Roulstone v New South Wales Bar Association

The Overcharging Cases

1. According to the evidence, within a period of weeks after Ms Helena Li's engagement was terminated, many former clients of Keddies commenced proceedings against the firm for having allegedly overcharged them fees. The evidence was that there were approximately 130 to 140 of such claims.
2. These claims by former Keddies clients placed financial stress on the former partners of Keddies including Mr Roulstone. There was evidence that the total estimated liabilities of the firm were approximately $12m.
3. Mr Keddie was declared bankrupt in June 2012. Mr Barakat and Mr Roulstone were declared bankrupt in August 2012.
4. Prior to each of these partners declaring bankruptcy, Keddies (or the former partners of Keddies) had paid approximately two million dollars to former clients in respect of an estimated fifty to fifty five cases.
5. In relation to what were referred to as "the overcharging cases", the Keddies partners were represented by Mr Robert Tassell of Verekers Lawyers. Either Mr Barakat or Mr Roulstone gave instructions to Mr Tassell, Mr Keddie having ceased to practice in June 2011.
6. The evidence, however, indicated that Mr Roulstone was also regularly involved in directly communicating with Margiotta Solicitors ("Margiotta's") who acted for a number of the former clients of Keddies in relation to the "overcharging cases". The evidence was that this included regular communications with Mr Naushad Husaini who had commenced working for Margiotta Solicitors.
7. There was said to be no formal arrangement between the former partners of Keddies as to the basis or mechanism by which the various "overcharging cases" were to be settled. The evidence indicated that in each case there would be discussions between the three partners by phone. On the evidence, three to four cases ran to final judgment but approximately fifty cases were settled.
8. The evidence indicates that some former clients of Keddies subsequently engaged and were represented by Firths the Compensation Lawyers ("Firths"), in respect of the "overcharging cases". At some later unspecified time, approximately five to ten of Firths' clients switched their legal representation from Firths to Margiotta Solicitors. In those cases, Margiotta Solicitors would render a Memorandum for their fees to Keddies for payment in respect of services to former clients of Keddies. In the present proceedings the evidence was that in at least three cases, Margiotta Solicitors billed Keddies a fee of $5,000 plus GST. There were other cases where a somewhat lesser amount was charged.
9. The usual course followed in the settlement of such claims, Mr Roulstone accepted, was that written settlement terms were produced in one form or another. In some cases deeds of release were drawn up to record the settlement, or in some cases settlement was effected by means of an acceptance of an Offer of Compromise that had been filed.
10. According to Mr Tassell, of the 120 cases in which his firm acted he estimated that he had handled for either the partners of Keddies or the firm's corporate entity, about 15 to 20 cases which were settled by acceptances of Offers of Compromise. In relation to other matters there were either Consent Judgments after acceptance of an Offer of Compromise or in one case a settlement by way of a Deed.
11. However, in relation to Mr Xi Li's case, the facts of which will be discussed below, the procedures followed in giving effect to settlements as referred to in the preceding paragraph were not engaged. In particular, there were no written Terms of Settlement and no acceptance of an Offer of Compromise. Whilst Mr Roulstone's evidence indicated that there may have been other cases that were settled where no written Terms of Settlement came into existence, such cases involved different circumstances to the settlement of Mr Xi Li's proceedings, as explained in evidence.
12. Mr Roulstone was criticised in the Association's final submissions (at [3.18]) in relation to what was contended to be an attempt by him to later suggest that there had been other cases where payment had been made to former clients without the settlement being documented. Mr Roulstone ultimately accepted that there had in fact been no comparable cases.
13. There was evidence however that there were three or four cases that were settled involving former clients of Keddies who resided in China. In those cases it took time for the relevant Deeds of Release to be signed. As such, the former Keddies partners paid settlement monies on the basis that they would be held in escrow by the former client's new solicitors. The monies were released after the Deeds had been signed.
14. In summary, on Mr Roulstone's evidence, it is clear that there had been no other cases (than that of Mr Xi Li) where clients were paid a settlement sum prior to a written record of the settlement being made. There had always been a form of writing recording the settlement.
15. Mr Tassell's evidence was to the same effect. There had, in his experience, been no other case, other than Mr Xi Li's case where payment was made prior to, or in the absence of any recorded settlement.

Background to Mr Xi Li's Case

1. Proceedings in respect of alleged overcharging of fees were commenced on Mr Xi Li's behalf in the District Court in 2010. The proceedings involved a claim by Mr Xi Li against the Keddies partners (proceedings 2010/344874). Mr Xi Li alleged that he had been overcharged legal fees by Keddies in the work injury proceedings in which they had earlier acted on his behalf. In the District Court proceedings, Mr Stephen Firth of Firths acted for Mr Xi Li and was the solicitor on the record.
2. The critical events surrounding the settlement of Mr Xi Li's proceedings for overcharged legal fees occurred in October and November 2011. Attendances by Mr Xi Li upon Mr Husaini and communications made on his behalf, including, in particular, communications made by Mr Roulstone and Ms Helena Li, are central to the issues in the present proceedings.

OCTOBER 2011

1. On 12 October 2011, Mr Xi Li and his wife attended on Mr Husaini, then of Margiotta Solicitors in Leichhardt. At that time Mr Husaini was acting on behalf of Mrs Li in relation to a claim that she was making concerning superannuation entitlements. Ms Helena Li was also present at the meeting. She, at that stage, was providing interpreting services for Margiotta Solicitors. The evidence was that towards the end of the meeting Mr Xi Li asked what had happened with his case against the Keddies partners. Mr Xi Li advised Mr Husaini and Ms Helena Li that he was interested in settling the proceedings.
2. Mr Xi Li was present in Mr Husaini's office when Mr Husaini made a telephone call in relation to a possible settlement of his claim. He was unsure as to whom Mr Husaini spoke to on that occasion. A handwritten file note was created by Mr Husaini, a copy of which was included in Exhibit 2 at Tab 6. It related to a phone call made by Mr Husaini to Mr Roulstone in which Mr Roulstone is said to have made an offer to settle Mr Xi Li's claim in the amount of $5,000 plus costs payable to Firths.
3. Mr Xi Li said that after the phone call he rejected Mr Husaini's advice to settle the proceedings with the Keddies partners for the amount of $5,000. Mr Xi Li's evidence was that Mr Husaini then made another phone call. Following the call it was indicated to Mr Xi Li that the Keddies partners had now offered to settle his case for an amount of $10,000. Mr Xi Li indicated that he would require at least $75,000 to $80,000 to settle his proceedings.
4. The file note created by Mr Husaini recorded that, following a call with Mr Roulstone, Mr Xi Li had indicated that he would accept $70,000 plus costs (Exhibit 2 at Tab 6). An offer was conveyed by Mr Husaini to Mr Roulstone in that amount. Mr Roulstone made a counter-offer of $10,000 which was rejected by Mr Xi Li.
5. In the Association's Closing Submissions (at [3.27]) it is noted that the two affidavits filed by Mr Roulstone in the present proceedings did not address the conversations that occurred on 12 October 2011 with Mr Husaini. However, it was conceded that they had been mentioned in correspondence that he had sent to the Association. In that correspondence Mr Roulstone had made two points about the conversation: "● On 12 October 2011 I received a telephone call from Mr Naushad Husaini, a solicitor employed by Margiottas. This approach was unsolicited. Mr Husaini informed me that he had been consulted by Mr Xi Li (who was with him at the time) and that Mr Li wished to attempt to settle his existing claim against the Keddies Partnership. ● Mr Husaini requested for me to provide some basic accounting documentation from the former file maintained in respect of Mr Li's matter. I did so on the same date by way of facsimile."
6. On 12 October 2011 Mr Roulstone sent a facsimile to Mr Husaini which contained accounting information. The last page of it included a file note of a conversation between Mr Roulstone and Mr Husaini at 2:00pm on 12 October 2011. It recorded that Mr Xi Li had claimed that he had deposited $10,000 into Keddies' trust account. Mr Roulstone said he would look into it.
7. Mr Roulstone's evidence was that he did not have any discussions with Mr Husaini, or anyone else on behalf of Mr Xi Li, about a possible settlement of Mr Xi Li's case in the period 12 October 2011 and 30 November 2011. Mr Roulstone accepted that in that period he would have spoken with Mr Barakat to convey information about the offer having been made by Mr Xi Li.

PART D - UNDERTAKING AND ORDER

1. Some time in November 2011, proceedings were brought in the Supreme Court by two former clients of Keddies against the Keddies partners (proceeding number 2011/370116). The former clients were Mr and Mrs Goritsas. Mr Stephen Firth joined the proceedings as a plaintiff. He made an application seeking to injunct Mr Roulstone, Mr Barakat and Mr Keddie from communicating with certain of Firths' clients including Mr Xi Li.
2. On 22 November 2011, Mr Roulstone and his two former partners provided an Undertaking to the Court in the following terms (included in Exhibit 2 at Tab 48, p 111): "… the Defendants be restrained from, either by themselves or by their servants or agents, at any time contacting, approaching or in any way communicating or attempting to communicate with any of their former clients or any of the former clients of Keddies the Insurance Law Specialists Pty Ltd or any other person or persons acting on behalf of such former clients (other than any solicitor on behalf of such former clients on the record) who have provided instructions to Firths the Compensation Lawyers to act on their behalf."
3. On 24 November 2011, this Court (Adams J) ordered injunctive relief against Mr Roulstone and his two former partners (Exhibit 2 at Tab 48, p 112). The order was in the following terms: "That the Defendants be restrained from, either by themselves or by their servants or agents, at any time contacting, approaching or in any way communicating or attempting to communicate with any of their former clients or any of the former clients of Keddies the Insurance Law Specialists Pty Ltd in respect of whom the third plaintiff [Firth] has served an authority to transfer the file or any other person or persons acting on behalf of such former clients (other than any solicitor acting on behalf of such former clients on the record) who have provided instructions to Firths The Compensation Lawyers to act on their behalf in respect of the subject matter of those instructions."
4. In evidence, Mr Roulstone agreed that he knew and understood the terms of the injunction and in fact he had been present when the terms of it had been negotiated. In addition, he admitted that as at 30 November 2011 he understood that he was prevented by the injunction from communicating with Mr Xi Li either directly or by an agent or through an agent of Mr Xi Li.

Part E - settlement negotiations: NOVEMBER 2011

1. A series of critical events occurred on 29 and 30 November 2011 leading to the settlement of Mr Xi Li's proceedings in respect of his claim for overcharged fees. It is apparent that Ms Helena Li played an active role in instigating settlement of his proceedings over those two days. Whilst the evidence does not reveal why or how she became involved in prompting settlement discussions in November 2011, it is apparent from the evidence that she did so, as a type of facilitator, rather than merely acting in her role as an interpreter. There is no dispute as to the following facts: 1. That on 29 November 2011, Mr Xi Li returned to Sydney having spent some time in China. When he checked his answering machine there was a message from Ms Helena Li. 2. That on the evening of 29 November 2011, he spoke to Helena Li who asked him whether he wanted to settle his claim against Keddies, or not. 3. That on the evening of 29 November 2011, Mr Xi Li told Helena Li that he would accept $80,000. She told him that it would be "very difficult" to achieve a settlement in that amount.
2. The evidence establishes that on 30 November 2011, the following events took place: 1. Mr Xi Li received a call from Helena Li who told him that the Keddies partners had agreed to pay an amount of $75,000. Mr Xi Li told her that he wanted $80,000 by way of settlement. Helena Li told him she would need to make another call. She later called back and told him that he should go to Margiotta Solicitors. 2. Mr Xi Li's evidence was that he then received a phone call from Mr Husaini of Margiotta Solicitors asking him to come to the firm's office in Leichhardt. He did so and there he met with Mr Husaini and Helena Li. Mr Xi Li told Mr Husaini that he wanted $90,000 to settle the proceedings. Mr Husaini told him that he would need to make a phone call which he did. 3. Mr Husaini told Mr Xi Li that the Keddies partners would settle for $80,000 clear of costs, that is they would pay all costs including Firths' costs. Mr Xi Li agreed to accept that offer. He said that he had signed certain documents at Mr Husaini's request. According to Mr Xi Li, Mr Husaini said to him "You will need to come back here to sign a settlement and then 7 days after Keddies will send you a cheque": Affidavit of Mr Xi Li sworn 11 April 2012 at [21].
3. Mr Husaini produced a record which he said was a file note created by him as to the events of 30 November 2011. It records him having contact with Mr Xi Li on 30 November 2011 at 11:00am and that he told him that the proceedings were listed for hearing the following day. It recorded that Mr Xi Li said that he was being offered $80,000 to settle the claim, that he wanted Mr Husaini's advice and that he wanted Mr Husaini to achieve a $90,000 settlement. The file note, included in Exhibit 2 at Tab 7, in particular, records the following: 1. At 11:55am Mr Xi Li attended at Margiotta's offices. He gave instructions for a settlement in the amount of $90,000. 2. Around the same time Mr Husaini made contact with Mr Tassell of Verekers, who was acting for the Keddies partners. He advised Mr Tassell of Mr Xi Li's offer to which Mr Tassell said he would obtain instructions. 3. At 12:15pm, Mr Tassell rang Mr Husaini. Mr Tassell told him that he could not deal with Mr Husaini in light of the orders of the Court which prevented him from doing anything other than communicating with the solicitor on the record. 4. At approximately 12:15pm Mr Husaini spoke to Mr Xi Li and told him that if he had Mr Xi Li's authority to put an offer of $90,000 and that was rejected by Keddies partners, then he, Mr Husaini, would not be in a position to conduct the hearing the next day. In that event, Mr Xi Li would be liable for costs thrown away, estimated at $20,000. 5. At 12:50pm, instructions were given by Mr Xi Li for Mr Husaini to act on his behalf and to settle the claim in the amount of $80,000. Mr Husaini then prepared a letter to Verekers stating that he had instructions to act for Mr Xi Li. 6. At approximately 12:32pm Margiotta Solicitors forwarded by facsimile a letter to Verekers regarding Mr Husaini's authority to act (Exhibit 2, Tab 9). 7. At 1:35pm Margiotta Solicitors sent by facsimile to Firths, an Authority to Transfer, and a Notice of Change of Solicitor (Exhibit 2, Tab 10). 8. At 1:37pm, Margiotta Solicitors served on Verekers by facsimile transmission, a Notice of Change of Solicitor (Exhibit 2, Tab 11). 9. At approximately 3:00pm, Mr Husaini put to Mr Tassell of Verekers, an offer in the sum of $80,000 to settle Mr Xi Li's proceedings. 10. At approximately 3:10pm, the offer put on behalf of Mr Xi Li was accepted by Mr Tassell on behalf of Mr Roulstone and his former partners. Mr Tassell undertook to mention the proceedings the next day and advise the Court that the matter had been settled and that Terms of Settlement would be filed.
4. Mr Roulstone's evidence as to the offer made to Mr Xi Li of $80 000 and how that eventuated will be dealt with below.

