Prothonotary v Gregory

Court of Appeal (NSW)|2017-04-18|Before: Bathurst CJ, Beazley P

The Prothonotary v Del Castillo [2001] NSWCA 75 Ziems v The Prothonotary of the Supreme Court of New South Wales (1957) 97 CLR 279 Category: Principal judgment Parties: The Prothonotary of the Supreme Court of New South Wales (Applicant) Paul John Gregory (Respondent) Representation: Counsel: Ms V Hartstein / Mr C Liedermann (Applicant) Mr D McGirr (Respondent)

Solicitors: Crown Solicitor for New South Wales (Applicant) McGirr Lawyers Pty Ltd (Respondent) File Number(s): 2016/353410

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

[This headnote is not to be read as part of the judgment] In 2010, the respondent, Paul John Gregory, a solicitor admitted to practise in New South Wales, was convicted of conspiring to dishonestly cause a risk of loss to the Commonwealth, contrary to subsection 135.4(5) of the Criminal Code 1995 (Cth). The Solicitor was sentenced in April 2010 to two years' imprisonment with a further order that after 12 months he could be released on recognisance of good behaviour for 12 months. By summons filed on 25 November 2016, the applicant, the Prothonotary of the Supreme Court of New South Wales (Prothonotary), sought declarations that the Solicitor was guilty of professional misconduct, not a person of good fame and character and not a fit and proper person to remain on the Roll of Legal Practitioners in New South Wales (the Roll). In addition, the Prothonotary sought an order that the Solicitor's name be removed from the Roll. The Solicitor did not oppose the orders sought by the Prothonotary, but the Court still had to satisfy itself that it was appropriate to make orders removing the Solicitor's name from the Roll. While limited use can be made in disciplinary proceedings of findings made by a court in criminal proceedings, the Solicitor's certificate of conviction could nonetheless be referred to as evidence of the particular offence for which he was convicted and sentenced. The Court held that in this case there was no doubt that the Solicitor's criminal conduct amounted to professional misconduct: [24]. The Court accepted that a conviction for a serious offence does not necessarily warrant a finding that a legal practitioner is permanently unfit to practise. Nonetheless, the offence for which the Solicitor was convicted was particularly serious and involved him using his position as a solicitor to conspire to perpetrate an act of calculated dishonesty: [26]. Such conduct strikes at the heart of the qualities necessary to practice law: [27]. Furthermore the Solicitor had not accepted full responsibility for his dishonest conduct. Accordingly it was appropriate for his name to be removed from the Roll. The Court declared that the Solicitor had been guilty of professional misconduct and was not a fit and proper person to remain on the Roll. The Court ordered that the Solicitor's name be removed from the Roll and that he pay the costs of the Prothonotary incidental to these proceedings: [32].

Judgment

THE COURT: The Respondent, Paul John Gregory, is a solicitor admitted to practise in New South Wales. By a summons filed on 25 November 2016, the Applicant (Prothonotary) seeks the following declarations and orders against the Respondent: "1. A declaration that the Respondent is guilty of professional misconduct. Particulars: (a) On 15 April 2010 in the Supreme Court of Victoria the Respondent was convicted of conspiring to dishonestly cause a risk of loss to a Commonwealth entity, contrary to section 135.4(5) of the Criminal Code 1995 (Cth). (b) The Respondent was sentenced to two (2) years imprisonment with a period of 12 months fixed before he was eligible for release on recognisance in the sum of $5,000 without surety to be of good behaviour for a period of 12 months. 2. A declaration that the Respondent is not a person of good fame and character. Particulars: (a) The Applicant reiterates the matters asserted in paragraph 1 herein. 3. A declaration that the Respondent is not a fit and proper person to remain on the Roll of Legal Practitioners of the Supreme Court of New South Wales. Particulars: (a) The Applicant reiterates the matters asserted in paragraph 1 herein. (b) The Respondent maintained a plea of not guilty throughout the criminal proceedings thereby displaying his lack of candour. (c) The Respondent has failed to show any remorse or contrition for his offending conduct, either during the criminal proceedings or subsequently. 4. An order that the name of the Respondent be removed from the Roll of Legal Practitioners of the Supreme Court of New South Wales."
Order 4 sought by the Prothonotary refers to the removal of the Respondent from the Roll of Australian lawyers maintained by the Supreme Court of New South Wales. [1] Since the proceedings commenced by the Prothonotary seek orders in the exercise of the Court's disciplinary powers with respect to legal practitioners, the proceedings are assigned to the Court of Appeal. [2]

