Prothonotary v Holt

Court of Appeal (NSW)|2008-06-04|Before: Tobias JA, McColl JA, Gzell J

CITATION: Prothonotary v Holt [2008] NSWCA 136

JUDGMENT OF: Tobias JA at 1; McColl JA at 2; Gzell J at 3

Declare that the opponent is guilty of professional misconduct in that: (i) on 2 July 1993 the opponent engaged in conduct of a dishonest nature for which, on 30 June 2006 at the Sydney District Court, he was convicted of the offence of: being the trustee of property wholly for the benefit of the beneficiaries of the Estate of the late James McEwan King, appropriating that property (a unit at 13/281 Sussex St Sydney) for his own use in violation of good faith and with intent to defraud, contrary to s 172 of the Crimes Act 1900. ("King Count 1"); (ii) between 5 August 1993 and 21 February 1997 the opponent engaged in conduct of a dishonest nature for which, on 30 June 2006 at the Sydney District Court, he was convicted of the offence of: being the trustee of property wholly for the benefit of the beneficiaries of the Estate of the late James McEwan King, appropriating that property (money in the sum of $29,310.00) for his own use in violation of good faith and with intent to defraud, contrary to s 172 of the Crimes Act 1900. ("King Count 2"); (iii) on 21 August 1997 the opponent engaged in conduct of a dishonest nature for which he was convicted on 30 June 2006 at the Sydney District Court of the offence of: obtaining property (money in the sum of $1,000.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Count 1"); (iv) on 16 July 1998 the opponent engaged in conduct of a dishonest nature for which he was convicted on 30 June 2006 at the Sydney District Court of the offence of: obtaining property (money in the sum of $1,000.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Count 2"); (v) on 10 September 1997 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 1"); (vi) on 3 October 1997 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $1,000.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 2"); (vii) on 7 November 1997 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 3"); (viii) on 12 December 1997 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $1,500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 4"); DECISION: (ix) on 23 January 1998 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 5"); (x) on 16 March 1998 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $1,500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 6"); (xi) on 6 April 1998 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $1,000.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 7"); (xii) on 27 April 1998 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 8"); (xiii) on 28 April 1998 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 9"); (xiv) on 26 May 1998 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $1,000.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 10"); (xv) between about 15 April and 3 July 1993 the opponent engaged in conduct of a dishonest nature, when applying for a loan to be secured by a mortgage over unit 13/281 Sussex St Sydney ("the Vintage"), by failing to advise the Advance Bank that he held that unit in trust for the Estate of the late James McEwan King ("the King Estate") and holding himself out as the true owner; (xvi) on or about 11 November 1993 the opponent engaged in conduct of a dishonest nature, in breach of his duty of candour to his professional colleagues and in breach of his fiduciary duty to the beneficiaries of the King Estate by, when sending a letter to the solicitors for the beneficiaries of the estate setting out the assets, income and liabilities of the estate, deliberately omitting to mention that the Vintage had been mortgaged to the Advance Bank as security for a loan of $250,000.00; (xvii) between 21 August 1997 and 16 July 1998 the opponent held himself out to be a solicitor without being the holder of a current practising certificate, contrary to s 25(3) of the Legal Profession Act 1987 (as it then was); (xviii) between 9 April 2001 and 21 May 2001 the opponent engaged in conduct of a dishonest nature by falsely and repeatedly asserting to police, who were investigating the conduct the subject of King Counts 1 and 2, that the advancing of funds by the Advance Bank to the opponent and associated companies, pursuant to a loan secured by the Vintage, had been the result of an error on the part of himself and the bank. 2. Declare that the opponent is not a person of good fame and character. 3. Declare that the opponent is not a fit and proper person to remain on the Local Roll of lawyers of the Supreme Court of New South Wales. 4. Order that the name of the opponent be removed from the Local Roll of lawyers of the Supreme Court of New South Wales.

