Legal Services Commissioner v Morgan (Legal Practice) [2009] VCAT 100

1. The Tribunal finds the Respondent guilty of four instances of professional misconduct as defined by s 4.4.4(a) of the Legal Profession Act 2004.
2. The Tribunal finds the Respondent guilty of one instance of professional misconduct as defined by s 4.4.4(f) of the Legal Profession Act 2004.
3. The Respondent is to pay the Legal Services Commissioner's costs of $2743.40 by no later than 4.00pm on Wednesday 11 March 2009.
4. The Respondent is to complete one additional CPD unit related to practice management, within the CPD year beginning 1 April 2008.
5. The Respondent is to pay a fine of $1000 in respect of each of the four findings of professional misconduct in matters J220/2008, J221/2008 and J223/2008, totalling $4000, to the Legal Services Board by no later than 4.00pm on Wednesday 11 March 2009.
6. The Respondent is to pay a fine of $1500 in respect of the finding of professional misconduct in matter J9/2009, to the Legal Services Board by no later than 4.00pm on Wednesday 11 March 2009.
7. The Respondent is to provide the Legal Services Commissioner with full written explanations of his conduct in respect of the disciplinary complaints made by Ms Elizabeth McCrae (matter J220/2008); Mr John Love-Linay (matter J221/2008) and Ms Patty Nikolakopoulos (matters J204/2008 and J9/2009) by no later than 4pm on Friday 20 February 2009.
8. The Respondent is to provide the Legal Services Commissioner with the information sought in the Commissioner's letter dated 19 December 2007 relating to trust monies, his file and his trust account ledgers regarding the subject of the disciplinary complaint made by Mr John Love-Linay (matter J221/2008) by no later than 4pm on Friday 20 February 2009.
9. The Respondent is to provide the Legal Services Commissioner with his original file and original trust account ledger regarding the disciplinary complaint made by Dr V Alexander Mogilevski (J223/2008) by no later than 4pm on Friday 20 February 2009.
10. Should the Respondent fail to comply with Orders 7-9 in full by the specified time, the Respondent's practising certificate will be cancelled from Monday 2 March 2009 and he may not apply for a practising certificate until 2 September 2009.
11. Liberty to apply.

1. Mr Stuart Morgan has practised as a legal practitioner since about 1 December 1983. As a sole practitioner he has carried on practice as Stuart Morgan & Associates of 238 Glenferrie Road, Malvern in Victoria.
2. These matters concern some five charges of professional misconduct brought against Mr Morgan by the Commissioner pursuant to provisions of the Legal Profession Act 2004 (the Act).
3. I will deal with each charge in turn.

1. The first charge ('Charge 1') (J220/2008) is of professional misconduct within the meaning of s 4.4.4(a) of the Act in that Mr Morgan contravened s 4.4.11(1)(a) of the Act by failing to comply at the required time or at any time with the request of the Legal Services Commissioner, to provide her with a full written explanation of his conduct regarding the disciplinary complaint made by Ms Elizabeth McCrae on behalf of Mr Shane Keast received by the Commissioner on 22 April 2008.
2. It has been alleged that Mr Morgan:
   • delayed Mr Keast's matter relating to breach of contract of the sale of a property at 10 Oldbury Grange, Tarneit;
   • failed to forward his file relating to the matter to Ms McCrae, Mr Keast's new lawyer; and
   • failed to respond to telephone calls and emails from Ms McCrae and Mr Keast.
3. The Commissioner determined that Ms McCrae's complaint was a disciplinary complaint within the meaning of s 4.2.3 of the Act.
4. By letter dated 30 April 2008 she advised Mr Morgan that pursuant to s 4.4.11(1)(a) of the Act she required him to provide her with a full written explanation of his conduct with regard to the subject matter of the complaint, within 16 days.
5. The Commissioner received no response to this letter. She wrote to Mr Morgan again on 4 June 2008 and reminded him of the details of the nature of the complaint. She gave him the opportunity to make submissions on whether the complaint should be treated as a disciplinary complaint and whether or not the complaint should be summarily dismissed pursuant to s 4.2.10 of the Act.
6. Not having received submissions from Mr Morgan within the required time frame, the Commissioner determined that the complaint was a disciplinary complaint and that there were no grounds to dismiss it under s 4.2.10 of the Act. By letter dated 15 July 2008 the Commissioner again requested a full written explanation of Mr Morgan's conduct pursuant to s 4.4.11(1)(a) of the Act.
7. By letter dated 15 August 2008 the Commissioner advised Mr Morgan (among other things) that:

(a) his response to her request by the letter of 15 July 2008 had not been received; and

(b) she required him to give this matter his immediate attention and provide her with a written explanation in relation to the subject matter of the complaint, within 16 days.