PART f - MR ROULSTONE'S EVIDENCE

1. Mr Roulstone in his affidavit sworn 5 December 2014 stated that he submitted his Application for a Local Practising Certificate to the Council of the Bar Association of New South Wales on 24 June 2014. As previously mentioned, he annexed a copy of the Application together with correspondence between him and the Bar Association (Annexure C) and correspondence from the OLSC dated 4 December 2014 (Annexure D) and a response to the Commissioner's letter (Annexure E).
2. As mentioned previously, in paragraph 7 of that affidavit Mr Roulstone referred to the decision in Barakat v The Law Society of New South Wales, supra, in which, he stated, a finding was made that he was a fit and proper person to hold an unrestricted practising certificate to practice as a solicitor and barrister.
3. In his second affidavit sworn on 15 December 2014 Mr Roulstone set out details of various actions he had taken and commitments that he had made and events that had occurred in the expectation of the Association issuing him with a practising certificate: Affidavit of Scott John Roulstone sworn 15 December 2014 at [4].
4. Mr Roulstone was cross-examined on 10 and 11 June 2015 and was further cross-examined on 15 June 2015.
5. In the course of the cross-examination, Mr Roulstone gave evidence concerning the practice that was formerly conducted by Messrs Keddie, Barakat and himself. He stated that Keddies developed a substantial following amongst Chinese clients and that the firm employed Ms Helena Li who acted as an interpreter. She was employed from about 1999 and later worked for the firm on a contract basis until the relationship ended on 23 October 2006. Mr Roulstone said that Ms Li's employment was terminated along with an employed solicitor and a Chinese "liaison officer" employed by the former Keddies partners: T 36.
6. Mr Roulstone gave evidence that within weeks of their termination, a number of former clients of Keddies commenced suing Mr Keddie, Mr Barakat and himself for alleged overcharging of fees, as previously mentioned. A number of proceedings were commenced. He said this included approximately 120 sets of proceedings instituted by Firths the Compensation Lawyers: T 37.
7. Mr Roulstone stated that, at that stage, Ms Helena Li a particular employed solicitor and the liaison officer who were terminated in October 2006 formed an association with Margiotta Solicitors. He stated that some seventy five authorities for the transfer of files were received from Margiotta Solicitors: T 37.
8. Prior to the intervention of the bankruptcy of the Keddies partners, Mr Roulstone said that approximately two million dollars was paid by them in respect of fifty to fifty-five cases: T 38.
9. Mr Roulstone stated that either he or Mr Barakat gave instructions to Mr Tassell to act on their behalf: T 42.
10. Mr Roulstone agreed that he, on behalf of his former partners, was regularly involved in communicating with Margiotta Solicitors in relation to the overcharging matters and that such communications included the question of settlement of the claims: T 42-43. He confirmed that the communications were on a regular basis with Mr Husaini of Margiotta Solicitors.
11. He also confirmed that Mr Husaini had previously worked at Keddies as an employed solicitor prior to the sale of that firm to Slater & Gordon.
12. Mr Roulstone stated of the many plaintiff clients whose files were transferred to Firths (all involving the overcharging claims) some switched solicitors to Margiotta Solicitors. As noted above, Mr Roulstone estimated that there were about five to ten such matters. Margiotta's then proceeded to negotiate settlements against the former partners: T 44.
13. He agreed that the usual course was that where a case was settled settlement terms were reduced to writing and in some a Deed of Release was used: T 44.
14. In some cases an Offer of Compromise had been accepted. When asked whether, apart from Mr Xi Li, payment had been made and cases settled in circumstances where there had been no written terms of settlement, Mr Roulstone said there may have been but that he was unable to recall the names. He said these were settled in May and June of 2011 by himself and Margiotta Solicitors: T 44-45.
15. He said in such cases Deeds of Settlement, according to his recollection, were eventually executed and returned. He thought that these cases involved plaintiffs who had been residing in China: T 45.
16. Mr Roulstone gave evidence subsequently in relation to his evidence referred to in [110] above. He said that settlement monies had been paid in some cases before Terms of Settlement were finalised and then held in escrow. The monies were released only after deeds were signed: T 45-46. He said "There was always some form of writing between myself and Margiotta's in relation to settlement. The deeds might not have been put in place": T 46.
17. Mr Roulstone was asked about the proceedings that had been instituted by Mr and Mrs Goritsas. He said those proceedings had been commenced by Firths. Mr and Mrs Goritsas, former clients of Keddies, were suing for fees they said they had been overcharged. Mr Firth, he said, became a third plaintiff to the proceedings in which he sought an injunction against the former Keddies partners: T 46.
18. Mr Roulstone was taken to the Undertaking given by himself and his former partners to the Supreme Court on 22 November 2011 and to the Injunction subsequently ordered by Adams J two days later. He said that he understood the terms of both the Undertaking and the Injunction: T 47. It was put to him: "Q. Specifically on 30 November 2011 you knew that by the undertaking and the injunction you were prevented from communicating with Mr Xi Li either directly or by your agent or through his agent. Is that right? A. Yes. Q. Because Mr Xi Li was one of those former clients who was then represented by Firths. A. That's correct. Q. Was there a strategy by you or your former partners to, with the assistance of others if necessary, to try and get clients of Mr Firth's to leave him and go to other solicitors? A. No. Q. Now, on 12 October 2011, so prior to the undertaking and the injunction, Mr Husaini called you on the telephone to discuss the possible settlement of Mr Xi Li's matters. Is that right? A. Yes." (T 48:1-19)
19. As previously mentioned (paragraphs [82]-[88]), on 12 October 2011, prior to the Undertaking being given to the Court and the injunction granted, Mr Husaini called Mr Roulstone on the telephone to discuss possible settlement of Mr Xi Li's matters. He said that arising from that telephone call he faxed some information with regard to Mr Xi Li to Mr Husaini: T 48. Mr Roulstone said there were two or three telephone conversations on that day and that he had faxed the material at around mid-afternoon, being an amended reconciliation statement dated June 2005 and a trust account print out (comprising three pages): T 48.
20. A copy of the facsimile sent to Mr Husaini was included in the plaintiff's tender bundle (Exhibit A at Tab 16, p 78).
21. Mr Roulstone later in his evidence emphasised that there had been three calls on 12 October 2011. The first was at 11:00am when Mr Husaini said "I am instructed by Mr Xi Li. He is with me now. He would like to settle his case against Keddies, and he has offered to settle for $80,000". Mr Roulstone said that he responded that he was not familiar with the case but would need to look up accounting documentation from the former file and get back to him.
22. After that conversation he said he contacted an assistant at the Redfern office about the documents.
23. Mr Roulstone said he called back about thirty minutes or so later and said "Naushad, I've looked at the bill and reconciliation statement. The profit costs were $70,000. Your offer is too much". Mr Roulstone said he thought he used the word "ridiculous" and then said "I will counter offer for $10,000". Mr Husaini, according to Mr Roulstone, then said "Scott, leave it with me. Send through the documents. I will get further instructions and come back to you": T 50.
24. As previously mentioned, a copy of the file note prepared by Mr Husaini was included in Exhibit 2 at Tab 6, page 13: see paragraph [85] above.
25. That note confirms the offer of $10,000 plus costs. Mr Roulstone stated that he thought the offer was inclusive of costs: T 50.
26. Mr Roulstone said that Mr Husaini did not come back to him about settlement of Mr Xi Li's case until 30 November 2011. He said that he had no discussions with Mr Husaini or anyone else, about the settlement of Mr Xi Li's case between 12 October 2011 and 30 November 2011: T 51.
27. He had a recollection that he had spoken to either one of his partners, or both of them, at some point between those dates and pointed out that Margiotta Solicitors were now on the record for Mr Xi Li: T 51.
28. He also said that at some point before 30 November 2011 he had spoken to Mr Barakat and told him of the offer (of $10,000) he had previously put to settle Mr Xi Li's case: T 51.

Communications on 30 November 2011

1. Mr Roulstone was taken to the file note made by Mr Husaini relating to entries made on 30 November 2011, included amongst which was a note of a telephone conversation between Mr Husaini and Mr Xi Li in which, in relation to Mr Xi Li, it was recorded: "He is being offered $80,000K to settle it. Wants my advice & wants me to get him $90,000K."
2. Mr Roulstone stated that his understanding was that the offer of $80,000 was from Mr Xi Li to Keddies. When asked whether he knew how it was Mr Xi Li was possessed of what he understood to be an offer of $80,000, Mr Roulstone responded "No, I don't know": T 53:40-45.
3. Mr Roulstone's evidence was that he could only recall having spoken to Mr Husaini once on the morning of 30 November 2011, that call being at about 10:00am: T 53.
4. He was asked whether he had a file note of the conversation, he said he did. That, in due course, became Exhibit 6 in these proceedings.
5. Exhibit 6 confirmed that Mr Roulstone had not made any offer to Mr Xi Li of $80,000 prior to the call to Mr Husaini on 30 November 2011: T 54.
6. Mr Roulstone was adamant that he had not made any offer of settlement to Mr Xi Li or to anyone else on behalf of Mr Xi Li other than the offer of $10,000 that was made on 12 October 2011: T 56.
7. He said that he did not know of anyone else who had made any offer on behalf of the Keddies partners: T 56.
8. Mr Roulstone said that after he had given instructions to Mr Tassell on the settlement on 30 November 2011, his first knowledge of any settlement was when Mr Tassell rang him back that day at about 3:30 or 3:45pm: T 57.
9. Mr Roulstone stated that he did not have knowledge of the fact that further injunctions were being sought by Firths against Margiotta Solicitors in the afternoon of 30 November 2011, but only found that out late in the evening on that day: T 58. A copy of the injunctive Order made by this Court (Adams J) on 30 November 2011 became Exhibit 1 in these proceedings.
10. He was shown a copy of an email sent by Mr Tassell addressed to Mr Branson QC and Ms Castle of counsel who were appearing for Mr Roulstone and his former partners in the Supreme Court Proceedings. It was sent on 30 November 2011 at 6:09pm. In it, Mr Tassell, inter alia, stated that he had been advised by Margiotta's that the injunction application against them was to be heard at 8:00am the following day and that short service orders had been made on that day. A copy of the email was included in Exhibit 2 at Tab 14.
11. The email was copied to Mr Roulstone and Mr Barakat. Mr Roulstone stated that he received the email when he was at a school function and that he may have read it, but could not recall reading about the injunction: T 58.
12. An email was sent by Mr Roulstone to Mr Tassell on that date at 6:31pm in response to Mr Tassell's email: Exhibit 2, Tab 15. It was put to Mr Roulstone that in light of the fact that the proceedings had been settled on the afternoon of 30 November 2011, and that proceedings for injunctive orders had been instituted, a circumstance of urgency had arisen: "Q. I suggest that out of that there arose in your mind an urgency to execute the settlement with Xi Li, so that it couldn't be undone by any injunction orders. A. I think the, I think the urgency arose earlier than that. I think it was --- I think the urgency arose earlier that day. I think it was just after it settled, about 4:00pm. Q. Why do you say urgency at 4:00pm? A. I had discussed the settlement with my partner, with my former partner Mr Barakat, after I heard that it had settled. He said that he was preparing a deed to send to Mr Tassell. And he rang me back, probably about 4:30 saying the client wanted his cheque, as in Mr Xi Li 'Could you leave the cheque at the reception and it will be picked up'." (T 60)
13. Mr Roulstone said that he thought he had said, in his conversation with Mr Barakat that afternoon, that he could not draw the cheque because his cheque book was at his home and the best he could do would be to draw it the next morning: T 61. He said that they agreed on that course.
14. It was put to Mr Roulstone that Mr Barakat had requested him to draw the cheque and make it available for collection. Mr Roulstone agreed: T 61-2.
15. Mr Roulstone was taken to a copy of the cheque that was drawn for the settlement monies at Exhibit 2, Tab 17, page 32. He agreed that at the time he signed the cheque no Deed of Release had been executed: T 63. Nor had a Deed been received at the time he drew the cheque and made it available for collection: T 63. Mr Roulstone said he placed it in an envelope and gave it to the receptionist at Margiotta Solicitors. When asked whether he wrote anything on the envelope he said that he did, but he could not remember whether it was "Xi Li" or "Xi Li care of Margiotta". He said it was either one or both: T 63. Mr Roulstone was asked in cross-examination: "Q. When you drew the cheque, when you wrote on the envelope and when you left it to be collected by Mr Xi Li, did you have regard to the terms of the undertaking and the injunction? A. Yes. Q. So at that time you did have regard to their terms? A. Yes. Q. What did you conclude with regard to whether you would be in breach of those terms? A. I wasn't aware that there had been any injunction against Margiotta. I noted the exception that was agreed upon in relation to the injunction, if another firm came on record, and those matters had been considered by me and in consultation with Mr Barakat and Mr Tassell during the course of the, of the afternoon of 30 November." (T 64)
16. A little later he was asked: "Q. --What did you conclude with regard to whether your actions in drawing the cheque and making it available in the way in which you did were in breach of the undertaking or the injunction? A. I couldn't see any difficulty in what I had done. I wanted to ensure payment as soon as possible and solicitors other than Mr Firth had come onto the record, on my understanding, at about lunchtime on 30 November." (T 65)
17. A little later it was put to him: "Q. You relied in some way, did you, on what Mr Tassell said to you? A. Yes. Q. What did he say to you? A. What he said - provided Margiotta had come onto the record the case can be settled, and he told me that earlier that day, on the 30th, about lunchtime, that he wouldn't deal with Mr Husaini until he had actually come onto the record as in acting on behalf of Mr Xi Li in those proceedings." (T 65)
18. Mr Roulstone said that the settlement discussion was later in the afternoon at about 3:00 or 3:30pm but there had been the earlier discussions between Verekers and Margiotta Solicitors about settlement: T 65.
19. It was put to Mr Roulstone: "Q. Your understanding then on 1 December 2011 is that you would not be in breach of the undertaking or the injunction because Margiotta's had come onto the record for Mr Xi Li? A. That's correct. Q. With the consequence that Mr Firth was no longer on the record for Mr Xi Li? A. That's correct. Q. Is that your understanding now? A. Yes. Q. But you would otherwise accept that the drawing, signing and making available for collection of a cheque by Mr Li in an envelope addressed to him would constitute communicating with him? A. Absent the injunction? Q. Sorry… … Q. What you did in signing the cheque, drawing it, signing it, putting it in an envelope addressed to Mr Xi Li -- A. Yes. Yes. Q. -- and making it available on the expectation he would collect it -- A. Yes. Q. -- was a communication with him. A. I guess by signing the cheque, if - if that's communication, I suppose so. Q. Let's go further. The writing on an envelope, "Xi Li" or "Xi Li care of Margiotta's" and leaving it for him to collect with the expectation that he's going to collect it, that's a communication. A. I agree that's a communication. Q. If it's collected by, as it turns out, someone else on his behalf then it's a communication with him through someone else. A. I suppose so, yes." (T 66-7)
20. It was then put to Mr Roulstone that there was no reasonable basis upon which he thought that it was open to him to communicate directly with Mr Xi Li, or in any way with Mr Xi Li, other than via solicitors representing him. Mr Roulstone responded: "A. The way I saw it was that I'm putting effect to the settlement in paying a settlement that had been reached without any breach of the injunction. Q. You said you saw it like that, but I'm suggesting that you couldn't honestly have seen it like that when you have regard to the terms of the undertaking. A. The way I understood the - the undertaking to be negotiated was that if another firm came onto the record and acted on behalf of a former Keddies client after that had occurred, a settlement would be effected and the settlement could be completed, that's the way I understood it." (T 67)
21. As to the reason for paying the settlement monies by cheque on an urgent basis Mr Roulstone again referred to the fact that Mr Barakat said he had spoken to Helena Li who said that she was not able to get hold of Mr Husaini and that Mr Xi Li wanted his cheque and would pick it up: T 74. He said he could not recall specifically why Mr Xi Li wanted his cheque the next day. Mr Roulstone said that he and Mr Barakat agreed to draw the cheque - that the matter was on for hearing and he thought something was said along the lines of "We didn't want the matter going off the rails with allegations that it hadn't been settled": T 74.
22. It was put to Mr Roulstone: "Q. … the real reason was to pre-empt the effect of any injunction that might be ordered the next morning against Margiotta's, wasn't it? A. I had no idea at that stage that there was any injunction being brought against Margiotta. Q. It was of course completely against the usual course to pay the client, as opposed to paying to escrow, before a settlement had been documented. A. Not necessarily. I think there had been a couple of other instances." (T 75)
23. It was pointed out that in earlier evidence he had said that in other cases money had generally been paid into escrow.
24. Mr Roulstone agreed that he had not discussed with Mr Tassell the question of payment being made: T 76.
25. A somewhat contrary version of events as related by Mr Xi Li in his affidavit sworn 11 April 2012 at [21] was put to Mr Roulstone. In that paragraph, Mr Li stated: "Mr Husaini also asked me to sign a single page document which I did. I signed that document at around 12:30 or 1:00pm. Mr Husaini then said: 'You will need to come back here to sign a settlement and then 7 days after Keddies will send you a cheque. I said: 'What do I do about Firths?' He said 'Don't worry about them. Don't answer their call'."
26. When Mr Roulstone was asked whether he had any response to that version, he responded in the negative: T 77.

part G - MR HUSAINI'S evidence

1. Mr Husaini was called by the Bar Association to give oral evidence, there being no affidavit evidence filed on his behalf. The solicitors for the Association had made attempts to arrange a conference to discuss with him the events with which the present proceedings are concerned. Whilst Mr Husaini had declined to make himself available for a conference prior to the hearing, he did in fact have a discussion with the Bar Association's legal representatives for approximately 45 minutes on the day he gave evidence (11 June 2015).
2. Mr Husaini said that from mid-January 2011 to the end of March 2006 he worked with Keddies as an employed solicitor. He said he left of his own accord to start working for Margiotta Solicitors in Leichhardt. Whilst at Keddies he acted for Mr Xi Li in relation to a workplace injuries claim. He said that when he was working there Ms Helena Li worked there as an interpreter. Additionally, a Mr Siu Sheng Lee worked at Keddies as a Client Liaison Officer. Mr Husaini said that any Chinese client who responded to an advertisement in a Chinese newspaper would contact either Mr Lee or Helena Li.
3. After he left Keddies, Mr Husaini worked for a brief period with Wyatt Attorneys in Ashfield between October 2007 and December 2007 and whilst there he said that Mr Lee brought Mr Xi Li's wife to see him. He said that in early 2011 or thereabouts she had a dispute with Wyatt Attorneys in relation to fees.
4. He said that at some point the relationship between Mr Lee and Helena Li and Margiotta Solicitors "soured" and they left the firm.
5. As to the arrangement or understanding between Margiotta and Keddies with regard to former Keddies clients, Mr Husaini stated there were four or five clients who Mr Lee introduced to the firm because he claimed they were not happy with Firths and wanted to settle their matters. An arrangement was made between Margiotta's and Keddies whereby Keddies would pay Margiotta's costs in the amount of any settlement received by the client, clear of any solicitor/client costs component.

Communications between Mr Husaini and Mr Roulstone

1. Mr Husaini gave evidence as to conversations that he said he had with Mr Roulstone concerning Mr Xi Li's claim on or about 11 and 12 October 2011 and then 30 November 2011.

(a) Conversations on 11-12 October 2011

1. Mr Husaini gave evidence of a conference with Mr Xi Li's wife in relation to a superannuation payment and said that at that time Mr Xi Li was present. On that occasion, Mr Xi Li raised with Mr Husaini the issue of contacting Keddies to see if he could resolve his claim. Mr Husaini said he then rang Mr Roulstone: T 120. In that respect he was taken to a copy of his file note dated 11 October 2011 in Exhibit 2 at Tab 6, p 13A. That note recorded in part: "Xi Li Conf with Client 11/10/11 12.25 XXXX XXXX Helena *** PA - SJR Discussion about matter His offer $5,000 they pay Firths costs on an indemnity basis Discussed matter with client He says he was charged $130,000 for Keddies costs & disb He will accept $70K plus costs *** damages etc Rang SJR put the offer $70k plus costs"
2. The file note then sets out figures concerning Mr Xi Li's claim and the costs charged by Keddies and others, including Helena Li (in the amount of $7,000). The file note concludes: "offer $10k plus costs Discussed offer with client He says he had paid $10k to Keddies Which was not refunded. This amount only represents what he paid to Keddies."

