(a) the files (other than any files handed by him to the complainant) concerning Ian Douglas Olifent / Artech properties Pty Ltd concerning QV apartments 1510, 1810, 1910 and 2010;

(b) a copy of his office and trust account ledgers in respect of the sales of those apartments; and

(c) any statement of account showing monies received or paid in respect of the sales of those apartments.

1. The legal practitioner is to pay a fine of $500 to the Legal Services Board by 15 May 2006.
2. The legal practitioner is to pay to Law Institute of Victoria Limited by 15 May 2006 its costs of these proceedings, fixed by the Tribunal at $1000."
3. Mr Rushford failed to comply with these orders. Over the period from 2006 to 2009, the LSC had difficulty contacting Mr Rushford on a number of occasions, but continued to purse its requests to him for information.
4. The failure to comply with the orders of Senior Member Howell of February 2006 was the subject of one of the proceedings which came before Judge Ross in this Tribunal on 29 July 2009. On that day, nine charges of professional misconduct were brought against Mr Rushford arising out of five separate proceedings. He was represented by counsel. He pleaded guilty to all nine charges and admitted the facts on which they were based.
5. The five matters before Judge Ross were referred to as the Alderton, Negri, Zenith, Borello and Olifent complaints. Eight of the nine charges related to failures to comply with statutory demands for explanations of his conduct in relation to the first four complaints (six under the 1996 Act and two under the 2004 Act). The ninth charge was of failing to comply with the order of Senior Member Howell of 14 February 2006 (relating to the Olifent matter).
6. Judge Ross made the following orders:
   1. The Tribunal finds the Respondent guilty of six instances of professional misconduct as defined by s 137 of the Legal Practice Act 1996.
   2. The Tribunal finds the Respondent guilty of three instances of professional misconduct as defined by s 4.4.3(1)(a) of the Legal Profession Act 2004.
   3. The Respondent is to respond, by statutory declaration, to the Commissioner's requests for a full written explanation of his conduct in relation to the Alderton complaint, by no later than 4pm on 19 August 2009.
   4. The Respondent is to respond, by statutory declaration, to the Commissioner's request for a full written explanation of his conduct in relation to the Borello, Negri and Olifent complaints, by no later than 4pm on 16 December 2009.
   5. In relation to the Olifent complaint the Respondent is to provide the Commissioner with the outcome of the accounting reconstruction exercise and any trust account records in his possession, by no later than 4pm on 16 December 2009.
   6. The Respondent is to pay a fine of $2500 to the Legal Services Board by no later than 4pm on 30 July 2010.
   7. Pursuant to s 4.4.17 of the Legal Profession Act 2004 the practitioner may not apply for a practising certificate until 30 July 2011.
   8. The Respondent is to pay the Commissioner's costs of $11,150.36. The parties are to confer and attempt to reach agreement on a payment schedule. Liberty to apply in the event of a failure to reach agreement.
7. Orders 3, 4 and 5 reflected an intention to give him the opportunity to collate and organise the information he had, and to work with his accountant to reconstruct trust account information.
8. The final part of Judge Ross's decision of 30 July 2009 was as follows:

[92] In the proceedings before the Tribunal it was common ground that the Commissioner's requests in respect of the Zenith complaint had now, albeit belatedly, been satisfied. Mr Rushford also complied, albeit belatedly, with the Commissioner's request to provide her with his file in relation to Mr Alderton's matter. Mr Rushford also gave evidence to the effect that he had conducted searches for the files and other material sought in relation to the other complaints, but none of the documents sought were in his possession. To that extent the requests relating to the provision of these documents have been satisfied. The apparent disappearance of these files may be the subject of further investigation by the Commissioner but for my purposes Mr Rushford has responded to the requests to the best of his ability.

[93] Mr Rushford has still failed to provide a written explanation of his conduct in relation to the Alderton, Borello, Negri and Olifent complaints.

[94] In relation to the Alderton complaint the parties have agreed that an order requiring the provision of a response within 21 days by statutory declaration, is appropriate.

[95] The provision of a response in respect to the other complaints is complicated by the need to reconstruct the relevant trust records. Mr Rushford has engaged an accountant to undertake this task. It is said that it may take 5-6 months. The Commissioner says that this is too long a period.

[96] I propose to make an order that Mr Rushford provide the written explanations of his conduct by no later than 4pm on 16 December 2009. In my view the time period specified is necessary having regard to the need to reconstruct the relevant records.

[97] The Commissioner seeks three further orders:

(i) the Respondent not be permitted to apply for a practising certificate for a period of two years;

(iii) the Respondent pay the Commissioner's costs of $11,150.36.

[98] The practitioner does not oppose the making of an order which would prohibit him from applying for a practising certificate for a period of two years. In the circumstances of this matter - and having regard to the practitioner's position - I will make an order in the terms sought. I note here that I have taken the imposition of such a restriction into account in assessing the quantum of fine to be imposed.

[99] Nor did the practitioner oppose the making of such an order for the payment of costs in the quantum sought by the Commissioner, but seeks time to pay. The parties agreed to an order that they confer as to an appropriate payment schedule and in my view such an order is appropriate. I will order that the Respondent pay the Commissioner's costs of $11,150.36 and order the parties to confer as to a schedule for payment.

[100] In relation to the imposition of a fine of $6000 this amount is calculated on the basis of eight fines of $500 (in relation to the findings arising from a failure to respond to the Commissioner's requests) and a fine of $2000 in relation to the practitioner's failure to comply with paragraphs 1 and 2 of Senior Member Howell's order.

[101] In support of the imposition of fines of this order of magnitude the Commissioner submits, in summary terms:

➢ these are serious matters, particularly the failure to comply with an order of the Tribunal;

➢ the requests were made a considerable time ago;

➢ a number of the requests are yet to be satisfied;

➢ the practitioner's conduct in respect of these proceedings has led to delay;

➢ the psychological issues relied upon by the applicant have had only a limited impact on his failure to respond to the Commissioner's requests; and

➢ two prior disciplinary findings have been made against the practitioner for similar offences (namely the finding of Senior Member Howell, which is also the subject of a charge in these proceedings; and an earlier finding of unsatisfactory conduct on 12 October 2004).