1. By letter sent by registered mail dated 11 September 2008 and received 12 September 2008 the Commissioner advised Mr Morgan that (among other things):

(a) his response to her requests in the above letters had not been received;

(b) his failure to provide her with a full written explanation of his conduct may constitute a breach of the provisions of the Act and may thereby amount to professional misconduct in accordance with section 4.4.4(a) of the Act; and

(c) she required him to give this matter his urgent attention and provide her with a written explanation of his conduct within 16 days.

1. By letter dated 8 October 2008 and sent to Mr Morgan by registered mail the Commissioner advised him that (among other things):

(a) his response to her requests by the above letters had not been received;

(b) she was satisfied that there was a reasonable likelihood that the Tribunal would find him guilty of professional misconduct within the meaning of s 4.4.4(a) of the Act in respect of his failure to comply with her request made pursuant to s 4.4.11(1)(a) of the Act.

1. An Australia Post Confirmation Advice Receipt shows that Mr Morgan also received this letter, on 13 October 2008.
2. At 21 November 2008, the date of the Commissioner's application for an order to the Tribunal, Mr Morgan had failed to provide the Commissioner with any written explanation of his conduct and failed to respond to all her letters referred to above.

1. The second and third charges (Charges 2 and 3) (J221/2008) are also of professional misconduct within the meaning of s 4.4.4(a) of the Act.
2. The charged misconduct lies first in contravention of s 4.4.11(1)(a) of the Act by failing to comply at the required time or at any time with the request of the Legal Services Commissioner to provide her with a full written explanation of his conduct regarding the disciplinary complaint made by Mr John Love-Linay.
3. Mr Morgan is also charged with misconduct in that he contravened s 4.4.11(1)(b) of the Act by failing to comply at the required or any time with the request of the Legal Services Commissioner to provide her with information relating to trust monies, his file and his trust account ledgers regarding the subject of the disciplinary complaint made by Mr John Love-Linay.
4. Mr Love-Linay's complaint arose in relation to the estate of the late Miss E. V. Bishop, of which Mr Morgan and Mr Love-Linay had been appointed executors, and commenced administration in November 2005.
5. In this connection allegations of:
   • delay;
   • failure to communicate with Mr Love-Linay; and
   • failure to finalise the estate's income tax commitments

1. The Commissioner determined that Mr Love-Linay's complaint was a disciplinary complaint within the meaning of s 4.2.3 of the Act.
2. By letter dated 19 December 2007 the Commissioner advised Mr Morgan that:

(a) she required him pursuant to s 4.4.11(1)(a) of the Act to provide her with a full written explanation of his conduct with regard to the subject matter of the complaint, within 16 days; and

(b) she required him pursuant to s 4.4.11(1)(b) of the Act to provide her with information relating to trust monies, his file and his trust account ledgers in relation to this matter, within 16 days.

1. By letter dated 25 January 2008 the Commissioner advised Mr Morgan that (among other things):

(a) his response to her letter of 19 December 2007 had not been received; and

(b) she required Mr Morgan to give this matter his immediate attention and provide her with a written explanation of his conduct, within 16 days.

1. On 13 February 2008 a member of the Commissioner's staff, on her behalf, telephoned Mr Morgan's office and left a message with Mr Morgan's employee Tanya. Mr Morgan was advised to contact the Commissioner's office by return call as a matter of urgency.
2. By letter dated 28 February 2008 the Commissioner wrote to Mr Morgan by registered mail to advise him that (among other things):

(a) his response to the above letters had not been received;

(b) his failure to provide the Commissioner with a full written explanation of his conduct and the additional information and documents may constitute a breach of the provisions of the Act and may thereby amount to professional misconduct in accordance with s 4.4.4(a) of the Act; and

(c) she required him to give this matter her urgent attention and provide her with a written explanation of his conduct and the requested information and documents within 16 days.