(b) Discussions on 30 November 2011

1. When Mr Husaini was asked whether Mr Xi Li made contact with him subsequent to the conference held on 11 or 12 October 2011 about possible settlement of the matter, Mr Husaini said "not until 30 November": T 124. He said that between 12 October and 30 November 2011 he did not have any contact with Mr Xi Li. He also said that he did not have any contact with anyone else with regard to the possible settlement of Mr Xi Li's matter: T 124.
2. The examination of Mr Husaini in evidence then moved to 29 and 30 November 2011. He was taken to telephone records which reflected a call made from Helena Li to Mr Husaini's phone at 6:38pm on 29 November 2011. He could not recall what the call was about but he said that she used to ring him from time to time. However he said there was definitely no discussion about Mr Xi Li: T 124.
3. Mr Husaini said that on 29 November 2011 he did not have any communication with Mr Siu Sheng Lee about Mr Xi Li's claim against Keddies, nor did he have any communication with Mr Roulstone, Mr Barakat or Mr Keddie on that date: T 125.
4. Mr Husaini said that before Mr Xi Li called him on the morning of 30 November 2011, he did not have any knowledge concerning any offer conveyed to Mr Xi Li on behalf of Keddies to settle the claim: T 125.
5. Mr Husaini said that at 11:00am on 30 November 2011 he returned Mr Xi Li's call. Mr Xi Li told him that his matter against Keddies was listed for hearing the next day and that he was being offered $80,000 to settle his claim. He said that Mr Xi Li wanted his advice and wanted him to get $90,000 to which Mr Husaini said "it would be better if you come to my office and then I could take formal instructions from you. I will call Helena to be here as well."
6. Mr Husaini said that at 11:55am on 30 November 2011, Mr Xi Li arrived at his office and he again said that he wanted him to try to get $90,000. Mr Husaini then rang Mr Tassell, solicitor, who acted for the former Keddies partners, and advised him that Mr Xi Li was in his office for advice about the matter listed for the next day. Mr Tassell apparently indicated that he had no formal instructions as at that time. Mr Xi Li wanted Mr Husaini to put an offer of $90,000 plus costs to settle the claim. Mr Husaini asked Mr Tassell if he could get instructions on such an offer and he would keep Mr Xi Li at his office: T 125-6.
7. At 12:15pm Mr Husaini spoke to Mr Tassell who apparently told Mr Husaini that he was unable to deal with him because of the court orders that were in place and that neither he nor his clients should deal with anyone unless they came onto the record: T 126.
8. Mr Husaini said that he explained to Mr Xi Li that if he obtained instructions to put an offer of $90,000 and Keddies rejected the offer, then there would be difficulty in him being able to represent him the next day as he did not have the file.
9. Mr Husaini said he explained to Mr Xi Li that if the proceedings were adjourned he could be made liable for costs of up to $20,000 to Keddies. He said that at 12:50pm his client formally instructed him to settle the claim for $80,000. Mr Husaini then prepared a letter to Verekers Solicitors advising that Mr Husaini now acted for Mr Xi Li. He rang Mr Tassell and asked for the District Court file number: T 126.
10. Mr Husaini was taken to his file note in Exhibit 2, at Tab 7, p 15A. The file note indicates that at 3:00pm on 30 November 2011 he again spoke to Mr Tassell. The note records that he had faxed a Notice of Change of Solicitor to Mr Tassell and that Mr Tassell had said that he could now speak to Mr Husaini. The file note records an offer being put to settle the claim in the amount of $80,000 plus the costs of Firths on a solicitor/client basis.
11. The file note records that at 3:10pm Mr Tassell said he had instructions to accept that offer and that he was prepared to mention the matter the next day and advise the court that the matter was settled. The file note records that Terms of Settlement were to be filed.
12. Mr Husaini when asked said he was unable to recall what Mr Xi Li had said to him which caused him to write the note recording the offer of $80,000 plus costs. He simply said, "He would have said it and that's why I just took that note while I was on the phone to him": T 126-7. He was asked whether he asked him what the source of the offer of $80,000 had been and he said "No" and he was unable to say how he came to that figure: T 127.
13. Mr Husaini then said that he dictated settlement instructions to be typed for Mr Xi Li when he arrived. He said he usually took detailed instructions on settlement from the client.
14. A copy of the authority from Mr Xi Li to settle dated 30 November 2011 appears at Tab 8, p 16 of Exhibit 2.
15. When asked whether he "took Mr Xi Li on as a favour to Mr Roulstone" - that is, by acting for him on 30 November 2011- Mr Husaini replied "No": T 129.
16. In relation to the file note made on 30 November 2011 and particularly the entry at 12:15pm recording a call to Mr Tassell, Mr Husaini was asked whether anyone else had called prior to that point. Mr Husaini replied that he may have called Mr Roulstone "… and I think he told me not to - he can't speak to me. And he gave me Rob Tassell's number": T 130.
17. Mr Husaini was asked whether Mr Xi Li had given any instructions, after the proceedings were settled in accordance with the discussions between himself and Mr Tassell, as to when he wanted to be paid: T 132. Mr Husaini said that Mr Xi Li had not said anything to him on that subject: T 132.
18. Mr Husaini referred to a call from Mr Xi Li to him at 3:55pm on 30 November 2011, advising that Mr Firth had spoken to him. Mr Firth had asked him why he had changed his mind. Mr Xi Li told Mr Firth that he had finished his case.
19. In that respect he was taken to his file note in Exhibit 2 at Tab 12, pp 27-27A. The note is in the following terms: " Xi Li 30/11/11 Call from client 3.55 He said he has received a letter from Steven Firth He rang him and asked him why he changed his mind. *** on for hearing tomorrow Client said to him that he is **** risk his case. Didn't want to go ahead because of family business I asked him when did he ring He said 2 minutes ago. I just got off the phone."
20. On 30 November 2011, Vodafone telephone records recorded two calls being made by Mr Husaini to Mr Roulstone for periods respectively of 27 seconds and 26 seconds. When asked what the call or calls were about he said he had no recollection of having rung Mr Roulstone and did not know what they discussed. He said it was not about Mr Xi Li's matter: T 135. Mr Husaini was asked: "Q. How can you know you didn't discuss these matters if you have no recollection of the conversation? A. I had no idea about Xi Li until he rang me that morning, and there was no mention of Mr Xi Li at all between October and this day, 30 November." (T 136)
21. Mr Husaini was cross-examined on three sheets of Vodafone records (which were marked MFI 3), including in particular, an entry at 9:48am on 30 November 2011 for a period of 94 seconds. The call related to contact between Mr Husaini and Mr Barakat. Mr Husaini said he had no recollection of the particular call: T 138. Further entries on that date for the same number were drawn to his attention but Mr Husaini said he had no recollection of calling the number and no recollection of what he may have discussed with Mr Barakat on that occasion: T 138.
22. Mr Husaini said that it was about 4:00 or 4:30pm on 30 November 2011 when he heard of proceedings having been brought by Firths seeking an injunction against Margiotta Solicitors: T 141. He said he received a call that afternoon from Mr Firth who wanted to speak to Mr Margiotta. He then transferred the call: T 141. Mr Husaini said that advice had been given that Firths were moving the court for an injunction and that it would be listed at 8:00am the next morning before Adams J. He understood that the injunction application related to the Xi Li matter: T 141.
23. Mr Husaini stated that sometime after 9:00am on 1 December 2011 he rang Mr Roulstone to let him know that there was an application for an injunction and that he would contact him when the hearing was finished that day: T 143. When asked why he had advised Mr Roulstone, Mr Husaini indicated there was no specific reason, it was just a follow-up from the day before, in that the matter was settled and that there was then an application for an injunction being made: T 143.
24. Mr Husaini said that he attended the District Court on 1 December 2011 and advised the Court of the Supreme Court injunction proceedings. The matter was then stood down: T 145.
25. On the payment of the settlement monies, Mr Husaini was asked as to when he had heard that a cheque had been drawn to pay Mr Xi Li's settlement. Mr Husaini replied that it was about 4:15pm on 1 December 2011. He stated: "On first December, sorry - my counsel, Mr Margiotta and I, we telephoned Mr Xi Li, because he had telephoned earlier during the day to find out where his cheque was. So we telephoned him to tell him what had happened during the court proceedings and he then said that, 'I have received my cheque' and we said 'do not bank the cheque' but he said 'I've already banked it'." (T 145)
26. Mr Husaini was asked whether he had any knowledge of the cheque before Mr Xi Li told him about it in the telephone call. He said that Mr Xi Li had telephoned his office sometime after morning tea. He then spoke to Marisa Margiotta and she told him that Mr Xi Li had telephoned asking where the cheque was. He said he told her to ring Mr Xi Li and tell him that the cheque would not be available until they had finished in court that day, and he would advise him as to what was happening: T 145-6.
27. Mr Husaini was then taken to a copy of a letter written by Margiotta Solicitors dated 2 December 2011 addressed to Mr Xi Li (included in Exhibit 2 at Tab 24). It stated, inter alia, that Mr Xi Li had informed Margiotta Solicitors that during the day he had received and banked $80,000 of the settlement monies. The letter recorded that Margiotta Solicitors had no knowledge of that fact.
28. In relation to a letter written by Margiotta Solicitors to Verekers also on 2 December 2011 (Exhibit 2 at Tab 25, p 45), Mr Husaini confirmed that he had no idea as to the circumstances of the cheque having been prepared and made available to Mr Xi Li on 1 December.
29. There was no cross-examination of Mr Husaini.
30. He presented as a straightforward witness.

PART H - mR xI LI's evidence

1. Mr Xi Li in his affidavit sworn 5 December 2011, provided a history of having engaged Keddies in respect of a workers compensation claim and a work injury damages claim arising out of injuries sustained at work on 7 September 2001: Affidavit of Mr Xi Li at [1].
2. He stated that his work injury damages claim was settled on 7 June 2005 in the amount of $325,000 all-inclusive: Affidavit of Mr Xi Li at [7]. He said he was charged a total of $124,025.39 by Keddies for their work in relation to that claim: Affidavit of Mr Xi Li at [8].
3. He gave evidence of returning home from a holiday in China on 29 November 2011 and finding a message on his answering service from Helena Li. He returned her call and was asked whether he wanted to settle his claim with Keddies or not, to which he replied "If they pay me $80,000 okay": Affidavit of Mr Xi Li at [14].
4. On 30 November 2011 he stated that he was in the waiting room of his family doctor when he received a call from Helena Li who told him to go to Margiotta's office. He said that later that morning he attended upon Mr Husaini. He was given some documents which he said he signed. He gave an account wherein Mr Husaini is said to have told him that Keddies would pay him $80,000 clear in his hand and that they would pay all costs including Firths' costs: Affidavit of Mr Xi Li at [17]. This latter aspect, of course, is not consistent with Mr Husaini's evidence.
5. He stated that on the morning of Thursday, 1 December 2011 he received a call from Helena Li who said that she had the cheque and would bring it around to him that morning: Affidavit of Mr Xi Li at [18].
6. He said that at about midday on that day Helena Li came to his home and gave him the cheque for $80,000. He said it was a Keddies cheque: Affidavit of Mr Xi Li at [19].
7. In Mr Xi Li's second affidavit, sworn 11 April 2012, he gave further evidence in relation to attending on Mr Husaini in late October 2011. He said he had a meeting with Mr Husaini in which he indicated he was interested in settling his claim against Keddies and that Mr Husaini made a telephone call which he said was about settling his case. He was not sure who Mr Husaini had called: Second Affidavit of Mr Xi Li at [5].
8. Immediately after the call he said Mr Husaini proposed that he settle for $5,000. He said he was not interested in such a small amount: Second Affidavit of Mr Xi Li at [6].
9. He said that Mr Husaini then made another call and said that Keddies had offered $10,000 but he refused to accept stating that he paid Keddies $120,000 and $10,000 was not enough: Second Affidavit of Mr Xi Li at [7].
10. When asked as to how much he wanted to settle for, he said he told Mr Husaini "I would need $75,000 - $80,000": Second Affidavit of Mr Xi Li at [7]. This does not accord with Mr Husaini's file note reproduced at [157] above.
11. He then set out a further discussion that he had had with Helena Li in which she said to him "You should negotiate because there are lots of claims against Keddies and they are going bankrupt".
12. He also said that she said "Even if you win, there is a good chance you wouldn't get the money. You might get a piece of paper from the Court but it would not be worth anything. You could just hang it on the wall".
13. He also said that Ms Helena Li told him that even if he won against Keddies they would appeal and he would have to wait another one to two years for his money. If he lost the appeal then he could lose everything: Second Affidavit of Mr Xi Li at [8]. This evidence suggests that Ms Helena Li was pressing Mr Xi Li to settle. There is no evidence that she was doing so at the behest of Mr Roulstone or Mr Husaini.
14. Mr Xi Li also gave further evidence as to the events of 30 November 2011. He said that he had received a call from Helena Li on his mobile in which she said "They agreed to $75,000" to which he responded "It's not $75,000 I want it's $80,000". Helena Li then said "I need to make another call": Second Affidavit of Mr Xi Li at [13]. I note that the evidence given in paragraph [13] had not been included in his earlier affidavit.
15. Mr Xi Li said that shortly after that call he had another call from Helena Li in which she told him to go to Margiotta's office. He said he then received a call from Mr Husaini asking him to come to the office of Margiotta Solicitors: Second Affidavit of Mr Xi Li at [15]. The latter statement was also not included in his earlier affidavits.
16. Mr Xi Li then gave an account of speaking to Mr Husaini and told him "I want to get $90,000" to which Mr Husaini said "I will have to make a phone call": Second Affidavit of Mr Xi Li at [16]. This statement as to wanting $90,000 is consistent with Mr Husaini's evidence: noted at [163] above.
17. He said Mr Husaini then made another call and then afterwards said to him "Keddies will pay you $80,000 clear in the hand. Keddies will pay all costs including Firths' costs". Mr Xi Li said "Ok": Second Affidavit of Mr Xi Li at [17].
18. He then gave evidence of having documents produced for his signature and signing the same: Second Affidavit of Mr Xi Li at [18]-[21]. He said he signed the documents at about 12:30 or 1:00pm. Mr Husaini said he would need to come back to sign a settlement and that seven days later he would receive a cheque: Second Affidavit of Mr Xi Li at [21].
19. He said later that night he received a call from Helena Li saying he would have to attend at Margiotta's the next day to pick up the Keddies cheque from Margiotta's: Second Affidavit of Mr Xi Li at [22].
20. He then gave evidence of attending on 1 December 2011 to collect the cheque for $80,000 which he banked later the same day: Second Affidavit of Mr Xi Li at [25]-[26].
21. At about 4:00 or 5:00pm that day he received a call from Mr Husaini asking him to go to a barrister's office on Sunday. He asked why, because he had already collected the cheque. Mr Husaini asked him who had given him the cheque and he replied "Helena": Second Affidavit of Mr Xi Li at [27].
22. Mr Xi Li was called by the Association to give brief evidence on 11 June 2015: T 150-152. He was asked in relation to his second affidavit about a conversation that he had with Mr Husaini on 30 November 2011. He was asked whether at any time during that day he indicated to Mr Husaini any requirement on his part as to time for payment. He replied "I don't remember, but maybe not": T 152:1-5. He was next asked whether at any time on 30 November he told anyone about any desire on his part as to when he required payment by, to which he replied "Not possible": T 152:5-10.
23. I have noted above certain inconsistencies between the evidence of Mr Xi Li and the evidence of Mr Husaini. On consideration of the whole of the evidence each gave, I have concluded that Mr Husaini is the more reliable witness of the two.

part I - Evidence of Mr Barakat

1. On 12 June 2015 I granted leave to the Association to issue a subpoena against Mr Tony Barakat to attend and give evidence in the proceedings. Mr Barakat gave evidence on 16 June 2015. No affidavit by him had been filed or was read. Mr Barakat's evidence was brief. It was principally directed to matters concerning settlement of Mr Xi Li's proceedings and conversations with Mr Roulstone as to the same.
2. Mr Barakat gave evidence about a telephone conversation he had with Mr Roulstone which he said took place "a couple of months before November 2011…could've been October": T 205:1-5. In that conversation Mr Barakat said Mr Roulstone told him that he had been contacted by Mr Husaini who had told him that Mr Xi Li was with him and that Mr Xi Li wanted to resolve the matter between himself and the former Keddies partners: T 205:11-15. Mr Roulstone had said that Mr Husaini had told him that Mr Xi Li was prepared to accept $80,000, which Mr Roulstone had countered with an offer of $10,000: T 205:15-20.
3. Mr Barakat said that he could not recall hearing about anything further happening with respect to the settlement of Mr Xi Li's case until 30 November 2015 on which date he said Mr Roulstone contacted him to inform him that the matter had settled for $80,000: T 205:25-30. He said that somewhere in that conversation he told Mr Roulstone that he would prepare a Deed of Settlement and Release: T 206:1-6.
4. Mr Barakat then gave evidence as to a second telephone conversation he had with Mr Roulstone on 30 November 2015. He said that he called Mr Roulstone and told him that he had been phoned by Ms Helena Li. Ms Helena Li had told him Mr Xi Li had been contacted by Mr Firth and that Mr Xi Li was distressed and that "Mr Firth had abused him and threatened him, and that he was quite concerned and wanted his settlement moneys as soon as possible…": T 207:5-10. In relation to the drawing of the cheque Mr Barakat gave the following evidence: "Q. What did you say to Mr Roulstone with regard to Mr Xi Li's request? A. I can't now recall whether I asked him to draw the cheque or whether he said, I will draw the cheque, but the understanding was that he was going to draw the cheque but he couldn't because he didn't have the chequebook with him, it was at home, and that he would draw it first thing in the morning, the next day. Q. Was there discussion between the two of you with regard to how the cheque would be conveyed to Mr Xi Li or otherwise deposited to his credit? A. Yes, the cheque was to be left at the Redfern reception for it to be collected. Q. To be collected by whom? A. By Helena, I think. I, I can't now recall whether that was discussed or specified, but the impression that I have in my mind was that it was to be collected by Helena. Q. Are you able to identify the source of that impression? A. No, but it must have been a discussion between either Helena and I or Scott and I, but I just can't now recall the specifics of discussing that arrangement." (T 207:12-35).
5. In relation to his knowledge about the injunction being sought by Mr Firth against Margiotta's on 30 November 2011 Mr Barakat accepted that he must have been aware of this because of the email he received in relation to it which was also sent to Mr Roulstone and counsel appearing for the former Keddies Partners (Exhibit 2 at Tab 14, p 29). He said however that he did not know the terms of the injunction sought by Mr Firth or what orders were made. He said he didn't "know much about what was sought in that injunction": T 208:1-8.