[102] I accept that these are serious matters and that the requests were made some time ago. But I take a different view of the impact of Mr Rushford's mental state on his capacity to respond appropriately to the Commissioner's requests. I also note that the various delays and adjournments occasioned by the practitioner's actions are adequately addressed by the costs order I will make.

[103] In mitigation Mr Oldis, counsel for the practitioner, relied on, among other things, a report from a psychologist, Ms Wendy Northey.

[104] Ms Northey is a registered psychologist with 25 year's experience in the provision of complex assessments in a number of forensic settings. The following extracts from Ms Northey's report are particularly relevant:

"37. At the time of his marriage breakdown, Mr Rushford's life was unravelling in a number of ways. He became depressed in around 2001 and suffered from low mood for a long period of time up to the present. In around 2004 his depression worsened, and then resolved somewhat with the help of antidepressant medication as prescribed. The depression clearly fell short of a major depressive disorder as indicated by the failure of the psychiatrist to diagnose such. However, it was more akin to a burnt-out state where a person can lose the capacity to deal with day to day demands and responsibilities due to exhaustion and feelings of demoralization.

1. ... The challenge before Mr Rushford in the period 2001-2004 was a demanding one which ultimately overwhelmed him. In the aftermath of that experience, between 2004-2008, Mr Rushford remained unable to cope adequately with all his responsibilities due to his ongoing feelings of exhaustion and denial.
2. It is only since he commenced employment with SolarCo and commenced psychological counselling that Mr Rushford has been able to more adequately attend to these matters before the Tribunal ... it would appear that he is well on the road to recovery now. Resolution of these matters will assist that recovery.
3. Certainly, psychological factors impacted negatively upon Mr Rushford's capacities and moral culpabilities to a significant extent. Having said that, it is clear that many of his problems were of his own doing, and it is difficult to in any way completely absolve Mr Rushford altogether. His mental illness was problematic. However, it cannot be said to have been entirely debilitating as one would accept from, say, a Major Depressive Disorder for instance."

[105] Ms Northey's report supports a finding that Mr Rushford's mental state impacted to a significant extent on his capacity to respond appropriately to the Commissioner's requests. These matters do not completely absolve Mr Rushford but they do reduce his moral culpability for his misconduct and I have taken them into account.

[106] Mr Oldis also relied on a letter of support form the practitioner's current employer, Mr Craig Martin, and a statutory declaration from the practitioner, dated 29 July 2009. I have taken these into account.

[107] It is also relevant to note that Mr Rushford is an undischarged bankrupt and has limited financial resources. The practitioner receives a modest income from his position with SolarCo and provides some financial assistance towards his daughter's upkeep.

[108] Mr Oldis did not resist the imposition of a fine but submitted that the Tribunal should have regard to all the circumstances, including Mr Rushford's limited financial means, in determining the question of quantum and the time specified for payment.

[109] Mr Rushford's mental state at the relevant time, his plea and the change in his attitude towards complying with the Commissioner's requests are significant mitigating factors in his favour.

[110] I am satisfied that the imposition of a fine is appropriate in the circumstances but I am not persuaded that a fine of the magnitude proposed by the Commissioner is warranted. In this context - and in addition to the matters set out in paragraph 109 - I have had regard to the fact that Mr Rushford does not presently hold a practising certificate and as a result of the orders I will make he will not be able to apply for a practising certificate for two years. Such a restriction is a significant penalty and accordingly only a modest fine is warranted.

[111] I propose to impose a fine of $250 in respect of each finding relating to Mr Rushford's failure to respond to the Commissioner's requests. There are eight such findings (hence $2000 in total). In respect of his failure to comply with Senior Member Howell's order I impose an additional fine of $500. Hence the total fine will be $2500.

[112] Having regard to Mr Rushford's limited means and the significant costs order he will be required to pay I propose to provide him a period of 12 months in which to pay the $2500 fine.

1. On 17 December 2009 the LSC wrote to Mr Rushford at an address in Albury and also to Mr Avi Furstenberg, of Lewenberg and Lewenberg, who had acted for him in the July 2009 proceeding. The purpose of the letters was to follow-up Mr Rushford's non-compliance with the orders that he provide responses by 16 December 2009. The letters recorded Mr Furstenberg's statement that he had been unsuccessful in his attempts to contact Mr Rushford.
2. In the meantime, on 6 August 2009, the LSC had written to Mr Rushford renewing its inquiries into his alleged breaches of trust accounting requirements. On 1 February 2010, Mr Rushford responded briefly to this letter. He admitted some allegations, denied others, and in relation to some matters, stated he would respond "after reconciliation of the trust account."
3. On 13 May 2010 Mr Craig Martin contacted the LSC on Mr Rushford's behalf. Mr Martin, Mr Rushford's employer, has been providing Mr Rushford with some degree of assistance in his dealings with the LSC. Mr Martin advised the LSC that he would visit Mr Rushford's accountant the following week in relation to the accounting reconciliation. There was further contact in July 2010, when Mr Martin told the LSC he was meeting with Mr Rushford the next day.
4. However, by March 2011, there had still been no further response and the LSC resolved to commence the present proceedings.