The inherent jurisdiction

Chapter 5 of the Uniform Law establishes procedures for making complaints against lawyers and for the disciplining of lawyers who are found to have engaged in "unsatisfactory professional conduct" or "professional misconduct". [3] In the present case, the Prothonotary does not rely on the provisions of Chapter 5 of the Uniform Law but invokes the inherent jurisdiction of this Court to support the declarations and orders she seeks against the Respondent.
Section 264(1) of the Uniform Law, which is in Chapter 5, preserves the inherent jurisdiction of the Court, as follows: "The inherent jurisdiction and powers of the Supreme Court with respect to the control and discipline of Australian lawyers are not affected by anything in this Chapter, and extend to Australian legal practitioners whose home jurisdiction is this jurisdiction and to other Australian legal practitioners engaged in legal practice in this jurisdiction." Since the Respondent has been admitted to practise in New South Wales, he is an "Australian lawyer" for the purposes of s 264(1) of the Uniform Law. [4] It follows that s 264(1) of the Uniform Law preserves this Court's jurisdiction and powers with respect to the control and discipline of the Respondent.
Section 264(1) of the Uniform Law has legislative predecessors in New South Wales dating back to 1935. [5] In A Solicitor v Council of the Law Society of New South Wales, [6] the High Court explained the nature of the Court's inherent jurisdiction preserved by the legislative predecessors to s 264(1). The Court observed that when the inherent jurisdiction is invoked the question is not one of punishment, but: "whether the Court is justified in holding out the [legal practitioner] as a fit and proper person to be entrusted with the duties and responsibilities of a solicitor". [7]
The High Court pointed out that where an order for removal from the Roll is contemplated, the ultimate issue is whether the practitioner is shown not to be a fit and proper person to be a legal practitioner of the Supreme Court. [8] That question is to be determined at the time of the hearing, bearing in mind that in some cases (like the present case) the legal practitioner's misconduct may have occurred many years earlier before the application is heard by the Court. [9]
The High Court in A Solicitor v Council of the Law Society of New South Wales also observed that in an appropriate case the Supreme Court may make a declaration of professional misconduct, with or without an order removing the legal practitioner from the Roll. [10] Their Honours pointed out that the statutory definition of "professional misconduct" now contained in Chapter 5 of the Uniform Law is not necessarily identical to the concept of professional misconduct for the purposes of the exercise of the Court's inherent jurisdiction to discipline legal practitioners. The Court considered that since personal misconduct, even if it does not amount to professional misconduct, can demonstrate unfitness to practise, there is less need to "stretch" the concept of professional misconduct when the Court is exercising its inherent jurisdiction. [11] As will be seen, however, on any view the Respondent's conduct in the present case amounted to professional misconduct.

Conduct of the hearing

The Respondent was represented by a solicitor at the hearing in this Court. The solicitor informed the Court that the Respondent did not oppose the orders sought by the Prothonotary and indeed consented to the orders being made. It is, however, well established that the Court must satisfy itself that it is appropriate to make orders removing a legal practitioner's name from the Roll, even if the practitioner concedes that such an order should be made. [12]
Ms Hartstein, who appeared with Mr Liedermann for the Prothonotary, read two affidavits. These proved, among other things, the Respondent's criminal conviction in the Supreme Court of Victoria. The affidavits exhibited a large number of documents, including the remarks of the sentencing Judge (Whelan J) and the judgment of the Victorian Court of Appeal dismissing the appeal against sentence by the Commonwealth Director of Public Prosecutions (DPP). [13] Ms Hartstein also tendered an Agreed Statement of Facts (Agreed Statement), extracted below. The Respondent's solicitor neither adduced any evidence nor made submissions on behalf of the Respondent.
The affidavit evidence and the Agreed Statement indicated that the Respondent, in addition to being admitted in New South Wales, was admitted to practise in the Northern Territory on 13 April 1981. Section 23(2) of the Uniform Law provides that the "designated local roll authority" [14] must remove a person's name from the Supreme Court Roll if satisfied that the person's name has been removed from the Supreme Court Roll of another jurisdiction. The Court requested Ms Hartstein to obtain affidavit evidence confirming that the Respondent's name had not been removed from the Roll maintained by the Supreme Court of the Northern Territory. An affidavit attesting to that fact was duly filed.
If the Respondent's name had been removed from the Northern Territory Roll before the hearing in this Court, it would have been necessary to consider the relationship between s 23(2) of the Uniform Law and the exercise of the inherent jurisdiction of the Court. It may well be the case that if the procedure established by s 23(2) is available because the legal practitioner's name has been removed from the Roll of another jurisdiction, that procedure should be used rather than commencing an application relying on the inherent jurisdiction of the Court. Since the Respondent remains on the Roll in the Northern Territory, the issue does not arise.
As has been noted, the Prothonotary commenced the proceedings in this Court in November 2016. This was more than six years after the Respondent's conviction in the Supreme Court of Victoria. Affidavit evidence adduced on behalf of the Prothonotary established that the Professional Standards Manager of the Law Society informed the then Prothonotary on 28 April 2010 of the Respondent's conviction and requested the Prothonotary to consider commencing appropriate proceedings in this Court. The Prothonotary promptly requested advice from the Crown Solicitor but it appears that no advice was provided. Unfortunately the matter was not followed up until December 2015, when the Law Society reactivated its inquiry. The delay in bringing the disciplinary proceedings against the Respondent is regrettable, not least because the timely exercise of the Court's disciplinary powers is important in protecting members of the public and in ensuring that the profession maintains the highest standards of integrity.

