1. The order issued on 16 August 2013 contained a typographical error. In order 2, the second reference to the year '2014' was intended to be a reference to '2015'. Order 2 is amended under s 119 of the Victorian Civil and Administrative Tribunal Act 1998 to read:

'Ms Sampson is required to obtain two additional points of CPD in the area of ethics and professional responsibility during each of the CPD years ending 31 March 2014 and 31 March 2015, by undertaking courses or activities approved by the Law Institute of Victoria.'

Legal Profession Act 2004 - professional misconduct - debt recovery - form of notices to debtors re outstanding fees for video and DVD rentals - two charges found proved under rule 28.2 of the Law Institute of Victoria's Professional Conduct and Practice Rules 2004 - penalty.

1. In relation to the two findings of professional misconduct against her, Ms Sampson is reprimanded.
2. Ms Sampson is required to obtain two additional points of CPD in the area of ethics and professional responsibility during each of the CPD years ending 31 March 2014 and 31 March 2014, by undertaking courses or activities approved by the Law Institute of Victoria.
3. Ms Sampson is to pay half of the LSC's party party costs, determined according to the County Court Scale. In default of agreement, the quantum of these costs is to be determined by the Costs Court.

1. On 10 July 2013, Ms Pippa Sampson was found guilty of two out of five charges of professional misconduct brought by the respondent (LSC). On 13 August 2013, a hearing was conducted on the question of penalty and costs.
2. The two findings of professional misconduct relate to letters of demand Ms Sampson sent to customers of the Alice Springs Civic Video rental store in 2008 - 9.
3. The issues were extensively dealt with in the decision of 10 July 2013,[1] which should be read in conjunction with this decision.

1. The LSC submitted that Ms Sampson should be suspended from practice for a period of not more than three months, be required to undertake at least five additional units of Continuing Professional Development (CPD) in the area of ethics and professional responsibility and be reprimanded.
2. Mr Hamlyn-Harris accepted that a reprimand was appropriate, but contested the suspension and requirements for additional CPD.
3. The main issues for consideration in relation to penalty are as follows: First, remorse, insight and specific deterrence. Second, general deterrence. Third, other matters put by way of plea.

1. Ms Sampson strongly contested all five charges brought against her. She defeated three of the charges, and was found guilty of two. As detailed in the 10 July 2013 decision, numerous issues needed to be dealt with in considering the allegations that each of the five notices of demand the subject of the proceedings breached both rule 28.1 and rule 28.2 of the Law Institute of Victoria Professional Conduct and Practice Rules 2004.
2. Ms Sampson had 'wins' in relation to a number of points at issue between the parties, notably:
   • Charges relating to the Webster Notice and Urgent Notice were defeated because it was found that the video store had a contractual entitlement to claim pre-litigation costs.
   • The two charges relying on rule 28.1 were defeated because the evidence did not show that Ms Sampson knew or reasonably believed that the statement and implied assertions in her notices of demand were untrue.
   • Findings of guilt in relation to Charges 2 and 4 were made on the basis of incorrect claims for pre-litigation legal costs, but not on the basis of some of the other Particulars alleged against her by the LSC. The finding on Charge 2 related to the sending of the Wallace Notice of 15 April 2009 and the Egan Notice of 4 November 2009. The finding on Charge 4 related to the sending of the Wallace Urgent Notice of 16 September 2009.
   • The charge involving the Notice sent to Mr Burdett was held not to be misleading or intimidating on the additional ground that it was statute barred.
   • Significantly, it was found that Ms Sampson's culpability was reduced to some extent in relation to the Notices the subject of Charge 2 (but not the Urgent Notice the subject of Charge 4) by the 'approval' she had received from the Law Institute of Victoria (LIV) in 2004 - 5 for the forms of notices she had drafted. This was very largely 'countermanded' by the LSC's letter of 27 March 2009 in relation to the Kune complaint, however.
3. After consideration of all the various deficiencies alleged in the notices of demand sent out by Ms Sampson, it became apparent that two of the things which Ms Sampson did gave rise to major concerns: in relation to the Wallace Urgent Notice, Ms Sampson used the wrong form of demand. She should have checked before assuming (incorrectly) that her client had a contractual entitlement to pre-litigation costs. Second, she should have ceased to use the form of Notice after 27 March 2009. She should not have sent the Egan and Wallace notices after she had received a clear indication from the LSC that it did not approve of this form of Notice.
4. Paragraph [213] of the 10 July 2013 decision set out a number of 'mitigating' or relevant factors which apply in Ms Sampson's case, in addition to the findings made in her favour on various issues referred to above. These were as follows:
   • Shortly after the letter of 27 March 2009 would have been received by Ms Sampson, she began to suffer serious health problems, which I accept over time would have impacted on her ability to respond to the new position taken by the regulator, together with the partnership dispute, which was also coming to a head during 2009.
   • In Victoria, the attitude of regulators, and the law generally, has evolved over the last few decades. As recently as late 2007, the LIV's 1999 Guidelines were applicable, which stated the LIV's view that costs to-date are properly claimable in a letter of demand. Although I have found that Ms Sampson went further than this, and I have rejected her argument that she was not in fact threatening to sue for pre-litigation costs, it is necessary to be mindful of not dealing with her conduct as if it were occurring today.
   • The LSC's conclusion conveyed by its letter of 27 March 2009 was that there was a reasonable likelihood that VCAT would find her guilty of unsatisfactory professional conduct (rather than professional misconduct).
   • The concept of a 'fit and proper person' to engage in legal practice is not one which can be defined with precision.[2] However, it is frequently manifested by dishonesty. Here, however, the situation is not clear-cut. The finding against Ms Sampson by the Federal Court that notices in very similar form were misleading and deceptive was, of course, a civil, not a criminal finding. Moreover, the Federal Court determination, since it required no finding of dishonesty or even carelessness, imports no moral obloquy. I do not regard Ms Sampson's conduct, in all the circumstances of this case, as demonstrating that she is not a fit and proper person to practise.
   • Upon becoming aware of the Federal Court decision, the LIV on 11 November 2011 requested an explanation from Ms Sampson as to the issue it raised as to whether she was a fit and proper person to hold a practising certificate. Following a submission on her behalf, the LIV determined that her practising status would not be affected by the decision.