1. The five matters the subject of this hearing commenced with the lodgement with VCAT of applications by the LSC on 30 June 2011. These applications were amended in minor ways shortly prior to the hearing and during the hearing itself. These changes reflected typographical errors. They did not alter the substance of the charges.
2. A directions hearing was scheduled for 30 September 2011. Ms Brylee Alexander of the LSC contacted Mr Craig Martin of Planet Power. I infer this is the same business, or at least is related, to "Solar Co" referred to in Judge Ross's decision. The LSC sent Mr Martin proposed consent orders on 27 September 2011. On 28 September 2011, Ms Alexander telephoned Mr Martin. Mr Martin confirmed that Mr Rushford still worked for Planet Power. Ms Alexander asked him to bring the letter to Mr Rushford's attention.
3. During the afternoon of 29 September 2011 Mr Rushford emailed signed consent orders to the LSC. Later that day, Ms Alexander emailed Mr Rushford, stating that attendance by the parties had not yet been excused by the Tribunal, but that she would hand up the signed consent orders if required. Mr Rushford then sent a further email at 10:03am the following morning, 30 September 2011, stating that he had received her correspondence from the day before, and that there was no possible way he could attend that day on such short notice.
4. At the 30 September 2011 directions hearing, orders were made by consent for the conduct of this proceeding, involving the filing and service of Notices to Admit, Witness Statements and any other material, leading up to a hearing in March 2012.
5. On 23 February 2012 Ms Alexander wrote to Mr Rushford noting that he had not complied with any of the Tribunal's orders of 30 September 2011 and that the matter was listed for hearing on 19 March 2012. She also stated that if Mr Rushford did not attend the Tribunal on 19 March 2012, the Commissioner would submit that the matter be heard in his absence. The letter of 23 February 2012 sought Mr Rushford's urgent responses as to whether he intended to contest the charges. It also stated:

If you do not attend VCAT on 19 March 2012 and you have not contacted VCAT or my office before this date, the Commissioner will submit that the matter should be heard in your absence. Please be aware that should the Commissioner succeed in proving the charges, our counsel for the Commissioner will submit that it is appropriate for VCAT to order that the matter be referred to the Supreme Court for your name to be removed from the roll.

1. On 7 March 2012 Ms Alexander telephoned Mr Martin to inquire whether the respondent was aware of the date of the upcoming hearing and whether he had received her letter of 23 February 2012. Mr Martin noted the date and said he undertook to speak to Mr Rushford about it.
2. At 7:17am on the day of the hearing, Monday 19 March 2012, the LSC received a letter from Mr Rushford dated 18 March 2012. This was sent from the same email address as had been used for other email communications to and from Mr Rushford since at least September 2011. This letter stated:

VCAT REFERENCE J86, J87, J88, J89 & J90 OF 2011

I confirm that I will be absent from proceedings at VCAT this Monday 19 March, 2012 and confirm your advice that the matter will be heard in my absence.

I am not in a financial position to defend the matters properly and do not believe I would be capable of defending them myself.

As you are aware I have been suffering from depression and anxiety for some period of time and this has affected my ability to deal with complex and difficult matters.

Previously I have received financial assistance from my employer to cover my legal fees but the business is no longer in a position to assist me.

I do not hold files or records in the Negri, Olifent or Borello matters and so rely upon the facts as presented to VCAT.

With respect to Olifent I understand that he has an amount of $6,688.32 outstanding according to a summary prepared by me and submitted to Ron Makin. As I understand these funds are currently held in the Trust Account would you confirm how payment could be completed.

I understand that the balance of the Trust Account was $6,767.90. Once funds are paid to Olifent then the account could be closed.

As discussed, I do not believe that I am holding funds for Negri as I believe my former Practice Manager Ian Dear accounted all monies as fees. I am however willing to make payment to them in the amount of $2,000.00. If this is acceptable please let me know how payment could be made.

Likewise I am willing to make payment to Borello in the amount claimed by him, namely $1,000.00.

The payments to Negri and Borello can be made to you within 7 days.

I hope the proposal above goes some way to assisting with resolution of the matters before VCAT.

I ran Clark Rushford Solicitors for some 10 years. In the latter years we concluded over 1,500 conveyancing matters per year. We were audited by the Law Institute Trust Account Branch 3 times during that period without incident.

It is with sadness that I now realise that I am unable to practice law and that my health has deteriorated to the current level.

I await your advice with respect to Negri, Olifent and Borello.

1. In the light of all the circumstances set out above, the submissions and evidence given on behalf of the LSC, and Mr Rushford's letter dated 18 March 2012, I am satisfied that he had received and understood the LSC's letter of 23 February 2012. I am also satisfied that Mr Rushford was therefore aware that the LSC would be submitting that the severest possible sanction should be sought against him, namely an order recommending to the Supreme Court that his name be removed from the local roll. In all the circumstances, I have concluded that Mr Rushford has chosen not to participate in these proceedings, and let them play out, with whatever consequences flow from them, without his involvement.
2. On that basis, I agreed to the conduct of the hearing of these five matters ex parte. I now proceed to consider the evidence and submissions provided in relation to each of the five matters.

1. In summary, the 20 charges against Mr Rushford allege as follows:

Failing to account for the sum of $2,012 held in trust for Mr & Mrs Negri since 2003; failing to comply with an earlier order of this Tribunal.

Failing to provide files sought by his former client, Mr Olifent; deducting trust monies amounting to $3,800 without rendering bills and failing to account for trust monies; failing to comply with an earlier order of this Tribunal for the provision of information.

Having a deficiency of $1,682 in his trust account; using his trust account to pay $1,760 rent for his own private purposes; failing to respond to a statutory demand for information from the LSC.

Engaging in legal practice and receiving trust monies when a practising certificate was no longer held; failing to maintain and reconcile trust records, failing to have trust records audited, failing to lodge audit reports; failing to comply with a statutory request by the LSC for an explanation of his conduct.

Failing to account for $1,000 held in trust on behalf of Mr Frank Borello since 2003; failing to comply with an order of this Tribunal to provide an explanation in relation to this matter.