Bar Association's Submissions

1. As the Association sought to establish an affirmative case against the plaintiff it is appropriate to commence with the submissions made on its behalf before turning to the submissions made on behalf of Mr Roulstone.
2. As earlier noted, the Association contended that the evidence before the Court established that Mr Roulstone: 1. breached the Undertaking given by him to this Court on 22 November 2011 and the Order made by Adams J on 24 November 2011; 2. failed to discharge his duty of candour, honesty and frankness.
3. In the Association's final submissions it was noted: "2.4 …the relevant question for the Court is whether Mr Roulstone has discharged his onus of establishing that he is a fit and proper person to hold a practising certificate under s 48(3)(b) of the LP Act: Comeskey v the New South Wales Bar Association [2015] NSWSC 824 at [45]. Section 42(2) of the LP Act provides that: A council may in considering whether or not the person is a fit and proper person to hold a local practising certificate, take into account any suitability matter relating to the person, and any of the following, whether happening before or after the commencement of this section … 2.5 Section 9 of the LP Act defines "suitability matters" to include, inter alia, whether the person is "currently of good fame and character" (s 9(1)(a)). However, s 42(2) of the LP Act does not confine the "fit and proper" test to "suitability matters" (as defined in s 9 of the LP Act) and instead extends it to the matters enumerated in ss 42(2)(a) to (f). Relevantly, s 42(2)(f) provides that the Council may take into account "other matters the Council thinks appropriate". 2.6 The term "fit and proper" is not defined in the LP Act. However, it has a well-established meaning. In New South Wales Bar Association v Murphy (2002)55 NSWLR 23 at [113] Giles JA (with whom Spigelman CJ and Ipp AJA agreed) held that: Refusal, cancellation or suspension of a practising certificate upon determination of unfitness to hold a practising certificate is not punitive of the legal practitioner. It is protective of the public in the same manner as removal from the roll. Fitness to hold a practising certificate is to be assessed having in mind the high standards required of legal practitioners in the practice of their profession. The standards are required because the relationship between legal practitioner and client, between legal practitioners, and between legal practitioner and court is one of trust in the performance of professional functions, and because there must be confidence in the public and in those engaged in the administration of justice that legal practitioners will properly perform those functions."
4. The Association contended that it should be concluded that Mr Roulstone is not a fit and proper person to hold a practising certificate and that his appeal to this Court should be dismissed.
5. The Association asserted that Mr Roulstone had failed to give an account of the relevant events that were peculiarly within his knowledge: Defendant's Outline of Opening Submissions at [4.1]. In consequence, it was submitted that there were a number of questions that remain unanswered and which call for a full and frank explanation. These included the matters identified in subparas (a) to (m) of [4.1] of those submissions. These matters, inter alia, include the identity of the person who gave instructions for offers of settlement on behalf of Mr Xi Li (including, in particular, instructions to Ms Helena Li) and whether Mr Roulstone had any involvement in her communications with Mr Xi Li or whether he had knowledge of Ms Helena Li's communications with Mr Xi Li and what communications Mr Roulstone may have had with Ms Helena Li or anyone else regarding settlement of Mr Xi Li's claim.
6. Further submissions were made on behalf of the Association as to the terms of settlement, communications concerning the same, the preparation of the settlement cheque and the circumstances in which it was prepared, including the sequence of events leading to the drawing and the signing of the cheque and its delivery, as well as communications between Mr Roulstone and Ms Helena Li, or others, regarding the same.
7. Further matters raised related to Mr Roulstone's knowledge of the restraining order having been made by the Court and the arrangements put in place to effect settlement.
8. The Association submitted that absent a full and satisfactory explanation by Mr Roulstone, the Court could not be satisfied that he is a fit and proper person to hold a barrister's practising certificate: Defendant's Outline of Opening Submissions at [4.2]
9. The Association in its opening submissions (at [3.1]-[3.12]) set out relevant principles, including (i) those that apply in cases in which there has been a breach of undertakings or contempt charges brought against a practitioner and (ii) principles concerning a barrister's duty of candour to the Court and obligation to make full and proper disclosure.
10. The Association observed in its opening submissions at [3.3], that to properly apply the "fit and proper person" requirement it is necessary to have regard to the following matters as stated in Garde-Wilson v Legal Services Board [2007] VSC 225 at [116]: "… not just the fact of the conviction [of contempt], but also the nature of the contempt; the entirety of the circumstances surrounding its commission, as may be revealed by the evidence before and the findings of the trial judge; the sentence imposed, including any aggravating or mitigating circumstances found by the sentencing judge; and other relevant considerations, such as the lawyer's history of practice, their remorse for committing the offence and the likelihood, if any, that he or she might reoffend. Depending on the nature of the case, there may, of course, be other relevant considerations, both for and against the applicant."
11. The Association observed that the question as to whether a person is a fit and proper person involves a value judgment to be made in the context of the particular activity to be licensed: Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at 388 per Toohey and Gaudron JJ.
12. The Association noted that a solicitor's failure to honour an undertaking may form the basis for disciplinary proceedings. Reference was made in that respect to the Solicitors' Rules in force at the time in 2011, which emphasised the duty of a practitioner to act with competence, honesty and candour and to exercise diligence in the observance of undertakings given to a court or opponents.
13. Relevant factors to be taken into account in the finding of professional misconduct flowing from a breach of an undertaking or court order, it was noted at [3.6] of the Defendant's Outline of Opening Submissions, include the question as to whether there is a reasonable explanation for the conduct, the solicitor's remorse and other circumstances relevant to the conduct in question that throws light on the character of the lawyer.
14. The Association further adverted, at [3.8], to the proposition that when it is a barrister whose fitness is being considered, the authorities point to the high ethic or moral standards expected from barristers by the public, their colleagues and the court. The submissions cited the dicta of the High Court in Ziems v Prothonotary of the Supreme Court of New South Wales (1957) 97 CLR 279 which emphasised that the Bar's standards were necessarily high because of the unique and indispensable function performed by members of the Bar in the administration of justice.
15. On the issue of frankness and candour the Association submitted at [3.10] that there was no doubt that barristers have an absolute duty of candour to the Court, citing the High Court's decision in Re Davis (1947) 75 CLR 409. The duty of honesty and frankness, it was noted, extends to the investigative steps immediately anterior to the consideration of a case by the Court or Tribunal appointed for that purpose: New South Wales Bar Association v Thomas (No 2) (1989) 18 NSWLR 193 at 206.
16. The Association noted at [3.11] of its Opening Submissions that there is an expectation that legal practitioners will give evidence to provide explanation as to their conduct rather than simply relying upon evidence from the Bar table: New South Wales Bar Association v Meakes [2006] NSWCA 340 at 70. The Association argued that this is particularly the case where a prima facie case has been presented and where the practitioner wishes an explanation on his or her part to be accepted: Coe v New South Wales Bar Association [2000] NSWCA 13 at [21].
17. The Association further submitted at [3.12] of its Opening Submissions that a failure by the practitioner to give any explanation or any evidence in proceedings can be used as a basis for drawing adverse inferences against him or her where the facts are peculiarly within his or her knowledge or any evidence of such facts: Council of the New South Wales Bar Association v Power [2008] NSWCA 135; 71 NSWLR 451 at [20]-[28].
18. The Defendant's Closing Submissions dated 20 July 2015 included a close analysis of the evidence as to relevant events preceding and following the Undertaking given by the plaintiff on 22 November 2011. The submissions also analysed the disclosures made by the plaintiff to the Association in relation to specific issues and alleged failure to disclose certain factual matters.
19. The Association noted that both the Undertaking and the Order had the effect of restraining Mr Keddie, Mr Barakat and Mr Roulstone by themselves or their servants or agents, from "contacting, approaching or in any way communicating or attempting to communicate with" Mr Xi Li other than via a solicitor acting on behalf of Mr Xi Li on the record: Defendant's Closing Submissions at [4.1].
20. It was contended that the evidence established two breaches by Mr Roulstone of the Undertaking and Order.
21. First, it was submitted in the Defendant's Closing Submissions at [4.3] that the evidence establishes that on 1 December 2011, Mr Roulstone: (a) Drew and signed a cheque in favour of Mr Xi Li; (b) Placed the cheque in an envelope; (c) Marked and placed the envelope for collection by Mr Xi Li; (d) Had an expectation that Mr Xi Li would collect the envelope marked for his collection.
22. Second, the Association contended that there had been a further breach of the Undertaking and Order. In that respect it was submitted at [4.11]: "Second, there is evidence before the Court of another breach of the undertaking and order based on the contents of the file note which was belatedly produced by Mr Roulstone: Exhibit 6. Although the file note bears the date 2 November 2011, Mr Roulstone claimed that the first few lines of that file note are a contemporaneous record of the conversation he had with Mr Husaini on the morning of 30 November 2011. This part of the file note records that: (a) Mr Husaini contacted Mr Roulstone before he had met with Mr Li and in anticipation of doing so; (b) Mr Husaini communicated to Mr Roulstone that Mr Li wanted to settle his case; and (c) Mr Roulstone confirmed to Mr Husaini that the Keddies partners were "happy to settle", but that Mr Husaini should come onto the record and contact Mr Tassell: see T 191: 6-16."
23. I propose to discuss the submissions made in relation to the following: (i) The statement by Mr Roulstone: "Happy to settle". (ii) Mr Roulstone's conduct, including in particular, his conduct in completing the settlement. (iii) Payment of settlement monies by cheque.

(i) The Statement by Mr Roulstone: "Happy to Settle"

1. The Association contended that the evidence established a breach of the Undertaking and Order by the plaintiff in telephone discussions between Mr Roulstone and Mr Husaini on 30 November 2011. The relevant statement by Mr Roulstone (that the Keddies partners were "happy to settle") was evidenced by a file note which Mr Roulstone produced during the hearing of the present proceedings (Exhibit 6).
2. The Association submitted that this file note, Exhibit 6, establishes that Mr Roulstone communicated with Mr Xi Li via an agent, Mr Husaini, solicitor, in circumstances where Mr Husaini was not a solicitor on the record and Mr Firth was then still the solicitor on the record for Mr Xi Li: Defendant's Closing Submissions at [4.13].
3. In particular, the statement that the former partners of Keddies were "happy to settle", it was argued, constituted a clear breach of the Undertaking and Order. The Association submitted that Mr Roulstone had no satisfactory explanation in relation to the same: Defendant's Closing Submissions at [4.14].
4. It was also noted that the contents of the file note, Exhibit 6, and in particular that part which recorded the statement that the Keddies partners were "happy to settle" had not been disclosed to the Bar Association prior to the hearing and that it would not have been disclosed to the Court but for the call that was made for the document to be produced during the course of cross-examination: Defendant's Closing Submissions at [4.14].
5. It was additionally argued that the sequence of events in this respect provides a potential explanation as to how Mr Xi Li came to understand that the Keddies partners wished to settle his case for an amount of $75,000 or $80,000 at a time before he met with Mr Husaini. There was no other explanation, it was submitted, on the evidence as to how Mr Xi Li had received an offer before he met with Mr Husaini on 30 November 2011: Defendant's Closing Submissions at [4.15]. Whether or not such an offer had in fact been made to Mr Xi Li, I note was very much in issue in these proceedings.

(ii) Mr Roulstone's Conduct, Including in Particular, His Conduct in Completing the Settlement

1. The Association relied upon a number of matters which it was argued would leave it open to this Court to conclude that Mr Roulstone wilfully breached the Undertaking and the Order. These included: 1. That the settlement of Mr Xi Li's claim did not follow the usual pattern of giving effect to a settlement, there being no documentation recording the terms agreed upon. This was said to have been contrary to the practice followed with other cases that had been settled by the Keddies partners. 2. The sudden urgency that arose to give effect to the settlement before the Terms of Settlement had been recorded and signed. The Association contended that Mr Xi Li's evidence was inconsistent with urgency and that his evidence had not been challenged on that point. 3. A troubling aspect of the matter was said to be that Mr Roulstone did not contact Mr Tassell or Mr Husaini in relation to the payment of the settlement monies to Mr Xi Li. This raised a question of an attempt by Mr Roulstone to act so as to prevent a potential "derailment" of the settlement. The settlement itself had been effected via communications between Mr Tassell and Mr Husaini. It would therefore, it was submitted, have been logical for them to secure Terms of Settlement if the matter was urgent. The fact that there had been no disclosure to Mr Tassell, it was argued, was a factor that pointed to the true purpose for making the payment on 1 December 2011, namely, to undermine any attempt by Mr Firth to enjoin the settlement: Defendant's Closing Submissions at [4.19].
2. It was further submitted that explanations advanced by Mr Roulstone and Mr Barakat for the payment, namely an alleged conversation between Helena Li and Mr Barakat in which Ms Li conveyed that Mr Xi Li was demanding urgent payment, was inconsistent and irreconcilable with the contents of a privileged statement of Mr Roulstone dated 20 December 2011 which was produced in response to a subpoena and became Exhibit 7 in these proceedings, which contained no reference to any such conversation. It indicated that Mr Roulstone signed the cheque because he thought that Mr Xi Li would want payment the following day: Defendant's Closing Submissions at [4.20].
3. Reliance was placed upon what was said to be an admission by Mr Roulstone in cross-examination that his conduct in effecting payment by cheque amounted to a "communication" with Mr Xi Li: T 66:35-48. Reliance was also placed upon what was said to be an admission by Mr Roulstone that the collection of the cheque by an agent of Mr Xi Li would not alter the fact that he had communicated with Mr Xi Li: T 66:15-67:2.
4. Accordingly, it was submitted that either: (a) The content of the Privileged Roulstone Statement was untrue. If so, then Mr Roulstone was not disclosing all relevant facts to his lawyers and in due course to the Court hearing the contempt case, or (b) Mr Roulstone's evidence to the Court in the present proceedings was misleading or untrue. (Defendant's Closing Submissions at [4.21]).
5. It was submitted that the inconsistencies and the lack of a credible explanation on this aspect leaves it open to the Court to infer that the true reason for the apparent urgency to make payment was to thwart Firths' attempts to prevent the settlement from being executed by an injunction restraining Margiotta Solicitors. If so, then there was a conscious and wilful endeavour by Mr Roulstone to undermine the efficacy of any order that Firths might obtain against Margiotta. Such conduct, it was submitted, would do him no credit and it would be unworthy of a legal practitioner to put his interests above those of the proper administration of justice: Defendant's Closing Submissions at [4.22].
6. Mr Roulstone was criticised in the Association's submissions for having what was said to be a poor recollection of critical matters, and on what was submitted to be inconsistent evidence given by him as to when he first came to know that Firths were seeking an injunction against Margiotta. It was submitted that he knew this on the evening of 30 November 2011, but later sought to resile from having accepted that position. It was noted that Mr Tassell had sent Mr Roulstone an email at 6:09pm on 30 November 2011 which raised the question of the application by Firths for an injunction.
7. Reliance was placed upon the inability of Mr Roulstone to provide an explanation as to how Mr Xi Li had supposedly received an offer of $80,000 before he met with Mr Husaini on 30 November 2011. All such matters, it was argued, were within Mr Roulstone's capacity to explain. These matters, it was contended, gave rise to a compelling inference (which it was submitted should be drawn), that Mr Roulstone had not provided a credible, plausible explanation for his conduct to the Court. This, it was submitted, was because it would not assist him in resisting the conclusion that there has been a breach of the Undertaking and Order. For these reasons, it was submitted the Court ought more readily to find that Mr Roulstone had breached the terms of the Undertaking and Order: Defendant's Closing Submissions at [4.26]

(iii) Payment of Settlement Monies by Cheque

1. In relation to the particular breach alleged and relied upon by the Association (payment to Mr Xi Li of cheque drawn by Mr Roulstone on 1 December 2011) it was submitted that, by this conduct, there could be no doubt that Mr Roulstone had participated in a "communication" with Mr Xi Li and that such conduct amounted to a breach of the Undertaking and the Injunction: Defendant's Closing Submissions at [4.5].
2. It was noted that Mr Roulstone had sought to explain his conduct on the basis that it was his understanding that there would be no breach of the Order or the Undertaking in effecting a settlement after another firm came onto the record to represent a former Keddies client: T 67:44-49. However, the Association contended that this explanation was implausible and should be rejected: Defendant's Closing Submissions at [4.6].
3. The Association submitted that Mr Roulstone's explanation was inconsistent with the plain text of the Undertaking and the Order. It was contended that the terms of both made it very clear that even after another solicitor came onto the record for a former Keddies client, any communication could only be with that solicitor, that is to say, any communication with the former client represented by Firths had to be with Firths, or if the client left Firths and instructed a new solicitor, with the new solicitor: Defendant's Closing Submissions at [4.7]. It was additionally submitted on behalf of the Association that there was no "carve out" or even a mention in the Undertaking or the Order, for conduct effecting a settlement or for allowing communication with the former client directly in any circumstances at all.
4. It was contended on behalf of the Association that the effect of the order made by this Court was that: (a) Mr Roulstone was restrained from communicating with a former client of Keddies who had provided instructions to Firths; (b) Mr Roulstone was restrained from communicating with any other person or persons acting on behalf of a former client of Keddies who had provided instructions to Firths; (c) Mr Roulstone was not restrained from communicating with a solicitor on behalf of such former client provided that solicitor was on the record.
5. It was submitted: "4.9 The clarity of the text leads to the conclusion that Mr Roulstone's conduct amounted to a conscious and willful breach of the undertaking and the order."
6. It was further submitted on behalf of the Association: "4.10 Even if Mr Roulstone's explanation that he did not believe that his conduct would give rise to a breach of the undertaking and order is accepted (ie that there was no conscious or willful breach), his conduct nevertheless amounted to a breach of the undertaking and the order. Moreover, his thought process in relation to the effect of the undertaking and order discloses a cavalier and reckless disregard of his obligations …"
7. It was further submitted that such conduct was inconsistent with the duties owed by solicitors and barristers and the trust that is reposed in them.

