further trust account deficiency and shows poor record keeping by the law practice."[19]
"[133] On the basis of the evidence in relation to the 12 files examined by the inspectors, I do not accept that final trust account statements were sent out in the majority of matters handled by the law practice. Nor do I accept that failure to send out statements in completed matters was due to oversight, mistake or ignorance. Rather, the failure seems to reflect a carelessness in accounting to clients once matters had settled, large sums had been received from the Commonwealth and the law practice was in a position to recoup its expenses and pay itself some fees. At this stage in the process, matters of accounting seem to have been handled in a rush, and important steps involved in proper accounting to clients were disregarded.
[134] Had final trust statements been prepared and sent to clients in a timely manner, the clients would have been in a position to identify the double payment of disbursements. However, without a final trust account statement, clients were not in a position to know that payment for disbursements had been taken twice by the law firm. In the circumstances, the failure to provide final trust account statements had serious consequences.
[135] In this context, it is convenient to say something briefly about the evidence of Mr Ronald Male, who was the approved external examiner for the law practice for the purposes of the annual examination of its trust records under s 3.3.52 of the Act for the years 2006, 2007 and 2008. Mr Male deposed to having used an audit program that he devised himself. He did not identify an (sic) problems with the "trust recording" by the law practice. However, he acknowledged that his testing would not have been nearly as comprehensive as that carried out by the inspectors. The errors identified appeared to be complex and difficult to identify.
[136] It may well be that Mr Male's audits did not involve checking whether final trust account statements had been sent out in accordance with Regulation 3.3.28(6)(a), or the checking of trust account statements against invoices in individual cases. However, these were actions that were well within the capacity of the defendant and the staff of the law practice. Because they were not carried out, serious irregularities occurred in the law practice's management of its trust account."[24]
"[114] In effect, it appears that the double payment of disbursements occurred because the client invoice was prepared before settlement funds were received and third party disbursements were paid. The invoice included amounts for disbursements. It was a static document. Settlement moneys were then received, paid into the trust account and third party disbursements were paid from those trust moneys. There was then a further appropriation from the trust account to pay the invoice as a whole (including the disbursements that had since been paid). This resulted in trust account deficiencies, because moneys were appropriated from trust for the same purpose twice. The law practice had the benefit of the second payment.
[115] In these circumstances, it seems to me to miss the point to attribute the trust account deficiencies that were created by the duplicated appropriations from trust to defects in the Infinity Law accounting package and the failure to produce adjustment notes. If funds are appropriated from trust to pay costs and disbursements on the strength of an invoice that has already been prepared (and given to the client), but disbursements are also separately paid from trust without reference to the invoice, then surely that is a problem with the way that the accounting system is being used rather than a problem with the accounting system per se. Invoices were prepared before disbursements were paid and a credit note entered in the debtors ledger to reduce the balance owing by the client. This is a process issue, not a problem with the software. The manual entry of a credit note would have ensured that the running balance of the debtors ledger reflected payment of disbursements.
[116] I find the suggestion that the problem arose from a failure to create adjustment notes very odd in circumstances where the invoice that the adjustment note 'adjusts' was sent to the client before the payments to which the adjustment note refers were made.
[117] The law practice could have avoided the double payment of disbursements if, as the LIV compliance manager Mr Dunn suggested, it had produced and checked a final trust statement before appropriating money from trust to pay itself. The trust statement would have disclosed that the disbursements had already been paid from trust...
[118] On the evidence before me, therefore, I am not satisfied that the double payment of disbursements was due to a fault in the Infinity Law software...
[119]... I find that the defendant has not given a satisfactory explanation for the double payment of disbursements."[26]
"[84] In my view, the defendant did not provide an adequate explanation of how the double payment of disbursements occurred and why the payment of disbursements from trust was not identified by the law practice before further appropriations were made from trust to pay the firm's invoices. It is not correct to say that the step of entering a credit note did not reduce the office account and that something more was required. In fact, the entry of a credit note was effective to ensure that a payment from trust was reflected in the office accounts."[28]
"[100] The relevance of the write-offs in Ms Eccles' evidence is unclear. According to the evidence given by Mr Scott, 'write-offs' occurred only at the time of the closure of files. By contrast, credit notes were used on an ongoing basis to reduce the balance in debtors' ledgers in respect of disbursements that had been paid from trust.
[110] Plainly, this is not a satisfactory explanation. The evidence was that a credit note did reduce the balance in the office account in respect of a payment made from trust for disbursements...
[298] Although the major problems identified in the Chun Report - the double payment and double billing of disbursements - were most likely inadvertent, they occurred because the law practice did not pay sufficiently close attention to its trust accounting obligations when settlement monies started to flow in from the Commonwealth. I do not accept that these problems were caused by a defect in the accounting software used by the law practice, as submitted by the defendant."[29]
"[65] From the outset, the defendant freely admitted that accounting errors were made resulting in the double payment of disbursements. He said that the double payments were made in error, and I accept this. Both he and members of the staff of the law practice gave evidence that they were extremely shocked when they learned from the inspectors about the double payment of disbursements. I also accept this evidence. I find that the trust account deficiencies resulting from the double payment of disbursements were created inadvertently.
[66] That, however, is not the end of the matter. The question remains whether the double payment of disbursements could and should have been avoided by more careful management of trust funds and trust account records by the defendant. In particular, the preparation of final trust account statements - as required by the Regulations - would have exposed the problem. That basic requirement was not met by the law practice."[30]
"[123] ... The importance of the memorandum is the fact that Ms Johnson had identified that the practice's records were showing disbursements as unpaid, when in fact they had already been paid from trust.
[124] In my view, the defendant, as principal of the law practice, and Mr Scott as its manager, should have followed up on the problem identified by Ms Johnson. It is plain that that followup did not occur and the manner in which both the defendant and Mr Scott sought to minimise the impact of the 16 May memorandum is worrying. The defendant ought to have been alerted by the 16 May memorandum to a potential problem with the recording of payments made for disbursements across its accounting system. However, I do not consider that the existence of the memorandum shows knowledge of the double payment of disbursements so that it could be said that the double appropriation of trust funds for disbursements was deliberate.
[128] I have concluded that the double payment of disbursements was inadvertent. However, there were clear signs that should have alerted the defendant and his staff to a problem with the firm's accounting processes and which highlighted the need to make inquiries to ensure that trust moneys were dealt with in accordance with the Act and Regulations and the client was not left out of pocket by an accounting error.
[129] Insofar as the 'events' referred to formed the basis for the Board's contention that the defendant failed to report trust account irregularities as required by s 3.3.22 of the Act, that failure is not made out in my view. The defendant was not aware of the double payment of disbursements until he was alerted to the problem by the inspectors."[31]
"[6]... I have decided that a receiver should be appointed to the law practice for a limited purpose. Having considered evidence from the Board and the defendant about the accounting practices of the law practice and the rectification of the errors that were identified, I have concluded that while the errors identified by the trust account inspectors were for the most part inadvertent accounting errors that were not deliberate or dishonest, their existence has exposed a lack of understanding of the trust accounting requirements of the Act and the Regulations, and a somewhat cavalier attitude towards the management of trust funds. The defendant ought not to have allowed the errors to occur. In particular, I have found that:
(a) Although the defendant blamed the errors on the accounting software used by the law practice, the errors were not principally attributable to a design flaw in the software system;
(b) Rather, the accounting errors were caused by a lack of understanding of how the accounting software worked and a lack of attention to the requirements of Part 3.3 of the Act and Part 3.3 of the Regulations;
(c) The accounting errors should have been readily apparent and might have been avoided had the law practice prepared final trust account statements as required by the Regulations;
(d) Further, the manner in which the trust account irregularities were remedied by the law practice gives rise to concern because -
- (i) trust moneys that were appropriated in breach of the Act and Regulations were actually restored to the trust account in only a very small number of cases;
- (ii) in the majority of cases, to deal with the deficiencies identified, amounts 'written off' were 'written back in' or new invoices were raised, even though many of the matters had been finalised some time earlier;
- (iii) in the matter of Rann, the new invoice that was raised to partially offset the deficiencies identified included fees for professional services that the defendant was not able to properly explain;
- (iv) the review conducted by the law practice to identify deficiencies in its Melbourne Voyager files looked only for deficiencies created by one means (the double payment of disbursements) and did not look for errors of other kinds, such as those identified by the inspectors in the files that were reviewed by them.
[7] Accordingly, I cannot be confident that trust account deficiencies have been properly identified and restored or that the errors that gave rise to them have been rectified. It is necessary for the protection of clients and former clients of the law practice that a suitably qualified person to be appointed to examine the Melbourne Voyager files held by the law practice to ensure that all irregularities in relation to trust money, trust property or the affairs of the practice have been fully identified and rectified and, in particular, that all trust deficiencies have been properly restored."[32]
I deal with these issues later in the context of the Board's submissions.
"[205] I accept the submissions of the Board on this question. Although the efforts of Mr Scott and Ms Thewlis are commendable, I am not satisfied that all irregularities in the remaining files have been identified and satisfactorily rectified by the law practice. Moreover, there is a real prospect that some of the rectification measures taken by the law practice involve further breaches of the Act and the Regulations. I have concluded that the identification and rectification of irregularities in the Melbourne Voyager files requires further investigation in the interests of the many clients who are affected."[34]
"[201] The Board submits that after 15 days of evidence, the Court is in no better position than Mr Scott or Mr Chun to determine whether the irregularities in the client files have been fully identified and whether deficiencies have in fact been restored. If he wished, the defendant could have put on proper and complete evidence concerning the other deficiencies and the measures that had been taken to restore them. However, he had chosen not to lead such evidence. In the light of the other serious irregularities identified in the Chun Report and the manner in which the law practice sought to deal with them, the Court should not be satisfied that the other files have been attended to satisfactorily.
[202] The Board pointed out that the Review of client accounts (as @ 31/3/09) was current to that date only. No updated information has been provided by the defendant in relation to any further accounting which has occurred, save in the matter of Rann. By contrast, the review as at 30 September 2009 for the 12 client files that were examined by Mr Chun and Ms Kozovska shows more detailed and more recent information than the table provided to Mr Chun on 31 March 2009. Entries have changed in the matters of Rann, Lewis, Pride, Fogarty and Singline. On this basis, the Board submits that if the rectification measures have been updated since 31 March 2009 for more than 40% of the 12 files examined by the inspectors, it should be inferred that further rectification measures have been or should be undertaken for the remaining clients since the law practice completed its review in March 2009. In other words, the Review of client accounts (as @ 31/3/09) is most likely incomplete.
[203] Furthermore, the Board pointed out that the review was conducted only in relation to disbursements paid from trust. This process would not identify other deficiencies, for instance those that occurred in the Smith and Simmonds matters, where the practice billed the full amount of a disbursement, but the creditor was paid a lesser amount from the office account. By reason of the way in which the reviews were undertaken by the law practice, deficiencies of this kind would not be identified.