1. Mr Makin gave evidence that in around 2002, he was looking for a practice to purchase for the purpose of practising with a colleague, Mr Michael Kavanagh. He examined a number of practices and ultimately decided to purchase Mr Rushford's practice. A sale agreement was entered into. It came into effect on 9 August 2004. There was an express requirement of the sale agreement that all trust accounts open at the time of the sale of the practice be dealt with by Mr Rushford, as Mr Makin did not want to have any responsibility for existing trust funds going forward. Mr Makin and Mr Kavanagh opened a new and separate trust account for new matters. No funds were transferred from the Clark Rushford trust account.
2. Shortly after they took over the practice Mr Makin and Mr Kavanagh began to receive enquiries and complaints from clients of Mr Rushford relating to Clark Rushford trust account issues. These have taken many years to resolve. In the case of the matters before the Tribunal now, they are still unresolved. Mr Makin said that there were so many problems that in December 2005 he changed the name of the firm from Clark Rushford to Makin & Kinsey (Mr Kavanagh having left the partnership by this stage) because the goodwill that he thought he had paid for in purchasing the firm "Clark Rushford" was of no value. He changed the name of the firm in order to distance himself from the name Clark Rushford. Mr Makin also gave evidence in relation to each of the five particular matters before the Tribunal. I deal with that evidence under each specific heading.

1. The first charge is of misconduct within the meaning of s.137(a) of the 1996 Act in that Mr Rushford wilfully or recklessly contravened s.188(1)(b) of that Act, by failing, without reasonable excuse, to account to Mr and or Mrs Negri for trust money received from them.
2. The second charge is of misconduct within the meaning of s.137(a) of the 1996 Act in that Mr Rushford wilfully or recklessly contravened Rule 30 of the Trust Account Practice Rules 2003 (the Trust Account Rules) in that he failed to furnish Mr and Mrs Negri with a statement of account upon the reasonable requests of Mr Makin, made on behalf of Mr and Mrs Negri.
3. Charge 3 was of professional misconduct within the meaning of s.4.4.4(f) of the 2004 Act in that Mr Rushford failed to comply with the order of VCAT made under the 1996 Act on 30 July 2009, by not providing an explanation for his conduct in relation to the Negris.
4. Mrs Negri gave evidence that she paid the sum of $2,021 to Mr Rushford in 2003 on account, to provide legal services to Mr and Mrs Negri on a debt recovery matter. She said she did not recall receiving any invoices from Mr Rushford for work done, was not aware of any work actually having been done, and that as of the date of the hearing, she had still not received this money back from Mr Rushford, despite a number of requests.
5. Mr Makin gave evidence of his requests on behalf of the Negris from at least January 2005 for an account of monies Mr Rushford held on the Negris' behalf. He said that in around January 2005, he spoke with Mr Rushford in the vicinity of practice. During the conversation Mr Makin told Mr Rushford that he was aware there was still money held on trust by Mr Rushford which he had not returned to his clients. Mr Makin asked Mr Rushford whether he was going to return the money. Mr Makin said Mr Rushford told him he wasn't going to return the money.
6. Mr Makin continued to seek payment of trust money from Mr Rushford on behalf of Mr and Mrs Negri. He accessed part of the accounts of the practice, including the trust account trial balance as at 25 August 2004. This showed the sum of $2,021 being held on behalf of Michael Negri. Mr Makin wrote to Mr Rushford on 8 July 2005 referring to Mr Rushford having undertaken to go through his trust account list with Mr Makin to determine if funds were still held in trust. The letter stated Mr Rushford had not done this despite Mr Makin's reminders to him. The letter went on to demand on behalf of the Negris and other clients that Mr Rushford provide a statement within seven days showing that the monies are either held on trust, and if not, when the funds were repaid to the clients. No response to this demand has been received.
7. In his letter dated 18 March 2012, Mr Rushford stated he did not believe he was holding funds for the Negris'. However, in the light of the clear information in the trust records which have been able to be obtained, the evidence of Mrs Negri and Mr Makin, and Mr Rushford's offer to repay the sum of $2,000, I am satisfied that the monies are still owing to the Negris. I find the facts alleged in charges 1 and 2 proved.
8. In relation to charge 3, the extensive correspondence referred to above establishes that Mr Rushford has not provided a full written explanation of his conduct in relation to the Negri complaints to the present day and certainly not since the Tribunal's order of 30 July 2009. I find the facts alleged in charge 3 are proved. Mr Rushford failed to respond, by statutory declaration, to the LSC's request for a full written explanation of his conduct in relation to the Negri complaint, by 16 December 2009.