1. Mr Morgan's receipt of this letter was confirmed by Australia Post receipt dated 29 February 2008.
2. By letter dated 8 July 2008 the Commissioner notified Mr Morgan of the details of the nature of the complaint and afforded him the opportunity to make submissions on whether the complaint should be treated as a disciplinary complaint and whether or not it should be summarily dismissed pursuant to s 4.2.10 of the Act.
3. The Commissioner received no submissions from Mr Morgan within the required time frame. She made a determination that the complaint was a disciplinary complaint and that there were no grounds to dismiss it under s 4.2.10 of the Act.
4. By letter dated 6 August 2008 the Commissioner again advised Mr Morgan that she required him:

(a) pursuant to s 4.4.11(1)(a) of the Act to provide her with a full written explanation of his conduct; and

(b) pursuant to s 4.4.11(1)(b) of the Act to provide her with information relating to trust monies, his file and his trust account ledgers in relation to this matter.

1. On 11 August 2008 a solicitor employed as Mr Morgan's locum, Ms Anna Domine, telephoned the Commissioner's office to confirm receipt of the letter dated 6 August 2008. The Commissioner was advised that Mr Morgan was on leave until 22 August 2008 and requested a 14-day extension to respond. Ms Domine also indicated that she could gather all the relevant information on Mr Morgan's behalf and that Mr Morgan could attend to it on his return.
2. Ms Domine sent a facsimile dated 19 August 2008 received by the Commissioner on 20 August 2008 confirming the Commissioner's agreement to granting an extension until 8 September 2008.
3. On 11 September 2008 the Commissioner sent Mr Morgan by registered mail a letter advising him among other things that:

(a) his response to her letters dated 19 December 2007 and 25 January, 28 February and 6 August 2008 had not been received; and

(b) his failure to provide her with a full written explanation of his conduct and the additional information and documents sought may constitute a breach of the provisions of the Act and may thereby amount to professional misconduct in accordance with s 4.4.4(a) of the Act; and

(c) she required him to give this matter his immediate attention and provide her with a written explanation in relation to the subject matter of the complaint and the additional information and documents within 16 days.

1. Mr Morgan's receipt of this letter of 11 September 2008 is confirmed by Australia Post receipt dated 12 September 2008.
2. By letter dated 8 October 2008 sent to Mr Morgan by registered mail and confirmed as having been received on 13 October 2008, the Commissioner advised Mr Morgan among other things that:

(a) his response to her letters detailed above had not been received; and

(b) she was satisfied that there is a reasonable likelihood that the Tribunal would find him guilty of professional misconduct within the meaning of s 4.4.4(a) of the Act in respect of his failure to comply with her requests made pursuant to ss 4.4.11(1)(a) and 4.4.11(1)(b) of the Act.

1. At 21 November 2008, the date of the Commissioner's application to the Tribunal for an order in this matter, Mr Morgan had failed to provide the Commissioner with any written explanation of his conduct and failed to respond to all her letters referred to above.

1. The fourth charge (Charge 4) (J223/2008) is also of professional misconduct within the meaning of s 4.4.4(a) of the Act in that Mr Morgan contravened s 4.4.11(1)(b) of the Act by failing to comply at the required time or at any time with the request of the Legal Services Commissioner, to provide the Commissioner with his original file and original trust account ledger regarding the disciplinary complaint made by Dr V Alexander Mogilevski.
2. This complaint relates to Mr Morgan's handling of the sale of interest in a freehold unit trust, the Goater's Trust, to Dr Mogilevski. The complaint was a disciplinary complaint within the meaning of s 4.2.3 of the Act. It had previously been brought before Member Butcher of this Tribunal on 7 May 2008 (J12/2008).
3. Order 3 of Member Butcher is as follows:

The respondent legal practitioner is found guilty of professional misconduct within the meaning of s 4.4.4 (a) of the Legal Profession Act 2004 in that he contravened the Act by failing to respond to a request made by the Legal Services Commissioner pursuant to s 4.4.11(1)(a) of the Act for a full written explanation of his conduct in respect of a complaint made to the Legal Services Commissioner by Dr V A Mogilevski.

1. On 30 May 2008 Mr Morgan provided the Commissioner with a full written explanation of his conduct with regard to the subject matter of this complaint.
2. By letter dated 8 July 2008 the Commissioner wrote to Mr Morgan reminding him of the details of the nature of the complaint and affording him an opportunity to make submissions on whether it should be treated as a disciplinary complaint and whether or not the complaint should be summarily dismissed pursuant to s 4.2.10 of the Act.
3. After receiving no submission from Mr Morgan the Commissioner determined that the complaint was a disciplinary complaint and that there were no grounds to dismiss it under s 4.2.10 of the Act.
4. By letter dated 30 July 2008 the Commissioner required Mr Morgan, pursuant to s 4.4.11(1)(b) of the Act to provide her with his original file and his original trust account ledger in respect of this matter.
5. By letter dated 27 August 2008 the Commissioner advised Mr Morgan among things that:

(a) his response to her request by letter dated 30 July 2008 had not been received; and

(b) she required Mr Morgan to give this matter his immediate attention and provide her with the documents she sought, within 16 days.