Agreed Statement

The Agreed Statement is as follows: "1. Paul John Gregory, the Respondent, was born 14 March 1949. He was first admitted to practise as a solicitor attorney and proctor of the Supreme Court of New South Wales on 19 March 1971. 2. He obtained a practicing [sic] certificate in 1971 and held a practising certificate continuously until 25 February 2010 when he surrendered his practising certificate. 3. The Respondent was employed by Abbott Tout Creer and Wilkinson and became a partner there in 1977. He was managing partner from 1984 to 1996. In February 1996 he joined International Management Group and worked there until June 1998. In August 1998 he joined the firm later known as Dibbs Barker Gosling and in 2001 became the Chief Executive Officer of that firm. … 5. On 16 April 2009 an indictment was filed in the Supreme Court of Victoria charging the Respondent with: Count 1 Between January 1994 and 24 July 1995 at Melbourne in the State of Victoria and elsewhere the Respondent did with Glenn Dawson Wheatley, Philip Egglishaw and Philip de Figuerido, contrary to section 29D of the Crimes Act 1914 defraud the Commonwealth, in relation to the failure to declare income totaling [sic] $74,494 to the Commissioner of Taxation from the John Farnham 'Talk of the Town' Tour for the financial year ending 30 June 1994. Count 2 Between 1 July 1994 and 23 January 1996 at Melbourne in the State of Victoria and elsewhere the Respondent did with Glenn Dawson Wheatley, Philip Egglishaw and Philip de Figuerido, contrary to section 29D of the Crimes Act 1914 defraud the Commonwealth, in relation to the failure to declare income totalling $181,916 to the Commissioner of Taxation from the John Farnham 'Talk of the Town' Tour for the financial year ending 30 June 1995. Count 3 Between approximately 28 March 2003 and 26 May 2004 at Melbourne in the State of Victoria and elsewhere the Respondent did with Glenn Dawson Wheatley, Philip Egglishaw, Philip de Figuerido and Strachans SA, contrary to subsection 135.4(5) of the Criminal Code, to dishonestly cause a risk of loss to a Commonwealth entity, namely the Commonwealth, knowing or believing that there was a substantial risk of the loss occurring, by agreeing an amount of $400,000 would be paid to Overseas Promotions Inc. as that entity's pretended share of the proceeds of the world wide promotion of the Kostya Tszyu v Jesse James Leija fight held at the Telstra Dome in Melbourne on 19 January 2003. 6. During his criminal trial, which lasted 14 days, the Respondent denied that he was guilty of any of the offences charged. Senior Counsel on his behalf challenged the admission into evidence of various documents tendered by the prosecution and made submissions in relation to the construction which the prosecution could place on other evidence. 7. On 22 February 2010 the Respondent was convicted of conspiring with Glenn Dawson Wheatley, Philip Egglishaw, Philip de Figuerido and Strachans SA to dishonestly cause a risk of loss to the Commonwealth contrary to subsection 135.4(5) of the Criminal Code 1995 (Cth). 8. The Respondent continued to deny his guilt and on 5 March 2010, in an interview with psychologist Anita Duffy who was preparing a report to be used on his behalf at his sentencing hearing, he vigorously asserted his innocence. 9. On 15 April 2010 the Respondent was sentenced to a period of 2 years' imprisonment. It was further ordered that after 12 months the Respondent may be released on a recognisance to be of good behaviour for 12 months. 10. In passing sentence Whelan J in the Supreme Court of Victoria found, inter alia, that: a) By the mid 1990s the Respondent had been a successful and prominent solicitor for many years; b) In 1994 one of his clients, of which he was an alternate director, was International Management Group of America Pty Ltd, a subsidiary of an international sports and entertainment management organisation called International Management Group or IMG. c) The Respondent was also a director of a company associated with IMG, named Complaw Pty Ltd. Complaw was set up as a vehicle for participation by a number of investors of whom the Respondent was one. d) The profits from a tour by Jose Carreras were remitted by Complaw overseas to be held by Strachans, a financial services organisation which managed companies and trusts and provided other specialised financial services. As a result of his association with IMG and Complaw the Respondent was aware of Strachans and the services they offered. e) On 28 March 2003 the Respondent sent an email to Philip [E]gglishaw, a senior figure within the Strachans organisation. That email set out a series of steps which the Respondent had suggested to Glenn Wheatley. Those steps plot a sophisticated deceit. First, Mr Egglishaw was to write to Mr Wheatley claiming a payment of $700,000 in relation to the share of the proceeds of the Kostya Tszyu fight promoted by Mr Wheatley. Mr Wheatley was to respond purportedly disputing the amount claimed on the basis that he had made less profit and therefore the claim should be reduced. Then, Mr Egglishaw was to reject this, whereupon Mr Wheatley would write to Mr Egglishaw saying he was going to refer the matter to the Respondent for legal advice. The Respondent and Mr Egglishaw were then to negotiate a fee of $400,000. This