1. Mr Rushford acted for Mr Olifent in relation to his purchase of a number of apartments in the QV project "off the plan", and the on-sale of those apartments by Mr Olifent. By 9 August 2004, the only apartment sale by Mr Olifent for which settlement had not occurred was Lot 1414. Mr Rushford had remained involved after the transfer of the practice on 9 August 2004, however, both in acting for Mr Olifent as vendor in relation to some on-sales, and as being the repository of information required to finalise work in relation to the sales of other apartments by Mr Olifent, which had already settled.
2. In relation to apartment 1414, in June 2005, both the vendor and purchaser were in a position to settle the matter and the purchaser had the option to rescind the sale if settlement was not effective by 24 June 2005. However, the settlement was delayed because the parties could not get Mr Rushford to complete the conveyancing files (preparation of statement of adjustments, details of cheques for settlement, details of allowances to be made for deposits, commission and fees, etc). Finally, on instructions from both parties, Mr Makin took both files from Mr Rushford and completed the settlement himself. Similarly, Mr Makin had to take over the conduct of four other QV sales (which Mr Rushford had remained involved in) where finalisation was prevented by Mr Rushford's inaction.
3. By February 2006, these four files still had not been provided. In order to finalise the conveyances for these matters, Makin & Kinsey had to take unusual steps, such as writing to the City of Melbourne in detail, explaining that they were not able to provide notices of acquisition because they had not been able to obtain the files from Mr Rushford. Clients, as well as Mr Makin, suffered additional expense and inconvenience due to the matters having to be finalised without the files, or necessary information. The non-production of these four files was the subject of the orders made by Senior Member Howell on 14 February 2006, and again, by Judge Ross on 30 July 2009.
4. Mr Makin's experience with matters he had taken over from Mr Rushford led him to make a complaint to the LIV, which responded by appointing a trust account inspector, Mr Ronald Hall, to investigate Mr Rushford's compliance with his trust accounting obligations. Mr Hall produced a report dated 7 December 2005 (the Hall Report).
5. The first charge in relation to the Olifent transactions is of misconduct within the meaning of s.137(a) of the 1996 Act, in that Mr Rushford recklessly contravened rule 23.2 of the Professional Conduct and Practice Rules 2003 in that he failed to hand over files sought by Mr Ian Olifent or by Makin & Kinsey on Mr Olifent's behalf, despite valid authorities being provided and no lien being claimed over those files by Mr Rushford.
6. On 3 August 2005, Makin and Kinsey wrote to Mr Rushford, asking for relevant information, and the files, in relation to five QV apartment sales, in order to finalise the conveyances of five QV properties. On 10 August 2005, Mr Rushford acknowledged that a proper authority from the client, Mr Olifent, had been produced. Production of these was promised by Mr Rushford on a number of occasions, but the files were never produced. At no stage did Mr Rushford claim any lien over the files. I am satisfied charge 1 has been proved.
7. Charge 2 alleges misconduct within the meaning of s.137(a) of The 1996 Act in that Mr Rushford wilfully or recklessly contravened Rule 30 of the Trust Account Practice Rules 2003 in that he failed to account to Mr Olifent or to Makin & Kinsey on his behalf for the trust monies held or received by Mr Rushford on Mr Olifent's behalf.
8. In response to Makin and Kinsey's request of 3 August 2005 for, amongst other things, an accounting for trust monies held by Mr Rushford on behalf of Mr Olifent, on 10 August, Mr Rushford provided a table, marked "Re Olifent", and headed "Account Reconciliation by Apartment." This table did not provide the information required in order to enable Mr Makin to complete the files. Also, part of the information it contained was incorrect. As noted, full and correct information was never provided. Accordingly, I am satisfied charge 2 is proved.
9. The third charge is of misconduct within the meaning of s.137(a) of the 1996 Act in that Mr Rushford wilfully or recklessly contravened Rule 31 of the Trust Account Practice Rules 2003 and s.174 of the 1996 Act in that he deducted money for his costs from trust without rendering a bill of costs. From his inspection, Mr Hall concluded that Mr Rushford had withheld $3,800.00 from monies held in trust on behalf of Mr Olifent, for his legal fees, being $950.00 each for the sale of four apartments. In his Report, Mr Hall stated there did not appear to be any bills of costs or statements prepared by Mr Rushford in respect of Mr Olifent's matters. Mr Makin's letter of 3 August 2005 requested that Mr Rushford provide an itemised account of how Mr Rushford arrived at the fees charged. Neither this account, nor any fee invoices, were ever produced. Charge 3 has also been made out.
10. The fourth charge is of professional misconduct within the meaning of s.4.4.4(f) of the 2004 Act in that Mr Rushford failed to comply with the order of the Tribunal made under the 1996 Act on 30 June 2009. Ms Brylee Alexander of the LSC gave evidence as to the events which occurred after Judge Ross's order of 30 July 2009, recited above. Mr Rushford did not provide the LSC with any accounting reconstruction by 16 December 2009. Charge 4 is also made out.

1. First, the LSC alleges professional misconduct within the meaning of section 4.4.3 of the 2004 Act in that the respondent contravened section 118(1)(a) of the Legal Practice Act 1996 by having a deficiency in his trust account without reasonable excuse.
2. Mr Makin gave evidence that on 10 June 2009, he received correspondence from the Department of Sustainability and Environment (DSE) that two cheques payable to the Land Titles Office dated 4 June 2004 drawn on the Clark Rushford Solicitors trust account, each in the sum of $841.00, had been dishonoured. The communication from DSE was addressed to First Choice Conveyancing and the cheques were written at the time when Mr Rushford was operating that business. The LSC gave Mr Rushford two opportunities to respond to this matter, on 5 August and 17 December 2009. It received no response, and so gave notice of its intention to commence a disciplinary proceeding in relation to this matter on 29 March 2011.
3. I am satisfied that the dishonouring of the cheques indicates a deficiency in Mr Rushford's trust account, and that he has not provided any reasonable excuse, despite being given the opportunity to do so. Charge 1 is therefore proved.
4. Secondly, the LSC alleges professional misconduct within the meaning of section 4.4.3 of the 2004 Act in that Mr Rushford's conduct in drawing a cheque on his trust account on about 2 June 2005 in the amount of $1760.00 payable to Compton and Green for rental arrears owing by him contravened section 174(3) of the 1996 Act.
5. The breach alleged was due to the cheque being drawn against the trust account, even though it was to pay personal expenses of Mr Rushford.
6. Mr Makin gave evidence that around 2 June 2005, he received a facsimile from Compton and Green Real Estate Agents in Williamstown enclosing a copy of a cheque dated 2 June 2005 written against the Clark Rushford Solicitors trust account signed by Mr Rushford for rental on premises at 3/122 The Avenue, Spotswood. Mr Makin said that Compton and Green had told him that the cheque was for rental arrears on Mr Rushford's private residence.
7. I am satisfied that the cheque was not drawn for any of the purposes authorised by section 174(3), given that it was for Mr Rushford's private purposes, rather than for any purpose connected with clients on whose behalf the monies were held on trust, and so this charge has been proved.
8. The third charge is of professional misconduct within the meaning of section 4.4.4(a) of the 2004 Act in that the respondent failed to comply with the request made pursuant to section 4.4.11(1)(a) of the 2004 Act.
9. On 5 August 2009 the LSC wrote to Mr Rushford requiring a full written explanation of his conduct within 16 days. It followed this up with letters dated 17 December 2009 and 29 March 2011. It received no response from Mr Rushford. Accordingly, this charge is made out.