1. The LSC submitted that Ms Sampson had not demonstrated remorse or insight into her wrong conduct. In my view, it would be incorrect to place great reliance on that factor here. This is because the numerous issues in the case were to a large extent interconnected and overlapping across various charges, two of which she was found guilty of, and three of which she was not.
2. The LSC submitted that specific deterrence is highly relevant here, in light of the prior correspondence with it over a long period, despite which she persisted in sending letters of demand which were misleading and intimidating, sometimes many thousand a month.
3. Mr Hamlyn-Harris on the other hand pointed to Ms Sampson's evidence to the effect that in the light of the long and bruising journey she has been on since 2009 in particular, she had no intention of resuming a bulk debt collecting practice even after the five year Federal Court injunction on her doing so expires (on 17 October 2016). He pointed to Ms Sampson's evidence that it was not a major part of her practice at any stage. Nor was it particularly remunerative. Yet it has clearly been the cause of years of trauma, expense and embarrassment for her. Mr Hamlyn-Harris referred to the adverse consequences which Ms Sampson has suffered as a result of this VCAT proceeding and the earlier Federal Court case:
   • The effect of the 17 October 2011 orders of the Federal Court themselves: the end of her bulk debt collecting practice, the requirement to publish advertisements in four national publications.
   • The direct financial consequences of the Federal Court decision: a $30,000 costs order, advertising costs of over $14,000 and counsel's fees of over $75,000, together totalling $120,000.
   • Adverse publicity following the Federal Court decision, leading to embarrassment and loss of clients.
   • A letter distributed widely throughout the legal profession and debt collecting agencies explaining the decision against Ms Sampson in detail and attaching the judgment. Indeed, I note the Federal Court decision in Australian Consumer and Competition Commission v Sampson appears to have become something of a flagship for cautionary messages from regulators to the profession. For example, it is given primary prominence in the Law Institute of Victoria's December 2012 'Letters of Demand Guidelines'.
   • Articles in the Herald-Sun and Lawyer's Weekly following the VCAT decision of 12 July 2013.
   • Discussions about that decision on the Jon Faine program on Radio 774 Melbourne.
   • The need to provide explanations to clients in response to numerous enquiries since then as to whether she would be continuing to practice (given that at least one article suggested she might be 'struck off the roll').
   • The delay in the finalisation of the disciplinary proceedings: these commenced in March 2010 but were put on hold for over a year whilst the Federal Court proceedings were conducted.
   • The substantial costs she has incurred in conducting her own case before VCAT, plus the costs of the LSC which she will be required to pay.
4. In the light of these matters, and having heard Ms Sampson give her evidence, it is clear this episode has profoundly affected her. She did defend herself robustly at times. But given she succeeded in relation to a number of points, I do not find that to be a strong factor suggesting that specific deterrence has a large role to play here.

1. The LSC also submitted that general deterrence is relevant. This is certainly a case relating to matters which regulators are very concerned about. Regulators are rightly very concerned to ensure that those practising in bulk debt collection, as well as practitioners engaging in one-off debt collection for clients, are given a strong message that consumers must not be misled or intimidated by assertions made in letters of demand.
2. As stated in the 10 July 2013 decision, the law and regulatory approach to debt collection practices by lawyers and collection agencies has tightened in recent years. Absent the mitigating factors applicable in Ms Sampson's case, practitioners engaging in misleading or intimidating conduct are likely to face severe sanctions. Further, as also referred to in the decision, Ms Sampson's case is not one relating to direct intimidation of debtors by personal contact in the way the decision in Collection House v Taylor[3] was. Nor did it concern matters such as the 'lending' of a solicitor's letterhead to debt collecting agencies, or falsely claiming moneys from debtors by way of supposed 'fines' or 'liquidated damages' which are aspects of the conduct of some solicitors which are of concern to regulators.
3. The fact that most debtors receiving letters of demand would not seek legal advice, given the small amounts involved, does enhance the importance of general deterrence. However, in view of the significant mitigating factors applicable in the particular case of Ms Sampson referred to above, it would be giving disproportionate weight to general deterrence if that was to be a major factor in favour of suspending her practising certificate.
4. The substantial adverse publicity which Ms Sampson's actions have attracted also serves the aim of general deterrence.

