[2014] ACTSC 352

Appeal allowed in part. The proceedings be remitted to ACAT to consider penalty. Parties to file submissions on costs.

PROFESSIONS AND TRADES - Lawyers - appeal against findings of unsatisfactory professional misconduct or professional misconduct - whether ACT Civil and Administrative Tribunal erred in fact-finding - whether procedural fairness afforded - finality of proceedings

ACT Civil and Administrative Tribunal Act 2008 (ACT)

Legal Profession Act 2006 (ACT)

Legal Profession Regulation 2007 (ACT)

Legal Profession (Solicitors) Rules 2007 (ACT)

Burrell v the Queen [2008] HCA 34; (2008) 238 CLR 218

Chandler v Alberta Association of Architects [1989] 2 SCR 848

Grierson v The King [1938] HCA 45; (1938) 60 CLR 431

House v The King [1936] HCA 40; (1936) 55 CLR 499

King v Health Care Complaints Commission [2011] NSWCA 353

Legal Practitioner v Council of the Law Society of the ACT [2014] ACTSC 256

Lucire v Health Care Complaints Commission [2011] NSWCA 99

Michael Wilson & Partners v Nicholls [2011] HCA 48; (2011) 244 CLR 427

Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597

Smith v New South Wales Bar Association [1992] HCA 36; (1992) 176 CLR 256

The Legal Practitioner v Council of the Law Society of the ACT (2011) 257 FLR 118; [2011] ACTSC 207

The Legal Practitioner v Council of the Law Society of the Act [2014] ACTSC 50

Court/Tribunal: ACT Civil & Administrative Tribunal

Before: J Gallop (Senior Member Presiding), J Lennard (Senior Member) and G Wright (Member)

Case Title: Council of the Law Society of the ACT v The Legal Practitioner E

Citation: [2013] ACAT 7

1. The appellant (the practitioner) was an Australian legal practitioner who practised in the ACT as a sole practitioner with an unrestricted practising certificate.

2. The practitioner has appealed against a decision of the ACT Civil and Administrative Tribunal (the tribunal) finding him guilty of professional misconduct and recommending that his name be removed from the local roll and that he be publicly reprimanded.

3. The tribunal proceedings arose from complaints about trust fund dealings made by three former clients of the practitioner (FB, BB and SS). The complaints concerned the misappropriation of trust funds, demands by the practitioner for cash payments, the failure to give receipts for cash payments, the failure to deposit monies into the practitioner's trust account and to issue trust account receipts, the failure to render invoices, the transfer of monies from the practitioner's trust account to the practitioner as payment for legal fees without supporting invoices and authorities, and the failure to issue trust account statements.

4. Pursuant to s 419 of the Legal Profession Act 2006 (ACT) (the Act), the Council of the Law Society of the ACT (the Council) applied to the tribunal for an order in relation to the complaints, asserting that the practitioner was guilty of professional misconduct or, alternatively, unsatisfactory professional conduct on 19 grounds: Appeal Book (AB) 110-124.

5. On 24 January 2013, the tribunal found that 17 grounds were made out and found the practitioner guilty of professional misconduct under the Act: AB 37-70. Without inviting submissions on penalty, the tribunal recommended that the practitioner's name be removed from the local roll and that he be publicly reprimanded.

7. After the appeal was filed, at the invitation of the Council, the tribunal reopened the penalty proceedings. The practitioner contended that the tribunal was functus officio and he declined to present further submissions. On 8 July 2013, the tribunal reimposed the original penalty: AB 15-34.

8. On 2 August 2013 the appeal was removed to this Court by the tribunal pursuant to s 83(1) of the ACT Civil and Administrative Tribunal Act 2008 (ACT) (ACAT Act).

9. In March 2007, SS and her former husband instructed the practitioner to act for them. SS said that she paid the practitioner $6,000 in cash.

10. SS alleged that thereafter she made weekly cash payments to the practitioner of $1,000 and then $500 until December 2008 (a total of about $75,000).

11. There was no dispute that SS paid the practitioner $6,000 on 6 January 2009.

12. BB engaged the practitioner to act for her brother, MB. BB alleged that, between May 2007 and June 2009, she paid more than $90,000 to the practitioner. The practitioner said that ten invoices totalling $46,231.80 were issued, but BB said that she received only four of the 10 invoices, reflecting a total amount of $15,561.00. On 1 July 2008, she paid the practitioner $26,000 for trial fees. There is no dispute that, at or about that time, she had a conversation with the practitioner to the following effect (AB 1014 [77]):

Practitioner: You need to give me money in trust for the trial. [Barrister engaged by the appellant] wants to see that there is money in trust for his fees before the trial.

BB: OK, how much do you need?

Practitioner: $20,000 for ... [the barrister's] fees and $9,000 for my fees for the trial.

BB: OK - I'll give you $20,000 for ... [the barrister's] fees and $6,000 for your fees. I'll pay you the extra $3,000 for your fees at the time of the trial.

13. In late 2007 the practitioner began to act for FB. In November 2008, he received a settlement cheque for $123,091 in relation to the sale of FB's house.

14. The practitioner denied that he was under financial stress in 2009, but the Council furnished evidence from a financial analyst showing that the practitioner had exceeded his credit card limits, his office rent was paid irregularly, he was unable to service loans and that he banked more money than he disclosed to the Australian Taxation Office.

15. In relation to the $6,000 that SS paid to the practitioner on 6 January 2009, SS said that the payment was a loan. She said that, when the practitioner asked for a further loan, she refused, and she sought repayment of the first loan. On 28 April 2009, the practitioner gave SS a cheque for $3,500 by way of part payment. These monies were drawn on FB's trust monies.

16. FB alleged that, on 10 March 2009, the practitioner asked her for a loan of $10,000. He made out a cheque to her for $15,000 drawn on her trust funds, which enabled her to lend $10,000 to the practitioner on 19 March 2009. In late August/early September 2009, he asked her for a further loan of $10,000, but she refused. The practitioner conceded that, on 31 August 2009, he transferred $10,000 from FB's trust monies to his office account. FB said that this transfer was unauthorised.

17. On 9 September 2009, FB made a complaint. On 11 September, records were collected from the practitioner's office.

19. It was agreed that on 30 November 2009, the practitioner responded to the complaints by FB and BB.

20. Between 31 March 2010 and 12 April 2010, FB's new solicitors corresponded with the practitioner regarding the release of FB's files and the return of her trust monies.

21. On 1 July 2010, a manager was appointed to the practitioner's practice and on 5 July the manager gained access to the practitioner's office.

22. On 18 August 2010, the Law Society filed an application for disciplinary action in the tribunal. As noted above, the proceedings before the tribunal were finally decided on 8 July 2013.

23. The grounds that were pressed on the appeal can be summarised as follows.

The tribunal erred in finding that the practitioner had withdrawn $3,500 from FB's trust ledger and paid it to SS without instructions to do so. In reaching this finding, the tribunal erred in rejecting the practitioner's file note dated 28 April 2009, which purported to document such instructions.

The tribunal erred in finding, in August 2009, the practitioner withdrew $10,000 from FB's trust ledger without authority. The tribunal erred in finding that the practitioner had lied in relation to the withdrawal, in rejecting a file note that purported to document instructions to make the withdrawal, in finding that the practitioner had borrowed $10,000 from FB on 10 March 2009, and in accepting the evidence of FB's daughter that corroborated the making of the loan.

The tribunal erred in finding that the practitioner had withdrawn $33,215 from FB's trust ledger without providing a tax invoice or written notice of withdrawal.

The tribunal erred in finding that the practitioner had breached rule 6.2 of the Legal Profession (Solicitors) Rules 2007 (ACT) (the Rules) by failing to release FB's files to her new solicitors and failing to explain the lien that he claimed over the file.

The tribunal erred in finding that the practitioner had breached regulation 57 of the Legal Professional Regulation 2007 (ACT) (the Regulation) by failing to issue trust account statements for the disbursement of monies beyond June 2008, and by failing to issue trust account statements beyond 26 October 2008 for the amounts of $26,000 paid to the practitioner on 1 July 2008 by BB and $5,000 on 1 July 2009.