1. In this proceeding the LSC has brought eight charges. The first is of professional misconduct within the meaning of section 4.4.3(1) of the 2004 Act in that Mr Rushford contravened section 314(1) and/or 314(2) of the 1996 Act by engaging in legal practice or representing that he was qualified to engage in legal practice when he was not entitled to do so.
2. The second charge is of professional misconduct within the meaning of section of 4.4.3(1) of the 2004 Act in that the respondent contravened section 178 of the 1996 Act by receiving trust money after ceasing to hold a practising certificate on 30 June 2005.
3. A certificate under section 7.2.5(1) of the 2004 Act was provided which proves that Mr Rushford ceased to hold a practising certificate from 30 June 2005. The Hall Report demonstrates by reference to the Commonwealth Bank Trust Account statement that a sum of $39,800 was deposited on 1 July 2005. It also refers to the sum of $41,800 as being deposited on 15 July 2005.
4. The bank statement shows a deposit of $41,800.00 on 11 July, but no deposit on 15 July. It also shows a number of payments out of the trust account after 1 July 2005. Whilst the LSC could not demonstrate receipt of the amount of $41,800 on 15 July 2005, I am satisfied that Mr Rushford did, at least in relation to the 1 July payment, receive trust money after he ceased to hold a practising certificate, in contravention of section 178(1) of the old Act. This is a serious offence, for which a maximum penalty of imprisonment for two years is provided.
5. Returning to charge 1, reliance was placed on the evidence of Mr Makin, and two letters from "MAI Legal & Finance" dated 1 July and 14 July 2005 respectively, which indicated Mr Rushford was conducting a legal practice under that name from 14 Hambleton Street, Middle Park. Those two letters are to confirm arrangements for property settlements for two QV apartments on 1 and 15 July respectively. They both set out what cheques were to be provided at settlement, including payments to the "Clark Rushford Trust Account," apparently for legal fees. These two letters were attachments to the Hall Report. Although in his letter of 1 February 2010, Mr Rushford denied this, I am satisfied from the evidence, including the two MAI letters, and the receipt of monies into the trust account the subject of charge 2, that Mr Rushford did continue to engage in legal practice after his practising certificate had expired on 30 June 2005.
6. Whilst practising, and receiving trust monies, when no practising certificate was held are serious matters, I note the evidence referred to by the LSC relates to the period immediately after 30 June 2005, when Mr Rushford's practising certificate expired. I was not directed to any evidence of this conduct continuing for a long period after 30 June 2005.
7. Charges 3 to 7 inclusive are related. Charge 3 alleges professional misconduct within the meaning of section 4.4.3(1) of the 2004 Act in that Mr Rushford contravened section 182 of the 1996 Act and/or rules 18 and/or 19 of the Trust Account Practice Rules 2003 by failing to maintain trust records since about September 2004.
8. Charge 4 alleges professional misconduct within the meaning of section 4.4.3(1) of the 2004 Act in that Mr Rushford contravened section 184(1) of the 1996 Act by failing to lodge trust account audit reports for the year ending 31 October 2004.
9. Charge 5 alleges that further and/or in the alternative, Mr Rushford is guilty of professional misconduct within the meaning of section 4.4.3(1) of the 2004 Act in that he contravened section 189(1) of the 1996 Act by failing to have records kept by him under section 182 of the 1996 Act audited by an approved auditor following ceasing to be authorised to receive trust money.
10. Charge 6 alleges that further and/or in the alternative, Mr Rushford is guilty of professional misconduct within the meaning of section 4.4.3(1) of the 2004 Act in that he contravened section 185(3) of the 1996 Act by failing to lodge audit reports under section 185(1) of the 1996 Act within 60 days after the end of the period to which the audit relates.
11. Charge 7 alleges professional misconduct within the meaning of section 4.4.3(1) of the 2004 Act in that Mr Rushford contravened Rule 21 of the trust account rules by failing to reconcile trust records since about September 2004 to at least 7 December 2005.
12. These charges arise out of the analysis in the Hall Report in 2005. On 5 September 2005, the LIV sent a letter to Mr Rushford requesting a response to the complaint made by Mr Makin on behalf of Mr Olifent, including in relation to trust accounting matters. Consistent with his conduct throughout, Mr Rushford provided only sparse information. The upshot was that when the Hall Report was written on 7 December 2005, it concluded that the practitioner had not maintained trust records, for example trust receipts, trust journals and trust ledgers for his practice.
13. The LSC renewed its investigation into trust accounting matters in 2009. On 6 August 2009, it wrote to Mr Rushford, putting 11 allegations to him. Belatedly, on 1 February 2010, Mr Rushford responded. He admitted he had continued to make deposits into the trust account after he sold Clark Rushford (although this does not appear to go directly to any of the charges). He also admitted failing to maintain trust records since approximately September 2004, failing to lodge audit reports since October 2003, failing to lodge a final audit report and failing to reconcile trust records for the month of September 2004 through to the date of the report.
14. There is some duplication between the allegations in charges 3 - 7 inclusive. In his letter of 1 February 2010, Mr Rushford admitted matters comprising the elements of each of the charges 4 - 7 inclusive. In relation to charge 3, although in his letter of 1 February 2010 mr Rushford reserved his position in relation to the alleged breach of the Trust Account Practice Rules 2003, his admission that he failed to maintain trust records since approximately September 2004, satisfies the allegation of contravening s182 of the 1996 Act, which is sufficient to make out that charge. I find charges 3-7 proved.
15. Charge 8 alleges professional misconduct within the meaning of section 4.4.4(a) of the 2004 Act in that Mr Rushford contravened section 4.4.11(1)(a) of the 2004 Act by failing to comply with the request for a full written explanation of his conduct. As indicated at paragraphs 20 and 21 above, Mr Rushford failed to provide a response to the LSC's letter of 10 May 2010 requiring the provision of an explanation of his conduct.
16. In summary, in relation to matter J89/2011, Mr Rushford effectively stopped maintaining his trust account records around September 2004, and thereby committed numerous breaches of the statutory trust accounting requirements. The evidence shows he did continue to practise and to receive trust monies, for a short period after his practising certificate expired on 30 June 2005. And he failed to comply with a statutory requirement to provide an explanation in relation to trust accounting matters.