Plaintiff's Submissions

1. As previously mentioned, the plaintiff accepted that he bears the onus of establishing that he is a fit and proper person to hold a practising certificate. However, in this case, having regard to the issues raised, the plaintiff contended that the Association has the onus of establishing the particular breaches of the Undertaking and Order alleged by it and additionally to establish Mr Roulstone's alleged lack of candour: Plaintiff's Submissions at [15]. I accept that submission and proceed on that basis.
2. Further, it was submitted that the standard of proof to be met in establishing the above matters was the civil standard but that the degree of satisfaction that that standard calls for varies according to the gravity of the offence to be proved. In this case it was submitted that the allegations by the Association made against Mr Roulstone as to breach of the Undertaking and the Order, and breach of duty of candour, are each very serious matters. In those circumstances the Association, it was submitted, must prove the breaches relied upon to the appropriate standard, namely, that enunciated in Briginshaw v Briginshaw (1938) 60 CLR 336 at 362.
3. The plaintiff's submissions addressed the expression "fit and proper" as interpreted in a number of cases, there being no definition of it in the LP Act: Plaintiff's Written Submissions at [19]-[21]. The following propositions may be derived from the caselaw therein cited:

• The question whether (an applicant) is a fit and proper person and one to be trusted to exercise relevant responsibilities is to be determined on solid and substantial grounds: Incorporated Law Institute of New South Wales v Meagher [1909] HCA 87; (1909) 9 CLR 655 per Griffith CJ at 664.
• For a practitioner to be considered fit and proper he/she must meet certain obligations beyond those imposed by law. An exhaustive statement of the scope of those obligations is not possible. The invocation of phrases such as "moral obligations" or the expectations of "right-thinking people" may be criticised as being too vague and subjective: Barakat v Law Society of New South Wales, supra at [149] (per Beech-Jones J).
• In the end it is the statutory criteria which must be applied. Thus, in relation to an application by a solicitor to be admitted as a practitioner, for a conclusion of unfitness to be reached some form of moral turpitude must attach to the practitioner in that it must be concluded that alleged conduct revealed "such deficiency in [their] character" as to warrant the conclusion that they are not fit to practice: Barakat v Law Society of New South Wales, supra, at [150], citing New South Wales Bar Association v Murphy (2002) 55 NSWLR 23 at [172].

1. I turn to the submissions made on behalf of the plaintiff in respect of the Undertaking and Order and the allegations of breach.
2. The plaintiff's submissions addressed the construction of both the Undertaking and the Order. Reliance was placed upon the recent decision of the Court of Appeal in Rafailidis v Camden Council [2015] NSWCA 185 at [45]-[48], in particular, upon the observation of McColl JA in that case at [48] (with whom Gleeson JA and Bergin CJ in Equity agreed), namely: "…in seeking to determine the meaning of the injunction …, it is open to the Court to have regard to the judgment given when the order was made and to the surrounding circumstances, including the pleadings."
3. It was noted that Mr Roulstone was part of the team that negotiated the terms of the Undertaking: T 47:23-28. Accordingly, it was submitted that his understanding of the Undertaking would have a strong bearing on its construction: Plaintiff's Submissions at [31].
4. Reliance was placed upon the evidence of Mr Roulstone which was to the effect that the Undertaking contained a "carve out" to enable him and his former partners to communicate with former clients who came onto the record with a different solicitor than Mr Firth: T 47:30-33. In cross-examination Mr Roulstone stated that the terms of the Undertaking were negotiated by the legal representatives of the parties and that it was a different undertaking to that which had been sought in the summons by Mr Firth. In cross-examination Mr Roulstone gave the following evidence: "Q. Yes, and you negotiated in effect a carve out from what had been sought, so that it would enable you to communicate with your former clients who came on the record with a different solicitor from Mr Firth. Is that right? A. Yes." (T 47:30-35)
5. It was noted that the terms of the Order were similar to those in the Undertaking and it was submitted that this meant that Mr Roulstone and his former partners could communicate with former clients if they were represented by a different solicitor on the record than Mr Firth: Plaintiff's Submissions at [34].
6. Reliance was also placed upon what was said to be Mr Roulstone's understanding of the Order expressed in his letter to the Association dated 18 July 2014 (Exhibit 2, Tab 47, p 106) where he said: "An injunction was consented to on 24 November 2011 between Mr Firth and the former Keddies partners the terms of which included that if any former clients of Keddies instructed solicitors other than Mr Firth, then the Keddies partners could communicate with such former clients or their lawyers without breaching the injunction." (Plaintiff's Submissions at [35])
7. This statement by Mr Roulstone is stated to be his "understanding" of the terms of the Order. It, of course, does not follow that his understanding as so expressed constituted a proper construction of the terms of the injunction order, a matter discussed below.
8. The submission for the plaintiff was that Mr Roulstone's understanding expressed in Exhibit 2 and set out above, is a proper way of reading both the Undertaking and the Order. Further, it was contended that each only applies to clients for whom Mr Firth was acting, not other clients: Plaintiff's Submissions at [36].

The Statement "Happy to Settle": Submissions

1. As to the breach of the Undertaking and Order alleged by the Association, said to have arisen from the conversation between Mr Roulstone and Mr Husaini on the morning of 30 November 2011 (referred to in para [240] above), and the words "happy to settle", it was noted that there is no dispute as to what was said, there having been a contemporaneous record of the conversation in the form of Mr Roulstone's abovementioned file note. What was in dispute was the question as to whether what was said by Mr Roulstone to Mr Husaini to the effect that the Keddies partners were "happy to settle" constituted "a communication" amounting to a breach of the Undertaking and/or Order.
2. It was submitted for Mr Roulstone that the words "we are happy to settle" spoken to a person representing Mr Xi Li, namely, Mr Husaini who was not at that time the solicitor on the record, was not a breach of the Undertaking and Order.
3. In the plaintiff's submission, the following matters must be taken into account in determining whether the words were a "communication":

• That Mr Husaini was ringing Mr Roulstone, not the other way around;
• That when Mr Husaini said that Mr Xi Li wanted to make an offer to settle his case, the first response by Mr Roulstone was to emphasise that an order was in place, that this prohibited him from speaking to Mr Husaini in relation to Mr Li's claim and that Mr Husaini would need to go on the record as the plaintiff's solicitor and then speak to Verekers.
• The phrase "happy to settle" was not "a communication" within the meaning of the Undertaking or Order. In this respect: 1. There was no attempt to set out an amount for which Mr Roulstone would be prepared to settle Mr Xi Li's claim. 2. There was no attempt by Mr Roulstone to invite an offer from Mr Husaini. 3. There was no attempt by Mr Roulstone in the conversation to make any offer.

1. It was further submitted on behalf of Mr Roulstone: "79. If the Association's contention is accepted, then any form of communication from Mr Roulstone, such as advising Mr Husaini that he would not talk to him, would be a communication in breach of the undertaking and order. Clearly, the undertaking and order were not intended to apply in those situations and by saying the words "happy to settle", Mr Roulstone did not breach the undertaking or order."
2. It was emphasised in submissions for Mr Roulstone that the main point of the 30 November 2011 conversation with Mr Husaini was to let him know that Mr Roulstone could not speak to him. It was also noted that this conversation had been clearly disclosed by Mr Roulstone to the Association: Plaintiff's Submissions at [81].
3. I agree with the proposition inherent in this submission. It is material to take into account the nature and purpose of the statement made by Mr Roulstone which, consistently with respecting the Undertaking and Order, was a statement that settlement discussions were, in effect, off-limits. Mr Roulstone was making it plain that he would not engage in such discussions.

Mr Roulstone's Conduct and the Cheque: Submissions

1. These two issues are related and dealt with together in the discussion that follows.
2. As to the issue of the urgency of the cheque, it will be recalled that the thrust of the submissions for the Association was that an inference may be drawn that the real reason for the urgency was to pre‑empt the effect of any injunction that might have been ordered on 1 December 2011 against Margiotta Solicitors. The submissions for the plaintiff, however, drew attention to a number of matters established in evidence upon which it was submitted that there was an innocent explanation for the "urgency".
3. It was submitted for Mr Roulstone that the best evidence regarding the urgency for the drawing of the cheque came from Mr Barakat. After the proceedings were settled at about 3:10pm on 30 November 2011, Mr Barakat received a call from Helena Li.
4. Mr Barakat's evidence was that he received a call from Helena Li in the afternoon of 30 November 2011 in which, he said: "… that Helena called and told me that Mr Firth had telephoned Xi Li despite receiving a letter from Mr Husaini to say that he was now acting on behalf of Mr Xi Li, that Mr Xi Li was distressed by the phone call because Mr Firth had abused him and threatened him and that he was quite concerned and wanted his settlement monies as soon as possible, but that he was trying to contact Mr Husaini that day and couldn't get through to him, and hence he called Helena." (T 207:4-11)
5. In the submissions for the plaintiff it was contended: "92. The reason why the cheque was drawn urgently was because Mr Li requested it after receiving threats from Mr Firth. This is a completely plausible explanation and there is absolutely no evidence to suggest that this is not correct. 93. Mr Roulstone gave evidence on this point (see T 61.27-31 and T 62.6-10). His evidence basically is that Mr Barakat called him. Mr Barakat had received a call from Helena Li who told Mr Barakat that Mr Li wanted his cheque."
6. I note that Mr Barakat was called by the Association to give evidence. His evidence-in-chief was relatively brief and there was no cross-examination on that evidence. There was no submission made suggesting that his evidence ought not be accepted.
7. It was also noted in the submissions for the plaintiff that there was no dispute that Mr Roulstone drew the cheque and signed it at his home early on 1 December 2011 and that he took the cheque with him to work. He put it in an addressed envelope and gave it to the receptionist. It was emphasised that had Mr Roulstone been motivated to provide a cheque at the earliest possible time then he could have taken steps to have obtained his cheque book and written the cheque on 30 November 2011, but that he did not go to those lengths. Instead of leaving the cheque with the receptionist it was observed that it would have been open to Mr Roulstone to have couriered the cheque directly to Mr Xi Li, but that he did not elect to do so.
8. Reference was made in the plaintiff's submissions to the evidence given by Mr Roulstone at T 64:32-46 in which he said that he was not aware that there had been any injunction against Margiotta when he drew the cheque. As previously mentioned, Mr Roulstone said: "I couldn't see any difficulty in what I had done. I wanted to ensure the payment as soon as possible and solicitors other than Mr Firth had come onto the record, on my understanding, at about lunchtime on 30 November".
9. It was again emphasised that Mr Roulstone was not aware that his Honour, Justice Adams, had made orders against Margiotta Solicitors the previous afternoon (Exhibit 1) and there was no evidence to contest that fact: Plaintiff's Submissions at [108]. The proceedings, of course, were proceedings against Margiotta Solicitors as the solicitors on the record for Mr Xi Li and not against Mr Roulstone or Mr Barakat.
10. Further, it was submitted that what Mr Roulstone wrote on the envelope was not a communication within the meaning of the Undertaking or Order. Whilst Mr Roulstone conceded in cross-examination it was a "communication", Mr Coles' submission was that the question as to whether it could or did amount to a communication within the meaning of the Undertaking or Order was a matter of construction for the Court rather than a matter for Mr Roulstone's evidence.

Principles

1. The principles adopted and applied in Jackson (previously known as Subramaniam) v Legal Practitioners Admission Board [2006] NSWSC 1338 by Johnson J have relevance to the present proceedings. His Honour there observed: "45. It is accepted by the Plaintiff and the Board that the Plaintiff carries the onus of proof in these proceedings. In practical terms, what does that mean in the circumstances of this case? 46. The jurisdiction which I am exercising is not a punitive one. It is exercisable in the public interest and for the protection of the public: Wentworth v NSW Bar Association ((1992) 176 CLR 239) at 251. Subject to the requirements of procedural fairness, the proceedings may be conducted in whatever manner the court considers appropriate to the matter before it: Wentworth v NSW Bar Association at 251. 47. Where serious allegations of improper conduct are raised on an application for admission, and are disputed by the applicant, it is necessary to devise a mechanism for resolution of those disputed matters. The approach of BR Martin CJ in Deo ([2005] NTSC 58) is of assistance to the present case."
2. In Jackson, supra, his Honour at [44] referred to the following observations by the Chief Justice in Deo at [4]: "The only questions in issue are whether the court should be satisfied that the application [sic] is of good fame and character and a fit and proper person to be admitted to practise. While the applicant's past conduct is relevant to a determination of these critical issues, and for that reason evidence as to past conduct is admissible, the question is not whether the applicant was in the past a fit and proper person to be admitted to practice but whether he is today, of good fame and character and a fit and proper person to be admitted. The burden rests on the applicant to satisfy the Court of those matters, but where the Law Society has objected to the application and, in support of the objection, asserts the existence of facts adverse to the application, the burden rests upon the Law Society to satisfy the Court of the existence of those adverse facts."
3. I consider that in the present proceedings the same approach should be applied and I do not understand the Association to have disputed the fact that it carries an evidentiary onus to establish the alleged breaches asserted by it in the present proceedings.

Onus of Proof

1. I have touched upon the onus of proof earlier in this judgment. I approach resolution of the present proceedings upon the basis that the plaintiff, Mr Roulstone, bears the ultimate onus of proving, on the balance of probabilities, that he is a fit and proper person to hold a barrister's practising certificate. In relation to serious allegations of improper conduct, in particular the alleged breaches of an Undertaking and Order by the plaintiff, the burden rests upon the Association to satisfy the Court as to the factual foundation for those serious allegations of breach.
2. As has been mentioned, the relevant standard by which such allegations are to be proved is the civil standard, proof on the balance of probabilities, qualified by the gravity of the issues raised in the allegations. The test has been said to be whether the issue has been proved to the reasonable satisfaction of the Court or Tribunal, such satisfaction not being produced by inexact proofs, indefinite testimony or indirect inferences: Briginshaw v Briginshaw at 362; Helton v Allen (1940) 63 CLR 691 at 701; Rejfek v McElroy (1965) 112 CLR 517 at 521. The court in proceedings such as the present should be comfortably satisfied, on the balance of probabilities, before findings (eg, of breach as alleged in the present proceedings) are made: Bannister v Walton (1993) 30 NSWLR 699 at 711-712.

The Issues Concerning Alleged Breach

1. As the ultimate issue for determination in these proceedings is concerned with the requirement specified in s 48(3), (the issue of whether Mr Roulstone is a "fit and proper" person) that in turn has required an examination of events between 12 October and 1 December 2011 during which period Mr Xi Li's proceedings against the former Keddies partners were settled, and whether evidence adduced by the Association establishes, to the requisite standard, that Mr Roulstone breached the Undertaking and Order made by this Court respectively on 22 and 24 October 2011.
2. The specific allegations ultimately made by the Association as to breach of the Undertaking and Order by Mr Roulstone fall within a narrow compass (being allegations of specific "communications" by Mr Roulstone with Mr Xi Li or his agents). The evidence adduced by the Association, however, extended more broadly to an examination of the complete process and events leading up to and following settlement of Mr Xi Li's proceedings, with a view to establishing, inter alia, that Mr Roulstone was involved in and/or directing the course of settlement through Mr Husaini and/or Ms Helena Li.
3. The specific allegations of breach relied upon by the Association, though within a narrow compass, if established, would, of course, carry serious implications. If established, the conclusion would follow that Mr Roulstone acted in contempt of the Undertaking and Order. The Association, with respect, properly addressed the issues arising in its Outline of Opening Submissions in the following terms: "3.2 Whilst a contempt of court is an offence involving interference with the administration of justice, and while a lawyer who commits that offence 'places their entitlement to practice in serious jeopardy', a person is not a fit and proper person to hold or continue to hold a practising certificate 'by reason only of having committed, and been convicted for, that offence': Garde-Wilson v Legal Services Board [2007] VSC 225 at [114]. If it is concluded that a practitioner is not a fit and proper person only because she was found guilty of and convicted for contempt, then that approach would involve an error of law: Garde-Wilson v Legal Services Board [2007] VSC 225 at [114]; Garde-Wilson v Legal Services Board (2008) 19 VR 398 at [123] per Dodds-Streeton JA. 3.3 To properly apply the 'fit and proper person' requirement, it is necessary to take into account: … not just the fact of the conviction [of contempt], but also the nature of the contempt; the entirety of the circumstances surrounding its commission, as may be revealed by the evidence before and the findings of the trial judge; the sentence imposed, including any aggravating or mitigating circumstances found by the sentencing judge; and other relevant considerations, such as the lawyer's history of practice, their remorse for committing the offence and the likelihood, if any, that he or she might reoffend. Depending on the nature of the case, there may, of course, be other relevant considerations, both for and against the applicant: Garde-Wilson v Legal Services Board [2007] VSC 225 at [116]. … 3.6 Factors relevant to whether a finding of professional misconduct will flow from a breach of an undertaking or court order will include whether there is a reasonable explanation for the conduct, the solicitor's remorse, and other circumstances relevant to the conduct in question that throws light on the character of the lawyer."
4. In New South Wales Bar Association v Murphy [2002] NSWCA 138; 55 NSWLR 23, the Court (Spigelman CJ, Giles JA and Ipp AJA) considered the provisions of the former Legal Profession Act 1987 which empowered the Council of the NSW Bar Association, inter alia, to cancel a barrister's practising certificate on the grounds that the practitioner was not a fit and proper person to be a barrister.
5. In relation to the power to remove a practitioner upon the grounds that he or she was not a "fit and proper person", Giles JA observed at [43]: "A variety of other phrases was used to convey unfitness to be a legal practitioner, as appears from the discussion in NSW v Foreman (1994) 34 NSWLR 408 at 441-444 although in Ziems v Prothonotary of the Supreme Court of NSW (1957) 97 CLR 279 at 297-8, it was said that that expression is not capable of more precise statement. A number of cases spoke of professional misconduct as sufficient for unfitness to be a legal practitioner …"
6. His Honour at [46] also observed: "both the inherent jurisdiction and the statutory power to remove from the roll were exercised not to punish the legal practitioner, but to protect the public."
7. In Barakat v The Law Society of New South Wales, supra, Beech-Jones J at [149] observed that the obligations required to be met by a practitioner were not capable of exhaustive statement and that the invocation of phrases such as "moral obligations" or the expectations of "right-thinking people" can be criticised as being too vague and subjective. His Honour further observed at [150]-[151]: "In the end it is the statutory criteria that must be applied in the sense explained in Murphy. In the present context, to found a conclusion of unfitness some form of moral turpitude must attach to the practitioner in that it must be concluded that their conduct revealed 'such deficiency in [their] character' to warrant the conclusion that they are not fit to practice (Murphy at [172]). A finding of dishonesty is clearly sufficient to warrant that conclusion, but it is not a necessary condition. In Wardell a 'reckless disregard' for obligations 'as to amount to an intention to avoid them' was found to be fatal. Lesser forms of conduct may suffice. However, a mere failure to take the most honourable or selfless course of action does not demonstrate unfitness …"

Duty of Honesty, Frankness or Candour

1. The further issue in these proceedings concerns Mr Roulstone's compliance or otherwise with his duty of honesty and frankness or candour in the disclosure of relevant and material information. This concerns Mr Roulstone's disclosures to the Association and his evidence on that matter in the present proceedings.
2. As the Association observed, a practitioner's breach of duty of candour in dealings with the relevant professional body can constitute a breach of professional duty, which can amount to professional misconduct: Defendant's Outline of Opening Submissions at [3.10] citing A Solicitor v Council of the Law Society of New South Wales [2004] HCA 1; 216 CLR 253 at [30]; Prothonotary of the Supreme Court of New South Wales v Hendrick Jan Van Es [2014] NSWCA 169.
3. The written submissions for Mr Roulstone referred to the decision in Forster v Legal Services Board [2013] VSCA 73 in which Kyrou AJA (with whom Weinberg and Harper JJA agreed) set out a summary of the principles relevant to the duty of candour.
4. In the plaintiff's submissions there was unqualified acceptance as to the existence of a duty of candour as outlined by the Association. The submission was that Mr Roulstone had met his duty of candour: Plaintiff's Written Submissions at [165].