[204] Finally, the Board submitted that the process of restoring deficiencies by preparing adjustment notes may involve further breaches of the Act and Regulations. In most cases, deficiencies were restored by producing an adjustment note for the relevant invoice. When asked whether moneys were paid back into trust, Mr Scott said, "No, we did not put it back into the trust and take it out again, no." He confirmed that he simply 'netted off' an invoice against its corresponding adjustment note. In so doing, the law practice may have again avoided the operation of the Regulations with respect to the withdrawal of trust money and the obligation to provide notice to a client before appropriating trust moneys.[35]"[36]
"(a) Although the defendant blamed the errors on the accounting software used by the law practice, the errors were not principally attributable to a design flaw in the software system.
(b) Rather, the accounting errors were caused by a lack of understanding of how the accounting software worked and a lack of attention to the requirements of Part 3.3 of the Act and Part 3.3 of the Regulations.
(c) The accounting errors should have been readily apparent and might have been avoided had the law practice prepared final trust account statements as required by the Regulations."
"[115] ... it seems to me to miss the point to attribute the trust account deficiencies that were created by the duplicated appropriations from trust to defects in the Infinity Law package and the failure to produce adjustment notes ...
[118] On the evidence before me, therefore, I am not satisfied that the double payment of disbursements was due to a fault in the Infinity Law software ...
[119] ... I find that the defendant has not given a satisfactory explanation for the double payment of disbursements."
"[140] In respect of the matters that are alleged against the LIV, I find, in summary, that:
(a) Although Messrs Henman and McCormack gave evidence that transactions in the trust account were not automatically picked up in the office account, it is not correct to say that the law practice was not aware of this fact or that a credit note did not reduce the office account balance. There was ample evidence in the records of the law practice that the debtors ledger was reduced by a credit note entry and that credit notes were regularly used by the law practice to align the office accounts with the trust account;
(b) The LIV software review, which included a review of the Infinity Law software, found that the software did not comply with the Regulations in certain respects, but the areas of non-compliance identified were unrelated to the double payment of disbursements or the other irregularities identified in the Chun Report;
(c) The LIV, in sending inspectors to the law practice, had no reason to believe that the law practice was likely to have experienced a problem with the double payment of disbursements. The memorandum referred to does not show that the LIV anticipated that there would be a problem with the double payment of disbursements at the law practice, and there is no evidence that the law practice was targeted because of its use of the Infinity Law software...
[164] From the evidence given by Messrs Dunn, Henman and McCormack, I conclude that:
(a) The Infinity Law software was cumbersome and was not easy to use;
(b) Like many other legal practice accounting programs, it isolated the trust account from the office account and its various modules;
(c) This was generally a good thing, given the special status of trust moneys and the special accounting requirements for them;
(d) However, it did require manual entries to ensure that transactions in the trust account were properly reflected in the office accounts and the integrity of those accounts was maintained;
(e) The Infinity Law software was set up on the basis that third party disbursements would be paid initially from the office account and not from the trust account. If third party payments were made from the trust account, manual entries were required to ensure that the payment was recorded in the office accounts;
(e) This would require additional attention for a firm like the law practice that paid disbursements from settlement moneys received into trust."
"[310] In my view, it is necessary for the person responsible for carrying out the examination and rectification task that I have described to have the powers of a receiver. The task of the receiver will be to examine the Melbourne Voyager files held by the law practice to ensure that all irregularities in relation to trust money, trust property or the affairs of the practice have been fully identified and rectified and, in particular, that all trust deficiencies have been properly restored. Depending on what is found, the task may involve recovering moneys or property taken in breach of trust, improperly or unlawfully. Ultimately, it may be necessary to wind up the law practice, but this is a matter for further investigation.
[311] Accordingly, a receiver will be appointed on condition that he or she does not, without further order from the Court, move to wind up the practice. I am also minded to limit the term of the appointment, because the law practice would be financially ruined by a lengthy receivership, which would amount to a de facto winding up."
"And it's my view that that is an example of - what the Board is effectively doing is that they're trying to find all these things to blacken my reputation and to make the tribunal think that I'm a totally incompetent person that can't be trusted to look after clients, can't be trusted to be honest with people."[41]
"Over the past few years the focus of sessions has shifted to assisting Mr Forster cope with the proceedings initiated against him by the Law Institute of Victoria, Legal Services Commissioner and the process with Receivers. Mr Forster has had to initiate a VCAT proceeding to defend himself which has added to his stress. While Mr Forster had a level of stress and periods of depression prior to the commencement of these proceedings, my view is that his psychological state has worsened as these proceedings have progressed. He has on a number of occasions discussed his contemplation of suicide and on one occasion his wife has rung me concerned about this. Other symptoms reported are low motivation, a constant state of pressure, difficulties with decision making and self organisation. He takes anti-depressant medication and recently his doctor has increased his dose. I have regularly expressed my concern to Mr Forster about the impact of the ongoing sustained pressure he is experiencing. As stated above he has contemplated suicide. To this point he has been able to reassure me that he would not act on these thoughts particularly after discussing the likely impact on his family. However, I have been concerned about the detrimental impact on Mr Forster's psychological health for a number of years and as the pressure is intensifying - so do my concerns."
"And in terms of my - of the person that I see, which is Dr Tierney - he's basically - he's basically someone who I regard as - essentially as a business coach. He's very common - good commonsense, and if I've got a particular problem with an issue, he provides useful strategies to deal with it."[43]
Contravention of a law about trust money or accounts and appointment of a receiver (s 2.4.4(1)(c) and s 1.2.6(k))
"[299] There was evidence before the court that prior to settlement, clients were given detailed estimates of costs and disbursements up to the proposed date of settlement, which enabled them to understand what proportion of the settlement funds they would receive after costs and disbursements had been deducted. There was also evidence that an invoice of costs and disbursements to that date was given to clients. This was usually the major invoice for the matter and, in most cases, it contained an account of professional fees over a number of years. The sums involved were significant, so alerting the client to the fact that he would lose a large proportion of the settlement sum in solicitor/client costs was a prudent, albeit unexceptional, measure.
[300] It appears, however, that once settlement took place and settlement moneys were paid by the Commonwealth, the defendant may have been unduly hasty in taking his professional fees. I have come to the conclusion that the defendant was careless in dealing with settlement moneys, and that many of the problems that arose could and should have been avoided by careful trust account management as required by the Act and Regulations. The problems experienced were inextricably bound up with the failure by the law practice to prepare and furnish final trust statements as required.
[301] I accept that the Melbourne Voyager litigation was long and difficult. The defendant undertook the 'long haul' on behalf of his clients and in so doing, took a significant financial risk himself. The defendant said that he received little or no income during the period of the Melbourne Voyager cases and that he had to mortgage his house to keep the practice afloat. Plainly, neither the defendant nor his clients anticipated that it would take so long to bring most of the matters to a conclusion. Furthermore, it seems that in many if not most matters, the settlements were smaller than the defendant had hoped, and he foresaw that such settlement moneys as were forthcoming could be eaten up in costs. In these circumstances, I accept that in dealing with the settlement moneys, the defendant was juggling competing demands and found himself in a difficult position, where his own interests conflicted to some extent with those of his clients.
[302] However, in the course of the hearing, the defendant displayed a strong sense of entitlement to the fees and other moneys that he had taken, notwithstanding the admitted errors, all of which benefited the law practice. He referred repeatedly to the large amounts of fees that had been written off; the clear implication was that it was of little consequence that he had taken moneys to which he was not entitled - much, much more was owed to him in any event.
[303] This attitude explains the manner in which the defendant responded to the findings of the inspectors, and to remedying the irregularities that were identified. While the defendant was anxious to sort out the problems as quickly as possible, in so doing he cast around for someone else to blame for what he ultimately regarded as a technical default. In my view, he failed to concern himself sufficiently with how the problems had arisen and how they needed to be remedied in compliance with trust accounting requirements.
[304] I find that the defendant has not given a satisfactory explanation of how the double payment of disbursements occurred. Moreover, the defendant did not properly turn his mind to the requirement to send out final trust account statements, which reflects a poor appreciation of his obligations and the importance of that requirement. His explanations for not passing on the benefit of creditor discounts, for the double billing of disbursements and for failing to pay trust moneys as directed were unsatisfactory. Furthermore, his treatment of Mr Rann displayed disregard for his obligation to give a proper accounting and, more generally, to the interests of Mr Rann as his client. This gives cause for concern about the rectification measures undertaken by the law practice, which principally involved raising new invoices and reversing previous write-offs to offset amounts that the law practice had appropriated in error.
[305] The review of client files carried out by Mr Scott was helpful, but insufficient to satisfy me that all irregularities in the Melbourne Voyager files have been identified and properly rectified. The fact that the accounting software used by the law practice has been updated and that new management practices have been introduced does not alleviate concerns arising from past practices."[49]
Complaint and disciplinary action (ss 1.2.6(1)(f) and 1.2.6(g))
"[175] ... although the defendant denied that he negotiated the discounts for the benefit of the law practice and maintained that he negotiated the discounts for the benefit of the client, he gave no proper explanation for the failure to pass on the discounts that he negotiated with counsel.
[177] At the very least, the failure to pass on one or more of the discounts shows poor accounting practices on the part of the law practice. Because trust moneys were used to pay the law practice rather than the creditor, the failure creates a trust account deficiency."[52]
"Your file is finished and there is currently additional moneys owing by you of $7,485.50 and moneys owing to you of $13,600.10. The difference being $6,114.60, these funds will be forwarded to you, subject to the consent of the Law Institute."
"We enclose authority for your signature and request you fax the same to our office as a mater of urgency. We have forwarded your account to your home address and hope you're enjoying your holiday in Brisbane."
"[234] The evidence points to the defendant having been careless in seeking from Mr Rann an authority to pay 'as a matter of urgency' when he did not know whether Mr Rann had seen the invoice to which the payments related and should have known there was a strong chance that Mr Rann had not seen the invoice. His actions revealed a disregard for Mr Rann's interests. The moneys in question had been sitting in the trust account since April, presumably without the knowledge of Mr Rann. Three months later, Mr Rann was suddenly requested to authorise the law practice to pay itself further moneys in respect of an invoice that he had not seen. The defendant was not acting in Mr Rann's best interests in pursuing this course, notwithstanding that Mr Rann ultimately received an unexpected payment of $6,000. Signing the authority deprived him of a further $7,000 that was held on trust for him.
[235] Moreover, although much was made of the fact that the supervisor of trust moneys for the law practice, Mr Dunn, had approved the payments, Mr Dunn gave evidence that he would not have done so had he known that Mr Rann had not seen an account when he signed the authority to pay."[73]
Please forward me a fresh email along the lines of: At [sic]
At my settlement conference I can recall Mr Forster explained to me that there would be two cheques received for settlement and that the smaller of the 2 cheques would be costs and I directed him to put this cheque into his office account directly against my outstanding accounts."