amount would be transferred to Mr Egglishaw through the Respondent's trust account. The email stated that the respondent had confirmed to Mr Wheatley that the tax will be 11%. f) The steps set out in the email were in fact undertaken. At Dibbs Barker Gosling, the legal firm of which the Respondent was then Chief Executive Officer, a file was created and maintained. Viewed in isolation it appears to be a normal solicitor's file concerning a normal commercial dispute. It included copies of emails, but not the email of 28 March 2003. g) The email of 28 March 2003 was part of a calculated deception so as to enable Mr Wheatley to evade his tax. h) An amount of $22,000 was paid to Strachans and an amount of $22,000 was paid into an account maintained by Strachans for the Respondent. The total of these amounts, $44,000, is consistent with the 11% tax referred to in the email. It was not a tax. It was a fee. The Respondent received half of that fee. i) In Mr Wheatley's tax return he claimed the sum of $400,000 which had been remitted to Strachans as an expense. He evaded $194,000 in tax that year. j) The purported negotiations which were set out in the email and in which the Respondent engaged thereafter represented an elaborate deception set up to afford the remittance of the $400,000 with legitimacy which it did not possess and to enable Mr Wheatley to evade tax in the way in which he did. 11. The Victorian Court of Appeal heard an appeal on sentence by the Crown on 29 November 2010 and handed down their decision on 17 May 2011. The Court of Appeal held that the sentence was manifestly inadequate but declined to intervene because of the position adopted by the prosecution, delay and the fact that the Respondent's then liberty would be terminated. 12. On 15 April 2011 the Respondent applied for a practising certificate. As he did not hold a current practising certificate the Council of the Law Society of New South Wales ('the Council') treated the application as though it were an application for the practicing [sic] year ending 30 June 2011. 13. On 16 June 2011 the Council resolved that it was not satisfied that the Respondent was a fit and proper person to hold a practising certificate. 14. On 5 March 2012 the Respondent applied for a practising certificate. On 19 April 2012 the Council resolved that it was not satisfied that the Respondent was a fit and proper person to hold a practising certificate. 15. On 30 November 2015 the Respondent wrote to the President of the Law Society seeking reinstatement of his practising certificate. In that letter the respondent expressed no remorse. He said that he believes he is held in high regard by those members of the profession with whom he regularly interacts and he submits that he has made a significant contribution to the profession in the past three years. 16. On 18 April 2016 the Respondent applied for a practising certificate. After being requested to do so, on 12 July 2016 the Respondent provided a statement under s.87 of the [Uniform Law]. [15] 17. In that s.87 statement the Respondent said, inter alia: a) In particular I advised Mr Wheatley in relation to a dispute which arose following Mr Wheatley's promotion of a professional fight in January 2003. b) This dispute was resolved and led to a substantial payment to an offshore company. c) I have always maintained my innocence in relation to the charges and strongly believed Mr Wheatley had set upon a course of deceiving me in relation to the 2003 dispute. d) As my trial came to a close my Senior Counsel Mr Ian Temby QC advised me ... that it was not necessary for me to give evidence as I had always been willing to do. ... In sentencing His Honour made a specific finding that I was NOT the architect or instigator of any tax avoidance scheme. His Honour also considered that my chances of reoffending were, in his opinion, NIL. e) Despite my conviction I have always considered and still consider myself to be a fit and proper person to hold a practising certificate. 18. On 21 July 2016 the Council resolved that the application be refused as they were not satisfied that the Respondent was a fit and proper person to hold a practising certificate. The reasons for the Council's decision were that the Respondent was found guilty of conspiring to cause a loss to the Commonwealth and was sentenced to a term of imprisonment. He completed his sentence in 2012 and was involved with the establishment of the WIRO and employed by it. He has shown no remorse and in fact maintains his innocence and has stated that he is a fit and proper person to hold a practising certificate. 19. The Respondent's name remains on the Supreme Court of NSW roll of Local Lawyers."
The matters recorded in [7] and [9] of the Agreed Statement reflect the contents of a certificate issued on 22 July 2016 by the Acting Prothonotary of the Supreme Court of Victoria (Certificate of Conviction). The Certificate of Conviction was issued pursuant to s 178 of the Evidence Act 2008 (Vic), the counterpart to which in New South Wales is s 178 of the Evidence Act 1995 (NSW). Although the Agreed Statement does not say so, the Certificate of Conviction records that the Respondent was tried and found not guilty of the charge of defrauding the Commonwealth contrary to s 29D of the Crimes Act 1914 (Cth) (Counts 1 and 2).