CATCHWORDS: LEGAL PRACTITIONERS - Application to remove from Local Roll - Convicted of criminal offences - As solicitor for deceased, appointed as sole executor and trustee of estate - Appropriating trust property - Practising without holding a practising certificate - Whether guilty of professional misconduct - Whether not a person of good fame and character - Whether not a fit and proper person to remain on Local Roll - Whether name should be removed from Local Roll

LEGISLATION CITED: Crimes Act 1900 Crimes (Sentencing Procedure) Act 1999

Prothonotary of the Supreme Court of New South Wales v McCaffery [2004] NSWCA 470 CASES CITED: Myers v Elman [1940] AC 282 New South Wales Bar Association v Cummins [2001] NSWCA 284, (2001) 52 NSWLR 279 Prothonotary of the Supreme Court of New South Wales v P [2003] NSWCA 320

PARTIES: Prothonotary of the Supreme Court of New South Wales (Appellant) John Colin Holt (Respondent)

SOLICITORS: Crown Solicitor (Appellant) Graham Chegwidden, Solicitor & Barrister (Respondent)

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40682/07

TOBIAS JA McCOLL JA GZELL J

13 JUNE 2008 PROTHONOTARY OF THE SUPREME COURT OF NSW v JOHN COLIN HOLT Judgment 1 TOBIAS JA: I agree with Gzell J. 2 McCOLL JA: I agree with Gzell J. 3 GZELL J: The claimant is the Prothonotary of the Supreme Court of New South Wales. She seeks declarations that the opponent, John Colin Holt, is guilty of professional misconduct, is not a person of good fame and character and is not a fit and proper person to remain on the local roll of lawyers of this Court. The claimant seeks an order that the name of the opponent be removed from that roll. 4 The opponent does not contest the proceedings. He consents to the declarations and order and consents to and agrees with an agreed statement of facts. The claimant no longer presses an order that the opponent pay her costs. 5 Despite the opponent's attitude to the proceedings it is not appropriate, however, that the declarations and order sought be made unless the Court is itself satisfied that they should be made and records the findings upon which they are made (Prothonotary of the Supreme Court of New South Wales v McCaffery [2004] NSWCA 470 especially at [12]). 6 The agreed statement of facts is as follows: "1. On 25 November 1966 the Opponent was admitted as a Solicitor of the Supreme Court of New South Wales. His name remains on the Local Roll of Lawyers.

On 8 May 1997 the Opponent's practising certificate was suspended and he has not subsequently sought to obtain a practising certificate.

On 30 June 2006 before Hock J in the District Court at Sydney the Opponent, having pleaded guilty, was convicted of, and sentenced in relation to, four criminal offences as follows: (i) On 2 July 1993 at Sydney in the State of New South Wales being the trustee of property wholly for the benefit of the beneficiaries of the Estate of the late James McEwan King, appropriating that property (a unit at 13/281 Sussex St Sydney) for his own use in violation of good faith and with intent to defraud, contrary to s172 of the Crimes Act 1900 (NSW). ("King Count 1") (ii) Between 5 August 1993 and 21 February 1993 ( sic ) being the trustee of property wholly for the benefit of the beneficiaries of the Estate of the late James McEwan King, appropriating that property (money in the sum of $29,310.00) for his own use in violation of good faith and with intent to defraud, contrary to s172 of the Crimes Act 1900 (NSW). ("King Count 2") (iii) On 21 August 1997 at Sydney in the State of New South Wales obtaining property (money in the sum of $1000.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s179 of the Crimes Act 1900 (NSW). ("Fisher Count 1"). (iv) On 16 July 1998 at Sydney in the State of New South Wales obtaining property (money in the sum of $1000.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s179 of the Crimes Act 1900 (NSW). ("Fisher Count 2")

When the Opponent was sentenced in respect of Fisher Count 1, pursuant to s32 of the Crimes (Sentencing Procedure) Act 1999 (NSW) the opponent by way of a "Form 1" admitted to having committed, and the judge took into account, ten further offences of obtaining property (money in various amounts) by a false pretence (in each case to Margaret Fisher that he held a Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s179 of the Crimes Act 1900 (NSW) on the following dates involving the following sums: (i) On 10 September 1997, $500.00; ("Fisher Form 1 Offence 1") (ii) On 3 October 1997, $1000.00; ("Fisher Form 1 Offence 2") (iii) On 7 November 1997, $500.00; ("Fisher Form 1 Offence 3") (iv) On 12 December 1997, $1500.00 ; ("Fisher Form 1 Offence 4") (v) On 23 January 1998, $500.00; ("Fisher Form 1 Offence 5") (vi) On 16 March 1998, $1500.00; ("Fisher Form 1 Offence 6") (vii) On 6 April 1998, $1000.00; ("Fisher Form 1 Offence 7") (viii) On 27 April 1998, $500.00; ("Fisher Form 1 Offence 8") (ix) On 28 April 1998, $500.00; ("Fisher Form 1 Offence 9") (x) On 26 May 1998, $1000.00; ("Fisher Form 1 Offence 10")