"[222] This sequence of events raises two particular issues: first, Mr Rann was asked to sign the authority to take funds out of his trust account to pay an invoice when he had not seen the invoice in question, and the defendant knew, or should have known, this to be the case; secondly, Mr Rann was asked to attest to a conversation that he says did not occur and apparently related to the deposit of settlement moneys directly into the law practice's office account.
[223] In addition, the manner in which the 2009 invoice was raised gives rise to serious questions concerning the defendant's billing practices. In the case of Rann, and other Melbourne Voyager matters where there was an agreement to charge according to scale, the law practice does not appear to have billed in accordance with its fee agreements."[76]
"10. Mr Forster's email asked that I send an email to him stating that at my settlement conference I can recall Mr Forster explained to me that there would be two cheques received for settlement and that the smaller of the two cheques received for settlement would be for costs and I directed him to put this cheque into his office account directly against my outstanding accounts.
11. I do not know why Mr Forster wants me to send him such an email. In fact, no such conversation took place at the settlement conference. As a result, I did not respond to Mr Forster's email."[77]
"Mr Arthur: Do you recall your solicitor at the mediation in fact explaining in detail the costs and disbursements incurred in your matter to you?
Mr Rann: No, I don't. The mediation conference was really quite short.
Mr Arthur: All right. Now if Mr Forster were to give evidence that he did explain the costs and disbursements to you would you dispute that?
Mr Rann: All I can say is I don't recall that happening.
Her Honour: Mr Rann, can I just clarify: are you saying you don't recall there being any discussion about costs and disbursements or are you saying you don't recall there being a detailed explanation about costs and disbursements?
Mr Rann: I don't recall any - any discussion about any disbursements, your Honour.
Mr Rann: I must explain that my state of mind at that time was one that I was pleased to be rid of the whole situation after seven or eight years. It has taken its toll physically and mentally on me and I just wanted to get out of the situation without costing me any money. I've already estimated that it cost approximately $40,000 out of my own pocket over the years to get to the final stage.
Mr Arthur: Because of the length of the case and your post traumatic stress disorder, and that the recalling the events which occurred, together with the very difficult nature of the litigation itself and the attitude of the defendant in that case, was very stressful, wasn't it?
"[246] This conduct by the defendant suggests that in September 2009, the defendant believed that the only authority that he had to pay the funds into his office account derived from things that were said at Mr Rann's settlement conference. In the light of this, the defendant sent Mr Rann - out of the blue and entirely without explanation - a request to do something that Mr Rann did not understand, and which served the sole purposes of the defendant.
[248] It follows that the defendant's request to Mr Rann to send him an email with the statement set out in the defendant's email involved, in effect, the defendant asking Mr Rann to say something that was not true.
[249] In seeking to 'shore up' his entitlement to be paid directly the party/party costs obtained from the Commonwealth, the defendant seems to have paid scant regard to the interests of Mr Rann. This causes me concern about the way in which rectification of the irregularities was carried out by the law practice."
Mr Arthur: "Do you recall having a conversation with Mr Forster to that effect?
Mr Arthur: Now do you recall a conversation where Mr Forster explained to you that there would be two cheques received for settlement?...
Mr Arthur: So you therefore don't recall the rest of what is said by Mr Forster to have been explained to you, is that correct?
Mr Arthur: You don't recall any discussion with Forster that there would be two cheques received from the Commonwealth of Australia?
Mr Arthur: "Now, you said before that you couldn't recall a discussion with Mr Forster about two cheques. That's what you just said, wasn't it?
Mr Arthur: I put to you that Mr Forster's position and his evidence will be that he did have a discussion with you on 18 April at the mediation conference, which he can specifically recall, and that he explained to you that there would be two cheques received. Now, you've already said that you were aware that there'd be an amount paid for the claim, that'd be 165,000, and there would be an amount paid for costs, that'd be 125,000?
Mr Arthur: Now, what he will say is that he explained to you that there'd be these two cheques for settlement: one for the claim and the other for party/party costs. And he explained to you that the smaller of the two cheques, the party/party costs cheque, would be directly put into his office account - now listen to me very carefully - and that would pay part of your costs. Do you remember him explaining those matters to you to that effect on the mediation day?
Mr Rann: Yet again no. I understood there were two amounts of money were going to come in. In what fashion they came, what the logistics were, I had absolutely no idea and nor did I care."[80]
Mr Arthur: "Now, Mr Forster wished you to confirm a conversation which had taken place at the mediation conference. Do you have any
Mr Rann: Well, Mr Forster claims that a conversation took place. He wanted to meet and confirm that conversation which I do not recall and I believe did not happen.
Mr Arthur: So do I understand that your evidence then is you do not recall that conversation taking place with Mr Forster?
Mr Arthur: "Now, I put to you, Mr Rann, that there was a conversation with Mr Forster at the mediation conference in the manner set out in that email?
Mr Arthur: I'm putting to you that in fact you, at the mediation conference, authorised or directed Mr Forster that he could put the cheque, the smaller of the two cheques, the party/party cost cheque directly into his office account to pay or at least to partially meet the outstanding accounts which you had to his firm. Do you accept that that was...?
Mr Rann: As I said before many times, I don't recall that and quite frankly I don't see how relevant it would be to me to be asked about where he banks the cheque.
Mr Arthur: So you simply don't recall that conversation?
Mr Arthur: Now, in your affidavit, Mr Rann, you said in paragraph 11 - would you look at paragraph 11 please?
Mr Arthur: You said, "In fact, no such conversation took place at the settlement conference"?
Mr Arthur: Now I put to you that that sentence is false because all you can really say and all that you've said to His Honour today is that the conversation you cannot recall. Do you agree with that? What your evidence is, Mr Rann, is you cannot recall any conversation to the effect that I put to you with Mr Forster about the two cheques?
Mr Rann: Not being able to recall means it didn't happen in my mind.
Mr Arthur: So are you saying that you positively can recall the conversation not having taken place? You can positively recall the conversation didn't take place or are you saying, "I can't recall whether it did take place" or to you is there no difference?
Mr Rann: I'm saying the conversation didn't take place.
Mr Rann: No, that's exactly what I've said in my affidavit.
Mr Arthur: I put to you your position has changed now. Previously, before I took you to the affidavit, apart from one reference where you said you dispute the proposition that I put to you, every single answer you gave before that was, "I cannot recall these conversations." Is that correct?
Mr Rann: Probably yes but what's the difference in cannot recall and not happening. What I'm saying is I don't remember them happening therefore they didn't."[83]
"The informal mediation on 18 April 2007 commenced at the office of Blake Dawson Waldron at 9.10 to 10.40. I remember Mr Rann wanted to receive payment immediately the case settled and wanted to receive $80,000 from the settlement. I explained to him that I had to pay others and myself first and he would have to wait and he approved the arrangement whereby the party party costs would go direct to me. We did not settle that day as I convinced him that I thought the Defendants would offer a bit more which would make meeting his demand for $80,000 achievable. At that conference an offer was made of $155,000 plus $125,000 for party party costs.
On 19th April 2007 at the settlement conference I did a detailed file note which notes $125,000 payable to Hollows being party party costs. The settlement monies was paid in two cheques. These payment arrangements were discussed with Mr Rann and my email sent to him reflected the arrangement. At the informal mediation took place between Mr Lysawick from Department of Defence and David Hanger the solicitor from Mallesons, myself and Sue Johnson and Mr and Mrs Rann at the office of Mallesons. On 19th April at a settlement conference with Mr Rann I again explained to Mr Rann that part payment of his outstanding account would be made directly from the monies received form (sic) the solicitors. He signed the instructions to settle. I further told him he would be charged for further work done in the matter."[85] [emphasis added]
"Mr Arthur: I put to you that Mr Forster's position and his evidence will be that he did have a discussion with you on 18 April at the mediation conference, which he can specifically recall, and that he explained to you that there would be two cheques received. Now, you've already said that you were aware that there'd be an amount paid for the claim, that'd be 165,000, and there would be an amount paid for costs, that'd be 125,000?
Mr Arthur: Now, what he will say is that he explained to you that there'd be these two cheques for settlement: one for the claim and the other for party/party costs. And he explained to you that the smaller of the two cheques, the party/party costs cheque, would be directly put into his office account - now listen to me very carefully - and that would pay part of your costs. Do you remember him explaining those matters to you to that effect on the mediation day?
Mr Rann: Yet again no. I understood there were two amounts of money were going to come in. In what fashion they came, what the logistics were, I had absolutely no idea and nor did I care"[89]
"Mr Arthur: Yes, sir. Thank you, Your Honour. (To witness.) Now, I put to you, Mr Rann, that there was a conversation with Mr Forster at the mediation conference in the manner set out in that email?
Mr Arthur: And that you directed and authorised Mr Forster to put the party/party cost cheque directly into his office account against your outstanding accounts --
His Honour: Yes, you need to indicate when that direction was given. If it is that you're putting that direction was given during the course of the conversation between Mr Rann and Mr Forster at the mediation conference or on that day. (To witness.) Do you understand the question, Mr Rann?
Mr Arthur: So what I'm asking you, Mr Rann, I'm putting to you --- ?-
Mr Arthur: I'm putting to you that in fact you, at the mediation conference, authorised or directed Mr Forster that he could put the cheque, the smaller of the two cheques, the party/party cost cheque directly into his office account to pay or at least to partially meet the outstanding accounts which you had to his firm. Do you accept that that was - - -?---
Mr Rann: As I said before many times, I don't recall that and quite frankly I don't see how relevant it would be to me to be asked about where he banks the cheque.
Mr Arthur: So you simply don't recall that conversation?
Mr Arthur: Now you never responded to the email that Mr Forster sent you, did you?
"Dr Hanscombe: The deposit of the party/party costs into the office account is the matter concerning which you say Mr Rann gave you a verbal direction at the settlement conference, correct?
Mr Forster: Yes. It's - to be more accurate, it's not actually the settlement - by settlement conference I mean the informal. mediation conference
Dr Hanscombe: Ok, the informal mediation. You say Mr Rann gave you a direction at that information mediation that you could deposit the party/party costs directly to the office account?
Mr Forster: Yes, it - that's not correct. Mr Rann - what occurred was Mr Rann was wanting to get his hands on the money. He was wanting the money for himself and basically I said to him, 'No, if we settle, you don't get it', words to that effect. And then he agreed and he said, 'Yes, Ok I understand' Because we were waiting all the time to get paid, so that's the context of that discussion with Mr Rann.
Dr Hanscombe: Well, whatever the context was, Mr Rann's evidence is in direct conflict with your evidence?
Dr Hanscombe: About that authority being given at the informal mediation. You're aware of that?
"Mr Forster: In respect of lack of candour, Your Honour - can I go to that issue? If I go - if I turn to your summary, sir, the lack of candour issues. I'm just trying to pick up the page where it mainly concentrates on that. Oh, certainly - perhaps the most - thing I should - - -
Mr Forster: We'll start with Mr Rann? Sorry? P.99 and following?---P.99. I've got to come back to Mr Rann as well, sir.