Findings - Whether Open or Sought

1. At this point it is necessary to refer to the distinction in the Association's submissions as to (a) findings in respect of which, whilst said to be open on the evidence in relation to Mr Roulstone's conduct, no affirmative finding was sought, and (b) findings sought by the Association as to specific breaches of the Undertaking and Order.
2. An example of the former was the submission by the Association in their closing submissions that: "3.71 It is open to infer from this sequence of events that the discussion between Mr Roulstone and Mr Husaini was the source of the communication to Mr Li that the Keddies partners were prepared to settle for an amount of $80,000. This is generally consistent with Mr Li's unchallenged evidence. If correct, this would establish that Mr Roulstone engaged in communications with Mr Li via agents other than a solicitor on the record in breach of the undertaking and order for the purpose of settling the case."
3. The Association, however, did not submit that the evidence was sufficient to establish that Mr Roulstone had entered into communications such as referred to in the submission made at [3.71]. In oral submissions Mr Stewart SC, with respect, properly accepted that whilst the Association had advanced "central propositions" (T 250:10-15) it acknowledged that the evidence was not sufficient to support, to the requisite standard, the making of adverse findings against Mr Roulstone in respect of all those propositions. This, at least in part, may be so by reason of the absence of evidence from a relevant witness.
4. It is plain on the evidence that Helena Li was playing a central role in the discussions and events leading to settlement of the proceedings in the period between 29 November 2011 and 1 December 2011. Precisely what role she played in the events leading to the cheque being drawn for Mr Xi Li and what, if anything, was in it for her, is unknown. The Association was criticised in the submissions for the plaintiff for not having taken proper and adequate steps to ascertain Helena Li's whereabouts and to secure both her attendance and evidence at the hearing under subpoena. The fact, however, remains that although she clearly was playing a role at this critical time, she did not give evidence in the proceedings. As discussed below, the absence of evidence from Ms Helena Li is a matter of significance on the cogency of the evidence called by the Association in terms of the capacity of the evidence to support certain "propositions" advanced by it.
5. Following a discussion with counsel as to the significance of the fact that there was no evidence from Helena Li in the making of adverse findings against Mr Roulstone, Mr Stewart made oral submissions as follows: "HIS HONOUR: It seems to me, in establishing the factual matrix of what occurred relevant to the alleged conduct, it might be said, and I have no firm view about it, that the Bar Association had the obligation to call Helena Li, not the plaintiff. As I say, I have no firm view about that, but I'm trying to apply first principles to a somewhat novel situation. It may be that that is the ultimate position. So criticism of the failure of the plaintiff to call Helena Li I don't think overcomes the de facto situation that presently exists, that is, we don't have her evidence for whatever reason, and in those circumstances, the question arises as to how does that impact upon making the findings. STEWART: In respect of certain findings, undoubtedly it means that that can't be made, and we haven't asked for such findings to be made. We've explored, in I think two sections of our submissions, a possible answer on a few questions as to what the position may have been. For the most part, depending on the view that your Honour takes of it, and we've referenced the evidence so that your Honour can see where it is and find it, at the end of the day, it may be that there isn't enough to establish that. But that doesn't affect the central propositions which are: (1) there was a breach of the undertakings and injunction; and (2) there was a breach of the obligation of frankness and candour. HIS HONOUR: These are grave allegations, and they ought to have, as we're all agreed, cogent evidence to establish the matters put against the plaintiff, and it does seem that the go between right through from first to last is Helena Li. She is liaising with Husaini; she is liaising with Mr Li; she is liaising with I think there's evidence-- STEWART: Mr Barakat, at length. HIS HONOUR: --Mr Barakat. Who was transmitting information to whom and whether Mr Roulstone was involved in all of that is the question and, if he was, to what extent in relation to what matters at what time and so on. STEWART: If I can take an example, it's pretty clear and can be made as a finding of fact that Helena Li conveyed to Xi Li on the 30th that there was an offer, as she put it, "from them", or she said "they have offered". It was first 75 and then after she made another phone call she said "okay" to the 80,000. There's not sufficient evidence, I accept, for your Honour to conclude that Mr Roulstone was behind that offer. It remains a big question as to who was and how it came about and whether he did know of it and so on, but there's not enough evidence to say positively by way of inference that he was behind that offer. But there is quite sufficient cogent and direct evidence to establish the central propositions which we advance, and perhaps I just need to go into them and show your Honour where that evidence is in relation to the breaches of the undertaking and injunction and the obligation of frankness and candour." (T 249:17-T 250:15) (emphasis added)
6. A little later in the course of his oral submissions, Mr Stewart, in responding to a question as to the capacity of evidence to support a possible finding adverse to the plaintiff on the allegation that an offer of $80,000 may have been conveyed to Mr Xi Li by someone unknown, observed: "STEWART: Yes, and that's in a section of the submissions headed, "An Explanation for the Communication of Offers to Mr Li", and really what it is, as I was seeking to explain earlier, is setting out what the basis for such an inference would be if your Honour was to draw it, and we've made the submission that it's open but we haven't put it any higher than that. So if I'm not mistaken, when we come to saying just what the breaches were, we do not say that the conveying of that offer was the breach. We say the breaches were confined to two matters. One was saying "we're happy to settle" in the phone call of 30 November in the morning between Mr Husaini and Mr Roulstone and, secondly, the process of drawing and making the cheque available for collection by or on behalf of Mr Xi Li. HIS HONOUR: Why then are you seeking a finding in terms of [3.71]? STEWART: It's not put at that level. HIS HONOUR: You are using the words "the source of communication" which is close to the verbiage of the order, and I rather took it that that was directed to establishing a breach. STEWART: We've put it at the level of "if correct this would establish" and perhaps it's not made at all clear to your Honour, and I apologise for that. What we've sought to put together here is really an unanswered question and we've put it as high as it can go, which would be to say it's open for your Honour to infer from the sequence that this is what happened. It's generally consistent with the unchallenged evidence and, if correct, it would establish that. But we haven't gone so far as to positively submit that that's the finding your Honour should make which at para 4 is where we get specifically to deal with the breach of the order and the undertaking and we limit it to the matters upon which there is a firmer basis, a much firmer basis, to make positive findings." (T 250:26-T 251:7) (emphasis added)
7. At the end of the day two propositions were relied upon by the Association, namely, the two alleged breaches of the Undertaking and Order summarised in paras [237] and [238] above and the alleged failure of Mr Roulstone to discharge his duty of frankness and candour.
8. I have earlier referred to the inconsistencies of the evidence of Mr Xi Li and Mr Husaini as to whether an offer of $80,000 had been made to Mr Xi Li before Mr Husaini spoke to him on 30 November 2011. There is no evidence capable of supporting a suggestion that an offer of $80,000 had been made to Mr Xi Li. There is no evidence that if there was, Mr Roulstone knew that such an offer had been made.
9. In the consideration of these "central propositions" there is a need for careful assessment of them in the relevant context in which they arose. Mere suspicion of some unproven involvement by Mr Roulstone in the process leading to settlement of Mr Xi Li's claim must, of course, not intrude and so distort the assessment of the propositions relied upon in the Association's case.

Factual Findings

1. The evidence establishes, and I find accordingly, the following events leading up to and subsequent to the settlement of the District Court proceedings instituted by Mr Xi Li and Mr Roulstone's role in relation to them. 1. On 12 October 2011, there were telephone discussions involving Mr Husaini concerning possible settlement of Mr Xi Li's claim. During the morning on that date, Mr Roulstone in a telephone conversation with Mr Husaini, put an initial offer of $5,000 to settle Mr Xi Li's claim (this offer was on the understanding that Keddies would pay costs). Mr Roulstone spoke to Mr Husaini in relation to such an offer. Mr Husaini then indicated to Mr Roulstone in a subsequent conversation that the plaintiff would accept $70,000 plus costs. Mr Roulstone made a counter-offer of a further offer of $10,000 on the same basis. Mr Xi Li rejected that offer. 2. Between 12 October 2011 and 30 November 2011, there is no evidence that Mr Roulstone had further discussions with Mr Husaini, or anyone else representing Mr Xi Li, on the subject of the possible settlement of Mr Xi Li's claim. After 12 October 2011, I accept Mr Husaini's evidence that he had no communication with Mr Xi Li until 30 November 2011. 3. Ms Helena Li assumed an active role in the settlement of Mr Xi Li's claim from 29 November 2011. In particular, on and from that date she encouraged Mr Li to pursue settlement of his claim. 4. On 29 November 2011, Mr Xi Li returned to Sydney from a holiday in China. 5. On his return he received a telephone message from Helena Li. 6. On the evening of 29 November 2011, Mr Xi Li spoke to Ms Helena Li. She asked him whether he wanted to settle the claim against Keddies. 7. On 29 November 2011, Mr Xi Li told Ms Helena Li that he would accept $80,000 plus costs to settle the claim. She told him that that would be "very difficult". 8. On 30 November 2011, Ms Helen Li again rang Mr Xi Li. She told him that the Keddies partners had agreed to pay $75,000 but he told her he wanted $80,000 to settle the claim. 9. There is no evidence that at that time such an offer had in fact been made. Apart from that hearsay statement, there is no evidence of the Keddies partners having agreed at that time to pay $75,000 or any other amount to settle Mr Xi Li's claim. 10. In the lastmentioned telephone conversation Ms Helena Li indicated that she needed to make another call. She later called Mr Xi Li back and indicated to him that he should go to the office of Margiotta Solicitors. 11. There is no evidence that Helena Li had by this time spoken to Mr Roulstone or any of the other former Keddies partners about settlement of Mr Xi Li's claim. 12. On the evidence there is a reasonable inference that Helena Li may at this time have been pursuing settlement of Mr Xi Li's claim of her own initiative although there is no evidence as to what her motive in doing so was at that time. There is no evidence that Mr Husaini had been liaising with Ms Helena Li up to this time (30 November 2011) concerning settlement of the claim. Mr Husaini's evidence was to the contrary. 13. The next relevant event occurred when Mr Xi Li received a call from Mr Husaini asking him to go to his office which he did. The inference is that Helena Li had spoken to Mr Husaini about settlement of Mr Xi Li's claim. Mr Husaini soon after met with Mr Xi Li and Ms Helena Li. Mr Xi Li told Mr Husaini he wanted $90,000 to settle the claim (although not stated implicitly, this was on a plus costs basis). 14. Later on 30 November 2011, Mr Husaini entered into settlement discussions with Mr Tassell of Verekers and subsequently told Mr Xi Li that the Keddies partners would pay him $80,000 clear and would, in particular, pay Firths' costs. Mr Xi Li agreed to that offer.

Was the Statement "Happy to Settle" a Communication in Breach of the Undertaking or Order?

1. The Association contended: 1. That Mr Roulstone had communicated his readiness to settle with Mr Xi Li via Mr Husaini who was not at the relevant time the solicitor on the record for Mr Xi Li. 2. That Exhibit 6, Mr Roulstone's file note, constituted evidence of such a communication. 3. That Mr Roulstone's version of events, in particular, his account that there had been no communication by him directly or indirectly, with Mr Xi Li on the question of settlement between 12 October 2011 and 30 November 2011, was inconsistent with the version of events recorded in Exhibit 6: Defendant's Closing Submissions at [3.68]-[3.69].
2. In determining whether Mr Roulstone's "communication" with Mr Husaini was in breach of the Undertaking or Order it is necessary to consider:

• The circumstances in which the communication by Mr Roulstone on 30 November 2011 was made; and
• The terms of the conversation on that date constituting the alleged communication.