The tribunal erred in finding that the practitioner had failed to deposit into his trust account the sums of $6,000, weekly payments of $1,000 and the sum of $500 received from SS in 2007-08. The tribunal should have rejected the evidence of SS; it erred in finding that the payments had been made but the practitioner had not issued receipts, and it erred by ignoring the evidence of Dr Hassall of counsel that he had not been paid.

The tribunal erred in finding that the practitioner had failed to deposit into his trust account amounts totalling $18,605 received on behalf of MB.

The tribunal erred in finding that the practitioner had failed to hold trust account deposits exclusively for MB, on whose behalf the monies were received.

The tribunal erred in finding that the practitioner had failed to account for sums of $26,000 (paid on 1 July 2008), $5,805 (paid on 16 July 2007), $5,800 (paid on 30 June 2008) and additional amounts totalling $17,888 paid by BB. The tribunal erred in finding that the practitioner had failed to issue a receipt for trust monies, had breached regulation 62 by withdrawing trust monies without authority, had ignored a costs agreement with MB, and had made an unauthorised transfer of funds between trust ledgers.

Having found the practitioner guilty of professional misconduct, the tribunal failed to afford him procedural fairness (an opportunity to be heard) before imposing a penalty.

24. The practitioner contends that the matter should be referred back to a differently constituted tribunal.

25. The practitioner conceded that, apart from Grounds 1.15, 3.6 and 4, the grounds of appeal challenge factual findings that turned on an assessment of the witnesses and the documentary exhibits. In other words, to successfully challenge the tribunal's decision the appellant must demonstrate that the tribunal's credit-based conclusions were contrary to "incontrovertible facts or uncontested testimony" or were "glaringly improbable" or "contrary to compelling inferences", upon due allowance being made for the advantages enjoyed by the trial tribunal: Fox v Percy [2003] HCA 22; (2003) 214 CLR 118 per Gleeson CJ, Gummow and Kirby JJ at [28]-[29].

26. The parties noted that, in relation to a finding of professional misconduct, the relevant standard of proof is that referred to in Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336. When considering whether it was comfortably persuaded of the relevant facts on the balance of probabilities, it was necessary for the tribunal to have regard to the seriousness of the allegations and the gravity of the potential consequences. At AB 41 (J [15]), the tribunal noted that it was applying the Briginshaw test.

An appeal tribunal may, as the tribunal considers appropriate, deal with an appeal -

(b) as a review of all or part of the original decision on the application by the tribunal.

1. Removal of applications from tribunal to Supreme Court

(1) If the parties to an application or an appeal (a matter) jointly apply to have the matter removed to the Supreme Court, the tribunal must order that the matter be removed to the Supreme Court.

(2) If a party to a matter applies to have the matter removed to the Supreme Court, the tribunal may, if it considers it appropriate, order that the matter be removed to the Supreme Court.

28. As stated above, the matter was removed to the Supreme Court under s 83(1).

29. In The Legal Practitioner v Council of the Law Society of the ACT (2011) 257 FLR 118; [2011] ACTSC 207 at [39]-[41], Refshauge J distinguished the Court's jurisdiction under s 83 from its appellate jurisdiction under s 86 of the ACAT Act. His Honour concluded that, if proceedings are removed to the Supreme Court under s 83, the Court exercises the jurisdiction of the tribunal, including the s 82 power to decide the nature of the appeal. However, in The Legal Practitioner v Council of the Law Society of the Act [2014] ACTSC 50 at [36], Penfold J was unconvinced that the ACAT Act intended to burden this Court with the de novo hearing of matters previously heard by the tribunal at first instance. In an earlier application in this matter (Legal Practitioner v Council of the Law Society of the ACT [2014] ACTSC 256 at [8]) I adopted the approach of Refshauge J, observing that "pursuant to s 82 it would seem that the "appeal tribunal" may either deal with the appeal as a hearing de novo, or deal with it as a review appeal".

30. In any event, the parties proceeded on the basis that this appeal should be by way of review under 82(b) of the ACAT Act. It was agreed that, on such an appeal, the appellant must demonstrate error. As explained in House v The King [1936] HCA 40; (1936) 55 CLR 499 at 504-505:

It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.

The Legal Profession Act 2006

31. Section 387(1)(b) and s 387(2) provide:

(b) conduct of an Australian legal practitioner whether happening in connection with the practice of law ... that would, if established, justify a finding that the practitioner is not a fit and proper person to engage in legal practice.

(2) For finding that an Australian legal practitioner is not a fit and proper person to engage in legal practice as mentioned in subsection (1), regard may be had to the suitability matters that would be considered if the practitioner were an applicant for admission to the legal profession under this Act or for the grant or renewal of a local practising certificate.

Without limiting section 386 or section 387, the following conduct can be unsatisfactory professional conduct or professional misconduct:

(a) conduct consisting of a contravention of this Act;

33. Section 11(1) provides that suitability matters include:

(a) whether the person is currently of good fame and character;

(j) whether the person has contravened, in Australia or a foreign country, a law about trust money or trust accounts;

34. The relevant provisions concerning trust accounts are ss 222, 223, 229, 230 of the Act, regulations 38, 57 and 62 of the Regulation, and rule 6.2 of the Rules.

Findings of the tribunal on witness credibility

35. At AB 44 (J [23]), the tribunal found the complainants to be credible witnesses whose evidence was clear and largely unchallenged or unshaken in cross-examination, and who impressed as giving thoughtful and truthful answers. It found that BB's evidence was entirely unshaken in cross-examination. At AB 44 (J [24]), it found that the subsidiary witnesses called by the Council were also believable and that the evidence of the subsidiary witnesses was consistent with evidence of the complainants and corroborated them in important respects.

36. On the other hand, the tribunal's findings about the practitioner's credibility were damning. At AB 44-45 (J [25]), the tribunal said:

[25] The practitioner consistently denied the obvious and asserted the implausible. He was often evasive or resorted to obfuscation when confronted with objective evidence which contradicted his version of events. At times, the evidence of the practitioner was farcical. His evidence should not be accepted in many important areas. He was not able to give clear or convincing evidence about, or explanations for, his conduct on several crucial issues. In general, the evidence before the tribunal revealed a legal practitioner whose record keeping and accounting practices were unprofessional, haphazard and often retrospective.

37. At AB 45 (J [26]), the tribunal commented on the practitioner's "unsatisfactory attitude towards the proceedings".

[28] When taken together, the practitioner's responses to the original complaints and the evidence given by him in affidavits and orally provide no credible explanation for the many events that called for explanation or clarification. Under cross-examination he was evasive and tended to obfuscation. His answers revealed that he had little appreciation of his duty to his clients or of his obligations in relation to trust moneys received.

Grounds 1.1, 1.2 and 1.3: Payment of $3,500 from FB's trust monies to SS on 28 April 2009

39. Relevantly, s 223(1) of the Act requires that trust monies be held exclusively for the person on whose behalf the money is received and be dispersed only in accordance with a direction given by that person. Section 230 of the Act provides that a practitioner commits an offence if the practitioner causes a deficiency in any trust account or trust ledger account.

40. The tribunal found that the practitioner breached s 223(1) of the Act by failing to hold trust money in the trust account of his practice exclusively for FB, on whose behalf the money was received, and had breached s 230 of the Act by causing deficiencies in his trust account: AB 48 (J [42]). He did so on 28 April 2009 by paying $3,500 from FB's trust ledger to SS without instructions.

41. There was no dispute that, on 6 January 2009, SS paid $6,000 to the practitioner and that, on 28 April 2009, the practitioner gave SS a cheque for $3,500, drawn on FB's trust monies. The question was whether SS had instructed the practitioner to do so.

42. The practitioner asserted that the payment had been made at the request of FB. In support of this contention, he relied on a cheque butt stating "SS as instructed by FB - $3500" and produced a file note dated 28 April 2009 that purported to be a contemporaneous record of instructions received from FB.

43. In effect, the tribunal found that the file note had been fabricated.

44. On the appeal, the practitioner submitted that the late emergence of the file note did not reflect adversely on its authenticity and that there was "no evidence to demonstrate that the file notes are anything other than a genuine contemporaneous record". The practitioner abandoned an alternative contention to the effect that "the file note could well have been written at a later time and yet accurately reflect (FB's) instructions".