Factual findings

The authorities establish that the Court should make findings in appropriate detail as to the basis of its orders, in part because the findings may be significant in the event that a practitioner removed from the Roll subsequently applies for readmission. [16] Findings need not necessarily be made on all matters alleged against the legal practitioner, but findings should be made on "significant matters". [17] In some circumstances it is appropriate for the Court to address allegations of misconduct that go beyond the offence or offences of which the legal practitioner has been convicted. [18] Except for the Respondent's failure to acknowledge guilt or express remorse, the only allegation of misconduct against him relates to his conviction for conspiring to dishonestly cause a risk of loss to a Commonwealth entity.

The rules of evidence

The task of making detailed findings concerning the Respondent's conduct has been made more difficult than it should be because the Prothonotary's submissions, both written and oral, seem to assume that this Court can take into account the findings made by the sentencing Judge and the Victorian Court of Appeal. The assumption overlooks the provisions of the Evidence Act 1995 (NSW) limiting the use this Court can make in disciplinary proceedings of the findings made by a court in criminal proceedings. [19] The oversight is surprising because the Prothonotary's written submissions refer, albeit in a different context, to two decisions of this Court dealing precisely with this question. [20]
Section 178(3) of the Evidence Act 1995 (NSW) provides that a certificate given by an officer of any Australian court is evidence of the particular offence in respect of which the conviction was recorded and of the sentence imposed. Section 178(5) provides that a certificate given under s 178 purporting to contain particulars of an indictment or conviction is evidence of the matters stated in the certificate. The Certificate of Conviction concerning the Respondent records the offence of which he was convicted but contains no particulars of the offence.
Section 91(1) of the Evidence Act 1995 (NSW) provides that evidence of findings of fact made in an Australian proceeding is not admissible to prove the existence of a fact that was in issue in the proceedings. Section 91(2) states that evidence that is not admissible under Part 3.5 (including s 91) to prove the existence of a fact may not be used to prove that fact even if it is relevant for another purpose. Section 92(2) creates an exception to the general rule stated in s 91(1), by providing that evidence that a person has been convicted of an offence may be admitted to show the fact of conviction.
In Sukkar, this Court held that in disciplinary proceedings neither the findings made by the sentencing Judge following a solicitor's conviction nor the remarks of the Court of Criminal Appeal on a subsequent appeal were evidence of the facts found or referred to in the judgments. Hodgson JA observed that the detailed facts set out in the Court of Criminal Appeal's judgment: [21] "may have some relevance to the [solicitor's] reputation, but cannot support findings by this Court as to what the [solicitor] actually did, beyond the bare elements of the offence with which he was convicted".
Sukkar was followed in Livanes. [22] In that case, the Court suggested to the Prothonotary's counsel during the hearing that a notice to admit facts be served on the solicitor to allow the facts relied on to be placed before the Court in admissible form. [23] This course was followed and the solicitor made the necessary admissions. Unfortunately, the Prothonotary's advisors did not follow the same course in the present case.