1. As to the circumstances of the communication between Mr Roulstone and Mr Husaini on the morning of 30 November 2011, I refer below to the accounts given by Mr Roulstone in his evidence and in his written responses to the Association. In that way, consistency or any lack of consistency in his account is more readily identifiable.
2. Mr Roulstone's evidence on the first day of the hearing on 10 June 2015 in cross-examination on this aspect was as follows: "Q. On the morning of 30 November Mr Husaini called you to discuss the Xi Li matter. Is that right? A, Yes. Q. At about what time was that, by your recollection? A. 10:00am. Q. Did you identify that time with reference to any particular event, or is that just loosely mid-morning, or is it more precise than that? A. I would say mid-morning. Could have been later. Q. As best as you can, can you recount the terms of the telephone conversation between you and Mr Husaini? A. Mr Husaini said, 'Scott, I'm sitting here with Xi Li and he wishes to settle the case against Keddies' and I said, 'Naushad, I can't speak to you about this. There are orders in place prohibiting me from speaking to you. You will need to come onto the record. You will need to contact our lawyers, Verekers. You will need to ring Robert Tassell on [XXX XXX] or [XXX XXX]'. And he said he would do so." (T 151-152)
3. Mr Roulstone in his written response to notices issued by the Association under s 68(2) and s 660 of the Act dated 18 July 2014 (Exhibit 2, Tab 47 at p 105) referred to his telephone conversation with Mr Husaini, stating: "…I heard nothing further from Mr Husaini until the morning of 30 November 2011. Mr Husaini telephoned me on behalf of Mr Li and I informed him immediately that there were orders in place preventing the Keddies Partners from communicating with Mr Li."
4. In Mr Roulstone's (previously) privileged statement, Exhibit 7 at [10], he again set out a similar account of what was said in the telephone call on 30 November 2011 which he recorded as having taken place at about 10:00am on that day.
5. Mr Roulstone, as earlier noted, produced in answer to a call for production, a file memorandum (Exhibit 6) which recorded his handwritten notes of his conversation with Mr Husaini on 30 November 2011. The file note is in the following terms: "Xi Li is coming in to see me today. He wants to settle his case. SR: Okay. … Happy to settle - You will need to come on record & deal with Verekers. Rob Tassell solicitor can be contacted on…"
6. Mr Husaini corroborated Mr Roulstone's statement to him to the effect that he, Mr Roulstone, told him in the phone conversation on the morning of 30 November 2011 that he could not speak to him about settlement of Mr Xi Li's claim. Mr Husaini gave evidence as follows: "Q. It's recorded in your file note at 12:15 you called Mr Tassell? A. Tassell. Q. Did you call anyone else prior to calling Mr Tassell? A. I may have called Scott, and I think he told me not to - he can't speak to me. And he gave me Rob Tassell's number." (T:130)
7. The inconsistency emphasised by the Association both in cross-examination of Mr Roulstone and in the Association's submissions was that his account of the conversation that he had with Mr Husaini omitted the words "we are happy to settle". It was submitted for the Association that this was a serious omission and furthermore that it constituted a communication that breached the terms of the Undertaking and the Order. A determination of the latter will, of course, have a bearing upon the significance of the omission relied upon.
8. I accept that to the extent that Mr Roulstone's prior accounts, including his account in evidence in chief, omitted the words "we are happy to settle", there exists an inconsistency. However, it is necessary, as I have indicated, to establish the significance or otherwise of those words. For that purpose they are to be examined in the context of the phone conversation.
9. It is a primary rule of construction that words contained in legal instruments should not ordinarily be taken and construed in isolation from the context in which they occur. The notion of "communicating" or "attempting to communicate" with any of the former clients of the defendants in the Undertaking and Order is preceded by the words "… be restrained from … at any time contacting, approaching" and there then follows the words "or in any way communicating or attempting to communicate with any of their former clients …".
10. The prohibition on "contacting" or "approaching" was clearly designed or intended to impose a restraint upon the defendants from what I may describe as "poaching" or "luring" clients from Firths. In other words, the restraint was clearly intended to prevent the former Keddies partners from initiating any contact or making any approach to that end. The further reference to "communicating or attempting to communicate", in context, applied to any form of communication whether physically or by electronic means.
11. I accept, as was argued on behalf of the plaintiff, that the restraint on communication contained within the Undertaking and Order, was not one that prevented every possible form of communication no matter what its nature. As argued by Mr Coles, it would be absurd to suggest that a statement, for example, by Mr Roulstone to Mr Husaini that he should not speak to him about settlement of Mr Xi Li's claim by reason of the court order, would constitute a "communication" within the meaning of the Undertaking or Order. Though that would be a "communication" of a type, it would not be the sort of communication which the Undertaking or Order was intended to proscribe.
12. Accordingly, it is necessary to determine the scope of the prohibition imposed on the former Keddies partners under the Undertaking and the Order and to then establish the nature of the actual "communication" that was made by Mr Roulstone and the circumstances in which it was said to have been made on 30 November 2011. A conclusion may then be reached as to whether or not it was a form of communication that breached the terms of the Undertaking or the Order.
13. I have referred above to the relevant terms of the Undertaking and Order. As to the conversation between Mr Roulstone and Mr Husaini on the morning of 30 November 2011, I note the following matters: 1. As recorded in Mr Roulstone's account both to the Association and in evidence in chief, and as recorded in Exhibit 6, the approach made on that date on the question of possible settlement came not from Mr Roulstone but from Mr Husaini. 2. There is no evidence to support the proposition that there had been any direct or indirect communication between Mr Roulstone and Mr Husaini or Mr Xi Li or any other agent he may have had on the question of settlement between 12 October and 30 November 2011 until Mr Husaini's call on the morning of 30 November 2011. Mr Roulstone's evidence that there had been no communication between him and Mr Husaini in that period was confirmed by Mr Husaini. Mr Husaini said in evidence that when he spoke to Mr Roulstone on the morning of 30 November 2011 Mr Roulstone said that he could not speak to him about settlement of Mr Xi Li's proceedings. 1. Exhibit 6 confirms Mr Roulstone's evidence as given in chief on 10 June 2015 (T 52) and in his letter to the Association on 18 July 2014 insofar as he said he told Mr Husaini in unequivocal terms that he could not speak to him on the question of settlement of the proceedings by reason of the Court's Order made on 24 November 2011. As noted above, he then directed Mr Husaini to Mr Tassell of Verekers.
14. In the further cross-examination, Mr Roulstone gave the following evidence: "Q. The file note also records, "We are happy to settle." When you gave evidence of this telephone call last week you didn't mention that component of it, in other words, that you had said, "We are happy to settle." Do you accept that? A. If that's the case, I accept that. Q. That was a serious omission in your evidence, is it not? A. I don't think so. Q. It's something you also didn't mention in your response to the Bar Association. A. I can't recall whether I did or I didn't. Q. It's serious because if you had said to Mr Husaini that we are happy to settle then you were communicating with Mr Li via someone other than a solicitor on the record for Mr Li. A. Mr Husaini was instructed to act, from my recollection. Q. He wasn't on the record, though, was he? A. The next line says, "You will need to come on the record." Q. Exactly. So you communicated with him with regard to yours and I take it your partner's willingness to settle prior to him being on the record? A. I communicated to him on the basis that I couldn't speak to him and that he would need to go on the record and speak to the solicitors who acted for us, and that was Verekers. Q. At that time, in that call with Mr Husaini, you had a discussion about the possible level of settlement, didn't you? A. No. Q. You took some time to answer that. Are you sure? A. Yes, the level of settlement was discussed back on 12 October. Q. Because I suggest to you that to say we are happy to settle requires some contemplation of the level at which you might be happy to settle. A. I don't read that into that. Q. Isn't that the case, you wouldn't be happy to settle at any level, I take it? A. I don't understand the question, I'm sorry. Q. I suggest what happened is, there was a discussion about a figure. A. There was no discussion about a figure." (T 193:1-44)
15. It is clear from this evidence that apart from expressing a preparedness to settle the proceedings, there was no discussion of an offer or a possible level of settlement as suggested in cross-examination. Additionally, the statement "we are happy to settle" did not convey that Mr Roulstone or his former partners had considered a range in they might have been prepared to entertain settlement as had been put to him in the cross-examination set out above.
16. The proposition put to Mr Roulstone in cross-examination - "… there was discussion about a figure" - was rejected by him. He responded "there was no discussion about a figure". The file note, Exhibit 6, provides corroborative evidence that there was no discussion of "a figure". The message conveyed in the phone call to Mr Husaini by Mr Roulstone was an emphatic one. It was that he could not and would not engage in settlement discussions but that any settlement discussions would need to take place with Verekers (Mr Tassell).
17. I accept Mr Roulstone's evidence that there was no discussion of settlement in the phone call from Mr Husaini. The phrase "we are happy to settle" in context, did not by my assessment of the evidence constitute a statement, express or implied, as to any possible basis for settlement or of a level or range or terms for a possible settlement.
18. The contention made on behalf of Mr Roulstone in the Plaintiff's Written Submissions at [78] was in these terms: "The phrase 'happy to settle' is not a communication within the meaning of the Undertaking or Order. There was no attempt to set out the amount for which Mr Roulstone would settle. There was no attempt to invite an offer from Mr Husaini and no attempt by Mr Roulstone to make an offer."
19. I, with respect, accept that submission as a correct understanding of the communication that took place between Mr Roulstone and Mr Husaini on the morning of 30 November 2011. The conversation could not, in my opinion, be construed or characterised as involving settlement discussions or a discussion more generally about Mr Xi Li's case. The terms of Mr Roulstone's communication emphasised in clear terms that he could not, and therefore would not, engage in settlement discussions and that in the circumstances the appropriate course was for Mr Husaini to speak to Mr Tassell. Mr Roulstone's statements to Mr Husaini in this respect, operate to his credit or advantage in two respects. Firstly, as to the credibility of his account given, initially to the Association, insofar as he said that he told Mr Husaini that he could not engage in settlement discussions. Secondly, his particular statements to Mr Husaini by which he refused to engage in settlement discussions and directed him to Verekers, demonstrate his understanding of the terms and the effect of the Order as well as his appreciation of the need for there to be compliance with the prohibition thereby imposed.
20. The proper construction of the Undertaking and Order and whether the phrase "happy to settle" could be considered as a breach of the terms of the order remain matters for consideration.
21. I have earlier referred to Mr Roulstone's understanding of the Order as expressed in his letter to the Association dated 18 July 2014 (Exhibit 2, Tab 47) namely that the terms of the injunction were to be interpreted on the basis that if any former clients of Keddies instructed solicitors other than Mr Firth, then the Keddies partners could communicate with such former clients or their lawyers without breaching the injunction.
22. The difficulty with that construction is that it runs contrary to the terms of each of the Undertaking and the Order. Whatever Mr Roulstone may have understood to be the situation, the parties chose to frame the Undertaking and the Order in terms that restrained the former Keddies partners from contacting, approaching, communicating with etc. any of their former clients, or any former clients of Keddies the Insurance Law Specialists Pty Ltd, or a person or persons acting on behalf of such former clients, other than with any solicitor on behalf of such former clients on the record, being clients who provide instructions to Firths.
23. Further, there was no exception or "carve out" whereby the defendants were free in any circumstances to communicate with such former clients. If that was the intention, it would need to have been expressed in terms that made plain that the restraining order was of a limited kind or had a circumscribed operation. The plain words of the Undertaking and Order imposed a general restraint upon the former Keddies partners. I do not consider that it is permissible, in effect, to read the terms of the Undertaking and Order as containing an exception that was not expressed.
24. Whether or not the parties addressed their minds to limiting the restraint or not does not entitle this Court to act on Mr Roulstone's stated understanding as to the Undertaking or Order. In my assessment, there are no objective or other circumstances that would warrant the imposition of a limitation on the injunction so that it would operate to permit, in any circumstances, the former Keddies partners themselves to speak to former clients in circumstances where such clients had engaged another solicitor on the record.
25. That conclusion, however, does not dispose of the issue of the proper construction of the Undertaking and Order. The words "communicating or attempting to communicate" contained in both the Undertaking and the Order are, as earlier stated, to be construed in context.
26. Given that the telephone call on the morning of 30 November 2011 was instigated by Mr Husaini it, of course, cannot be said that the words "happy to settle" amounted to a statement by way of an approach by Mr Roulstone directed towards seeking or procuring a settlement of the proceedings.
27. Further, the words "we are happy to settle" in context cannot not be said to have been words constituting advice, inducement or persuasion to Mr Xi Li or to Mr Husaini as agent to terminate the retainer between Mr Xi Li and Mr Firth and to engage Mr Husaini or some other solicitor. As Mr Stewart in his oral submissions observed, it is necessary to have regard to the substantive effect of the Order and to give effect to its obvious purpose or objective. Mr Stewart observed: "And the reason is this, that whoever initiated the communication, it's the substance of it that's important because it's the consequence of the substance of the communication that was sought to be protected by Mr Firth through the injunction. So it was to stop the luring away of clients or, in circumstances where they may have already been lured away, as it would seem from the contempt charge, the statement of charge, that I've taken your Honour to, to stop payments being made in settlements that had already been achieved." (T 252:39-45).
28. Mr Stewart cited as an analogous example a circumstance when an employee leaves his or her employment and is subject to a restraint against soliciting or contacting former clients of the employer. He observed: "… In circumstances where a former client takes the initiative and makes the contact, the restraint still operates, it still operates to stop the former employee who was subject to the restraint from responding positively in such a way as to characterise, in that case a solicitation …" (T 252:46-T 253:3)
29. Even if the words "we are happy to settle" can be said to be a form of "communication", in the circumstances of the present case the question remains, what is its nature? Those words occurring in context cannot, of course, be characterised as some form of solicitation which the order is designed to prohibit. The words in question said to have been a communication occurred in a context in which Mr Roulstone was positively discouraging and in fact preventing any communication taking place with him in relation to Mr Xi Li's proceedings.
30. The words "happy to settle" did not amount to a solicitation, invitation or other communication in breach of the Order. They were an initial or prefatory comment made in response to an introductory statement made on the phone by Mr Husaini. They were plainly not a premeditated or considered statement of intent. Furthermore, although the words "happy to settle" indicated a receptive frame of mind towards the concept of settlement, as had been discussed, Mr Roulstone's statement made clear that if discussions did take place, they were not to be with him.

The Urgent Payment of the Settlement Monies

1. The evidence does not, in my assessment, support the proposition that the payment of the settlement monies by cheque on 1 December 2011 was motivated by a desire by Mr Roulstone to pre-empt the effectiveness of any injunctive relief that the Court may have ordered on 1 December 2011.
2. The evidence establishes the following: 1. On Mr Barakat's unchallenged evidence, the request for urgent payment came through Ms Helena Li to him. 2. On his evidence, Ms Helena Li told Mr Barakat that Mr Firth had contacted Mr Xi Li and took issue with him having terminated his retainer which, on her version, had caused Mr Xi Li to became upset and ask for payment of the settlement amount. 3. Mr Barakat in turn rang Mr Roulstone and discussed arrangements for a cheque to be drawn as soon as possible. 4. Whilst Mr Roulstone agreed, he was not in a position to do so on 30 November as he had left his cheque book at home. 5. Rather than ensure payment on 30 November (as, for example, employing a courier service to expedite the process), Mr Roulstone waited until the next day before drawing the cheque.
3. In addition to the above matters, I note the following: Firstly, Mr Xi Li did not refer to the circumstances in which he received the cheque in his first affidavit. That was only addressed later in his second affidavit. I have previously stated that the reliability of certain of Mr Xi Li's evidence is, in my assessment, questionable. That may have been due to the length of time that had elapsed before he was required to recall events concerning the settlement. Secondly, based on Mr Barakat's evidence there is a reasonable basis to conclude that it was Mr Xi Li who in fact requested urgent payment.
4. Whilst it is, of course, possible that Mr Roulstone saw another possible benefit in having early payment of the settlement monies made, that possibility has not on the evidence been established as a likely one. The evidence certainly does not establish a cogent basis for a conclusion that the urgent payment was undertaken deliberately by Mr Roulstone in order to frustrate any injunctive relief the Court may order.

Was the Cheque a Communication in Breach of the Undertaking or Order?

1. As earlier discussed, on 1 December 2011 Mr Roulstone placed a cheque, in settlement of Mr Xi Li's claim, in an envelope addressed to Mr Xi Li.
2. Accepting that the cheque, together with the addressed envelope, could be considered to be a form of communication, the question again is whether it was a communication within the terms of the Undertaking and Order.
3. The ordinary dictionary meaning of "communication" includes an act of imparting or transmitting something intangible, in particular, "information". In certain contexts it may also include transmission of something that is abstract: Oxford English Dictionary.
4. In this case the tender or an act of providing a cheque, that is, a written order to a bank, would not in itself constitute a communication in the ordinary sense of that word to the recipient (as distinct from a bank). The act of addressing an envelope containing the cheque conveys the identity of the person intended to receive it. The reference in the Order to "communication", having regard to the evident purpose of the prohibition (to prevent clients of Mr Firth from being lured away), and to the context in which that word appears as earlier discussed, does not, in my assessment, as a matter of construction, extend to the act of enclosing a cheque in an addressed envelope.
5. Even if contrary to that conclusion it could be said that the act of leaving the addressed envelope out for collection was a communication by Mr Roulstone contrary to the Order, I accept that at the time of doing so Mr Roulstone did not have an understanding or belief that it could constitute a breach of the Order. Again, the evidence of his statements to Mr Husaini on the morning of 30 November 2011, recorded in Exhibit 6, provides some support for that conclusion. Any such "communication" would at most have been an inadvertent one.

Lack of Candour

1. The Association's submission in relation to what it asserted was a lack of candour by Mr Roulstone was that the overwhelming weight of evidence established that Mr Roulstone had misled the Association and that he has otherwise failed to discharge his duty of candour and frankness: Defendant's Closing Submissions at [5.1]. The Association relied upon answers provided by Mr Roulstone in relation to a s 660 Notice issued to him on 8 August 2014.

(a) Answers Provided by Mr Roulstone to the Second s 660 Notice

1. The Association submitted that answers provided by Mr Roulstone in response to the second s 660 notice issued to him on 8 August 2014 were false or at least misleading. In para [5.3] of their Closing Submissions the Association set out questions 11 and 12 in the Notice and the answers given by Mr Roulstone in a Statutory Declaration dated 19 August 2014 which I reproduce below: "Q11. Did you draw a cheque on or about 1 December 2011 in the sum of $80,000 in favour of Mr Li? A11. Yes. Q12. If the answer to A11 is in the affirmative, please answer the following questions: (a) who asked you to draw the cheque? A No one. I drew the cheque of my own volition and as a matter of course to complete the settlement. (b) for what purpose did you draw the cheque? A To complete the settlement. (c) To whom did you give the cheque? A To Eileen Drurie, the receptionist at my Redfern Office, a former employee of Keddies."
2. It was submitted that each of the responses was false or misleading in that it did not convey the true position or the entire truth for the reasons set out in [5.4(a)-(e)] of the Defendant's Closing Submissions.
3. It was submitted for Mr Roulstone that he had disclosed material facts in answer to the questions raised: Plaintiff's Written Submissions at [167].
4. In relation to the question, "(a) who asked you to draw the cheque?", the Association's submission was that the answer given by Mr Roulstone was patently false: "… because on Mr Roulstone's own evidence Mr Barakat had asked him to draw the cheque: T 61:50-62:4 …" (Defendant's Closing Submissions at [5.4(a)])
5. In response it was submitted for Mr Roulstone that his evidence on the point at T 91:23-41 was given in the context in which it had been put to him that he drew the cheque because Mr Barakat phoned him and told him that Helena Li had called and said to Mr Barakat that the client wanted his cheque urgently. It was additionally put that he was asked whether he would draw the cheque and make it available: "Q. … and you had a discussion and you agreed to do so, that's what you've told us. A. Yes. Yeah."
6. In the submissions for Mr Roulstone, the underlined words "you agreed to do so" was submitted to be a basis upon which Mr Roulstone's response was given. That was said to be consistent with Mr Roulstone's answer that no one had asked him to draw the cheque, rather it arose following discussion and an agreement between Mr Roulstone and Mr Barakat.
7. In the submissions for the plaintiff it was observed that though a regulator under the LP Act in the position of the Association is entitled to issue a second s 660 Notice in the form of interrogatories, it may only be issued in two circumstances as specified in the plaintiff's submissions at [141]. It was contended that in this case the Association had no legal power to issue the second s 660 Notice.
8. Be that as it may, I proceed upon the basis that the questions were put and answered. I accept the point made by Mr Coles in his submissions that the questions put in the second s 660 Notice were in the nature of interrogatories. Interrogatories are required to be drawn with some specificity in order to elicit a direct answer to a particular point or fact. The same, in my opinion, can be said of questions in a s 660 Notice. Question 12(a) was framed in terms of the proposition or premise that Mr Roulstone had been asked to draw the cheque.
9. It was acknowledged in the plaintiff's submissions that Mr Roulstone in cross-examination accepted that the right answer would have been "Mr Li through Helena Li through Mr Barakat had asked for payment of the settlement monies" but that his initial answer as given was what he had in mind at the time that he completed the answers: Plaintiff's Written Submissions at [173].
10. It was contended by Mr Coles that this was not an example where Mr Roulstone intended to give a false answer or to mislead the Association. It might simply be a misunderstanding of the question which he corrected under cross-examination: Plaintiff's Written Submissions at [174].
11. Furthermore it was submitted that there were no circumstances that compelled Mr Roulstone to draw the cheque. As such the drawing of the cheque was, as the answer recorded, in fact done by Mr Roulstone of his own volition, that is, by his own decision or at his option: Plaintiff's Written Submissions at [176].
12. It was also submitted by the Association that the answer that the cheque was drawn "… as a matter of course to complete the settlement" was false: Defendant's Closing Submissions at [5.4(c)]. The Association relied upon evidence in which Mr Roulstone was unable to identify other cases in which payment had been made before any deeds were executed and that it was not simply "a matter of course" to make a payment prior to settlement being recorded in writing.
13. In response to question 12(a), it was contended for Mr Roulstone that the cheque paid was in fact "as part of the course of settlement": Plaintiff's Written Submissions at [177]. It was submitted that this was an absolutely true statement. At that time, on Mr Tassell's evidence, Mr Xi Li's proceedings represented the second or almost the second overcharging claim to have been settled and it was submitted that a different course or practice of effecting settlement could have been developed after Mr Xi Li's proceedings were settled. It was submitted that in these circumstances it could not be said that the payment was not as a matter of course to complete the settlement. It was acknowledged that Mr Roulstone agreed that a "full answer" would be 'to complete the settlement as soon as possible." T 93:25-27. However, it was submitted that this did not mean that Mr Roulstone's answer was incorrect or misleading: Plaintiff's Written Submissions at [178].
14. In relation to question 12(c) "To whom did you give the cheque?", the Association's submission was that this was incomplete and misleading because Mr Roulstone did not simply give the cheque to the receptionist Ms Drurie but placed it in an envelope and marked it for the attention of Mr Xi Li with the expectation that he was coming to collect it. It was submitted that the response was not the entire truth and was liable to mislead the Association as it directed attention away from the communication with Mr Xi Li: Defendant's Closing Submissions at [5.4(e)].
15. In response it was submitted on behalf of Mr Roulstone: "182 This answer is completely accurate. The question was not: 'What did you do with the cheque?'. The Association's criticism is unfounded."