The sentences imposed for the offences amounted to a total effective sentence of 2 years and 5 months full time imprisonment with a non parole period of 16 months. The particular sentence in relation to each charge was as follows: King Count 1 - a fixed term of 12 months commencing on 30 June 2006 and expiring on 29 June 2007; King Count 2 - a fixed term of 6 months commencing on 30 June 2006 and expiring on 29 December 2006 Fisher Count 1 - (taking into account Fisher Form 1 Offences 1-10) - a sentence of imprisonment of 1 year and 9 months consisting of a non parole period of 8 months commencing on 28 February 2007 and expiring on 27 October 2007 and a balance of term of 1 year and one month commencing on 28 October 2007 and expiring on 27 November 2008. Fisher Count 2 - a fixed term of 6 months commencing 28 February 2007 and expiring 27 August 2007.

The facts of the Opponent's conduct in relation to King Counts 1 and 2, and the progress of those charges through the criminal justice system, are accurately set out in the Statement of Facts tendered by the Crown in the sentencing proceedings, a copy of which is annexed and marked "A" .

Further to those facts, in the course of the police investigation into the matters the subject of King Counts 1 and 2, on 9 April 2001 and 29 May 2001 the Opponent was interviewed by police. During each of those interviews he falsely asserted on a number of occasions that the advancement to him (and companies associated with him) of monies as a result of the mortgaging of a unit he held in trust for the beneficiaries of the Estate of the late James McEwan King was the result of an error on the part of himself and the Advance Bank.

The facts of the Opponent's conduct in relation to Fisher Counts 1 and 2 and Fisher Form 1 Offences 1-10, and their progress through the criminal justice system, were as follows.

On 20 December 1996 Mrs Margaret Fisher, then aged in her mid-sixties, engaged the Opponent as her solicitor in litigation involving a dispute about the maintenance of a home unit which she owned and in which she lived. The Opponent was, at that time, a solicitor with a current practising certificate.

From that time until 16 July 1998 the Opponent and Mrs Fisher had regular meetings, telephone conversations and correspondence in relation to her litigation. All but one of the letters sent by the Opponent to Mrs Fisher during that period was on letterhead bearing the title "John C. Holt Solicitor".

On 8 July 1997 the Opponent's practising certificate was suspended as a result of the allegations the subject of King Counts 1 and 2. He did not inform Mrs Fisher of that event but, until 16 July 1998, continued to hold himself out to her as a solicitor.

On twelve occasions between August 1997 and July 1998, after his practising certificate had been suspended, the Opponent requested from Mrs Fisher, and received, payments of money on account of legal fees and disbursements. Mrs Fisher lived close to the Opponent's office and in each case made payment on the day it was requested. The dates and amounts are set out in paragraphs 3 (iii) - (iv) and 4 (i) - (x) above.

On 10 August 1998 Mrs Fisher, having been unable to contact the Opponent, made enquiries with the Law Society of New South Wales and discovered that his practising certificate had been suspended. On or about the next day, Mrs Fisher and the Opponent had a telephone conversation during which there was an exchange to the following effect: […] Opponent: "Oh, by the way, you can still get me on this number." Fisher: "Why would I. You are not a practising solicitor." Opponent: "Who told you that?" Fisher: "I telephoned the Law Society the day before and they told me you are not listed to practise. […] You were not in a position to take my case to court." Opponent: "Oh, that does not matter, because the barrister presents the case." […]

In April 2003, after unexpected delay on the part of the prosecuting authorities, the Opponent was charged with the offences. While he ultimately admitted his guilt, in the course of his defence, Mrs Fisher (who was then in her seventies) was required to give evidence at a committal hearing and was subjected to cross examination.