The findings

The Agreed Statement sets out Count 3 on which the Respondent was convicted. A finding can therefore be made that the offence of which the Respondent was convicted comprised the following elements: "Between approximately 28 March 2003 and 26 May 2004 at Melbourne in the State of Victoria and elsewhere the Respondent did with Glenn Dawson Wheatley, Philip Egglishaw, Philip de Figuerido and Strachans SA, contrary to subsection 135.4(5) of the Criminal Code, to dishonestly cause a risk of loss to a Commonwealth entity, namely the Commonwealth, knowing or believing that there was a substantial risk of the loss occurring, by agreeing an amount of $400,000 would be paid to Overseas Promotions Inc. as that entity's pretended share of the proceeds of the world wide promotion of the Kostya Tszyu v Jesse James Leija fight held at the Telstra Dome in Melbourne on 19 January 2003."
The Agreed Statement cannot be used to make more detailed findings as to the Respondent's criminal conduct. This is because the Agreed Statement merely records the findings made by the sentencing Judge, not the Respondent's agreement that the findings were correct as a matter of fact. On the contrary, the Agreed Statement (and other evidence) shows that the Respondent has consistently maintained his innocence of the charge of which he was convicted. He took this course most recently, so far as the evidence reveals, in a letter of 12 July 2016 to the Professional Standards Manager of the Law Society of New South Wales.
The findings made by the sentencing Judge are referred to in other documents which were admitted into evidence. But they carry the matter no further since s 91(1) of the Evidence Act 1995 (NSW) renders the evidence inadmissible to prove the existence of a fact in issue in the current proceedings. The absence of any objection by the Respondent to the tendering of this material does not make it admissible to prove the facts underlying the Respondent's conviction and sentence.
Nonetheless, the Agreed Statement and the Respondent's statement to the Law Society under s 87 of the Uniform Law (s 87 Statement) (which is in evidence) make it clear that the conduct which led to the Respondent's conviction was committed in his capacity as the solicitor acting for Mr Wheatley. There is therefore no doubt in this case, unlike some others, [24] that the Respondent's criminal conduct amounted to professional misconduct (as distinct from personal misconduct demonstrating unfitness to practise). There is also no doubt that the Respondent has never acknowledged his guilt, despite the jury verdict, and has not exhibited any remorse for his conduct.

Principles

The general principles applicable to a case such as the present were conveniently summarised by Young CJ in Eq in Prothonotary of the Supreme Court of NSW v P. [25] Insofar as relevant, the passage is as follows: "(1) The onus is on the claimant to show that the opponent is not a fit and proper person. It is a civil onus: Re Evatt; Ex parte NSW Bar Association (1967) 67 SR (NSW) 236. However Briginshaw v Briginshaw (1938) 60 CLR 336, 362 shows the particular standard that must be applied when working out the civil onus of proof. (2) An order striking off the Roll should only be made when the probability is that the solicitor is permanently unfit to practice: Prothonotary v [Ritchard] (NSWCA 31.7.1987 per McHugh JA) and see NSW Bar Association v Maddocks (NSWCA 23.8.1988). (3) The fact that the opponent has a conviction for a serious offence is not necessarily sufficient reason for an order striking that person off the Roll; see Ziems v Prothonotary (1957) 97 CLR 279, 283. (4) The fact of conviction and imprisonment is, however, far from irrelevant and may be regarded as carrying a degree of disgrace itself. See Ziems case at 288. (5) The Court needs to consider the conduct involved in the conviction and see whether it is of such personally disgraceful character that the opponent should not remain a member of an honourable profession: Re Weare [1893] 2 QB 439, 446; Barristers' Board v Darveniza (2000) 112 A Crim R 438 (QCA). (6) The fact that the opponent pleaded guilty to the charge will usually be counted in [the practitioner's] favour: NSW Bar Association v Maddocks. … (7) Conduct not occurring in the course of professional practice may demonstrate unfitness if it amounts to incompatibility with the personal qualities essential for the conduct of practice. There may not even have been any criminal conviction with respect to that conduct. … (8) The concept of good fame and character has a twofold aspect. Fame refers to a person's reputation in the relevant community, character refers to the person's actual nature: McBride v Walton (NSWCA 15.7.1994 per Kirby P); Clearihan v Registrar of Motor Vehicle Dealers (1994) 117 FLR 455, 459. …"