(FB)

28/4/9

3:35pm

Telephoned me and said (SS) is in need for $5000 but write her a cheque from my money for $3500 only.

I told her I need a written authority for that. She said just give it to her and I will

come later to give you the written authority. She needs the money urgently.

I telephoned (SS) and told her (FB) told me to write you a cheque for

$3500.00. When can you come and get.

Said I do not have a car and I need it before bank closes.

I told her that I will drop it right now.

I [illegible] , delivered [illegible]

4:15pm

46. After referring to the practitioner's case that the file note was a contemporaneous record of FB's instructions, at AB 48 (J [40] - [41]) the tribunal said:

[40] Both SS and FB gave evidence to the contrary. Telephone records for the practitioner's and FB's office and mobile telephones do not show any call made by FB to the practitioner on 28 April 2009. The records of the practitioner's mobile phone show that he called SS three times on 28 April 2009. The evidence establishes that he wrote a cheque for $3,500 to SS, from FB's trust account monies. The evidence of both FB and SS is accepted by the tribunal. The tribunal is satisfied that the practitioner had no instructions or authority from FB to pay the amount of $3,500 from money held on her behalf to SS.

[41] ACAT is not satisfied that the file note produced by the practitioner is a contemporaneous record of events. ACAT accepts the evidence of SS that the cheque was written to partly repay a loan made by her to the practitioner. ACAT accepts the evidence of FB that she had no conversation with him in relation to payment of any money by her to SS. She did not instruct the practitioner to make the payment, nor did she in any way authorise the payment.

[129] In relation to the complaint made by FB, the practitioner produced in his affidavit of 10 August 2011, handwritten notes by him which he described as file notes on which he relied to substantiate his assertion that if FB had authorised payments of $3500 and $10,000 from her trust monies. The file notes are not supported by the ancillary evidence such as phone records. The practitioner did not produce these file notes in response to the original complaints, nor did he advert to them in his responses. If they were contemporaneous file notes and therefore existed at the time of the original complaints, the practitioner has failed in his duty of full and frank disclosure to the applicant. On this issue the practitioner gave oral evidence which contradicted his affidavit.

48. The tribunal was entitled to accept the evidence of SS and FB (which was consistent with FB's telephone records) and to find that the file note was a fabrication. The findings are consistent with the tribunal's findings about the general credit of SS and FB, the late production of the file note and the tribunal's general findings about the practitioner's lack of credit.

Grounds 1.4 - 1.8 and 1.10: Withdrawal of $10,000 from FB's trust ledger in August 2009

49. The tribunal found that, on 31 August 2009, the practitioner contravened section 223 of the Act by transferring $10,000 from FB's trust monies to his office account without instructions and that the practitioner's conduct breached s 230 of the Act by causing a deficiency in FB's trust ledger account.

50. On the appeal, the practitioner asserted that the tribunal should have accepted a file note that purported to document instructions to make the withdrawal.

51. FB gave evidence that she had loaned the practitioner $10,000 in March 2009. FB's daughter corroborated the making of the loan. She said that she had been with her mother when the amount of $10,000 was withdrawn from the bank and had seen her mother deliver the money to the practitioner. She changed her evidence about when the loan had occurred, at first saying that it was made after the "Skyfire event" but later saying that it was made before the "Skyfire event".

52. FB gave evidence that, on or about 2 September 2009 the practitioner asked to borrow a further $10,000 but she refused that request. She denied asking for return of the sum of $10,000 in August/September 2009, she denied authorising the transfer of $10,000 from her trust funds to the practitioner's office account and she denied receiving the sum of $10,000 from the practitioner on or about 2 September 2009.

53. The practitioner denied that FB had had loaned the sum of $10,000. He conceded that he did transfer $10,000 from FB's trust account monies to his office account. He asserted that FB had telephoned him and requested $10,000 urgently and that, by transferring the money to his office account, he was able to provide her with cash expeditiously. He said that he gave her $10,000 in cash on 2 September 2009. The practitioner conceded that he had no written authority or receipt from FB in relation to the transaction. However, he relied on file notes (typed version at SAB 95) that purported to document the telephone conversation with FB. The file notes read:

31/8/9

(FB)

Wanted $10,000 for her son. [from her money?]

Cheque will take few days.

Asked me to transfer money to B Acc

Withdraw it and call me to come and pick up the money

Told her to sign authority said no - Do it no need for signing

[illegible]

10:30am

2/9/9

(FB)

Take call from (FB) re money.

Told her I got the money she can come any time.

She said I will come but I will call you to bring it down as I will be in a hury. She came and telephoned me.

I went down, I asked her to count it, she said no, it is OK. If not I will call you.

54. On the appeal, the practitioner contended the tribunal erred in accepting FB's evidence that he had borrowed $10,000 from her on 10 March 2009, and in accepting the evidence of FB's daughter that corroborated the making of the loan. The practitioner contended that the daughter's evidence was unreliable because she changed her mind about when the loan occurred; whether it was before or after the "Skyfire event".

55. At AB 49 (J [44]), the tribunal rejected the practitioner's submission that the file notes were contemporaneous records of the events. After referring to FB's evidence, at AB 49-50 (J [47]-[52]), the tribunal said:

[47] Records for FB's home phone and mobile phone show that she made no call to either of the practitioner's phone numbers on either 31 August or 2 September 2009.

[48] Records for mortgage accounts, credit card accounts and savings accounts of the practitioner and his wife for the period March to August 2009 show that the practitioner was under extreme financial stress at the time the $10,000 was removed from FB's trust monies.

[49] The evidence given by the practitioner in relation to this ground is unsatisfactory...

[50] The evidence of the practitioner is not accepted by the tribunal: none of the independent evidence supports his version of events, his oral evidence was unconvincing and there is a reasonable basis for suspecting that his file notes were generated post complaint. The tribunal finds the practitioner's evidence in relation to this ground to be untruthful.

56. In relation to the evidence given by FB's daughter, several points should be made. First, the tribunal was entitled to find that an initial mistake about the precise timing of the loan was a matter of little significance (particularly as the timing was later corrected). A witness may have a good recollection of an event but a poor recollection about when it occurred. Second, the evidence of FB's daughter was not critical to establishing the existence of the loan; it was merely corroborative. The primary evidence about the loan came from FB herself. The tribunal was entitled to accept FB's evidence that she had loaned $10,000 to the practitioner, regardless of whether the making of the loan was corroborated by her daughter. Finally, the making of the loan was not critical to the complaint. It merely provided context to the core allegation of the complaint; that the practitioner removed monies from FB's trust account without her direction or knowledge.

57. The tribunal noted that the practitioner was "under extreme financial stress" in March 2009, when FB said that the loan was made: AB 52, J [63]. The practitioner's version of events found no support in the telephone records of FB. Even on the practitioner's account, his conduct was substandard; he transferred a large amount of money without written authority to support the transfer.

58. In these circumstances, the tribunal was entitled to reject the file note and to reject the evidence of the practitioner as "unconvincing" and "untruthful": AB 50, J [50]. The tribunal's findings about the credit of FB and the practitioner in relation to this matter were consistent with its findings about their credit in relation to other matters.

Grounds 1.9 and 1.11: Withdrawal of $33,215 from FB's trust ledger

59. Section 229(1)(b) of the Act and regulation 62 of the Regulation required that, before withdrawing monies from the trust account for FB's legal costs, the practitioner gave FB a tax invoice or a written notice of the withdrawal.

60. The Council claimed that amounts totalling $47,278 were withdrawn from the trust account for legal costs after 22 February 2008, but there was no associated notice of withdrawal or tax invoice.

61. The tribunal was able to identify amounts totalling only $33,215, but was satisfied that $33,215 had been withdrawn in breach of s 229(1)(b) of the Act and regulation 62 of the Regulation: AB 51 (J [56]).

62. On the appeal, the practitioner submitted that the failure to provide sufficient reasons regarding the sum of $33,215 demonstrated an error on the part of the tribunal.