The Opponent was committed for trial in October 2004 and maintained his pleas of not guilty up until 10 April 2006, the day the matters were listed for trial. On 29 June 2006, the day before he was sentenced, the Opponent repaid the $10,500.00 which he had fraudulently obtained from Mrs Fisher." 7 There is an error in paragraph 3(ii) of the above statement of facts. The second date should be 21 February 1997. 8 The Crimes Act 1900, s 172 provides as follows: "Whosoever, being a trustee of property for the use or benefit, wholly or partially, of some other person or for any public or charitable purpose, converts, or appropriates, the same, or any part thereof, for the use or benefit of himself or herself, or some other person, or for any other than such public or charitable purpose, or, otherwise disposes of, or destroys such property, or any part thereof, in violation in any such case of good faith, and with intent to defraud, shall be liable to imprisonment for ten years. Provided that no prosecution shall be instituted under this section without the leave of the Supreme Court, or of the Attorney-General." 9 Section 179 is in the following terms: "Whosoever, by any false pretence or by any wilfully false promise, or partly by a false pretence and partly by a wilfully false promise, obtains from any person any property, with intent to defraud, shall be liable to imprisonment for five years." 10 The additional statement of facts to which reference is made in paragraph 6 of the above statement of facts is as follows: "1. The accused was the solicitor for James McEwan King and was appointed sole Executor under Mr King's will. The will provided that Mr King's Estate was to be held by the accused under trust. The major portion of the Estate, referred to as the "residuary Estate", was to be held upon trust as to the net income therefrom for Mr King's son, Bruce McEwan King, during his life and then after his death as to the income therefrom for his wife, Jean King, during her life or until her remarriage, and upon either of those events for the children of Bruce McEwan King and Jean King. Bruce McEwan King did not survive his father. The residuary Estate was held on trust for Jean King and her three children.

The accused applied for probate of the will. That was granted and the assets of the Estate were converted to cash totalling approximately $275,000, of which the residuary Estate amounted to approximately $269,251.

In December 1987, the Estate purchased a home unit in Sussex Street, Sydney ("the Vintage") for approximately $225,000. The Certificate of Title showed that the registered proprietor as "John Colin Holt". The fact that he was the Trustee was not disclosed, but that was the usual practice. Following the purchase, the property was unencumbered.

In 1989, the accused recommended to the beneficiaries that the Estate make a further investment in property. In particular, he recommended that they purchase four parcels of land on Magnetic Island, Queensland. The accused disclosed the fact that he was a director and shareholder of the company which owned the land. The beneficiaries took independent legal advice following which they agreed to purchase the four parcels of land.

That purchase took place in August 1989. Each parcel of land was purchased for $39,350. The purchase was financed from Estate funds and a loan of $100,000 secured by a mortgage over "the Vintage". The mortgagee was also a client of the accused.

In late 1992, that mortgage was increased to $120,000, the additional money being required to pay the special levy (approximately $13,000) imposed by the Body Corporate for essential structural repairs to "the Vintage", as well as other monies said to have been spent in relation to the property.

By letter dated 2 February 1993, Mrs King wrote to the accused seeking details of the present "state of affairs" of the Estate. On 16 February 1993, the accused replied to that letter. The accused reiterated the position so far as the purchase of the various properties was concerned. The accused stated that the Estate had not received any income of any consequence during the period of his trusteeship and that it was unlikely that this position would change for some time. He recommended that they should retain their interest in the property purchased by the trust.

On 15 March 1993, the solicitor for the beneficiaries wrote to the accused informing him that they were considering winding up the Estate and sought from him a statement about the affairs of the Estate.

During the period covered by this correspondence, the accused had been in negotiations with staff of the Advance Bank in relation to overdrawn accounts that he had with that bank. The three accounts were in arrears to the order of $120,000. Those loans were unsecured. During the course of those negotiations, the accused offered "the Vintage" as security for a loan from the Advance Bank to the accused. At no time prior to the commencement of the loan did the accused inform the Bank that he held the Vintage on trust for the beneficiaries of the Estate. The beneficiaries did not give the accused permission to use the property in that way.

On 3 July 1993, the mortgage of the property by the accused to the Advance Bank was registered. The mortgage was in the sum of $250,000. In excess of $120,000 was used to repay the debts of the accused referred to above. Approximately $8,000 went into an account operated by the accused. The balance was used to pay out the existing mortgage. From that time on, rent received from the tenants of the Vintage was paid into the loan account associated with the mortgage.

In November 1993, the accused wrote to the solicitors for the beneficiaries. In providing a breakdown of the assets and liabilities of the Estate, the accused did not mention the mortgage to the Advance Bank. The accused recommended as "trustee" "that the unit should be retained at all cost".

Count 2 in the Indictment is a rolled-up charge relating to monies paid into the mortgage account. The monies were misappropriated over a period commencing in July 1993 and ending in February 1997. The $29,310 is the value of the loss to the Estate from the time that the mortgage commenced.

In about November 1996, the solicitor for the beneficiaries received instructions to seek the winding up of the Estate. At about this time, the accused attempted to obtain a release of "the Vintage" from the mortgage to the Advance Bank. That request was denied. On 18 November 1996, the accused was requested by the solicitor for the beneficiaries to provide all relevant documents for the finalisation of the Estate. The accused stated that he would attend to settlement by the end of December 1996. At this time, the accused was in arrears in relation to his obligations to the Advance Bank pursuant to the mortgage. Proceedings were commenced for the sale of "the Vintage" by the Advance Bank, as mortgagee in possession. On 24 April 1997, the Advance Bank sold the property for $275,000 - all proceeds of the sale went to satisfy the monies owed to the Advance Bank.