The Respondent's fitness

A conviction even for a serious offence does not necessarily warrant a finding that a legal practitioner is permanently unfit to practise. [26] However, the Respondent was convicted of a particularly serious offence clearly involving the use of his position as a solicitor to conspire with others to perpetrate an act of calculated dishonesty. The terms of the charge make it clear that the object of the conspiracy was to enable the Respondent's client to obtain a benefit at the cost of the Commonwealth. The inference is readily available that the Respondent acted dishonestly in order to facilitate the evasion by his client of a large amount of tax. In any event, the Respondent's s 87 Statement makes it clear that the payment of $400,000 was to an offshore company and enabled Mr Wheatley, a co-conspirator, to evade the tax due on that amount.
There are, no doubt, many examples of dishonest conduct by legal practitioners that demonstrate unfitness to practise law. However, a solicitor's dishonest participation in a conspiracy designed to enable a client unlawfully to evade tax strikes at the very heart of the qualities required to practise law. Spigelman CJ explained why that is so in a case involving a barrister who failed to lodge tax returns over many years: [27] "[19] Honesty and integrity are important in many spheres of conduct. However, in some spheres significant public interests are involved in the conduct of particular persons and the state regulates and restricts those who are entitled to engage in those activities and acquire the privileges associated with a particular status. The legal profession has long required the highest standards of integrity. [20] There are four interrelated interests involved. Clients must feel secure in confiding their secrets and entrusting their most personal affairs to lawyers. Fellow practitioners must be able to depend implicitly on the word and the behaviour of their colleagues. The judiciary must have confidence in those who appear before the courts. The public must have confidence in the legal profession by reason of the central role the profession plays in the administration of justice. Many aspects of the administration of justice depend on the trust by the judiciary and/or the public in the performance of professional obligations by professional people."
The gravity of the Respondent's conduct is demonstrated by the custodial sentence imposed on him by the Supreme Court of Victoria. As we have noted, the judgment of the Victorian Court of Appeal on the appeal by the DPP against sentence cannot be used for the purpose of making findings of fact in disciplinary proceedings. Nonetheless, it is a further indication of the seriousness of the Respondent's dishonest conduct that the Court of Appeal considered that the trial Judge should have imposed a much longer sentence of imprisonment. The Court declined to allow the DPP's appeal only because there were unusual circumstances which made it inappropriate to interfere with the sentence imposed at trial. These included the Court's view that the DPP was bound by the way in which the prosecution had been conducted, the delay in instituting the prosecution and the fact that the Respondent had been released from full-time custody by the time the appeal was heard. [28]
Where a solicitor has been convicted of a grave offence involving deliberate dishonesty in the practice of law, exceptional circumstances will be required before the Court could contemplate any sanction other than removal from the Roll. [29] For some lesser sanction to be considered the legal practitioner would at least have to adduce cogent evidence of extenuating circumstances or of contrition and rehabilitation countering the inference of permanent unfitness to practise law. In the present case, the Respondent has offered no evidence of extenuating circumstances that may have ameliorated the gravity of his professional misconduct. By persistently maintaining his innocence in the face of his conviction (against which he apparently did not appeal), he has precluded any reliance on contrition or rehabilitation.

Conclusion and orders

There are two unsatisfactory features of this application. The first is the delay in bringing the application. The second is that the Prothonotary's case attributed greater evidentiary significance to the findings of the sentencing Judge and of the Victorian Court of Appeal than can be justified under the relevant provisions of the Evidence Act 1995 (NSW). Accordingly, this Court has had to approach the application without the benefit of admissible evidence that would have shed light, for example, on the Respondent's motive for engaging in the conspiracy and the full nature and extent of his dishonesty.
Despite the limited evidence in admissible form adduced by the Prothonotary, we are satisfied that the Respondent has been guilty of professional misconduct and is not a fit and proper person to be entrusted with the duties and responsibilities of a solicitor. We are also satisfied that he is not a fit and proper person to be enrolled as a legal practitioner of the Supreme Court of New South Wales. The probabilities are that he is permanently unfit to practise law.
Bearing in mind that the jurisdiction of this Court to remove a legal practitioner from the Roll is "entirely protective", [30] such an order should be made in the present case. The following declarations and orders should be made:
Declare that the Respondent, Paul John Gregory, has been guilty of professional misconduct.
Declare that the Respondent, Paul John Gregory, is not a fit and proper person to be on the Roll of Legal Practitioners of the Supreme Court of New South Wales.
Order that the name of the Respondent, Paul John Gregory, be removed from the Roll of Legal Practitioners of the Supreme Court of New South Wales.
The Respondent, Paul John Gregory, pay the costs of the Applicant, the Prothonotary of the Supreme Court of New South Wales, of and incidental to these proceedings.