1. The first charge is of professional misconduct within the meaning of s.4.4.3 of the 2004 Act, being misconduct at common law, in that Mr Rushford failed to account to his client, Mr Borello, for the sum of $1,000.00 paid into the Clark Richards trust account on 11 November 2003. It alleged this would reasonably regarded as disgraceful and dishonourable by legal practitioners of good repute and competency.
2. Mr Borello gave evidence that he paid the $1,000 to Mr Rushford to be held in trust pending settlement of the purchase of a proposed investment property, that he did not receive any invoices for work done by Mr Rushford, and that he has not received the money back.
3. Mr Makin gave evidence of his requests on behalf of Mr Borello from at least January 2005 for an account of monies Mr Rushford held on Mr Borello's behalf. The conversation between the two men in around January 2005 referred to in paragraph 38 above is relevant to the Borello debt also.
4. Mr Makin continued to seek payment of trust money from Mr Rushford on behalf of Mr Borello. He accessed part of the accounts of the practice, including the trust account trial balance as at 25 August 2004. This showed the sum of $1,000 being held on behalf of Mr Borello. Mr Makin wrote to Mr Rushford on 8 July 2005. The letter was addressed to him at "MAI Legal and Finance". The letter stated that Mr Rushford had undertaken to both Mr Borello and Mr Makin that he would repay the money to Mr Borello, but that this had not occurred. The letter also referred to Mr Rushford having undertaken to go through his trust account list with Mr Makin to determine if funds were still held in trust. The letter stated Mr Rushford had not done this despite Mr Makin's reminders to him. The letter went on to demand on behalf of Mr Borello and other clients that Mr Rushford provide a statement within 7 days showing that the monies are either held on trust, and if not, when the funds were repaid to the clients. No response to this demand has been received.
5. In his letter of 18 March 2012, Mr Rushford stated he did not hold any files or records for Mr Borello, and so relied upon "the facts as presented to VCAT." He also offered to repay the $1,000.00 to Mr Borello.
6. I am satisfied that Mr Rushford received the sum of $1,000 from Mr Borello in 2003, and has failed to account to him for it (at least to the date of the hearing). I am also satisfied that this would reasonably be regarded as disgraceful and dishonourable by legal practitioners of good repute and competency, thus satisfying the test of professional misconduct at common law.[1]
7. Charge 2 was of professional misconduct within the meaning of s 4.4.4(f) of the Act, in that Mr Rushford failed to comply with an order of VCAT made on 30 July 2009.
8. In relation to charge 2, the extensive correspondence referred to above establishes that Mr Rushford has not provided a full written explanation of his conduct in relation to the Borello complaint to the present day and certainly not since the Tribunal's order of 30 July 2009. I find the facts alleged in charge 2 are proved. Mr Rushford failed to respond, by statutory declaration, to the LSC's request for a full written explanation of his conduct in relation to the Borello complaint, by 16 December 2009.

1. I have found the 20 charges of misconduct, and professional misconduct proved against Mr Rushford.
2. The overall picture which emerges from the evidence is of a practitioner who, to a significant extent, let things slide after he sold his practice in 2004. He did continue to practise for another year (and for at least a short time after his practising certificate expired on 30 June 2005) but it is clear he was not functioning effectively. He was unable to provide necessary information for matters he had handed over to Makin & Kinsey as part of the sale of his practice. This caused very substantial worry, complexity and expense for the successor firm, its clients, and others involved. He ceased to maintain his trust records properly from September 2004. The drawing of cheques on his trust account to pay rent for the premises he lived in, suggests at the least serious disorganisation and perhaps desperation. His failure to account to his clients the Negris and Mr Borello for monies he held on their behalf appears to be another symptom of his disorganisation.
3. Mr Rushford made a number of promises to provide files and information required to finalise transactions. He rarely delivered on these, however. Such undertakings were made to the Tribunal as well, as reflected in the orders made by Senior Member Howell in 2006, and Judge Ross in 2009. These also were not complied with. In this regard, I note that Judge Ross based his decision in part on Mr Rushford's apparent "change in his attitude towards complying with the Commissioner's requests" Unfortunately, this change was not sustained.
4. Mr Rushford did provide a little information at various points, but never enough to make much difference to resolving the issues he had left behind him. In many cases, the issues on files were never resolved, and so the parties had to just negotiate a resolution on a commercial basis as best they could.

1. Ms Bennett, for the LSC, urged that I make an order under s 4.4.17 (a) of the 2004 Act recommending to the Supreme Court that Mr Rushford's name be removed from the roll of practitioners. That is the only penalty which the LSC proposed.
2. In my view, it is appropriate for me to impose what I regard as the appropriate penalties which are within the Tribunal's power, regardless of whether I make that recommendation to the Supreme Court as well.
3. Given that Mr Rushford chose not to participate in the hearing, there is very limited material I can have reference to which runs in his favour, in determining the appropriate disposition. He is not entitled to any credit for pleading guilty. I do not have any up to date information as to his mental state. Mr Rushford's letter of 18 March 2012 suggests his depression and anxiety has exacerbated. This suggests that the assessment by the psychologist, Ms Northey, relied on by Judge Ross in July 2009, that he was "well on the road to recovery" was unfortunately over-optimistic. Also, Judge Ross concluded that Mr Rushford's mental state "did not completely absolve" him form moral culpability for his actions. The LSC submitted on those few occasions when he had co-operated with it, or VCAT (albeit only to a very limited extent) it was only to buy himself a little more time on that particular occasion.
4. VCAT's disciplinary function is of course primarily protective: Hannebery v Legal Ombudsman[2].
5. In Quinn v Law Institute of Victoria[3] (at paragraph 30) Maxwell P said:

[30] Nevertheless the phrase "not so much to punish as to protect" [used in Hannebery] underlines the fact that the Tribunal's orders are punitive as well as protective. The available sanctions are, by their nature punitive, and the objectives of specific and general deterrence - which serve the protection of the public - depend on the sanctions having punitive effect.