1. Three personal written references were provided by long-standing legal colleagues of Ms Sampson. One of these referees attended at the hearing. These references all strongly endorsed her personal competence and integrity. And they attested to the profound effect the proceedings have had on her.
2. Mr Hamlyn-Harris also drew attention to the positions of trust and responsibility which Ms Sampson has been, and continues to be appointed to, such as being appointed an administrator of the personal affairs of incapacitated persons (10 to 12 times in recent years), appointment as trustee responsible for the sale of property and appointment by the Supreme Court and as a replacement executor or trustee of deceased estates (one such appointment currently held).
3. Ms Sampson can also rely on her impressive record of service to the community and to the profession. This includes a school directorship and committee membership, three terms served as President of the Eastern Suburbs Law Association, being a LIV counsellor, serving on the Suburban and Country Lawyers Committee of Management, helping to establish a community youth support scheme and doing pro bono legal work. There are no professional disciplinary findings against Ms Sampson other than the present matter.
4. She remains the sole principal at Goddard Elliott, currently responsible for the employment of four lawyers, two paralegals, two semi-retired consultants and five support staff.

1. The primary function of disciplinary proceedings is of course to protect the public. In some cases, this requires that a punitive sanction be imposed on the practitioner, in order to serve the purposes of specific and general deterrence.[4] That is not the case here. Ms Sampson's clean record, her extensive service to the profession and the community, the support of her colleagues, and the repercussions for those who depend on her as the principal of the practice are all factors which are to be taken into account. Ms Sampson should receive a reprimand for her professional misconduct. This conveys a message of denunciation of her conduct in sending the notices the subject of Charges 2 and 4 which misled and intimidated debtors, and grossly exceeded the legitimate assertion of the entitlements of her video store clients. However, given the mitigating factors and the fact that the ends of specific and general deterrence have already been largely served, the circumstances do not warrant suspending Ms Sampson's practising certificate.

1. Mr Hamlyn-Harris said that Ms Sampson has completed nine units of additional training, specifically in response to the requirements imposed by the Federal Court order of 17 October 2011. This has been in the area of trade practices compliance and consumer protection. It has been in addition to the normal 10 compulsory units of CPD which all solicitors must complete annually.
2. Mr Hamlyn-Harris questioned whether there was a benefit in the LSC's proposal that she complete at least an additional five or more units worth of CPD, specifically in the area of Ethics and Professional Responsibility. I accept that as a result of the additional nine units of training she has done, and more particularly, the whole experience of conducting the Federal Court and VCAT litigation, Ms Sampson is now very well educated about consumer protection, especially in relation to debt recovery.
3. However, I agree with the LSC that Ms Sampson's conduct here, over a number of years, supports the conclusion that additional exposure to broad-based ethical issues would be appropriate. I will therefore make an order in the terms proposed by the LSC, but varied such that two sessions are to be completed in each of the next two years.

1. It was accepted on behalf of Ms Sampson that Section 46D of the Victorian Civil and Administrative Tribunal Act 1998 (VCAT Act) has the effect that she is required to pay some portion of the LSC's costs as a result of having been found guilty of professional misconduct. The question arises, what proportion, in light of the fact that both parties achieved partial success in this proceeding? Ms Anderson indicated that the LSC's party party costs and disbursements of conducting the proceeding, on the County Court Scale, amounted to $51,199.26. This excluded some (relatively small) amount relating exclusively to the charges concerning the Webster Notice and Urgent Notice (which were not proved). Ultimately, Ms Anderson said she was instructed that the LSC would accept half that amount (namely, $25,599.53).
2. As Mr Hamlyn-Harris said, the apportionment of costs cannot be done on a mathematical basis. In terms of comparing the overall levels of success achieved by each party, it can be noted that Ms Sampson achieved the 'wins' described above. On the other hand, the LSC has obtained two findings of professional misconduct, in circumstances where it might be said that the difference between two and five such findings is less significant than the difference between two such findings and no such finding. I accept the LSC's contention that the costs involved in getting to the point where it obtained the findings which it did would be likely to be more substantial than the remaining costs incurred in conducting the case on the other three charges. In all the circumstances, I determine that the appropriate order is that Ms Sampson pay half of the LSC's costs. These are to be determined by the Costs Court in default of agreement.

[1] Legal Services Commissioner v Sampson (Legal Practice) [2013] VCAT 1177.

[2] Ziems v The Prothonotary of the Supreme Court of New South Wales [1957] HCA 46; (1957) 97 CLR 279 at 297-8.

[3] [2004] VSC 49.

[4] Quinn v Law Institute of Victoria [2007] VSCA 122 at [29] and [30]