63. The material before the tribunal included a reconstruction of FB's trust ledger (AB 1109) and debtor's ledger (AB 1120) prepared by a financial analyst, Mr Glanville, and ten invoices that the practitioner said that he had provided to FB. The reconstructed debtor's ledger relating to FB at AB 1120 is based on FB's version of events. It takes into account the four invoices that FB says that she received.

64. The tribunal accepted FB's evidence that she had received only four tax invoices. The tribunal found that the practitioner conducted his practice in a haphazard way and noted that, of the ten invoices produced by the practitioner, only one matched a withdrawal from the trust account. The tribunal referred to a "pattern of conduct consistent with the practitioner withdrawing money as he needed it, rather than as he generated invoices for legal work performed" (A.D. 51, J [55]).

65. The reconstructed trust ledger for FB shows that, between 25 November 2008 and 31 August 2009, there were eight transfers that were unsupported by an invoice, for a total amount of $33,215. However, by 31 August 2009, the overall negative balance was $38,036. On the appeal, the Council argued that the latter sum was the relevant figure, not the sum of $33,215 found by the tribunal.

66. The tribunal's finding that only $33,215 was unsupported by invoices appears to reflect an error by the tribunal in the manner in which it dealt with the reconstructed debtor's ledger at AB 1120. However, the Council is content to rely upon the lower figure that the tribunal found to be established.

67. The tribunal's finding that the practitioner conducted his practice in a haphazard fashion and did not document transactions was not only open; it was the only available finding. The tribunal was entitled to accept FB as a witness of credit and to proceed on the basis of a reconstructed debtor's ledger that was based on her evidence. The tribunal's conclusion that these grounds were established simply reflected its view that FB was a truthful witness. When interpreting the debtor's ledger, the tribunal did make an error, but it was an error that related only to quantum and favoured the practitioner.

Grounds 1.13 - 14: Failure to release documents to FB's new solicitors

68. Rule 6.2 of the Rules requires that, upon completion or termination of the practitioner's retainer, the practitioner must release documents related to the retainer unless the practitioner claims a lien for costs due by the client to the practitioner.

69. After FB terminated the practitioner's retainer, her new solicitors requested her file. At that stage, all the practitioner's costs had been paid by FB. However, the practitioner refused to provide the file, stating that there was a substantial cost associated with complying with the request because he would need to dismantle court books and the copy several thousand pages (T377 - 378). He sought an undertaking that FB would meet the costs of copying the files, but received no such assurance.

70. Before the tribunal, the practitioner submitted that "he was entitled to believe that he was owed payment of fees or disbursements" and that he retained the file and claimed a lien "due to the belief he would be owed funds".

71. The tribunal was comfortably satisfied that the practitioner had failed to release documents to FB's new solicitors in breach of rule 6.2 of the Rules.

1. an authority signed by FB on 31 March 2010 directing the practitioner to release her file to Ray Swift Moutrage;
2. letters written to the practitioner by Ray Swift Moutrage requesting the files on 31 March 2010; 12 April 2010; 13 April 2010; and 28 April 2010. The letters requested the practitioner to release trust monies being held in FB's account and the following documents... and all documents and files relating to FB's matter. ...

1. replies to the letters by the practitioner dated 9 April and 12 April 2010. In these brief replies the practitioner states that FB must pay for photocopying the files. ....

[67] In his oral evidence, the practitioner said that he was 'implicitly' exercising a lien over the files. He gave no explanation of the basis on which he believed he was able to exercise a lien. The last account rendered to FB was dated November 2008. It had been paid. There was no basis for the practitioner to claim a lien over the files where the matter had been completed, a final invoice issued more than 12 months previously and no accounting made to the client in relation to monies held in trust. The replies from the practitioner were trite, and appear to be no more than a delaying tactic.

73. On the appeal, the practitioner initially submitted that the tribunal erred in finding that he had breached rule 6.2 by failing to release FB's files to her new solicitors and by failing to give any explanation of the lien that he claimed over the file. However, through his counsel, the practitioner then conceded that any claim of lien was mistaken. Nevertheless, he maintained that the tribunal erred in tarring his conduct as dishonest and therefore supportive of a finding of professional misconduct. Rather, he submitted that such mistaken conduct could not amount to professional conduct.

74. The material set out in the decision at AB 53 (J [66]) supports the tribunal's findings. Under rule 6.2, any documents held by a practitioner must be given to the client unless a lien is claimed. The actual files (not photocopies) must be given to the client. In cross-examination at AB1613.25 - 1617, 1625.20 - 1626.25, the practitioner asserted that, although he had not expressly claimed a lien when refusing to release the documents and although FB had more than $15,000 credit in her trust account at the time, he had "implicitly' raised a claim for a lien for unpaid fees. The "implicit" claiming of a lien is insufficient; a lien must be expressly (or at least clearly) claimed. There was ample material to support the tribunal's finding that, when the practitioner refused to release the documents, he did not genuinely intend to raise a claim for a lien but was merely employing a delaying tactic. The tribunal was entitled to infer that the practitioner's later reliance on a lien was disingenuous. Such findings are consistent with the tribunal's other findings about the practitioner's credit.

Grounds 1.15 and 3.6: Regulation 57 - Issue of trust account statements

75. Regulation 57 of the Regulation requires that, unless a trust account statement has been given within the previous 12 months and there has been no subsequent transaction affecting the ledger account or record, a trust account statement must be given as soon as practicable after 30 June in each year.

76. At AB 54 (J [68]) the tribunal found that the practitioner had reached regulation 57 by failing to issue a trust account statement in relation to FB's trust account funds after 30 June 2008. At AB 58 (J [82]), the tribunal found that, in breach of regulation 57, the practitioner had failed to issue a trust account statement in relation to MB's trust account funds after 26 October 2008.

77. At AB 54 (J [68]) the tribunal found that the practitioner had failed to issue a trust account statement in relation to FB. The tribunal did not articulate the reasons for making that finding by express reference to FB.

78. On the appeal, the practitioner asserted that the tribunal failed to give any reasons for its conclusion that regulation 57 had been breached in relation to FB's trust account funds.

79. Under division 6.1 of the ACAT Act, the tribunal may make an order on an application, but give a statement of reasons only if one is requested: s 60. The tribunal may reserve its decision and deliver a "written statement of reasons for the decision" at a later date: s 62. On the appeal, there was no evidence that the practitioner had sought reasons in relation to the conclusion of breach of regulation 57 in relation to FB, and the application of the reasons provisions in the ACAT Act to this case and their interaction was not argued. Rather, the practitioner argued that, as with MB, in the case of FB the tribunal erroneously failed to accept that the practitioner had been under no obligation to issue a trust account statement. As the issue of whether the tribunal was required to give reasons was not ventilated on the appeal, I express no view.

80. On the appeal, in relation to FB, the practitioner submitted that, on 25 October 2008, a trust account statement was prepared for FB and that, as there were no subsequent transactions concerning FB's account, he was not obliged to provide a trust account statement until after 30 June 2010. He was denied a practising certificate for the financial year beginning 1 July 2010, when a manager was appointed to his practice. Consequently, he was unable to create the relevant trust account statement.

81. In support of this submission, the practitioner appeared to be relying upon the exemption in regulation 57(7)(c), which provides that a trust account statement is not required if, as at 30 June, a trust account statement has been given within the previous 12 months "and there has been no subsequent transaction affecting the ledger account or record".

82. However, a practitioner cannot bring himself or herself within the regulation 57(7)(c) exemption by failing to record transactions that should have been recorded. For obvious reasons, the exemption relates to the absence of "transactions" not the absence of a record of transactions. The reconstruction of FB's trust ledger (at AB1109) reveals unrecorded transactions after 28 October 2008, including the payment of $3,500 to SS on 28 April 2009, which the practitioner himself admitted. The appointment of the manager more than 12 months later provides no excuse for the failure to create a trust account statement.

83. At AB 58 (J [83]), the tribunal found that the practitioner had failed to issue a trust account statement for MB beyond 26 October 2008 relating to the disbursement of amounts of $26,000 paid to the practitioner on 1 July 2008 and $5,000 paid on 1 July 2009.