Endnotes

Legal Profession Uniform Law (NSW) (Uniform Law), s 22(1) requires the Supreme Court to maintain a Roll of Australian lawyers for New South Wales. The Roll contains the names and other relevant particulars of persons admitted to practise by the Court. Section 4 of the Legal Profession Uniform Law Application Act 2014 (NSW) applies the Uniform Law set out in Sch 1 to the Legal Profession Uniform Law Application Act 2014 (Vic) as a law of New South Wales.
Supreme Court Act 1970 (NSW), s 48(2)(k); Supreme Court Rules 1970 (NSW), Pt 65A r 2(1).
These terms are defined in ss 296 and 297, respectively, of the Uniform Law.
See the definition of "Australian lawyer" in Uniform Law, s 6(1). See also Uniform Law, s 261, which provides that in Chapter 5 the term "lawyer" includes an Australian lawyer who is not an Australian legal practitioner - that is, an Australian lawyer who does not hold a current Australian practising certificate.
The earliest provision expressly preserving the inherent jurisdiction of the Supreme Court over solicitors was s 79 of the Legal Practitioners Act 1898 (NSW) introduced by the Legal Practitioners (Amendment) Act 1935 (NSW). The High Court recounted the legislative history of the provisions expressly preserving the Supreme Court's inherent jurisdiction in A Solicitor v Council of the Law Society of New South Wales (2004) 216 CLR 253; [2004] HCA 1 at [10]-[11] per curiam. The provision involved in that case was s 171M(1) of the Legal Profession Act 1987 (NSW).
(2004) 216 CLR 253; [2004] HCA 1.
A Solicitor v Council of the Law Society of New South Wales at [12], citing Southern Law Society v Westbrook (1910) 10 CLR 609; [1910] HCA 31 at 612 (Griffith CJ).
A Solicitor v Council of the Law Society of New South Wales at [15].
A Solicitor v Council of the Law Society of New South Wales at [21].
A Solicitor v Council of the Law Society of New South Wales at [15].
A Solicitor v Council of the Law Society of New South Wales at [21].
Council of the New South Wales Bar Association v Einfeld [2009] NSWCA 255; 258 ALR 768 (Bar Association v Einfeld) at [13] per curiam.
Director of Public Prosecutions (Cth) v Gregory (2011) 34 VR 1; [2011] VSCA 145 (DPP v Gregory).
In New South Wales, the designated local roll authority is the Prothonotary: Uniform Law s 6 (definition of "designated local roll authority"); Legal Profession Uniform Law Application Act 2014 (NSW), s 11(2).
Section 87 of the Uniform Law requires an applicant for the grant or renewal of a practising certificate to provide a statement disclosing (among other things) any conviction for an indictable offence and explaining why, despite the conviction, the applicant considers himself or herself a fit and proper person to hold a certificate.
Council of the New South Wales Bar Association v Power (2008) 71 NSWLR 451; [2008] NSWCA 135 (Bar Association v Power) at [10] (Hodgson JA, Beazley and McColl JJA agreeing); New South Wales Bar Association v Cummins (2001) 52 NSWLR 279; [2001] NSWCA 284 at [24]-[25] (Spigelman CJ, Mason P and Handley JA agreeing).
Bar Association v Power at [11].
As was the case in Bar Association v Einfeld.
Evidence Act 1995 (NSW), ss 91, 92, 178.
Prothonotary of the Supreme Court of New South Wales v Sukkar [2007] NSWCA 341 (Sukkar); Prothonotary of the Supreme Court of New South Wales v Livanes [2012] NSWCA 325 (Livanes).
Sukkar at [9] (Tobias and Basten JJA agreeing).
Livanes at [9]-[10] (McColl JA, Campbell and Meagher JJA agreeing).
Livanes at [12].
For example, in A Solicitor v Council of the Law Society of New South Wales where the "personal misconduct" consisted of aggravated indecent assault against persons under the age of sixteen years.
[2003] NSWCA 320 at [17] (Meagher and Tobias JJA agreeing). The passage was quoted with approval in Sukkar at [21].
As in Ziems v The Prothonotary of the Supreme Court of New South Wales (1957) 97 CLR 279; [1957] HCA 46, where a barrister was convicted of manslaughter as the result of driving while intoxicated. In A Solicitor v Council of the Law Society of New South Wales, the High Court considered that a conviction for four "isolated" acts of indecent assault against children warranted only a suspension from practice having regard to the "unusual pressures" on the practitioner at the time of the offences and his subsequent rehabilitation.
New South Wales Bar Association v Cummins (2001) 52 NSWLR 279; [2001] NSWCA 284 at [19]-[20] (Mason P and Handley JA agreeing).
DPP v Gregory at [77]-[79].
See the observations of Dixon J in relation to a barrister who had been convicted twelve years earlier on a charge of housebreaking: In re Davis (1947) 75 CLR 409; [1947] HCA 53 at 426 (Williams J agreeing). See also New South Wales Bar Association v Hamman [1999] NSWCA 404; 217 ALR 553 at [101] (Mason P).
Prothonotary of the Supreme Court of New South Wales v Ritchard (Court of Appeal (NSW), 31 July 1987, unrep) at 21 (McHugh JA), cited in New South Wales Bar Association v Cummins (2001) 52 NSWLR 279; [2001] NSWCA 284 at [26] (Spigelman CJ, Mason P and Handley JA agreeing). DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 18 May 2017

Legal Practitioners Act 1898(NSW)

Legal Practitioners (Amendment) Act 1935(NSW)

Legal Profession Act 1987(NSW)

"designated local roll authority"); Legal Profession Uniform Law Application Act 2014(NSW)

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