1. By registered letter dated 29 September 2008 and received 1 October 2008 the Commissioner advised Mr Morgan among other things that:

(a) his response to her letters dated 30 July and 29 August 2008 had not been received;

(b) his failure to provide her with the documents she sought may constitute a breach of the provisions of the Act and may thereby amount to professional misconduct in accordance with s 4.4.4(a) of the Act; and

(c) she required Mr Morgan to give this matter his urgent attention and provide her with the documents within 16 days.

1. At 2 December 2008, the date of the Commissioner's application to the Tribunal for an order in this matter, Mr Morgan had:

(a) failed to provide the Commissioner with his original file in this matter;

(b) failed to provide her with his original trust account ledger in respect of this matter; and

(c) failed to respond to her letters of 30 July, 27 August and 29 September 2008.

1. The fifth charge (Charge 5) (J9/2009) is of professional misconduct within the meaning of s 4.4.4(f) of the Act by failing to comply with an order of the Tribunal made under the Act.
2. The charge arises from the Tribunal's finding of professional misconduct against Mr Morgan in VCAT matter J204/2008 in relation to the complaint made to the Commissioner by Ms Patty Nikolakopoulos.
3. Among other orders dated 19 November 2008 I ordered Mr Morgan to provide the Commissioner with a full written explanation of his conduct regarding the subject of the disciplinary complaint LSC/08/2327, by 4pm on Friday 4 December 2008.
4. By letter on that date Mr Morgan advised the Commissioner that the matter of Nikolakopoulos was being typed and would follow shortly. The anticipated explanation was not received.
5. By letter dated 10 December 2008 sent by registered mail and received 12 December 2008, and by confirmed facsimile on 11 December 2008, the Commissioner advised Mr Morgan that, amongst other things:

(a) she had not received his full written explanation;

(b) he was in breach of the order of the Tribunal; and

(c) so as to avoid further proceedings he was asked to comply with the order of the Tribunal, within 7 days.

1. As at the date of making this application - 9 January 2009 - Mr Morgan had failed to comply at the required time or at any time with the order of the Tribunal to provide a full written explanation in respect of the matter complained of by Ms Nikolakopoulos.

1. The facts outlined above are admitted and Mr Morgan does not contest the findings of professional misconduct sought by the Commissioner in each of these matters.
2. I find Mr Morgan guilty of four instances of professional misconduct as defined by s 4.4.4(a) of the Act and one instance of professional misconduct as defined by s 4.4.4(f) of the Act. I now turn to the question of penalty.
3. Sections 4.4.17, 4.4.18 and 4.4.19 of the Act set out the penalties which may be imposed if the Tribunal finds a legal practitioner guilty of professional misconduct. The type of orders relevant to matters such as those before the Tribunal include:
   • the imposition of a fine not exceeding $50,000;
   • the suspension or cancellation of the practitioner's practising certificate;
   • an order reprimanding the practitioner; or
   • an order that the practitioner undertake a specified course of further legal education.
4. In respect of these matters the Commissioner seeks the following orders:
   • (i) Mr Morgan is to respond to the Commissioner's requests for full written explanations of his conduct in respect of the disciplinary complaints made by Ms Elizabeth Mc Crae (matter J220/2008); Mr John Love-Linay (matter J221/2008) and Ms Patty Nikolakopoulos (matters J204/2008 and J9/2009), within 16 days.
   • (ii) Mr Morgan is to provide the Commissioner with the information sought in the Commissioner's letter dated 19 December 2007 relating to trust monies, his file and his trust account ledgers regarding the subject of the disciplinary complaint made by Mr John Love-Linay (matter J221/2008), within 16 days.
   • (iii) Mr Morgan is to provide the Commissioner with his original file and original trust account ledger regarding the disciplinary complaint made by Dr V Alexander Mogilevski (J223/2008), within 16 days.
   • (iv) Mr Morgan is to complete an additional CPD unit related to practice management, within the CPD year beginning 1 April 2008.
   • (v) Mr Morgan is to pay the Commissioner's costs of $2743.40.
   • (vi) Mr Morgan's practising certificate is to be cancelled and he may not be granted a practising certificate for a specified period.