84. In relation to MB, the practitioner also relied upon the exemption in regulation 57(7)(c). The reconstructed trust account ledger relating to MB shows that the practitioner made unrecorded transfers of money from the trust account to the general account on several dates between October 2008 and June 2009: AB 1110.

[82] ... The practitioner produced no trust account statement beyond 26th of October 2008. The practitioner failed to offer any explanation for the unmatched deposits identified by Mr Glanville, haphazard and irregular invoices and receipts, the absence of correspondence between the amounts deposited, the amounts paid by BB, the amounts invoiced and the amounts withdrawn from his trust account. The totality of the evidence leaves the tribunal more than comfortably satisfied that the practitioner demanded and received cash payments, failed to issue receipts for the cash payments, failed to deposit the cash payments into his trust account, failed to produce adequate and accurate invoices and failed to account to his client for the money is paid into trust.

86. As stated above, the exemption applies where there has been no transaction; it does not apply where there has been a failure to record a transaction.

Grounds 1.12 and 2.1 - 2.5: Payments made by SS

87. Section 222 of the Act requires that, as soon as practical practicable after receiving trust money, a practitioner deposit it in the trust account. Regulation 38 of the Regulation provides that, after receiving trust money, a practitioner must make out a receipt as soon as possible.

88. In 2007, SS and her former husband JS instructed the practitioner to act for JS in relation to an appeal. Dr Hassall of counsel was briefed. SS said that, in about March 2007, the practitioner asked her to pay $6,000 to obtain an opinion from Dr Hassall and, on about 27 March 2007, she paid that sum. From that sum, $3,000 was ultimately paid to Dr Hassall for a written opinion.

89. SS said that, from about 9 April 2007 to 25 June 2008, she paid the practitioner $1,000 a week in cash. From about 9 July 2008, the weekly amount was reduced to $500, which SS paid until December 2008. By that stage, she had made cash payments to the practitioner totalling about $75,000 (including the sum of $6,000). The practitioner had estimated that the cost of the matter would exceed $50,000.

90. The Council alleged that, apart from one sum of $1,000 deposited on 5 October 2008, none of the cash payments made by SS found their way into the practitioner's trust account, nor did the practitioner issue receipts for the payment or invoices for legal work undertaken for SS.

91. The practitioner agreed that he had received $6,000 from SS, but he denied that it was for Dr Hassall's fees, asserting that "to the best of (his) recollection" it was paid in relation to separate proceedings in which SS and her former husband were defendants to an action for possession of their property. He also denied receiving regular cash sums of $1,000 and $500.

92. The tribunal accepted the evidence of SS that she paid $6,000 to the practitioner so that he could obtain an opinion from Dr Hassall of counsel, and found that the practitioner did not pay the money into his trust account. The tribunal concluded that SS was a credible and reliable witness when she said that she had made regular cash payments. In reaching this conclusion, the tribunal considered the fact that SS (by her own admission) had failed to completely disclose her income in a financial statement prepared for Family Court proceedings: AB 59 (J [88]). The tribunal accepted SS's evidence that the practitioner had assisted her to complete the false financial statement, and had encouraged her to conceal the fact that she was making weekly cash payments to the practitioner. The tribunal had regard to documentary evidence that supported SS's version of events, including contemporaneous handwritten notes made by SS, a facsimile sent by SS to JS in May 2007 (in which SS stated that she was making weekly payments) and communications between JS and the practitioner in which JS referred to payments that were being made by SS to the practitioner in relation to the appeal.

93. On the appeal, the practitioner contended that the evidence of SS should have been rejected for two reasons. First, because she admitted that she had filed a false financial statement in Family Court proceedings. Second, because her evidence was "directly contradicted" by that of Dr Hassall of counsel.

94. As to the false Family Court document, SS volunteered that she had produced a false document, and explained the circumstances. The tribunal was entitled to accept her explanation.

95. The practitioner submitted that, although SS said that she had paid $6,000 to the practitioner for the purpose of Dr Hassall providing a written advice, Dr Hassall said that he did not receive the sum of $6,000.

96. The practitioner's submission that Dr Hassall's evidence "directly contradicted" that of SS is not substantiated. In fact, it appears that Dr Hassall was paid $3,000 for his opinion in relation to the appeal, and that the money was paid by JS, although SS had undertaken to pay the costs of the appeal: AB1042.

97. However, the issue of whether Dr Hassall received the sum of $6,000 and the source of any payment to him was largely irrelevant to an assessment of SS's credit. The only issue was whether SS should be accepted when she said that she paid that sum to the practitioner for the purpose of paying Dr Hassall to provide a written opinion on the appeal. If she did pay the money to the practitioner, then it should have found its way into the practitioner's trust account.

98. The practitioner admitted that he received a sum of $6,000. The only real dispute concerned the purpose for which that money was paid. The practitioner made a vague assertion that it related to separate proceedings, but failed to produce evidence to substantiate that claim.

99. On the other hand, SS produced a significant quantity of contemporaneous documentary material, which provided strong corroboration of SS's evidence that she made regular payments.

100. The tribunal's findings turned on whether the evidence of SS should be accepted. There was substantial documentary material supporting SS's account of events. The tribunal was entitled to accept her as a credible witness. The tribunal found the practitioner to be a witness who lacked credibility in relation to most matters and, consistent with that approach, it rejected is evidence concerning these matters. The tribunal was entitled to accept the evidence of SS, reject the evidence of the practitioner and find that each of these grounds was made out.

Grounds 3.1 and 3.2: Receipt of $18,605 from BB

101. Pursuant to s 222 of the Act, the practitioner was required to deposit into his trust account any trust monies that were received from BB in relation to MB.

102. In relation to the payment of monies by BB, the tribunal had evidence by way of a reconstructed trust statement, evidence from BB and MB of demand made by the practitioner for payment in cash, diary notes, telephone records and bank statements, and evidence from the practitioner. BB said that she had paid the practitioner the sum of $88,000 (not $90,649 as stated by the tribunal at J [72]). Invoices totalling $46,232 were produced. There was evidence that BB or MB were repaid $24,412. The unexplained shortfall was about $17,000.

103. Before the tribunal, there was no assertion that BB was a dishonest witness. Rather, her memory about particular payments was tested. During cross-examination, she made appropriate concessions, fairly conceding that she could be mistaken about some sums that she thought had been paid. In particular, she was tested about sums of $5,000, $2,000, $1,000 and $5,800. In large part, the concessions that she made related to recalling particular items recently, years after the event. However, re-examination clarified that, in fact, the sums of $5,000, $2,000 and $1,000 had been identified by BB much earlier than was suggested in cross-examination; the items were not "recently remembered". Further, there was evidence (which the tribunal took into account - see J [70]) that the practitioner had requested cash payments from other clients to whom he did not issue invoices or receipts.

104. The tribunal accepted BB as a witness of credit, who would not deliberately falsify facts. It found that the difference of approximately $18,605 (which it should have found to be about $17,000) was of such a magnitude that it could not be solely due to inaccurate recollection by BB: at J [72]. The tribunal did not find that each asserted payment was necessarily made (whether they totalled $18,605 or a slightly lesser amount); rather, the tribunal found that substantial cash payments were made but not deposited into the trust account.

105. On the appeal, the practitioner submitted that, given the concessions made by BB and the fact that some alleged payments were not supported by documentary evidence, the tribunal erred in finding that the monies had been paid.

106. The tribunal was entitled to find that BB was not only an honest witness, but she was also an essentially reliable witness. In reaching that finding, the tribunal was entitled to take into account BB's evidence in re-examination, where she clarified some of the concessions that had been made in cross-examination. The tribunal was entitled to conclude that the difference between payments made and invoices issued (whether it was $18,605 or $17,000) was so substantial that it could not be the result of an inaccurate memory. In reaching that conclusion, the tribunal was entitled to take into account the practitioner's practice of asking other clients for cash payments and failing to issue them with invoices or receipts. The tribunal was entitled to rely upon the evidence of BB, the size of the differential and the practitioner's practice in relation to other clients, and there was no requirement for there to be documentary evidence supporting the differential. The tribunal was entitled to conclude that these grounds were made out.