His Honour: Well, you can deal with - while he's in your mind, deal with him now?--
Mr Forster: Right. In respect of Mr Rann there was - there was a conference that was held by my solicitor, Sue Johnson, which is on the - on the - on
His Honour: I want to know what you explained to him at the settlement conference?
Mr Forster: OK, we'll I'll just - can I quickly just flick through, because there's a lot of documents.
His Honour: But all these documents are in evidence, and really - what's your recollection of what you explained to him at the settlement conference?
Mr Rann: Yeah. Well, my recollection is, sir, that we - we were doing - we were at the settlement conference, we're going through the process of explaining offers and backwards and forwards with the discussions with the other side, and what is claimed as work. And how - how - what would happen when the case would finish. And what I said - and what happened is that we had got a - the other side, or Blake Dawson Waldron indicated that they would pay $125,000 for party/party costs. That, you know - sorry, that we would - we talked about it, and I said, Well, look, we'll - because we wanted to have a fixed figure on party/party costs to avoid having to go through a party - a costing process. So we had a figure of $125,000 on a party/party cost, and then we had a figure - which I would have to refer to my notes as to an amount. And what - and then what happened with Vic is that - - -
His Honour: Just without referring to your notes - you said you had a very clear recollection of what happened at the settlement conference?
Mr Forster: We were looking - I was looking outside the - talking to him - he's facing the window, a beautiful view of Sydney Harbor, and what he - - -
Mr Forster: Yeah, it was very nice. And what he was saying - look, he was - he was saying to us, I want to get this amount of money and I want to get my money straightaway.
Mr Forster: And what I said to him, No, Vic, you can't expect that, or words to that effect. I said to him: You will get - you'll have to wait because the case has been. going on a long time, there'll be two cheques; you'll get a cheque for - there'll be a cheque - a cheque that would be $125,000 which would be the party/party costs amount, and that would go straight - straight to me to pay the barristers, the disbursements and everything, and then - and then the remainder - the remainder would go to him, being the amount that he wanted. But I also said to him at the time - because I reduced my fees down to make sure that he'd get the $80,000 that he wanted - I said to him: Look, Vic, I think we'll just - we'll settle it. The final settlement - they won't do it today, but the final settlement will be settled. And it got settled the following day. So I was very clear in terms of - in terms of making sure Mr Rann understood. And the particular reason, I suppose, that Mr Rann - why it sticks in my memory, is that Mr Rann was one of very few clients that was so financially astute. Most of them would - most of them were at the stage that they would just - they'd walk out of the room without anything. But Vic's an astute businessman, and he wanted to know exactly, you know, what the lie of the land is. And so therefore I had to say to him, Vic, or words to the effect - Well, Vic, you're not going to get your - you're not going to get the payment straightaway and you have to wait. And then I told him what you'd get, and I said, Look, why don't we come back - or come back tomorrow, or whatever, and expect a further payment. And that's exactly what happened. Then we signed him up. And in terms of the process, Mr Rann was unlike most of the clients in the sense that he was very - he had a lot of commercial acumen. I mean he was running quite a complex business, a mobile stone business, and I think he was mainly doing the paperwork and the office administration work. So he - so he understood it, and had a pretty clear understanding. And he never said to me - he never said to me things like, Mr Forster, you know, you ripped - words like I've ripped you off, or anything like that. So at the end of the day he was - he was relieved to have it finished, understandably. Gone on for - it had gone on for a long time, and the reason I sent the email is that I wanted him to confirm exactly what occurred, and that's exactly what did occur in our discussion. I am not sure if there's something there that's worrying Your Honour, or if I need to clarify something in terms of that?
His Honour: My difficulty is I can't - you know what the issue is, you know what is said against you, and this is your opportunity to give your recollection of what you told him at the settlement conference and what his instructions were?
Mr Forster: Yes, well his instructions were that he agreed - he didn't want to at the start, but he agreed that, you know, fair enough, you get your - you've got to get the party-party costs in for you, and you get that. And that's - and that's precisely what happened and it's reflected further in the correspondence to the client to the extent that I go through the remainder of the documents..."
His Honour: I'm not clear as to what your evidence is about what Mr Rann told you and what directions he gave you at the mediation conference. You know the one I'm referring to?
His Honour: Now, you've heard Mr Rann's evidence about his recollection of what took place at that?
His Honour: What instructions do you say he gave you?
His Honour: That is, about the costs and the like and the payment from the Commonwealth?
Mr Forster: To the best of my recollection, Your Honour, is that - all I can - he raised with me - he raised with me as to what would happen if he accepted the offer that was made on that day, and then he asked - he said to me, Well, will I get my money straight away?, or words to that effect. At that time that's when I said to Vic, No, Vic. If you settle it - If we settle it today, you've got to wait. There'll be two cheques. There'll be a cheque for party/party costs. Those monies will go straight to us and then you'll get your money at the end. And in the end what occurred is that - my recollection is that I said to Vic, you know, You'll get your $80,000 that you want to get from the settlement and that $80,000 is - just leave it with me. Leave it with us 'cause I'm pretty confident that they will come up with this - with these actual figures that they did come up with on the following day. I can't be any more accurate than that. And it's - but the reason why I remember it particularly, Your Honour, is that for some reason I just remember that there was - it was looking at the - we were looking out the window and there was a fantastic view of the harbour at the time and that sort of stuck in my mind and he was different in the sense that he was the person that was pretty particular about financial matters, more so than probably 90 per cent of them.
His Honour: And is the conversation you've just described the basis for your statement that you had instructions that $125,000 should be paid into the office account?
Mr Forster: Yes, sir, and that was - occurred at that time.
His Honour: You say, yes, it occurred at that time?
Mr Forster: And I was looking out the - sorry, sir.
His Honour: My question was, the conversation you just described to me, is that the basis for your submission in your statement that you had instructions to deposit the $125,000 into the office account?
Dr Hanscombe: And that's the whole of the conversation on that topic?
Mr Forster: I mean, we would've - no, look, I'd be reconstructing if I tried to say. Just let me think. No, I think that's all I can - - -
"I made a further file note dated 18 April 2007 taken during the informal settlement conference when David Forster myself and Mr and Mrs Rann were present with solicitors from the Blake Dawson Waldron and Michael Lyswvich from the Department of Defence. Now produced and shown to me and marked SJ 4 is a copy of 3 pages of my handwritten notes of the informal settlement conference together with a further page which I believe was taken during a break in the settlement conference."
"... as soon as practicable after receiving trust money, a law practice or an approved clerk must deposit the money in a general trust account of the practice or clerk unless -
(a) the practice or clerk has a written directions 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."
We apologise for this error. It has been an operator error and the deposit should have been made to the trust account. Given the large number of transactions this error was overlooked."
"At his settlement conference on 18 April 2007 I recall explaining to Mr Rann that the defendant's had deliberately complicated the litigation and made it as difficult as possible and that this reduces the amount he would recover from the litigation".
Any other relevant matters (s 2.4.4(1)(f)): The Applicant's Candour
"The Law Institute Executive Council Item 10 states therein, 'Infinity has advised that they will not act until the LIV have provided them with directions as to what modifications are required' ...
Now produced and shown to me at the time of swearing this affidavit and marked with the letters 'DBF94' is a copy of the Law Institute of Victoria Executive Council minute item 10 with redaction undated."
"My instructions are that that has been indicated to my instructor that it is from the Executive Council."[107]
"Mr Arthur: What does [67] - is that your handwriting as well?
Mr Arthur: But 'Executive Council' at the top is in your handwriting.
"Now, can I take you to the minutes of the executive council, on p.1331, please. It is said that this is the executive council of the Law Institute of Victoria, your employer. 'Item 10, if I can read that to you. Infinity has advised that they will not act until the LIV has provided them with directions as to what modifications are required. They have stated that they are awaiting a meeting with the LIV in August to seek direction from the LIV. Accordingly there is very little we can do unless the LIV can document the necessary changes they would like to see, so that we can pass them on to Infinity. Clearly is it in every one's interest to have the Infinity correct the necessary system deficiencies as it seems very likely that all users of this particular software product will have similar breaches of the regulations, and as a consequence of the system handling of items that have been highlighted above. Infinity have confirmed that all users of their software are in conflict with 3.3.3.4 as interpreted by the LIV, but the LIV know about the issue and have approved the use of their software. Were you aware that this was the view of the executive council?'"
Mr Arthur: "Up the top of that page has got in handwriting executive council? -
Mr Arthur: Do you know whether that was a resolution of the executive council?-
Mr Arthur: Is there a document which is attached to the subpoena?
Mr Arthur: Have you been able to produce the document that is referred to in the schedule of the subpoena?
Mr Brett-Young: I'm already looking at that. The documents referred to the schedule is Executive Council, the Law Institute of Victoria meeting item 10 referred to Infinity Law a copy attached.
Mr Brett-Young: There was no such document that's related to the Executive Council of the Law Institute of Victoria.
Mr Arthur: Could I ask you to look at the document which is annexed to the subpoena. Can I ask you, are you familiar with that document?
Mr Brett-Young: Only to the extent I've seen it attached to the subpoena, and - and to what I've been informed by officers of the LIV.
Mr Arthur: Have you seen this document before seeing it attached to the subpoena?
Mr Arthur: Are you able to say what the reference to Executive Council on the top left hand corner of the document?
Mr Brett-Young: My understanding from the officers at the LIV is that that wasn't on the document that was previously provided to the Court. We don't know what that note is.
Mr Arthur: Are you able to say whether this note was discussed at an Executive Council meeting?
Mr Brett-Young: To my knowledge it was not discussed at an Executive Council meeting."[112]
"In his affidavit sworn on 5 November 2009, the defendant asserted that the document in question was an extract from the minutes of the LIV "executive council".[113] Mr Henman's evidence was that while the handwriting on the side was his, the typewritten text was an extract from a letter the LIV had received from firm X, the firm that he and Mr Dunn had inspected."
"Are you saying he didn't have those instructions?---He would have had a belief that that was what it was. I mean, I believed that that's what the document was, but in the sense of - sorry, put that another way. Mr Arthur sat in a conference with the barristers and the other side and we went through documents with them, and we started to ask them questions to try and find out what the documents were and I specifically asked them about the Law Institute Executive Council note - which I thought it was that, and my recollection is I said something to the effect, Well, that's the Law Council Executive Committee Council note and what they did is that they didn't affirm or deny, but I went away from that meeting with the firm impression that that was what the document was. What then transpires may be - I'm not sure how many months later it would have been, but maybe - how many months later would it be - it probably would've been - it might've been two or three months later or four months later, Mr Arthur has put a question that it is from the Executive Council. Now, at the time when he put that question"[114]
"Mr Arthur: Just very, very quickly one of the examples in paragraph 21 of the letter from the Legal Services Board, lack of candour with the court. Now, there was a notation Executive Council on a document. Could you very, very briefly describe to the Board why that notation was made?