[31] Critically for present purposes, however, the Tribunal's protective function is paramount. Thus, where there is a choice of sanctions, it is to be expected that the Tribunal will choose the sanction which maxims the protection of the public.

1. It is clear that Mr Rushford's professional misconduct requires a condign penalty from the point of view of both specific and general deterrence. The seriousness of his misconduct requires that a penalty be imposed disallowing him from practising for an extended period.
2. It is also clear from the history of his dealings over the last eight years, that Mr Rushford is not currently a fit and proper person to hold a practising certificate. His letter of 18 March 2012 confirms this.
3. Mr Rushford should not be allowed to practise again unless and until he becomes a fit and proper person. This can be achieved by an order which prevents him from applying for a practising certificate for an extended period, and thereafter, limits him to practising only under supervision, and without being allowed to handle trust monies. The question is whether I should go further and recommend to the Supreme Court that he be struck off the roll. In practical terms, I believe the appropriate approach for me would be to consider whether there is a reasonable likelihood that the Supreme Court would find that Mr Rushford is not a fit and proper person to remain on the roll of practitioners.
4. In Mr Rushford's favour it might be said that his conduct is not in the category of blatant dishonesty as, for example, where there has been fraud or similar conduct. There is also his mental condition, which, on the limited information I have, does not appear to be at the extreme end of the scale, such as would absolve him of moral culpability. This, together with his deliberate non-participation in the hearing, means that his metal condition this only runs in his favour to a limited extent. Also, to the extent his mental condition does run in his favour in terms of the moral element, it runs against him in terms of the element of his capacity to act effectively in the interests of clients.
5. Further, in relation to the monies withheld from his clients since 2004/5 ($2,021 from the Negris and $1,000 from Mr Borello) it appears Mr Rushford has belatedly proposed repayment in his letter of 18 March. I do not know whether or not this has now occurred. It might be said these amounts are not of a high order of magnitude. Doubtless they are significant to the clients, though. Also, their true value has in any event been whittled down through the clients being deprived of over eight years' interest on the monies.
6. Under the 2004 Act, a practitioner is required to be a fit and proper person to be admitted (ie to be on the roll of legal practitioners) (s 2.3.6) and also to be a fit and proper person to hold a practising certificate (s 2.4.7). The decision under s 2.3.6 is made by the Board of Examiners. No criteria are set out in the 2004 Act for the Board of Examiners. The decision under s 2.4.7 is made by the Legal Services Board (LSB). The applicable criteria for the LSB include the suitability matters in s 1.2.6. These include whether a person has a material mental impairment. It might be said that the public would be sufficiently protected by the LSB, or its successor, taking steps to satisfy itself as to Mr Rushford's mental fitness, by way of expert advice if and when he makes any future application for a practising certificate. The LSB would at the same time, address his non-medical fitness as well. The argument would be that such steps would be sufficient to protect the public, so striking off the roll is not necessary.
7. In practical terms, there needs to be something above and beyond not being fit and proper to hold a practising certificate to justify being struck off the roll. The cases suggest that the test is probable permanent unfitness to practise.[4] Here, Mr Rushford has engaged in a pattern of conduct for almost eight years (since 2004) which demonstrates he has been unfit to practise for that time. This eight year period, and the fact that there is no indication that he is improving, tends towards a conclusion of permanent unfitness. Mr Rushford has chosen not to participate in this proceeding, but instead to let it take its course.
8. Taking all the above matters into account, I have concluded that Mr Rushford should be banned from practising until 1 July 2019, being a period of approximately seven years from the present date. This, in addition to the seven years since he last practised legally, on 30 June 2005, will amount to a period away from practice of 14 years. Further, he should not be allowed to practise as a principal or be allowed to handle trust monies, before 1 July 2022. Even after those periods have elapsed, Mr Rushford would of course still have to convince the LSB or its successor, that he is a fit and proper person to practise.
9. Further, I have concluded that there is a reasonable likelihood that the Supreme Court would find that Mr Rushford is not a fit and proper person to remain on the roll of legal practitioners. In circumstances where a practitioner had taken some part in the proceedings, or shown some improvement in terms of his fitness to act as a solicitor with responsibility for handling his clients' affairs, the position might be different. However, given the lack of any positive indication in Mr Rushford's favour, even after seven years, and the opportunities he has been given, I conclude that it is probable he is permanently unfit to practise. There is a line to be drawn between situations where a practitioner should be banned from practising for a lengthy period, yet still be allowed to remain on the roll, and those cases where, even though the practitioner's misconduct arises in part from an inability to cope, rather than from purely evil intent, it is nevertheless in the public interest for them to be removed from the roll. That is a decision for the Court, which will take into account any additional material put before it by the LSC, however, my own conclusion, focussing on the protection of the public, is that it is appropriate for me to make a recommendation to the Supreme Court under s 4.4.17 of the 2004 Act, that Mr Rushford's name be removed from the roll.

1. Finally, the LSC sought an order that Mr Rushford pay its costs, pursuant to clause 66D of Schedule 1 to the Victorian Civil and Administrative Tribunal Act 1998. There being no exceptional circumstances, I will order those costs be paid by Mr Rushford.

[1] Allinson v General Council of Medical Education and Registration [1894] QB 750; This standard has been adopted in Victoria (Re A Solicitor [1960] VicRp 96; [1960] VR 617, at 620 per Dean J).

[2] [1998] VSCA 142

[3] [2007] VSCA 122

[4] Prothonotary of Supreme Court of New South Wales v P [2003] NSWCA] 320; Prothonotary v Richard (NSWCA) 31 July 1987 per McHugh JA; NSW Bar Association v Maddocks (NSWCA 23 Auust 1988); Legal Services Commissioner v Brott (Legal Practice) [2011] VCAT 110. In New South Wales Bar Association v Murphy [2002] NSWCA 138 at [27], Speigelman CJ suggested that under the NSW regime, conduct which is sufficiently egregious as to give rise to a contention that a person is "indefinitely" unfit to practise would also be sufficient to justify removal from the roll.