Grounds 3.2 - 3.10: Dispersal of trust account monies provided by BB

107. Pursuant to s 223 of the Act, a practitioner is required to hold trust monies in a general trust account exclusively for the person on whose behalf the monies are received, and disperse the monies only in accordance with a direction given by that person. Pursuant to s 230 of the Act, a practitioner commits an offence if he or she causes a deficiency in any trust account or trust ledger account or fails to pay or deliver any trust monies.

108. Regulation 38 of the Regulation requires that, after receiving trust monies, a practitioner makes out a receipt as soon as practicable. Regulation 57 requires a practitioner to provide a trust account statement as soon as practicable after 30 June in each year. Regulation 62 requires that trust funds be withdrawn only in accordance with an agreement or instructions, and in association with a prior request for payment or notice of withdrawal.

109. BB gave evidence that she paid $26,000 into the practitioner's trust account on 1 July 2008 "for the trial" of her brother, MB. At that time, she had a conversation with the practitioner to the effect that the money was to be used to pay $20,000 to counsel for his fees. The remaining $6,000 was for the practitioner's fees in relation to the trial. BB's brothers corroborated BB's evidence that the money was paid for counsel's fees. One of the brothers was not required for cross-examination at the ACAT hearing. The counsel in question deposed to a meeting with BB in which she repeated her understanding that she had paid $20,000 to the practitioner for counsel's fees. The practitioner did not challenge BB's evidence that there was a conversation to the effect that the money was to be held in trust "for the trial" and that $20,000 was to be paid to counsel for his fees.

110. The reconstructed trust account ledger and report prepared by the financial analyst shows that the whole of the $26,000 was used for purposes other than the trial. Most was used for the practitioner's legal fees.

111. There was evidence supporting BB's evidence that she made substantial cash payments to the practitioner. The supporting evidence was in the form of bank statements, diary records and corroborating evidence from BB's brothers. The practitioner produced no receipts or other records in relation to the cash payments, and failed to deposit the cash payments into his trust account.

112. The practitioner relied upon a retainer agreement dated 20 May 2007 signed by MB (SAB 230), that authorised the practitioner "to use any funds that are held on the client's behalf or funds the solicitors may subsequently receive from the client on the client's behalf" to pay any costs or disbursements in relation to any matter conducted by the practitioner on behalf the client. The practitioner also relied upon a written authorisation from MB dated 9 May 2009 (SAB 239) regarding the transfer of $5,000 from MB's trust account to establish a new trust ledger for a separate property action, and on a costs agreement dated 9 May 2009 between the practitioner and MB.

113. The tribunal was satisfied that the practitioner breached the requirements of the Act and Regulation in relation to the sums paid by BB of $26,000 (paid on 1 July 2008 "for the trial" of BB's brother, MB), $5,805 (paid on 16 July 2007), $5,800 (paid on 30 June 2008) and additional amounts paid in cash (totalling $17,880). The tribunal was "comfortably satisfied" that BB paid more than $80,000 to the practitioner: AB 56 (J [76]). The tribunal found that the practitioner made constant requests to BB for cash payments, and that BB made the cash payments, but that the practitioner did not issue receipt for the payments. He withdrew amounts from trust without providing corresponding invoices.

114. The practitioner was critical of the fact that, in its reasons, the tribunal made no reference to the costs agreement, the retainer agreement, or the written authorisation.

115. It is true that the tribunal did not refer to the costs agreement dated 9 May 2009, the authorisation dated 9 May 2009, or the retainer agreement between the practitioner and MB dated 20 May 2007.

116. BB was not a party to those documents. The sum of $26,000 paid by BB on 1 July 2008 was paid for a specific purpose. BB directed that it be used "for the trial" of her brother. The payment occurred on 1 July 2008. It post dated and, because it was paid for a specific purpose, that purpose displaced any general entitlement associated with the retainer of 20 May 2007.

117. In relation to the withdrawal of funds from the trust account, appropriate invoices were not issued, and no authority was obtained from BB in relation to the withdrawal of the funds.

118. Even if the transfer from the trust account of $5,000 (or other amounts) was authorised, the practitioner also received substantial cash sums from BB, which never found their way into the trust account and in relation to which the practitioner failed to account in a proper way. There was evidence supporting BB's evidence about the making of cash payments in the form of bank statements, diary records and corroborating evidence from BB's brothers. The practitioner produced no receipts or other records in relation to the cash payments.

119. There was no proper account to BB when the practitioner's retainer came to an end. The practitioner did not issue a trust account statement beyond 26 October 2008 in relation to the disbursement of the $26,000 paid on 1 July 2008 or an amount of $5,000 paid on 1 July 2009.

120. On appeal, the practitioner advanced no particular argument in relation to grounds 3.3-3.9.

121. Regardless of the documents to which the tribunal did not refer, the tribunal was entitled to make the findings that it made.

Ground 4: Failure to afford procedural fairness in relation to penalty

122. On 24 January 2013, the tribunal concluded that the practitioner was guilty of professional misconduct. The tribunal immediately proceeded to consider the orders that should be made under s 425 of the Act. The tribunal decided that the public interest required that it recommend that the practitioner's name be removed from the local roll of legal practitioners, that he be publicly reprimanded and that he pay the legal costs of the Council.

123. On 20 May 2013, the tribunal heard an application by the Council for the tribunal to reopen the case in relation to penalty and costs. The basis of the application was that the tribunal had failed to afford the practitioner an opportunity to make submissions in relation to penalty and costs although, during the hearing, the practitioner had indicated that he wished to make submissions.

124. As the appointment of the senior member who presided over the original panel had expired, the application was heard by two members of the original tribunal. Pursuant to s 92(2)(c) of the ACAT Act, the general president had directed that the matter continue before two members.

125. On the application to reopen, the practitioner submitted that the tribunal was functus officio; that the decision on penalty and costs was final and the proceedings could not be reopened. Alternatively, the practitioner submitted that, if the tribunal decided to reopen the matter in order to deal with penalty and costs, then those issues should be considered by differently constituted tribunal.

126. The tribunal decided that, pursuant to ss 23 and 56(d)(i) of the ACAT Act it had the power to determine its own procedures and set aside or vary orders, including the power to do so for the purpose of avoiding unfairness or otherwise bringing the administration of justice into disrepute. Pursuant to s 56(c)(iii) it set aside the orders made on 24 January 2013 and reopened the hearing for the purpose of receiving evidence and submissions about penalty and costs. The tribunal's reasons for setting aside the penalty order and reopening the hearing (at AB 20 - 21) can be summarised as follows:

1. Neither party would be prejudiced by the reopening, nor would any third party.
2. A reopening would be faster and less expensive than an appeal.
3. The costs order made by the tribunal may indicate that the matter was not finalised.
4. In any event, finality in litigation should be subservient to the fundamental requirement that a litigant receive a fair hearing.

127. On 8 July 2013, the hearing continued. In accordance with directions, the respondent had filed and served submissions about penalty and costs. The practitioner did not file any written submissions and was not represented at the hearing. At the conclusion of the hearing, the tribunal made the orders that had been made originally.

128. On the appeal, the practitioner argued that tribunal erred by failing to afford him procedural fairness (an opportunity to be heard) before imposing a penalty on 24 January 2013. The practitioner argued that the purported reopening of the hearing was ineffective because, after 24 January 2013, the tribunal was functus officio.

129. The first issue is whether, prior to 24 January 2013, the tribunal failed to afford the practitioner procedural fairness in relation to penalty. The second issue is whether the tribunal was functus officio or, on the other hand, it was empowered to reopen the hearing after 24 January 2013 for the purpose of affording procedural fairness. If the tribunal had such power, then the practitioner was afforded an opportunity to be heard, although he declined to avail himself of that opportunity. Finally, if the tribunal had no power to reopen the hearing, then there is an issue about whether the proceedings should be remitted to a differently constituted tribunal.