5. Mr Morgan did not oppose orders (i) to (v). I am satisfied that orders in the terms set out above at (i) to (v) are appropriate in the circumstances of this matter.
6. In relation to the cancellation of Mr Morgan's practising certificate the Commissioner sought an order of the type made by Member Butcher in matters J312/2007, J11/2008 and J12/2008. The relevant parts of Member Butcher's order are set out below:

"7. The respondent legal practitioner's local practising certificate is cancelled from 1 June 2008.

1. A local practising certificate is not to be granted to the respondent legal practitioner before 1 September 2008. If by 30 May 2008 the respondent legal practitioner provides to the Legal Services Commissioner full written explanations in relation to complaints made by Michael and Nina Shadforth, Kevin Bremner and Dr V.A. Mogilevski and provides to the Legal Services Commissioner his file in relation to the subject matter of the complaint made by Michael and Nina Shadforth, he is to be eligible to be granted a local practising certificate as from 1 July 2008.
2. If any dispute arises concerning whether the respondent legal practitioner has complied with the requirements of the Legal Services Commissioner in relation to the provision of full written explanations concerning the complaints made by Michael and Nina Shadforth, Kevin Bremner and Dr. V.A. Mogilevski or whether he has provided the file in relation to the subject matter of the complaint made by Michael and Nina Shadforth, either party has leave to apply."
3. The Commissioner submitted that in view of the number of findings of professional misconduct it was appropriate that Mr Morgan's practising certificate be cancelled and he not be granted a practising certificate for a specified period the duration of which should be at least as long as the period specified in Member Butcher's order.
4. Mr Morgan opposed an order cancelling his practising certificate. He said that he had been in practice for some 25 years, mostly as a sole practitioner, and other than the matters presently before the Tribunal he had not been the subject of disciplinary proceedings.
5. The matters which bring Mr Morgan before the Tribunal are said to have all arisen out of a particularly difficult period in 2007. At that time Mr Morgan's son was diagnosed with Asperger's Syndrome. His son's illness also placed strain on his marital relationship. At the same time Mr Morgan had to confront some staffing issues as a number of long serving employees left his employ.
6. Mr Morgan has sought assistance from officers in the professional standards area of the Law Institute of Victoria, among others, in relation to the matters raised by the Commissioner.
7. Mr Morgan submitted that as he was a sole practitioner any order of the type made by Member Butcher would be extremely disruptive.
8. I have had regard to the submissions made and to the fact that Mr Morgan has admitted the charges. Such admissions are a substantial mitigating factor in his favour.
9. However I am concerned about Mr Morgan's apparent unwillingness to confront the issues associated with the various disciplinary complaints. While he has provided an explanation in relation to some of the charges he is unable to explain his failure to hand over the McCrae and Mogilevski files. He has the files and is prepared to provide them to the Commissioner but has not yet done so.
10. Nor has Mr Morgan provided a satisfactory explanation for his failure to comply with my order of 19 November 2008 that he provide a full written explanation of his conduct in respect of Ms Nikolakopoulos' complaint. He said that he drafted a response in December 2008 but was extremely busy before Christmas with a number of conveyancing matters and was unable to finalise his explanation within the required time. No satisfactory explanation was provided for his failure to finalise his response in the period after Christmas.
11. In all the circumstances I do not think it appropriate to make an order cancelling Mr Morgan's practising certificate at this stage. However I propose to modify the type of order made by Member Butcher so as to provide that if Mr Morgan does not comply with the orders set out (i) to (iii) of paragraph 54 above by 20 February 2009 then his practising certificate will be cancelled and he will be unable to apply for a practising certificate for six months.
12. Such an order is intended to focus Mr Morgan's mind on the need to provide the explanations and documents sought by the Commissioner's in respect of the various disciplinary complaints within the time specified. There will be liberty to apply for a variation of the orders I propose to make.
13. In addition to the order dealing with Mr Morgan's practising certificate I also propose to make orders imposing fines in respect of each finding of professional misconduct.
14. Mr Morgan will be required to pay a fine of $1000 in respect of each of the four findings of professional misconduct in matters J220/2008, J221/2008 and J223/2008, totalling $4000, by 11 March 2009.
15. In relation to the finding of professional misconduct in matter J9/2009, a more significant fine is warranted as it is more serious than the other matters before me. Mr Morgan will be required to pay a fine of $1500 by 11 March 2009.
16. I am satisfied that the orders to which I have referred are appropriate in the circumstances have regard to the nature of the misconduct, Mr Morgan's admissions and the submissions of the parties.