Mr Forster: We spent $20,000 in the subpoenaed dispute with the Law Institute of Victoria. What occurred is that I became aware of the fact that in 2007 the Law Institute received a report that said that the Infinity Law package was not a good package, that they had problems with resources and that it didn't comply with the provisions of the Legal Profession Act.
Mr Arthur: So the note Executive Council, why did you put that on the document? ...
Mr Forster: In terms of the notation, what we were presented with, it was extremely difficult to get these documents from the Law Institute and the reason for that is that we had a letter from the Law Institute President denying the existence of the report, and I would like to hand around to you some examples of some of the documents that were in the possession of the Law ...
Mr McGarvie: Could I receive them and I'll determine whether to distribute whatever the document is.
Mr Forster: Essentially what those documents demonstrate is that the Law Institute was aware of the problems with the package and, unfortunately, they made a decision not to tell members about the problems with the package and there is a letter in there which is written by Penny Fairbank, Marketing Manager of the Law Institute, saying: look, we won't tell members, effectively we won't tell members about the problems with the package because you will only provide sponsorship to the conference. So the proper process of finding out what occurred with the package and the history of the package we're still not aware. So this particular Item 10 when we came across Item 10, when we met with my counsel, we had all these documents, and the Law Institute's position and the Legal Services Board's position was: we won't tell you the author of any of the documents. So it required us to go to the Supreme Court and prove each individual document. We had to call all these inspectors to prove these individual documents.
Mr Arthur: Why did you put Executive Council on the top of the document?
Mr Forster: We were trying to sort out what the individual documents were coming from. We had all these documents and it had Item 10 and we asked the Law Institute to identify who these documents were and we assumed - it was incorrect - we assumed that it was from the Law Institute Executive Council because it had Item 10. And then I did an affidavit and to the affidavit I exhibited the memo and on that memo - we will provide you with a copy of that - you will see on that memo it has a note by the inspector which sets out the specific problem that occurred with us."
"21. At a meeting between counsel of the Law Institute, my counsel and I, we requested the Law Institute to identify the document. They refused to. The purpose of my notation was to try and identify the source of documents and I had no intention to falsify the document. The document was headed item 10 and I mistakenly believed it was a LIV Executive Council document. The Law Institute sought to claim public interest immunity and my notation was to assist my counsel in identifying documents. My notation was photocopied and exhibited to an affidavit and my error was unintentional. The LIV complicated obtaining subpoenaed material and subsequently billed me for approximately $20,000 which was settled for $14,000. The litigation tactics used by the LIV were designed to avoid disclosure of documents to the court which were embarrassing to the LIV."[116]
"[11.2] It is submitted that the evidence of Forster should not be accepted unless that evidence is supported by contemporaneous documents or corroboration by a witness of truth. The Court has had the opportunity over an extended period to assess Forster's demeanour in the witness box. His demeanour was not that of a witness of truth. He consistently sought to evade answering questions directly and gave speeches whereby he sought to impugn the motives and characters of others. The transcript is full of examples of this conduct. A few of them are set out below.
[11.10] Fourthly, Forster put forward a document he had received from the Law Institute under a subpoena as being an extract of minutes from a meeting of the executive council of the Law Institute. Witnesses were asked questions by Forster's counsel apparently on instructions that the document was a minute of the executive council. Henman gave evidence that the document was in fact an extract from a letter from a legal practice to himself in relation to an investigation he was conducting. Brett Young gave evidence that the handwritten notation "executive council" on the copy of the document exhibited to Foster's affidavit was not on the document which the Law Institute had produced to the Court. Indeed, there would be no reason for any one at the Law Institute to make such a notation, given than the Law Institute would be aware that the un-redacted document is in fact a letter.
[11.11] The only plausible explanation for the handwritten annotation on the document at CB1331 is that Forster or someone at Hollows wrote it. Whether the person that did it believed the document to be a minute from a meeting of the executive council is not to the point. The fact is that Forster has allowed a document to be put forward on a false basis. Such conduct must tell against him."
"That really gets you to the issue of credit. We have made very substantial attacks on the credit of Mr Forster in particular. Those attacks are set out and they are made after very careful consideration. They are set out in section 11 of our written submissions. Credit is of the utmost importance in this case, because nobody can know how Mr Forster operates his trust account except by what he says about how he operates his trust account, and by reference to the objective evidence in the documents. So credit is a very important concern for Your Honour in this case. Our submission is that Mr Forster presented in the witness box as prevaricating and evasive on important issues such as just tell me how you appropriate from trust to pay a bill? He was either unwilling or unable to give a responsive answer. But there are also external indications that Mr Forster's credit, regrettably, cannot be accepted, and the most remarkable of them occurred this morning. There was a document which Mr Forster had put forward by an affidavit as an executive council minute of the Law Institute. It appears at court book 1331, and we saw it put to every Law Institute witness.
The evidence of Mr Brett Young was that it did not bear the writing 'Executive council' at the top when it was produced on subpoena. The evidence of Mr Henman was that it was a letter to him, and a post-it note to the right side with the annotation was his handwriting, but he had not written 'Executive council'. Mr Forster put that forward in his affidavit as a Law Institute executive council minute. In terms, absolutely frankly we put a submission in our submissions that Mr Forster or somebody at Hollows had written the words 'Executive council' on that document. That has not only never been responded to, including this morning, but this morning our learned friend referred to it as what it truly is, the letter to Mr Henman.
Now, it could not have been produced in the form that it was, because nobody at the Law Institute, knowing that it was a letter in its unredacted form, could have annotated it like that. If that's right, then that is at least one objective demonstration of a document being consciously advanced on a false basis. And if that's right, that must give Your Honour very grave cause for concern as to credit."
"I did not realise the puttage by Mr Arthur was suggesting that the document which had my own handwriting was not my own handwriting. My counsel had been told of my honest belief the document was from the Executive Council of the LIV. The Board is twisting the facts and muddying the waters unfairly."
"The administration of justice would proceed more slowly and with greater cost if the courts before whom a solicitor practised felt it necessary to check the accuracy of what the solicitor had said to it ... If what the solicitor has done is such that the court will hesitate before acting upon what the solicitor has said, that is ... an important matter to be taken into account"[132]
"In reaching my conclusion that the appeal should be dismissed I have considered afresh the question of sanction. Shorn of the gloss, the findings of the Tribunal establish that a legal practitioner was guilty of having sworn a knowingly false affidavit. It was an affidavit filed in connection with legal proceedings in which, to the knowledge of the barrister, both the Family Court and the opposing litigant had obvious and material interests in getting at the truth on this particular matter. The false affidavit was unexplained by the practitioner who, despite warning, declined to enter the witness box ...
If (which I doubt) there are exceptional cases where a practitioner who knowingly swears a false affidavit that is filed in court could be regarded as fit to practice, this is not one of them."[136]
"Mr Forster: The mere fact that Her Honour Justice Emerton as I understand it, didn't seem to think that this issue of candour was important or that Her Honour hasn't said anything about it, it just seems to me that effectively what you're trying to do is you're trying to make a big issue out of something that my counsel didn't regard as important. I certainly have never seen my behaviour as being something that was dishonest or intending to mislead anyone and that in terms of the suggestion that I didn't pick up to be in the cross-examination or in the tribunal, I didn't - I wasn't focussing on that. What I was focussing on in the case, was I was focussing - what I was focussing my mind on and what I regarded as very important is I thought that the words, "Depends on funding" changes to "the disbursement payments," well, I thought those words were absolutely critical to my case because what I thought was that those words meant precisely the problem with the disbursement payments and I wasn't focussed on these words, "Executive Council." What I was doing is that when I saw that document as with other documents I wrote on documents when I believed that's what it was and I believed it was that and once the people corrected - obviously what's happened is it's been corrected and obviously it's been said that it's no an Executive Council meeting, well then that's the end of the matter.
Dr Hanscombe: So it really wasn't a very big issue?
Mr Forster: Well, sorry, it wasn't in my mind. Obviously if I'd believed that I was - had done an affidavit for the purposes of misleading the court or trying to create some false impression then obviously myself and I think my counsel would have been focusing on this issue and he would have - in his final submissions he would have regarded it as a very important issue and he would have said something about it, about this ---".[137]
"The fact that a person chooses not to answer their phone or return calls is not something I am responsible for." [emphasis added]
"A few years ago my Messagebank was the Telstra 101 and - I mean, it doesn't flash at you that you have messages. You've actually got to go and retrieve them. And I - sometimes I would do that daily, sometimes it could be a few days before I actually check my messages with the Telstra one ..."[138]
"... I probably did but I don't think I was taking too many calls at that stage. I was quite aware I was going to be called up to court but I didn't want to cancel my holidays."[139]
"Dr Hanscombe: Did you get a message from Mr Forster - think carefully about that, did you get a message from Mr Forster in the week before you went away?"
Ms Thewlis: I honestly don't know, I really don't know. I know I had quite a number of them on my return including a message from Corrs to ring but I honestly don't know with the week prior to."[140]
"...can I just seek instructions very quickly. Your Honour, the other very critical factor is that without appointing a local practitioner as a receiver who is familiar with the Frankston area and Frankston clients my client is concerned that a receivership which is going to last on the plaintiff's proposal for six months, by the time the six months has expired he won't have a practice any more, his goodwill will be completely gone. So that is really why he submits that a local practitioner should be appointed, someone who knows the Frankston clients and can deal with their problems rather than a couple of partners from a large city firm. So I suppose that submission relates to the identity of the receivers, on the one hand, and also the duration of the receivership on the other."[145]
Here it is submitted, on instructions, that if the receivership goes for six months he won't have a practice left and his goodwill will be completely gone.
"In circumstances where the sale of the office premises took place on the Friday before the Monday on which the receivers were to be appointed and the defendant knew that such an appointment was going to be made because reasons had already been handed down, the purchaser was expressly asked not to say anything about the sale to the receivers, and there were two subsequent occasions on which the defendant could have informed the receivers (and indeed the Court) of the sale and did not but instead made loud complaint that the receivership was putting the practice in mortal danger, there is in my view a basis for an apprehension that the proceeds of sale may be dissipated by the defendant."
"The allegation of lack of candour to the court is misconceived. I am entitled to change my mind regarding my intentions as to place to practice. I was never requested to tell the Receiver of my decision that an offer made for the purchase of my building was under contract. The duty of candour can be divided into two separate categories, candour in the presentation of the law and candour in the presentation of the facts. I never presented any evidence to the court which was misleading or false. Whether or not I sold my person asset was not material to the decision to appoint a receiver. It was not regulated property it was my private business affair. My counsel was aware of the sale."
"I refer to the above matter and enclose herewith a copy of documents filed with VCAT on 14 February 2011 as per the Orders of the Tribunal on 21 January 2011 in case a copy has not made it to you to date.
I note that documents were to be filed by you on 25 February 2011 pursuant to the Orders of 21 January 2011. I understand from speaking with VCAT that no documents have been filed by you to date.