130. Both the tribunal and the respondent accepted that, prior to imposing a penalty and costs on 24 January 2013, the practitioner had been given no opportunity to make submissions about penalty and costs. During the substantive hearing, it had been anticipated that, at the conclusion, there would be an opportunity to make submissions. In any event, as a general proposition, a professional person should not be required to formulate submissions about appropriate penalty orders until the disciplinary tribunal has determined whether and in what respects the person's conduct constituted professional misconduct: Lucire v Health Care Complaints Commission [2011] NSWCA 99 per Basten JA at [65]; King v Health Care Complaints Commission [2011] NSWCA 353.

131. Pursuant to s 425(3)(a) of the Act, the tribunal can only make an order recommending that the name of a practitioner be removed from the local roll, but under s 425(3) the tribunal may make other orders that are not merely recommendations, including an order publicly reprimanding the practitioner under s 425(3)(e). Both types of order were made in this case. On the appeal, no argument was advanced that, in relation to procedural fairness, different considerations apply to an order that is only a recommendation.

132. On the second question, whether the tribunal had power to reopen the proceedings to cure the lack of procedural fairness, both parties relied on the High Court's decision in Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597. The facts in that case were that the Immigration Review Tribunal had overlooked an applicant's request for an adjournment and had proceeded with a hearing in the absence of the applicant and without following statutory processes that were designed to ensure procedural fairness. The Tribunal decided against the applicant. Following representations by the applicant, the Tribunal held a further hearing and made a fresh decision, which favoured the applicant.

133. At [39], Gaudron and Gummow JJ noted the proposition endorsed in Ridge v Baldwin [1963] UKHL 2; [1964] AC 40 (at 79 per Lord Reid, at 99 per Lord Evershed and at 129 per Lord Hodson) that, as a general rule, an administrative tribunal may cure procedural unfairness by subsequently providing a proper hearing to the person affected. But their Honours observed that the question of whether the Tribunal could disregard the earlier decision depended upon the proper construction of the statute: at [44]. Gaudron and Gummow JJ (McHugh and Hayne JJ conncurring) decided that the Tribunal had power to make the second decision because the first decision was made in jurisdictional error and was of no legal effect; it was "no decision at all": at [53]. Gaudron and Gummow JJ approved the approach of the Supreme Court of Canada in Chandler v Alberta Association of Architects [1989] 2 SCR 848; that a decision involving jurisdictional error does not prevent the decision-maker from correcting the error in a later decision. There was no express provision in the statute which gave legal effect to a decision of the Tribunal that involved jurisdictional error, and the Act should not be construed as impliedly having that effect.

134. Gleeson CJ arrived at the same conclusion. His Honour considered that that the question was whether the statute manifested an intention to permit or prohibit reconsideration in the circumstances in issue. His Honour concluded that, not only had there been a denial of procedural fairness, but there had also been non-performance of a condition precedent of regularity of adjudication in that the Tribunal had failed to follow the statutory procedure requiring that the respondent be given an opportunity to be heard. Having recognised that it had not performed its functions, the Tribunal was entitled to proceed to do so.

135. In Burrell v the Queen [2008] HCA 34; (2008) 238 CLR 218, Gummow ACJ, Hayne, Heydon, Crennan and Keifel JJ noted that they were considering only the power of superior courts of record to reopen a proceeding and reconsider the orders that had been made. The plurality first emphasised the importance of considering the power to re-open in the context of the statute relating to the relevant court: at [14]. Second, at [15], their Honours referred to the importance of the principal of finality; that, once resolved, controversies should not be reopened except in a few, narrowly defined circumstances (such as where a judgment has been procured by fraud). Third, at [16], their Honours observed that the principle of finality serves not only to protect parties to litigation from attempts to re-agitate what has been decided, but also serves to prompt all participants in the judicial process to "get it right the first time". The plurality expressly disavowed a desire to consider whether some forms of denial of procedural fairness may create an exception to the general rule stated in Grierson v The King [1938] HCA 45; (1938) 60 CLR 431 that the NSW Court of Criminal Appeal is a statutory court which has no jurisdiction to reopen an appeal which has been heard on the merits and finally determined: at [26].

136. In the context of the general rule that an administrative tribunal may cure procedural unfairness by subsequently providing a proper hearing to the person affected, the question is whether the ACAT Act evinces a different intention.

137. The relevant provisions of the ACAT Act are ss 6, 7, 23, 56, 61, 79, 83, 84 and 86

138. The procedures of the tribunal are governed by goals of simplicity, speed and procedural fairness. Pursuant to s 6 of the ACAT Act, the objects of the Act include ensuring that access to the Tribunal is simple and inexpensive, that applications are resolved as quickly as possible (consistent with achieving justice) and that decisions of the tribunal are fair. Section 7 provides that the tribunal must ensure that its procedures are as simple, quick and inexpensive as is consistent with achieving justice, and must observe procedural fairness. To those ends, the tribunal may determine its own procedures: s 23.

139. On the other hand, the tribunal is designed to function very like an inferior court, and a similar level of protection is provided by way of appeal processes. Under s 61, an order of the tribunal is "made" when it is pronounced or "entered", and it "takes effect" on the day that it is made. In contrast to the scenario that was considered in Chandler (where the only appeal was available was on a point of law), under s 79(3) of the ACAT Act, a party to an original application may appeal the decision on a question of fact or law. Generally, that will result in the appeal president constituting an appeal tribunal (differently constituted) to review the decision on the original application: s 81. The appeal tribunal may, as the tribunal considers appropriate, deal with the appeal either as a new application or as a review of all or part of the original decision. By consent, or if the tribunal considers it to be appropriate, an appeal may be removed to the Supreme Court: s 83. If a question of law arises on an application or an appeal raises an issue of public importance, the tribunal may refer the question to the Supreme Court: s 84. There is a right to seek leave to appeal to the Supreme Court on a question of fact or law from a decision of an appeal tribunal: s 86.

140. The court-like appeal and review structure applying to the tribunal suggests that, like a court, the principal of finality may have some application to the orders made by the tribunal. As noted in Burrell, that principle serves to protect parties from attempts to re-agitate what has already been decided and provides an incentive to all participants in the adversarial process to "get it right the first time". Where adequate appeal and review processes apply, there is limited opportunity for conflict between the principle of finality and the entitlement to procedural fairness.

141. The combination of finality and adequate appeal and review processes supports the two key objects and principles behind the ACAT Act: first, ensuring the quick and simple resolution of matters and, second, ensuring fairness.

142. Importantly, s 56 of the ACAT Act refers to the tribunal having the power to set aside an order in only three circumstances: the order was made ex parte, a limited "slip rule" applies, or "extraordinary circumstances make it appropriate to amend or set aside the order". In the context that a comprehensive appeal and review process is available, s 56 should be read as providing the only circumstances in which an order can be set aside.

143. It was under s 56(c)(iii) that the tribunal set aside the penalty order in this case, thereby reopening the proceedings.

144. In its decision of a July 2013, the two member tribunal did not specifically address the s 56(c)(iii) question of whether there were "extraordinary circumstances" that "(made) it appropriate" to set aside the penalty order made on 24 January 2013. Rather, it was guided by general considerations of "fairness". The tribunal's reasons for setting aside the orders and reopening the proceedings are summarised above. Essentially, the tribunal decided that it was more efficient to reopen the proceedings for the purpose of affording procedural fairness rather than await the outcome of the tortuous appeal procedure that had been instituted. One further matter was raised by the tribunal, i.e. that the original costs order "may be said to indicate that the matter is not finalised". The tribunal did not elaborate upon this possibility, and it was not the subject of argument on appeal.

145. It is unnecessary to consider the scope of "extraordinary circumstances". When an error on the part of any original tribunal is identified to that tribunal, it may accept that it has erred. It would often be more efficient for the original tribunal to reopen the case and re-decide the matter. The frequency with which such a scenario may occur suggests that the circumstances in the present case were not "extraordinary".

146. The nature of the review and appeal processes in the ACAT Act also informs a consideration of whether the circumstances under consideration constitute "extraordinary circumstances" that make it "appropriate" to set aside an order.

147. Not only were the circumstances in the present case far from "extraordinary", they were not circumstances which indicated that it was "appropriate" to reopen the proceedings. If, in such circumstances, original tribunals reopened their proceedings as a matter of course, then appeal and review processes would be thrown into chaos.

