Mr. M. Howell (Senior Member) and Ms E. Wentworth & Mrs E. Hannebery (Members)

Legal Services Commissioner v Hession (Legal Practice) [2010] VCAT 1687

The respondent having given an UNDERTAKING to the Tribunal:

(a) that he will participate in workshops or courses relating to probate and the administration of deceased estates generally, being workshops or courses for which a total of ten continuing professional development points have been allocated;

(b) that he will not act as the executor of a Will or the administrator of a deceased estate until he has participated in workshops or courses for which ten continuing professional developments points have been allocated, save that he may continue to act as executor of the Will of Margaret Elizabeth Daley deceased and trustee of her estate;

(c) that he will ensure that he is familiar with the practice rules that are current from time to time relating to probate and the administration of deceased estates;

1. The respondent is to pay a fine of $30,000.00 to the Legal Services Board by 5 October 2011.

2. The respondent is to pay $38,161.90 to the Legal Services Commissioner by 5 April 2011 as the Commissioner's costs of the proceedings.

Dr. K. Hanscombe SC and Ms U. Stanisich of counsel.

1. Mr. Hession is a legal practitioner. On 11 August 2010, the Tribunal found Mr. Hession guilty of two disciplinary charges[1].
2. First, the Tribunal found Mr. Hession guilty of professional misconduct, being misconduct at common law, in relation to the taking of executor's commission to which he was not entitled. The commission has been repaid.
3. Secondly, the Tribunal found Mr. Hession guilty of unsatisfactory professional conduct in relation to a letter dated 14 October 2005 sent by him to beneficiaries under the Will of Margaret Elizabeth Daley deceased.
4. The Tribunal heard submissions on 5 October 2010 as to the orders to be made consequent upon those findings. The Tribunal made final orders on that date, and gave oral reasons for the making of those orders. The Tribunal stated that it would place its reasons in written form. These are those reasons.

Matters considered by the Tribunal before making the orders:

1. It must be mentioned at the outset that counsel for the Legal Services Commissioner and counsel for Mr. Hession both submitted that it was appropriate to impose a fine of $30,000.00. The Tribunal is not bound to impose a fine of that or any other amount[2]. On the other hand, the submissions should cause the Tribunal to impose a fine of $30,000.00 if the imposition of a fine of that amount is "within the permissible range"[3].
2. It also must be mentioned at the outset that agreement has been reached concerning the costs of the proceedings, to the effect that Mr. Hession will pay $38,161.90 to the Legal Services Commissioner as the Commissioner's costs of the proceedings.
3. Previous disciplinary matters: On 1 August 2000, the Full Tribunal of the Legal Profession Tribunal found Mr. Hession guilty of four counts of misconduct in what was substantially the same matter[4].
4. First, Mr. Hession was found guilty of misconduct at common law in that he issued legal proceedings in the Magistrates' Court seeking an order for payment of the cost of repairs to a motor vehicle (based upon information provided by a motor vehicle repairer), without speaking to the complainant, without obtaining instructions from the complainant, without advising as to the amount likely to be recovered after legal costs were taken into account, without advising the complainant as to her right to claim against her own insurer, and without advising the complainant of the cost implications of losing the proceedings.
5. Secondly, Mr. Hession was found guilty of misconduct as defined by the Legal Practice Act 1996[5] being unsatisfactory conduct that amounted to a substantial or consistent failure to reach reasonable standards of competence and diligence.
6. Thirdly, he was found guilty of misconduct as defined by the Legal Practice Act 1996[6] because he failed to provide a written statement about legal costs to a prospective client[7].
7. Fourthly, he was found guilty of misconduct as defined by the Legal Practice Act 1996[8] because he failed to provide a written statement about legal costs and other matters to a prospective client[9].
8. The Legal Profession Tribunal fined Mr. Hession $15,000.00 and ordered him to pay the costs of the proceedings. Mr. Hession appealed to the Court of Appeal[10]. The appeal was dismissed on 10 November 2000.
9. Specific deterrence: There is a need for specific deterrence. The Tribunal found that Mr. Hession transferred $109,669.00 to his own use from monies held in his trust account. He transferred the monies in payment of executor's commission to which he was not entitled. He did not research the law or make proper enquiry as to his entitlement to commission. Specific deterrence will be addressed, in part, by an undertaking given by Mr. Hession. It also will be addressed, in part, by the considerable expense involved in Mr. Hession paying a fine, the legal costs of the Commissioner, and his own legal costs.
10. The Tribunal was concerned that, when he transferred trust money to his own use as executor's commission, Mr. Hession was not familiar with the law relating to the entitlement of an executor to commission. The Tribunal also was concerned that Mr. Hession did not appear to be familiar with the administration of deceased estates generally. To address these concerns, Mr. Hession gave an undertaking to the Tribunal:

(a) that he will participate in workshops or courses relating to probate and the administration of deceased estates generally, being workshops or courses for which a total of ten continuing professional development points have been allocated;

(b) that he will not act as the executor of a Will or the administrator of a deceased estate until he has participated in workshops or courses for which ten continuing professional developments points have been allocated, save that he may continue to act as executor of the Will of Margaret Elizabeth Daley deceased and trustee of her estate;

(c) that he will ensure that he is familiar with the practice rules that are current from time to time relating to probate and the administration of deceased estates.

1. General deterrence: It is common for a legal practitioner to be the executor of the Will, and trustee of the estate, of a deceased person. It is equally common for the legal practitioner to act as the legal practitioner handling the administration of the estate, and to charge costs for legal services provided to the estate. Such a practitioner has almost complete control of the estate. There is a need for the practitioner to be deterred from charging executor's commission unless he or she is clearly entitled as a matter of law to charge commission.
2. Punishment: A degree of punishment is required in the present case, particularly as findings of misconduct were made in respect of Mr. Hession in the year 2000. Punishment will be adequately addressed by the imposition of a fine, and the costs payable by Mr. Hession in the present proceedings.
3. The Tribunal considered whether Mr. Hession should be deprived of his right to practise for a period of time. It decided that such an order was unnecessary, for two reasons. The first reason is that the events that gave rise to these disciplinary proceedings occurred in 2005, and no other disciplinary findings have been made in respect of Mr. Hession since then. The second reason is that Mr. Hession is a sole practitioner with a relatively large staff, and significant financial commitments. The Tribunal is satisfied that loss of his right to practise would have adverse consequences for his staff and his family, and potentially cause financial ruin to Mr. Hession. The Tribunal is entitled to take these factors into account[11].
4. Having considered all of the matters which have been mentioned, the Tribunal is satisfied that a fine of $30,000.00 is "within the permissible range" of possible dispositions[12], and the appropriate order to make in this matter. Payment of the fine is stayed until 5 October 2011.
5. The Tribunal also will order that Mr. Hession pay the costs of the Legal Services Commissioner, agreed at $38,161.90. Payment of the costs is stayed until 5 April 2011.

[1] Legal Services Commissioner v Hession [2010] VCAT 1328.

[2] Law Institute of Victoria v Brott [2008] VCAT 1998 @ [52-58].

[4] Legal Profession Tribunal proceedings No. T0083 of 2000.

[5] Paragraph (a)(iv) of the definition of 'misconduct' in s.137 of the Legal Practice Act 1996.

[6] Paragraph (a)(i) of the definition of 'misconduct' in s.137 of the Legal Practice Act 1996.

[7] As required by s.86(1) of the Legal Practice Act 1996.

[8] Paragraph (a)(i) of the definition of 'misconduct' in s.137 of the Legal Practice Act 1996.

[9] As required by s.86(3) of the Legal Practice Act 1996.

[10] Supreme Court proceedings No. 6462 of 2000.

[11] Ha v Pharmacy Board of Victoria [2002] VSC 322 @ [120].

[12] See Law Institute of Victoria v Brott [2008] VCAT 1998 @ [58].