The matter was referred to the Police. A statement was taken from Mrs King in March 1998. A follow-up statement was taken in February 2000. The accused was interviewed on 29 May 2001 and again on 9 April 2002. During the first interview, the accused admitted that the loss to the Estate was as a result of an "error" that he had made. He admitted that he should have outlined the fact of the trust and that he had put forward the property as his own (Q120-1). He also admitted to paying cheques from the Estate's account to the Advance Bank loan account (Q138).

On 11 October 2004, the accused was committed for trial. The accused was initially arraigned upon an indictment containing 47 counts. On 2 May 2005, a new indictment was prepared containing 35 counts, but adding an additional count under s178BA. That count related to obtaining a benefit from the Advance Bank by deceiving them as to the ownership of "the Vintage".

The matter was listed for a three-week trial commencing on 29 August 2005. On that day, the accused offered to plead guilty to the present indictment. Those please were accepted in full satisfaction of the matters relating to the Estate.

As a result of the offences committed by the accused, the Estate sought compensation from the Law Society of NSW. The Estate received $157,097 from the Law Society." 11 There is an error in paragraph 14 of the above statement. The first interview was on 9 April 2001. The second was on 29 May 2001. 12 Professional misconduct of a solicitor at common law has come to be regarded as conduct that would reasonably be regarded as disgraceful or dishonourable by solicitors of good repute and competency (Myers v Elman [1940] AC 282 at 288-289, New South Wales Bar Association v Cummins [2001] NSWCA 284, (2001) 52 NSWLR 279 at [36]-[41]). 13 There is a controversy as to whether professional misconduct is limited to misconduct in the course of professional work or extends to conduct sufficiently closely connected to actual practice or to conduct outside the course of practice manifesting the presence or absence of qualities incompatible with, or essential for, the conduct of practice (Cummins at [49]-[56]). 14 The controversy does not arise in this case because the opponent's conduct with respect to Mrs Fisher arose in the course of his purported practice as a solicitor and his trusteeship arose from his conduct of his practice as the solicitor for the late Mr King. 15 But in my view, not only would a competent solicitor regard the opponent's conduct in breach of trust as disgraceful and dishonourable, it also demonstrated a lack of the qualities of honesty and integrity essential to the conduct of professional practice. 16 As Spigelman CJ said in Cummins: "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." 17 In my view, the claimant is entitled to a declaration that the opponent is guilty of professional misconduct and a declaration that he is not a person of good fame and character. 18 But that does not mean that in the exercise of its inherent jurisdiction the court should automatically strike the opponent's name from the local roll of lawyers or declare that the opponent is not a fit and proper person to remain on the roll. 19 In Prothonotary of the Supreme Court of New South Wales v P [2003] NSWCA 320 at [17], Young CJ in Eq with whom the other members of the Court agreed summarised a series of propositions drawn from the authorities as follows: "A series of propositions as to the law clearly have appeared from the cases and I will briefly summarise them. (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 Richard (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 her favour: NSW Bar Association v Maddocks. Though we do not assume that all pleas of guilty necessarily show remorse, it is significant that in the instant case Keleman DCJ said that it did.

(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. This is particularly so where the conduct over a long period shows systematic non-compliance with legal and civic obligations: NSW Bar Association v Cummins (2001) 52 NSWLR 279, 289; NSW Bar Association v Somosi (2001) 48 ATR 562.

(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.