148. In this case, the undoubted greater efficiency associated with the original tribunal reopening the proceedings to correct acknowledged error did not constitute "extraordinary circumstances" that made it "appropriate" to do so.

Should the matter be remitted to a differently constituted tribunal?

150. The practitioner submitted that, if the question of penalty and costs was determined by the same tribunal there would be an apprehension of bias.

151. The test to be applied in Australia when determining whether a judge is disqualified by reason of the appearance of bias (including pre-judgment) is whether a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial and unprejudiced mind to the resolution of the question to be decided: Michael Wilson & Partners v Nicholls [2011] HCA 48; (2011) 244 CLR 427.

152. Had the Court upheld a ground of appeal other than the procedural fairness ground, then it may well have been appropriate to remit the matter to a differently constituted tribunal because the original tribunal had expressed a firm view about facts that would have had to be reconsidered on a rehearing. In particular, it would have been inappropriate for the same tribunal members to reassess de novo the practitioner's truthfulness: Smith v New South Wales Bar Association [1992] HCA 36; (1992) 176 CLR 256 at [41] per Brennan, Dawson, Toohey and Gaudron JJ.

153. However, the Court has found no error in the way in which the tribunal assessed the evidence and arrived at factual findings to support the conclusion of professional misconduct, including the factual findings about the practitioner's lack of credit. The only matter to be considered on remittal is the appropriate sanctions to be imposed under s 425.

154. A fair-minded lay observer would not reasonably apprehend that the original tribunal members might fail to act impartially by taking into account all relevant matters (including any evidence and submissions from the practitioner) before determining appropriate sanctions. It is an everyday occurrence that tribunals and courts change their preliminary views about an appropriate outcome because they are persuaded by evidence and submissions. To cite but one example, that is what happened in Bhardwaj. In King v Health Care Complaints Commission, the NSW Court of Appeal referred the matter back to the same tribunal to determine what consequential orders should be made.

155. For the preceding reasons, I make the following orders and directions:

1. The orders made by the tribunal on 24 January 2013 are set aside.
2. Order 1 purportedly made by the tribunal on 20 May 2013 is set aside.
3. The orders purportedly made by the tribunal on 8 July 2013 are set aside.
4. The proceedings are remitted to the tribunal for further hearing and decision on what, if any, orders should be made under s 425 of the ACAT Act consequential on the tribunal's findings concerning professional misconduct published on 24 January 2013.
5. The practitioner is to file and serve short submissions on costs by 30 January 2015.
6. The Council is to file and serve short submissions on costs by 14 February 2015.
7. Any submissions in reply are to be filed and served by 28 February 2015.
8. Liberty to apply to the Registrar to relist the matter in relation to costs. If neither party applies to relist the matter, costs will be determined on basis of the written submissions filed by 28 February 2015.

I certify that the preceding one hundred and fifty five [155] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Chief Justice Murrell.

ACT Civil and Administrative Tribunal Act 2008 (ACT) (ACAT Act)

(b) to ensure that access to the tribunal is simple and inexpensive, for all people who need to deal with the tribunal; and

(c) to ensure that applications to the tribunal are resolved as quickly as is consistent with achieving justice; and

(d) to ensure that decisions of the tribunal are fair; and

In exercising its functions under this Act, the tribunal must -

(a) ensure the procedures of the tribunal are as simple, quick, inexpensive and informal as is consistent with achieving justice; and

(b) observe natural justice and procedural fairness.

The tribunal may decide its own procedure in relation to a particular matter in a hearing or a step in dealing with an application if no procedure is prescribed under this Act or an authorising law for the application or the rules.

(i) the order was made after hearing an application in the absence of a party; or

(ii) the order is in error in relation to an amount or the name or address of a party, and the tribunal proposes to amend or set aside the order only to correct the error; or

(iii) extraordinary circumstances make it appropriate to amend or set aside the order; or

(d) take any other action in relation to an application -

(ii) that is consistent with this Act or an authorising law.

(1) An order of the tribunal is made by the order being -

(a) pronounced in the tribunal by the tribunal for the application making the order; or

(b) recorded, in accordance with the tribunal's practice, as having been entered; or

(2) An order takes effect on the day that the order is made.

(3) A party to the original application may, by application, appeal the decision to the tribunal on a question of fact or law.

An appeal tribunal may, as the tribunal considers appropriate, deal with an appeal -

(b) as a review of all or part of the original decision on the application by the tribunal.

(1) If the parties to an application or an appeal (a matter ) jointly apply to have the matter removed to the Supreme Court, the tribunal must order that the matter be removed to the Supreme Court.

(2) If a party to a matter applies to have the matter removed to the Supreme Court, the tribunal may, if it considers it appropriate, order that the matter be removed to the Supreme Court.

(1) If the tribunal considers that a question of law that arises in considering an application or an appeal raises an issue of public importance, the tribunal may refer the question to the Supreme Court.

(1) A party to an application, other than an application mentioned in subsection (2), for an appeal may appeal to the Supreme Court on a question of fact or law from -

(b) if the appeal president dismissed the appeal under section 80 - the original decision of the tribunal; or

(c) if the appeal president decides not to deal with the appeal under section 85 - the original decision of the tribunal.

Legal Profession Act 2006 (ACT) (the Act)

The following provisions of the Act concern trust accounts.

(1) As soon as practicable after receiving trust money, a law practice must deposit the money in a general trust account of the practice kept in the ACT.

(a) hold trust money deposited in a general trust account of the practice exclusively for the person on whose behalf it is received; and

(b) disburse the trust money only in accordance with a direction given by the person.

(3) The law practice must account for the trust money as required by regulation.

(1) A law practice may do any of the following, in relation to trust money held in a general trust account or controlled money account of the practice for a person:

(b) withdraw money for payment to the practice's account for legal costs owing to the practice if any relevant provision of this Act is complied with;

(1) An Australian legal practitioner commits an offence if the practitioner causes -

(a) a deficiency in any trust account or trust ledger account; or

Legal Professional Regulation 2007 (ACT) (the Regulation)

(1) This section applies if a law practice receives trust money that is required to be paid into a general trust account.

(2) After receiving the trust money, the law practice must make out a receipt.

(3) The receipt must be made out as soon as practicable -

(1) A law practice must give a trust account statement to each person for whom or on whose behalf trust money (other than transit money) is held or controlled by the law practice or an associate of the practice.

(c) except as provided by subsection (7), as soon as practicable after 30 June in each year.

(7) The law practice is not required to give a trust account statement under subsection (6) (c) in relation to a ledger account or record if at 30 June -

(c) a trust account statement has been given within the previous 12 months and there has been no subsequent transaction affecting the ledger account or record.

(1) This section prescribes for the Act section 229 (1) (b) the procedure for the withdrawal of trust money held in a general trust account or controlled money account of a law practice for payment of legal costs owing to the practice by the person for whom the trust money was paid into the account.

(2) The trust money may be withdrawn as set out in subsection (3) or (4).

(3) The law practice may withdraw the trust money -

(i) the money is withdrawn in accordance with a costs agreement that complies with the legislation under which it is made and that authorises the withdrawal; or

(ii) the money is withdrawn in accordance with instructions that have been received by the practice and that authorise the withdrawal; or

(iii) the money is owed to the practice by way of reimbursement of money already paid by the practice on behalf of the person; and

(b) if, before effecting the withdrawal, the practice gives or sends to the person -

(i) a request for payment, referring to the proposed withdrawal; or

(ii) a written notice of withdrawal.

(4) The law practice may withdraw the trust money -

(a) if the practice has given the person a bill relating to the money; and

Legal Profession (Solicitors) Rules 2007 (ACT) (the Rules)

Upon completion or termination of a practitioner's retainer, practitioner must, when requested to do so by the practitioner's client, give to the client, or another person authorised by the client, any documents related to the retainer to which the client is entitled, unless:

(a) the practitioner has completed the retainer; or

(b) the client has terminated the practitioner's retainer; or

(c) the practitioner has terminated the retainer for just cause and on reasonable notice; and

the practitioner claims a lien over the documents for costs due to the practitioner by the client.