I look forward to receiving your outline of submissions articulating your case together with any witness statements or other documents you wish to file as soon as possible."
"I refer to the above matter and enclose herewith a copy of further documents filed with VCAT this day.
I note that no documents have been filed with VCAT by you and that your material was due to be filed on 25 February 2011. Could you please advise whether you intend to proceed with your application and if so when it is anticipated that you will be filing documents including your outline of submissions articulating your case together with any witness statements or other documents.
We note that until such time as your documents are filed we are unable to file outline submissions."
"I was next to the associate on one side and Mr Forster was on the other side and we started to go through His Honour's materials to ensure that what His Honour had was the same as what all the parties had.
Mr Forster's materials were spread across his side of the Bar table and there was some difficulty in Mr Forster finding the matching materials at which His Honour had. Mr Forster stood back and said, "You find the folder," and I walked round with the associate looking at the folders that were on his side of the Bar table and we were looking at number of the folders that he had there to see if he had the very first folder that we were trying to match up.
At that point, I saw a folder that had "Legal Services Board tabs 30 to 60," on it and I looked at it and I recognised the tab numbers and I said to Mr Forster, "I think that's the folder you said that you never got," and Mr Forster walked around and picked up the folder and he opened it up and inside I could see one of the letters from the board was there.
The letter on the top had the board's colour header on it and it was a blue signature on it.
Mr Forster then picked up the folder, looked at it and then turned around and put it in one of his suitcases behind him."[160]
"I did not receive the 4 volumes of material provided to me by the Legal Service Board until recently delivered to my home. I collected the mail on the 9th of March and on the 15th March my wife collected the mail. On both these occasions the 4 volumes of material were not provided and letters were provided ..."
"On 1 July 2011 at approximately 5.00pm, I sent an email to the Tribunal, copied to David Forster attaching an outline of submissions from the Board together with an affidavit of Sonia Anne Rivalland sworn 1 July 2011...
At 5.03pm on 1 July 2011, I sent an email to Mr Forster again attaching a copy of the Board's outline of submissions and the affidavit of Sonia Rivalland sworn on 1 July 2011."
"No email was received from Mr Muir. I have forwarded the statutory declaration to Terri Twining of Legal Practitioners Liability Committee re indemnity insurance and she has to advise me the amount payable. There is no point in this application and Sonia Rivalland was aware of contact being made with Terri Twining last Friday and apparently Sarah Mauriks received the email at just past Five on 1st July. Rivalland has already acknowledged in her affidavit I had spoken to Terri Twining regarding arrangements for the Liability Committee to inform me of amount to pay.
I am holidaying and return to my office next week as Mr Muir was previously advised and payment will be made when advised amount due." [emphasis added]
(i) The Applicant's conduct towards the Board's Senior Counsel; Mr Batrouney and Mr Mann
"I was in court at the hearing in this matter on 18 November 2010. At the end of the hearing, once Justice Emerton had left the court room, the defendant approached the Board's Senior Counsel (Dr Hanscombe), and with his face within inches of her face, and in an intimidatory manner, as he followed her from the bar table towards the court door, he repeatedly called her a "monster". As he did this, I said to the defendant that he should stop and that if he had anything to say he should speak to me and not counsel directly..."
"...in view of the letter in particular and its contents, and what I understand to constitute an attempt at intimidation and an attempt to have Dr Hanscombe withdraw as counsel for the Board..."[170]
"You're a serial offender in this regard Mr Forster, you called Mr Batrouney a vulture at the preceding hearing if not before the one before that in open court, you approached Mr Mann in court and made disparaging comments about the state of his marriage..."[182]
"Mr Forster: You guys, at the end of the day, make me bankrupt, destroy my relationship with Mary. You destroy me mentally ...
Mr Forster: and here, this guy here, is after his 400,000 to make 1.2 million ...
Her Honour: Mr Forster, would you sit down or leave the court please?
Mr Forster: This guy over there is billing, you look at the bills that this guy (indistinct). It's just outrageous.
Her Honour: Could you please restrain your client, Mr Warne.
Mr Forster: And then they talk in that way. Look, I'm a human being and I expect to be treated fairly.
Mr Forster: ... other than having that vulture there that's going to ramp it up to one million, and he double bills for meetings with people and then that. And at the end of the day, someone needs to have a bit of bloody decency around here. It's just unfair. Jesus Christ Almighty. I'll be back at two o'clock, or what 2.30. Bloody parasite ...
Her Honour: Mr Warne, if your client's going to take that attitude in court after lunch, I'll have to consider whether or not it constitutes a contempt in the face of the court."[183]
"Dr Hanscombe: Yesterday afternoon after lunch before your Honour came onto the Bench Mr Forster was seen by everybody present in court to stand in the witness box, face Mr Mann and Mr Williams and taunt Mr Mann as to his marital affairs. After court yesterday when your Honour had risen Mr Forster went across the court in the full view of everybody in court, and taunted both Mr Mann and Mr Williams.
Mr Forster has put to this court, I think on four separate occasions, that he was intimidated. In view of Mr Forster's conduct yesterday, whether Your Honour considers it necessary to direct Mr Mann where to sit is a matter for Your Honour, but in view of Mr Forster's conduct yesterday it cannot be the case that what was put to your Honour that this witness feels intimidated is truthful.
Now, I accept Mr Arthur was putting his instructions, but the conduct yesterday was so egregious that those instructions cannot be truthful."[185]
"Mr Forster: The only - I don't wish to get in - in an - involved in an argument with - with Dr Hanscombe, but the assertions that Dr Hanscombe has put to the court are not accurate, and all I can say is that I think it's preferable that Mr Mann sits behind. I don't intend to have any comments to Mr Mann, or - or Mr Williams and I think it's - that's the most appropriate way for everybody present in this court to behave, but I would say that the assertions made by Mr - Dr Hanscombe are not correct, and I'm not in a position to - I just need to say Your Honour, that that's all I wish to say, thank you."[186] [emphasis added]
"Dr Hanscombe: Thank you, Your Honour. I do seek now to cross-examine this man, and it goes directly to his credit on that issue. (To witness) Mr Forster, you're under oath in that witness box, the Associate warned you when you sat you were still on your oath, correct?
Dr Hanscombe: And you turned to her Honour and you said that what I had said about your conduct was not true, didn't you?
Mr Forster: Were not ... were not a proper picture of what happened, so they're not true ...
Dr Hanscombe: Mr Forster, before the court convened for yesterday afternoon session you stood in that witness box, you turned and faced Mr Mann and you said, 'How's your third marriage going?' or words to that effect, did you not?
Mr Forster: I did not say that and I wasn't in the witness box when there was any discussion, so you're quite incorrect. Any discussion that occurred in court my recollection is it was - it was I was down there, and - and I can assure you there's been other discussions that have occurred in court in this matter. So that - that ...
Mr Forster: Just to clarify, Dr Hanscombe, you said that I made these assertions whilst I was in the witness box and I was standing ...
Dr Hanscombe: I said you stood in the witness box and faced Mr Mann?
Mr Forster: Well it's not correct, the assertions weren't made whilst I was in the witness box and - and respectfully what you've sought in my opinion to - to amplify, and really distract the court from dealing with the issues before it. It's - it's - it's just a red herring in my opinion, but that's your right, I disagree with what you say and it is not a correct assertion of what occurred.
Dr Hanscombe: Mr Forster, did you or did you not ...?
Mr Forster: I've already answered the question, I've already answered ...
Dr Hanscombe: say to Mr Mann words to the effect, 'How's your third marriage going?'
Mr Forster: I said words to the - look, the actual words to the effect were not exactly that. I may have said ..
Mr Forster: Well the words would - would have - I said something to the effect that Mr - Mr Garry Mann who's in a - well, the words were - let - let - let me think exactly what they were. I said something to the effect that you - I think I said that you're in your third broken relationship, and something to the effect that you were having a relationship now with former best man who's a solicitor who you're now having a relationship with the former best mate, and I probably said something to the effect that - words to the effect that Mr Mann is - had about four - four former jobs - words to the effect in respect of his last four positions where he's been employed by solicitors that he's had problems with the solicitors, and I've also said words to the effect something in respect of the Legal Services Board, and the fact that in relation to the Legal Services Board he has lodged a - a complaint with a former solicitor of his that acted in relation to his family law matter.
Dr Hanscombe: Where were you standing when you said it?
Mr Forster: Well, I think the, I think the conversation that we had was somewhere around - around that area, it certainly wasn't in here ...
Dr Hanscombe: You started the conversation, did he answer you?
Dr Hanscombe: You stood, faced him and spoke in a sneering and taunting way, 'how are you getting on with your ex wife number 3'. Isn't that right?
Mr Forster: How are you getting - well, look, I'm sorry, Dr Hanscombe, I don't have the benefit of taking notes at the time. All I can say the thrust of what my conversation with Mr Mann was - was in the fact that he's doing it again, it's the third time or the fourth employer that he's had that he's had these sorts of problems with and that he's had - he's got an - his best mate that he's currently having a relationship with his best mate's wife. Now all those issues were summarised in my comments.
Dr Hanscombe: And you say you're intimidated by this man?
Mr Forster: Of course I'm - I'm intimidated by this man in terms of when I'm giving evidence if I have to look at someone and they're giving me grimaces, et cetera, it is quite difficult. I find that intimidating, and to the other extent I found that his practice is intimidating because essentially all my problems in this matter, why and the reason before this court, is similarly caused by Mr Mann. So I feel intimidated because my career is at stake because Mr Mann has been pursuing me since August 2007 and unfortunately it's not the only person that he's pursued in that way, so he's got a history of doing that sort of thing to other practitioners. There's about four practitioners that have expressed that view to me, two of them his former solicitors that have acted in two of his last two matrimonial disputes.
Dr Hanscombe: And that's why you taunted him about his marital affairs?
Mr Forster: No. Well it's not taunting him. What I'm trying to do I suppose is to try and make people that are supporting Mr Mann in his endeavours to destroy me to make them aware of the issues as to what Mr Mann has done. I wasn't even aware of these issues. I only found out about all this material from another solicitor relatively recently. I didn't look into Mr Mann - I'd moved on from Mr Mann. So I wasn't even aware of all his track history, which is very substantial. I only became aware that in - when I went to a Law Institute seminar two months ago a practitioner who was present there said, you've got Mr Mann and then he started telling me all the problems which was Richmond & Bennison that they had experienced with Mr Mann in his employment at that organisation, and he suggested I speak to other people and then I subsequently spoke to two former lawyers that acted for him in relation to family law matters and they explained to me that the first matrimonial was vicious, the second matrimonial was even further vicious, and then I was further told that now he was in a relationship with a solicitor who was mediating Melbourne Voyager matters, broke up with that solicitor and now he was off side with that solicitor because he now was having a relationship with that person's third wife. So understandably when I paint the things in the context of what I've heard from all these former employees that does lead to a feeling of intimidation, and that's understandable. It's very understandable, Dr Hanscombe.