(9) The attitude of the professional association is that the application is of considerable significance. (10) The question is present fitness, not fitness as at the time of the crime: Prothonotary v Del Castillo [2001] NSWCA 75 at para 71." 20 In the instant circumstances the opponent has been convicted of serious offences arising from the conduct of a solicitor's practice. He falsely held himself out as qualified to practise as a solicitor. He purloined property held by him as trustee. That conduct makes him presently and permanently unfit to practise as a solicitor. He is not fit to remain a member of an honourable profession. While the opponent did plead guilty, he did so at a late stage. It cannot be assumed that his plea connotes remorse. Both his dealing with the trust property and his continuing to act for Mrs Fisher demonstrated a systematic flaunting of his duties over an extended period of time. 21 In my view the opponent is not a fit and proper person to remain on the Local Roll of lawyers and his name should be removed from it. 22 In terms of the claimant's amended summons I suggest that the following declarations and order be made: 1. Declare that the opponent is guilty of professional misconduct in that: (i) on 2 July 1993 the opponent engaged in conduct of a dishonest nature for which, on 30 June 2006 at the Sydney District Court, he was convicted of the offence of: being the trustee of property wholly for the benefit of the beneficiaries of the Estate of the late James McEwan King, appropriating that property (a unit at 13/281 Sussex St Sydney) for his own use in violation of good faith and with intent to defraud, contrary to s 172 of the Crimes Act 1900. ("King Count 1"); (ii) between 5 August 1993 and 21 February 1997 the opponent engaged in conduct of a dishonest nature for which, on 30 June 2006 at the Sydney District Court, he was convicted of the offence of: being the trustee of property wholly for the benefit of the beneficiaries of the Estate of the late James McEwan King, appropriating that property (money in the sum of $29,310.00) for his own use in violation of good faith and with intent to defraud, contrary to s 172 of the Crimes Act 1900. ("King Count 2"); (iii) on 21 August 1997 the opponent engaged in conduct of a dishonest nature for which he was convicted on 30 June 2006 at the Sydney District Court of the offence of: obtaining property (money in the sum of $1,000.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Count 1"); (iv) on 16 July 1998 the opponent engaged in conduct of a dishonest nature for which he was convicted on 30 June 2006 at the Sydney District Court of the offence of: obtaining property (money in the sum of $1,000.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Count 2"); (v) on 10 September 1997 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 1"); (vi) on 3 October 1997 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $1,000.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 2"); (vii) on 7 November 1997 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 3"); (viii) on 12 December 1997 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999:

obtaining property (money in the sum of $1,500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 4"); (ix) on 23 January 1998 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999:

obtaining property (money in the sum of $500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 5"); (x) on 16 March 1998 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $1,500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 6"); (xi) on 6 April 1998 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $1,000.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 7"); (xii) on 27 April 1998 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 8"); (xiii) on 28 April 1998 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $500.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 9"); (xiv) on 26 May 1998 the opponent engaged in conduct of a dishonest nature for which, upon his admission and upon being convicted of Fisher Count 1, the following offence was taken into account on a Form 1, pursuant to s 32 of the Crimes (Sentencing Procedure) Act 1999: obtaining property (money in the sum of $1,000.00) by a false pretence (to Margaret Fisher that he held a current Practising Certificate authorising him to practise as a solicitor in the State of New South Wales) with intent to defraud, contrary to s 179 of the Crimes Act 1900. ("Fisher Form 1 Offence 10"); (xv) between about 15 April and 3 July 1993 the opponent engaged in conduct of a dishonest nature, when applying for a loan to be secured by a mortgage over unit 13/281 Sussex St Sydney ("the Vintage"), by failing to advise the Advance Bank that he held that unit in trust for the Estate of the late James McEwan King ("the King Estate") and holding himself out as the true owner; (xvi) on or about 11 November 1993 the opponent engaged in conduct of a dishonest nature, in breach of his duty of candour to his professional colleagues and in breach of his fiduciary duty to the beneficiaries of the King Estate by, when sending a letter to the solicitors for the beneficiaries of the estate setting out the assets, income and liabilities of the estate, deliberately omitting to mention that the Vintage had been mortgaged to the Advance Bank as security for a loan of $250,000.00; (xvii) between 21 August 1997 and 16 July 1998 the opponent held himself out to be a solicitor without being the holder of a current practising certificate, contrary to s 25(3) of the Legal Profession Act 1987 (as it then was); (xviii) between 9 April 2001 and 21 May 2001 the opponent engaged in conduct of a dishonest nature by falsely and repeatedly asserting to police, who were investigating the conduct the subject of King Counts 1 and 2, that the advancing of funds by the Advance Bank to the opponent and associated companies, pursuant to a loan secured by the Vintage, had been the result of an error on the part of himself and the bank. 2. Declare that the opponent is not a person of good fame and character.

Declare that the opponent is not a fit and proper person to remain on the Local Roll of lawyers of the Supreme Court of New South Wales.

Order that the name of the opponent be removed from the Local Roll of lawyers of the Supreme Court of New South Wales.

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.

At a glance

Court

Decision date

Before

Source

Judgment (54 paragraphs)

Parties

Legislation Cited (2)

Cases Cited (8)

Cited By (2)