Dr Hanscombe: When you said to Her Honour that what I had asserted you had done, which was to taunt this man about his marital affairs, you said to Her Honour that that was not truthful. That was wrong, wasn't it?
Mr Forster: No. Look I'm putting it in a context. Obviously the purpose ...
Mr Forster: Look can I just explain why I said it. Mr Blair Williams was an employee of mine for four years approximately. Mr Blair Williams is in court next to Mr Garry Mann. The other person that's been in court is Mr ...
Dr Hanscombe: Would you answer my question, Mr Forster. What you said to her Honour this morning was, wrong wasn't it?
Mr Forster: My - my answer is - it's got to be put in a context. Obviously at the time it's not - it is emotive, I accept that."[187]
"I apologize for my discourteous language. My emotional comment that Dr Hanscombe was a monster was not made during the court hearing and I was upset about her previous conduct towards me.
Given the great stress that I was under a reprimand is a more appropriate penalty."
"At the conclusion of the hearing [on 12 April 2010] after Emerton J had made the order appointing the Receivers, I recall observing shortly thereafter, Dr Hanscombe look around to Gary Mann who was sitting at the left rear of the Court room. I saw Gary Mann smile and gesticulate with a thumbs up gesture towards Dr Hanscombe and Dr Hanscombe appeared to me acknowledge the gesture from Mr Mann by smiling at him. Mr Mann had attended Court during the trial of the receivership application on numerous occasions."
"Mr Senathirajah: You said that the matters in that affidavit - sorry, that statement - are true and correct?
Mr Senathirajah: If you turn to p.22, it's the last page? Page 22.
Mr Senathirajah: I want you to have a look at the third sentence in the second paragraph commencing, "I have found it very difficult"?
Mr Senathirajah : Yes, "Coping with the situation, particularly when as soon as the appointment of the receiver was made Mr Mann gave a thumbs up signal to Ms Rivalland and was acknowledged immediately thereafter the thumbs down to me"?
Mr Senathirajah: Is that your evidence to His Honour?
Mr Forster: I'm just thinking. I'm not sure if it was Ms Rivalland or is it Dr Hanscombe that's - - -
Mr Senathirajah: That's your evidence when you - - -?
Mr Forster: Yes, no, I'm just trying - I'm just - I'm just - sorry - yes, I think that's correct. Yes, that's correct.
Mr Senathirajah: Is that on 12 April, upon Justice Emerton making the order appointing receivers to your practice Mr Mann gave a thumbs up signal to Ms Rivalland and the thumbs down signal to you. That's your sworn evidence to His Honour?
Mr Senathirajah: That didn't happen did it? Mr Mann did not give a thumbs up signal to Ms Rivalland?
Mr Forster: Well he did. He gave - and he's given a number of signals to me during the course of the proceeding.
Mr Senathirajah: You say to His Honour that you saw that - that is that you saw?
Mr Senathirajah: And similarly, you say that you saw Mr Mann give you the thumbs down?---This - this is the situation, this is at the end isn't it, it's the last day of the case?
Mr Forster: No, I - - -?---I'm just trying to - - -
Mr Forster: I'm just - I'm just - all I can remember is that when - when it happened, Mr Mann - Mr Mann did something like that to me and then he did something like that
Mr Senathirajah: To Ms Rivalland, that's your evidence?
Mr Forster: That's - that's - that's my recollection, unless I'm getting terribly confused that it's Dr Hanscombe but I'm pretty sure it's - - -
Mr Senathirajah: Yes and this happened - now I've put this to you now three times, I will make it a fourth time?
Mr Senathirajah: This happened when Her Honour, on 12 April, pronounced orders appointing a receiver to you practice. That's the evidence you're giving to His Honour?
Mr Forster: I'm sorry, just - yes, I think so - unless I've got terribly confused but all I - all I - my reflection is that all I can say is that I remember the date when - I remember that Mr - sorry, Mr Mann made his thumbs down and then he gave a thumbs up signal.
Mr Senathirajah: Mr Forster do you want me to ask it a fifth time?
Mr Senathirajah: That's your words - did you draft that witness statement?
Mr Senathirajah: Yes, and you knew you were going to adopt it in the witness box when you drafted it?
Mr Senathirajah: And you know the importance of giving evidence on oath?
Mr Senathirajah: So, is that the evidence you wish to give to His Honour, that on 12 April when Her Honour pronounced the orders appointing a receiver or receivers to your practice, you saw Mr Mann (a) give a thumbs up to Ms Rivalland and (b) give you the thumbs down?
Mr Forster: Well the only - look, the only - I probably - to be 100 per cent sure, it hasn't got the date on that statement but I'm - all I can recall is that it was on the day when the receiver was appointed.
Mr Senathirajah: Take it from me that that's 12 April?
Mr Senathirajah: Because you then had cross-examined Ms Rivalland about that?
Mr Senathirajah: You wouldn't have cross-examined a witness if you weren't sure what had happened?
Mr Forster: No, I'm just - sorry - I'm just getting a bit tired and - and what - what I say happened happened, that's all I can say. I can't be any clearer than that.
Mr Senathirajah: And you in fact took the next step of calling your own counsel, Mr Arthur, to give evidence about it. Do you remember that?
Mr Forster: Yes. Yes, Mr Arthur gave evidence about it as well. Yes, that's correct.
Mr Senathirajah: And this is the position: none of that is true. You weren't there. You had stormed out of court by that stage?
Mr Forster: Well, that's - the appointment of - the appointment of the receiver, I stormed out of court. I do recall that.
Mr Senathirajah: So what you've just told His Honour now on four occasions is not true. You didn't see Mr Mann give the thumbs up to Ms Rivalland and you didn't see him give you the thumbs down because you weren't there?
Mr Forster: All I can recall is in terms of what I saw. I said I saw Mr Mann give his thumbs down and the signal was reciprocated with Ms Rivalland.
Mr Senathirajah: You were here, Mr Forster, when I cross- examined your counsel Mr Arthur and he said that you were not there?
Mr Forster: He did say that, yes, and I remember him - I do recall that.
Mr Senathirajah: So what you've told His Honour now four times is simply not true?
Mr Forster: I do recall Mr - I do recall Mr Arthur - I do recall Mr Arthur telling me that that's what he observed. Now, whether or not I've got the two dates - it may be that I've got the dates confused, that the first date, which was the date when the court handed down her judgment - because I do know - I do recall that I left - I do recall that I left ---
Mr Senathirajah: You're now telling more lies. Mr Arthur wasn't there when judgment was handed down. It was only you and I on 31 March?
Mr Senathirajah: This is your evidence. You just told His Honour that you were getting confused with the date on which Her Honour handed down judgment?
Mr Senathirajah: Your evidence, Mr Forster. You tell His Honour what you meant by that evidence?
Mr Forster: Well, the - there was a lengthy trial and at the end of that trial, Your Honour, the - I can't be any clearer. All I can say is that when I did that statement I believe that that's true. I have a very strong recollection of Mr Mann with his signal. My recollection is that it occurred at the end of - at the end of the process when a decision was handed down. Now, if I've got it wrong and it's the decision being handed down on the first time - because I do recall that when I left - look, I can't be any clearer. All I could say is that the time when I left the court and I was fairly distressed - I'd have to be refreshed. What date was that? The date that I left the court ---
Mr Senathirajah: Mr Forster, this is your statement which you've adopted in the box?
Mr Senathirajah: Now, you've given evidence that you drafted it, correct?
Mr Senathirajah: And you say there that what occurred that you've described there occurred on the date Her Honour made orders appointing the receivers?
Mr Forster: All - look, I can't make myself and clearer than to say - is this: all I remember is that there was a decision that was handed down and the decision was effectively that I was down the gurgler, or whatever, and what Mr Mann did is he did his thumbs down decision - his thumbs down, and Ms Rivalland did - acknowledged it. Now, I can't - it can't have been the time when I left the court distressed because - you'd have to tell me what date that was.
Mr Forster: That was the date when I left and the receiver was appointed?
"We enclose copies of adjustment notes and your trust statement.
The current amount outstanding on your accounts is $3,576.36 plus interest, further, we currently have over $12,000 of unbilled disbursements. As previously advised we will write all of these off, provided you do not wish us to incur the further expense of providing a detailed itemised account. This is your entitlement.
However, having regard to the large reduction offered on your accounts, and the interest which was not paid on your earlier outstanding disbursement accounts, it is in your interest to accept these accounts. Should you still require an itemised account we will do same and we expect any new account to be larger than the interim account already provided as not all work was charged for. Please ring David to discuss if you still wish an itemised account."[205]
"And it's a matter for Your Honour whether or not one could make that out as a charge and no charge is laid; it's a matter for Your Honour whether that is in fact a proper way for the solicitor to deal with his clients who were elderly, and who of the very nature of their cases, had psychiatric injuries. They were vulnerable people, and the board does consider it relevant that they are written to in those terms."[207]
"'Good character' is not a summation of acts alone, but relates rather to the quality of a person. The quality is to be judged by acts and motives, that is to say, behaviour and the mental and emotional situations accompanying that behaviour. However, character cannot always be estimated by one act or one class of act. As much about a person as is known will form the evidence from which the inference of good character or not of good character is drawn."[211]
"Character involves, inter alia, two things: the acceptance of high standards of conduct; and acting in accordance with those standards under pressure. Character is tested not by what one does in good times but in bad."[213]
REVISED ISSUE ESTOPPEL RULING OF 17 AUGUST 2011
"A judicial determination directly involving an issue of fact or of law disposes once for all of the issue, so that it cannot afterwards be raised between the same parties or their privies. The estoppel covers only those matters which the prior judgment, decree or order necessarily established as the legal foundation or justification of its conclusion, whether that conclusion is that a money sum be recovered or that the doing of an act be commanded or be restrained or that rights be declared. The distinction between res judicata and issue estoppel is that in the first the very right or cause of action claimed or put in suit has in the former proceedings passed into judgment, so that it is merged and has no longer an independent existence, while in the second, for the purpose of some other claim or cause of action, a state of fact or law is alleged or denied the existence of which is a matter necessarily decided by the prior judgment, decree or order.
...the judicial determination concludes, not merely as to the point actually decided, but as to a matter which it was necessary to decide and which was actually decided as the groundwork of the decision itself, though not then directly the point at issue. Matters cardinal to the latter claim or contention cannot be raised if to raise them is necessarily to assert that the former decision was erroneous."
"In Ramsay v Pigram (40), Barwick CJ encapsulated what was involved in answering the question by saying:
Long standing authorities, in my opinion, warrant the statement that, as a mechanism in the process of accumulating material for the determination of issues in a proceeding between parties, an estoppel is available to prevent the assertion in those proceedings of a matter of fact or of law in a sense contrary to that in which that precise matter has already been necessarily and directly decided by a competent tribunal in resolving rights or obligations between the same parties in the same respective interests or capacities, or between a privy of each, or between one of them and a privy of the other in each instance in the same interest or capacity. The issue thus determined, as distinct from the cause of action in relation to which it arose, must have been identical in each case."
"(a) to ensure the effective regulation of the legal profession and the maintenance of professional standards;
(b) to address the concerns of clients of law practices and legal practitioners through the regulatory system and provide for the protection of consumers of legal services;
(c) to ensure the adequate management of trust accounts;
(d) to ensure that the Victorian system is at the forefront of regulation of legal practitioners."
[1] S 2.4.37(3) of the Legal Profession Act 2004.
[2] See generally Seachange Management Pty Ltd v Bevnol Constructions and Developments Pty Ltd and ors [2008] VCAT 1479.
[3] (1996) ATPR 41-507; 43,341.
[4] (1996) ATPR 41-507, 43,341, 43,347.Also see Rajski v Scitec Corporation Pty Ltd [1986] NSWCA 1.
[5] Australian Institute of Judicial Administration, 'Litigants in Person Management Plans: Issues for Courts and Tribunals' (2001) 4-8.
[6] For example Tn 1007 lines 23-31 and 1008 lines 1-8
[7] Stanoevski v Council of the Law Society of New South Wales [2008] NSWCA 93 [58] (Campbell JA, Hodgson JA and Handley AJA agreeing).
[8] Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd [1992] HCA 66; (1992) 110 ALR 449, 449-50 (Mason CJ, Brennan, Deane and Gaudron JJ).
[10] See generally Ex parte Munro; Re Legal Practiioners Act (1969) 71 SR (NSW) 448, Walter v Council of Queensland Law Society Inc [1988] HCA 8; (1988) 77 ALR 228, 235 (Mason CJ, Wilson, Deane, Toohey and Guadron JJ); Wentworth v New South Wales Bar Association [1992] HCA 24; (1992) 176 CLR 239, 251 (Deane, Dawson, Toohey and Gaudron JJ).
[35] Legal Profession Regulations 2005 (Vic) reg 3.3.34.
[36] Legal Service Board v David Brian Forster [2010] VSC 102.
[39] For example, Transcript of Proceedings, David Forster v Legal Services Board (Victorian Civil and Administrative Tribunal, J102/2010, President Justice Ross, 17 August 2011 - 15 September 2011) ('VCAT Tn') 1067 lines 28-31; 1068 lines 1-8; 1071 lines 29-31; 1080 lines 22-31; 1081 lines 1-21; 1103 lines 15-18; 1110 lines 8-28; 1184 lines 12-14; 1276 line 13; 1047 lines 26-31; 1048 lines 1-8 and 1158 line 15.
[40] VCAT Tn 1183 line 12; 1254 lines 15-16; 1296 line 26 and 1339 line 24.
[41] VCAT Tn 1091 line 27 and 1092 line 1.
[42] See Tab 4, Volume 1 of the Applicant's materials in David Forster v Legal Services Board (Victorian Civil and Administrative Tribunal, J102/2010, President Justice Ross, 17 August 2011 - 15 September 2011 ('Applicant's VCAT materials').
[44] [2010] VSC 102 [295].
[50] For example see VCAT Tn 1424 lines 21-31 and 1425-1427.
[53] VCAT Tn 1274 line 23 to 1275 line 11.
[55] VCAT Tn 1278 line 23 to 1279 line 16.
[56] Exhibit LSB-55 in David Forster v Legal Services Board (Victorian Civil and Administrative Tribunal, J102/2010, President Justice Ross, 17 August 2011 - 15 September 2011 ('VCAT Ex') and VCAT Tn 1281 lines 11-6 and T1282 lines 5-6.
[59] VCAT Tn 1278 line 23 - T1279 line 15.
[60] VCAT Tn 1286 line 30 - 1288 line 3.
[61] Legal Services Board v Forster [2010] VSC 102 [206].
[78] Transcript of Proceedings, Legal Service Board v David Forster (Supreme Court of Victoria, 6947/2009, Justice Emerton, 9 November 2009 - 21 May 2010) ('Supreme Court Tn') 125 lines 1-29.
[79] VCAT Tn 798 lines 28-29, 799 lines 3-5 and 9-16.
[80] VCAT Tn 802 lines 22-31 and 803 lines 1-13.
[82] VCAT Tn 805 lines 10-2 and 25-31 and 806 lines 1-4.
[83] VCAT Tn 806 lines 23-31 and 807 line 1, lines 5-6 and 14-29.
[85] Applicant's VCAT materials, Tab 1, Volume 3 (statement dated 31 August 2011).
[86] VCAT Tn 920 line 31 and 921 lines 1-13.
[89] VCAT Tn 802 line 25 - 803 lines 2-13.
[92] For example, VCAT Tn 797 line 26 - 799 line 25.
[94] VCAT Tn 1267 lines 27-31 and 1268 lines 1-17.
[96] VCAT Tn 1269 line 14 - 1271 line 5.
[97] Applicant's VCAT materials, Tab 41 Volume 3.
[101] VCAT Tn 1147 lines 29-31 and 1148 lines 1-2.
[102] For example, VCAT Tn 683 lines 8-16; 783 line 19 - 784 line 24.
[104] VCAT Tn 1150 line 26 - 1151 line 1.
[107] Supreme Court Tn 1192 lines 25-26.
[108] Supreme Court Tn 1336 lines 1-4.
[109] See Tab 37, Volume 2 of the Board's materials in David Forster v Legal Services Board (Victorian Civil and Administrative Tribunal, J102/2010, President Justice Ross, 17 August 2011 - 15 September 2011 ('Board's VCAT materials').
[110] Supreme Court Tn 235 lines 2-22.
[111] Supreme Court Tn 311 lines 18-21.
[112] Supreme Court Tn 1386 lines 1-26.
[113] The document in question exhibited to the defendant's affidavit had a handwritten notation, "executive council". There was evidence before the Court that the document produced on subpoena by the LIV did not have the notation.
[114] VCAT Tn 896 line 19 - 897 line 9; see also 1038 line 23 - 1039 line 5.
[116] Board's VCAT materials, Tab 20, Volume 1.
[117] VCAT Ex LSB-32, [11.1-2 and 11.10].
[119] VCAT Tn 1035 lines 1-2 and 1035 line 21.
[125] VCAT Tn 1039 lines 27-9 - 1040 lines 9-12.
[126] VCAT Tn 1040 line 28 - 1041 line 9.
[130] Rondel v Worsley [1969] 1 AC 191, 227; Vernon v Bosley (No 2) [1999] QB 18; Unioil International Pty Ltd v Deloitte Touche Tohmatsu (No 2) (1997) 18 WAR 190, 193 (Ipp J); Kyle v Legal Practitioners' Complaints Committee [1999] WASCA 115; (1999) 21 WAR 56.
[131] Barristers' Board v Young [2001] QCA 556 [42] (Mackenzie J).
[132] (1994) 34 NSWLR 408, 445-6.
[133] Kyle v Legal Practitioners' Complaints Committee [1999] WASCA 115; (1999) 21 WAR 56; See generally David Andrew Ipp, 'Lawyers Duties to the Court' (1998) 114 Law Quarterly Review 63.
[134] (1962) 80 WN (NSW) 968. Also see NSW Bar Association v Cummins [2001] NSWCA 284; (2001) 52 NSWLR 279, 290 [59] (Spigelman CJ).
[137] VCAT Tn 1059 line 20 - 1060 line 23.
[141] Legal Services Board v Forster [2010] VSC 102.
[142] Supreme Court Tn 1105 lines 12-31 - 1106 lines 9-10.
[143] Supreme Court Tn 1391lines 26-7.
[147] VCAT Tn 1397 line 1 - 1398 line 30.
[149] VCAT Tn 1391 line 15 - 1393 line14.
[151] VCAT Tn 1113 lines 2-9, 1115 line 11 and 1122 lines 7-9.
[152] VCAT Tn 1402 line 13 - 1404 line 12.
[154] Transcript of Proceedings, David Forster v Legal Services Board (Victorian Civil and Administrative Tribunal, J102/2010, President Justice Ross, 24 June 2011) ('VCAT Directions Hearing 1') 34 lines 25-31.
[158] Ibid 40 lines 22-31 and 41 lines 1-3.
[160] VCAT Tn 353 line 25 - 354 line 25.
[161] VCAT Tn 378 lines 24-31 - 379 lines 1-3.
[163] VCAT Tn 380 lines 24-7, 381 lines 5-13, 390 lines 18-25.
[166] VCAT Tn 1074 lines 27-31- 1075 lines 1-12.
[169] Supreme Court Tn, 17 February 2011, 18, lines 3-6.
[170] Ibid 19 lines 29-31, 20, line 1.
[173] VCAT Tn 937 lines 3-10, 945 lines 14-26.
[177] Applicant's VCAT materials, Tab 3, Volume 3.
[178] VCAT Tn 937 lines 16-17; 945 line 27 - 946 line 10.
[179] VCAT Tn 947 line 22, to 950 line 9.
[182] Supreme Court Tn, 16 February 2011, 21 lines 1-5.
[183] Supreme Court Tn 73 lines 23-31 and 74 lines 1-19.
[185] Supreme Court Tn, 19 November 2009, 590 lines 10-28.
[188] Applicant's VCAT materials, 22 Tab 1, Volume 3 Tab 1.
[191] VCAT Tn 977 line 31 - 978 line 1.
[195] VCAT Tn 1347 lines 20-25; 1349 lines 1-10.
[198] VCAT Tn 1350 line 27 - 1351 line 23.
[199] Applicant's VCAT materials, Tab 50, Volume 3.
[203] A copy of her Honour's order is set out in the Board's VCAT materials, Tab 53, Folder 4.
[204] Board's VCAT materials tabs 57-61, Volume 4.
[205] Board's VCAT materials, Tab 57 Volume 4.
[206] Supreme Court Tn 909 lines 17-8.
[208] In particular, I would have provided that Mr Forster only be permitted to engage in supervised legal practice and that he not be authorised to receive trust money.
[209] Melbourne v The Queen (1999) 198 CLR 1, 25 [66] (Gummow J).
[210] (1966) 67 SR (NSW) 448, 475-6.
[211] Cited with approval in Melbourne v The Queen, op cit and Jackson (previously known as Subramaniam) v Legal Practitioners Admission Board [2006] NSWSC 1338 [55] (Johnson J).
[212] (1994) 34 NSWLR 408, 408.
[213] Cited with approval in Prothonatory of the Supreme Court of New South Wales v Nikolaidis [2010] NSWCA 73 [21] (Allsop P, McColl and Young JJA).
[214] NSW Bar Association v Evatt [1968] HCA 20; (1968) 117 CLR 177, 183-4.
Forster
Legal Services Board
(1988) 77 ALR 228
(1992) 176 CLR 239
(1997) 18 WAR 190
(1999) 21 WAR 56
(1994) 34 NSWLR 408
(2001) 52 NSWLR 279
(1999) 198 CLR 1
(1968) 117 CLR 177
(1939) 62 CLR 464
(2004) 220 CLR 363