Conclusions on Answers to Question 12(a), (b) and (c)

1. In assessing and determining whether the answers provided to the above questions were either false or misleading, and thus in breach of the plaintiff's duty of candour and frankness, observations should be made, firstly, as to the process involved with the second s 660 Notice and, secondly, the manner in which the questions were framed in terms of determining their focus.
2. As to the first, as earlier observed, the questions were, as I have accepted, in the nature of interrogatories and it was incumbent upon the drafter of the questions to identify with some precision, without being unduly pedantic, the topic or subject matter in question. Questions 11 and 12(a)-(c) were all concerned with the mode or means of effecting payment of the settlement sum of $80,000, that is to say, through the use of a cheque.
3. Hence, question 11 raised the question as to whether Mr Roulstone drew "a cheque" to which he replied in the affirmative.
4. Questions 12(a) and (b) were concerned, respectively, with the identity of persons who had asked Mr Roulstone to draw "the cheque" and the recipient of "the cheque". Question 12(b) was directed to the purpose of drawing "the cheque".
5. As to Question 12(a), I accept Mr Barakat's evidence that the person who had requested urgent payment was, as stated by Mr Barakat, Ms Helena Li. On his evidence Mr Barakat understood that she had been requested by Mr Xi Li to arrange for payment. Accordingly, the answer given failed to record that the request for payment had come about in that way. However, whilst the decision to make payment of the settlement sum of $80,000 was, on the evidence, made upon the basis of an agreement between Mr Roulstone and Mr Barakat, the decision to draw the cheque itself could be said to have been a voluntary act by Mr Roulstone though giving effect to the agreement to do so.
6. The evidence given by Mr Roulstone on question 12(a) is to be found at T 60:40-45; T 61:25-30 to T 62:1-10 and at T 91:15-30.
7. At the end of the day, whilst on one view there can be said to be some truth to the answer that the physical act of drawing the cheque was a voluntary act of Mr Roulstone, the answer given was inadequate to convey the circumstances that lay behind the drawing of the cheque. To that extent the answer was deficient. It is, however, another question as to whether it could be said that the answer given was deliberately false, or deliberately misleading. I have concluded that the evidence is not sufficient, or sufficiently cogent, for such a finding to be made.
8. It is necessary to put question 12(a) in the context of the issues in the proceedings in order to determine the significance or materiality of the answer given to that question. The issue of urgency of payment arose for consideration in the proceedings, firstly, because of its possible significance in supporting the proposition that Mr Roulstone acted urgently in a way to pre-empt any injunctive relief that may have been made by the Court on 1 December 2011 on Mr Firth's application. Secondly, the relevance otherwise of the issue of urgency was said, in effect, by Mr Roulstone, to relate to the urgency that arose, not in his mind or the minds of any of the former partners of Keddies, but in the mind of Mr Xi Li who rang Helena Li requesting urgent payment.
9. The evidence, as discussed at [350]-[352], in my opinion supports the proposition that it was the latter circumstance, that is, Mr Xi Li's request that engendered the urgency for payment, and not the former. In those circumstances, the possible significance as to the purpose behind the request made for the cheque is reduced.
10. The statement made by Mr Roulstone in his answer to question 12(a) - that he drew the cheque "as a matter of course to complete the settlement" - is to be evaluated as to the meaning to be given to the phrase "a matter of course". That expression is defined in the Oxford English Dictionary as meaning "the natural or expected thing". Accordingly, in one sense the drawing of a cheque to pay the settlement monies was a matter of course in that sense in giving effect to the settlement. On the other hand, payment within a day of the settlement being reached may be said not to fall within the natural or expected process in effecting the settlement. A more fulsome answer would have made reference to the reason for the urgency and the circumstances in which the request for payment came about. However, I do not consider that the failure to advert to and elaborate upon the same could be said to give rise to a deliberate or false or misleading statement by Mr Roulstone in the circumstances to which I have referred above.
11. In relation to the answer to question 12(b), the answer "To complete the settlement" undoubtedly correctly identifies the purpose for which the cheque itself was drawn. I do not consider that the answer to the question, standing alone, could be said to have been a false or misleading statement or willfully so.
12. As to question 12(c) I do not, with respect, consider that there is any substance at all to the submission made on behalf of the Association. I accept, as Mr Coles submitted, that the answer is completely accurate in that it was provided to Ms Drurie, the receptionist at the Redfern office. As Mr Coles observed, the question was not "What did you do with the cheque?". The point made on behalf of the Association, that Mr Roulstone placed the cheque in an envelope marked for the attention of Mr Xi Li with the expectation that he would collect it, is not in any way, in my opinion to detract from or undermine the truthfulness of the answer given. I consider that the answer can be regarded as a complete answer, given that the Association did not seek by the question to ascertain the purpose or ultimate destination or payee on the cheque.

(b) Questions 12(f)(ii), 12(f)(iii) and 12(f)(iv)

1. In the Defendant's Closing Submissions at [5.6] it was contended that certain responses given by Mr Roulstone in his statutory declaration in respect of questions 12(f)(ii)-(iv) were false or misleading for reasons set out in that paragraph. Question 12(f)(ii) was in these terms: "12(f) at the time you drew the cheque were you aware: … (ii) Of any attendance by Mr Li at the offices of Margiotta and any discussions he had with Mr Husaini on or about 30 November 2011; A No."
2. It is to be noted that question 12(f)(ii) was directed to whether Mr Roulstone was aware (a) at the time he drew the cheque of Mr Xi Li's "attendance" at Margiotta's offices and as well (b) "[of] … any discussions he had with Mr Husaini on or about 30 November 2011".
3. In the submissions for the plaintiff it was noted (respectfully) that question 12(f)(ii) was poorly worded.
4. The Association noted at [5.6(a)] of its Closing Submissions that Mr Roulstone had given evidence to the Court that Mr Husaini told him that Mr Xi Li was with him in his office and wanted to settle the case against Keddies. The submission then refers to other evidence given by Mr Roulstone which it was submitted advanced matters to justify his response.
5. In the submissions for Mr Roulstone it was argued that the answer "No" was said to be correct. In this respect it was observed that in cross-examination Mr Roulstone at T 94:15-20, gave evidence (a) that he did not see Mr Xi Li with Mr Husaini; (b) that he did not see Mr Xi Li attend the offices of Margiotta; (c) that he accepted Mr Husaini and Mr Xi Li were together to provide instructions; and (d) that he did not know what discussions took place between Mr Husaini and Mr Xi Li.
6. I have earlier adverted to the need for questions in the nature of interrogatories to be drafted with some precision. That, as I have indicated, was necessary with the s 660 Notices. Question 12(f)(ii) sought an answer as to Mr Roulstone's knowledge or awareness, not only of any attendance by Mr Xi Li at the offices of Margiotta, but whether he was aware in addition, of "any discussions" that Mr Xi Li had had with Mr Husaini on the date in question. Mr Roulstone, of course, was not party to, or in attendance at, any discussions that took place on that occasion between Mr Xi Li and Mr Husaini. There was no evidence that Mr Roulstone had been told as to what precisely had been discussed between Mr Husaini and his client. In those circumstances I do not consider it can be said that the answer given to question 12(f)(ii) could be said to be false or misleading. The fact, unchallenged, is that he could not and was not aware of the "discussions" between Mr Xi Li and his solicitor on or about 30 November 2011.
7. Question 12(f)(iii) asked the question of whether, at the time Mr Roulstone drew the cheque, he was aware: "(iii) of any authority obtained by Mr Husaini on or about 30 November 2011 from Mr Li terminating Mr Li's retainer of Firths and appointing Margiotta as Mr Li's solicitor …. "
8. Mr Roulstone's answer to that question was "No".
9. The Association submitted that this answer was false and misleading because on his own evidence Mr Roulstone was aware from his discussions with Mr Tassell that Mr Husaini had filed a Notice of Change of Solicitor. Mr Roulstone had referred in evidence to a telephone conversation he had with Mr Tassell during the day of 30 November 2011, where it was said that Margiotta's had come onto the record and a Notice of Change of Solicitor had been filed.
10. It was observed that Mr Roulstone's justification for his response to the question was that he was told about the Notice of Change of Solicitor but had not seen the authority, nor any documentation from Mr Tassell. However, it was noted that he reticently accepted that he was aware that there was "obviously an authority": T 95:36-38.
11. In relation to this question, the submission for Mr Roulstone was, again, that the question was "… a poorly worded question": Plaintiff's Written Submissions at [189]. Further, the submission for Mr Roulstone was: "191 Although Mr Roulstone was aware that Mr Husaini had filed a Notice of Change of Solicitor, there is no possible way that Mr Roulstone could know of any authority terminating the retainer of Firths. The answer is correct. 191 The question did not ask Mr Roulstone whether he was aware of the Notice of Change of Solicitor."
12. The answer to question 12(f)(iii), may be considered against the background of information earlier provided by Mr Roulstone to the Bar Association in his letter of 18 July 2014: Exhibit 2 at Tab 47, p 106-7. At page 107, Mr Roulstone disclosed, inter alia, that he knew from his telephone discussion with Mr Tassell that Margiotta's had come onto the record and that a Notice of Change of Solicitor had been filed. His evidence on the matter was at T 55:12-13. That information was capable of conveying tacitly or impliedly that Mr Roulstone could have inferred Firth's retainer had been terminated. His answer to question 12(f)(iii) accordingly should be considered in light of the earlier information provided as to his knowledge of the Notice of Change of Solicitor having been filed. However, as the submissions for Mr Roulstone observed, that was not the specific question asked.
13. Whilst an answer to the question could have included reference to the fact that termination of Mr Xi Li's retainer of Firths was a matter that could have been implied from the filing of the Notice of Change of Solicitor, the need to do so should be evaluated in light of Mr Roulstone's disclosure to the Association of the fact that he was aware of that having been done. The question, however, being framed in terms of Mr Roulstone's knowledge or awareness that a solicitor had obtained an authority from his client, was not a matter upon which a third person such as Mr Roulstone would have actual knowledge, as distinct from implied knowledge, unless told or otherwise expressly informed that that had taken place.
14. In the circumstances, I do not consider that the question as framed, and the answer given, provides a basis for a finding that the answer was false or deliberately misleading.
15. Question 12(f)(iv) sought an answer to the question as to whether at the time the cheque was drawn Mr Roulstone knew: "(iv) of any communication by Mr Husaini to Mr Li on or about 30 November 2011 that you and your former partners would pay Mr Li $80,000 to resolve the proceedings that Mr Li had brought against you and your partners."
16. Mr Roulstone's answer to that question was "No."
17. The Association submitted that the answer was false and misleading because on his own evidence Mr Roulstone was aware from his discussions with Mr Tassell that an offer of $80,000 had been made and accepted and the matter had been settled. The submission was that this would obviously mean that Mr Roulstone was aware that Mr Husaini had communicated to Mr Xi Li that an amount of $80,000 would be paid to settle the proceedings. It was submitted that Mr Roulstone's justifications for his responses were not credible and that he maintained he was not aware of the matters because he was relying upon what Mr Tassell had told him.
18. In response it was submitted on behalf of Mr Roulstone that the obvious answer to the question was "No" and that Mr Roulstone had accordingly answered it in that way: Plaintiff's Written Submissions at [194].
19. It was further submitted that Mr Roulstone could not have been aware of any communication between the solicitor, Mr Husaini and his client Mr Xi Li. Further, it was observed that someone other than Mr Husaini could have informed Mr Xi Li.
20. It was submitted that the answer given by Mr Roulstone was correct and was not misleading. It was again submitted that the Association's question was "poor": Plaintiff's Written Submissions at [196].
21. Again, this question was framed in terms of a communication directly between a solicitor, Mr Husaini, and his client Mr Xi Li, on or about 30 November 2011. A question framed in that way seeks, in effect, to ascertain whether a third person, Mr Roulstone, was privy to or was told of a particular "communication" having taken place between the solicitor and client.
22. The matter put forward by the Association, namely that Mr Roulstone had information that was passed on through Mr Tassell that an offer of $80,000 had been made and accepted and that the matter had settled, could base or support an inference that some form of communication or assent had been given by Mr Xi Li to Mr Husaini. However, that was not the way the question was expressed. The question rather sought to elicit direct or actual knowledge in Mr Roulstone as to any communication of the fact. I consider that the submission put on behalf of Mr Roulstone is a sound one. There is no basis for a finding that the answer provided to question 12(f)(iv) was either false or deliberately misleading.
23. In relation to the Association's submissions as to allegedly false or misleading statements made in answer to the second s 660 Notice, it is necessary to bring into account the obligation Mr Roulstone had to disclose matters within his knowledge relevant to any answer to questions raised in the Notice. It was acknowledged in the written submissions for the plaintiff that the obligation on Mr Roulstone was to disclose anything which he honestly believed and that should not be left out and it was contended that he had done that. It was accepted that the duty of candour did not permit of deliberate or reckless misrepresentation pretending to be a disclosure: Re OG, A Lawyer (2007) 18 VR 164 at [123]. In the assessment of the submissions made as to alleged false and misleading answers and as to Mr Roulstone's truthfulness it is, in my opinion, relevant to bring into account the evidence to which I have earlier referred at [347]-[348] namely, the evidence that establishes that Mr Roulstone acted properly on 30 November 2011 to ensure that he did not engage in discussions as to the settlement of Mr Xi Li's claim by reason of the prohibition under the Order and the emphatic direction he gave in that respect to Mr Husaini that he would need to deal with Mr Tassell and not him.
24. I also accept, as was submitted on behalf of the plaintiff, that it is necessary to firstly identify the alleged non-disclosure by Mr Roulstone and then to determine whether it was a matter that was material to the Association and to the Court in the present proceedings: Plaintiff's Written Submissions at [203].
25. I accept the submission that each case depends on its own circumstances but that a high degree of culpability arises for intentional misconduct: Plaintiff's Submissions at [204].
26. Upon a close consideration of the evidence and the submissions made I am not satisfied that it has been established to the requisite standard that Mr Roulstone's answers in his statutory declaration responding to the Second 660 Notice, were deliberately false or deliberately misleading for the reasons set out above.

Conclusions 1. The evidence does not establish that Mr Roulstone gave deliberately false or misleading evidence to the Association or to the Court. 2. In particular, the information provided by Mr Roulstone to the Association, including by way of answers to the second s 660 Notice issued to him, has not been established as having been false or intentionally misleading in any material respect. 3. There is no evidence contradicting Mr Roulstone's evidence to the effect that he did not have any communications with Mr Husaini or Mr Xi Li or anyone else on his behalf between 12 October 2011 and the morning of 30 November 2011 when Mr Husaini phoned Mr Roulstone. 4. There is no evidence capable of establishing, or from which an inference can be drawn adverse to Mr Roulstone, that when Mr Xi Li attended on Mr Husaini on the morning of 30 November 2011, Mr Roulstone or either of his former partners, had indicated they were prepared to pay or offered to pay him $80,000 plus costs to settle his claim. 5. The communications between Mr Roulstone and Mr Husaini in the telephone conversation initiated by Mr Husaini on the morning of 30 November 2011 did not constitute a breach of the Order made by this Court on 24 November 2011. 6. The cheque and addressed envelope enclosing the cheque for $80,000 in favour of Mr Xi Li did not constitute a communication in breach of the Undertaking or Order.

1. On the basis of the findings and conclusions set out above I am satisfied that the plaintiff has discharged the onus of proof with respect to the statutory requirements for the grant of a practising certificate under s 48(3) of the LP Act, namely: 1. That he was and is eligible to apply for the grant when the application was made, and 2. That he was and is a fit and proper person to hold a practising certificate.

Proposed Orders

1. I propose to make the following Orders: 1. Order the time for the appeal by the plaintiff pursuant to s 108 of the Legal Profession Act 2004 is extended to the date of the filing of the Summons filed in these proceedings, namely, 9 December 2014. 2. Appeal allowed. 3. A declaration that the deemed refusal of the plaintiff's application to the Bar Association of New South Wales for a practising certificate made on 24 June 2014 for the period from 1 July 2014 to 30 June 2015 be set aside. 4. Order that the defendant, the New South Wales Bar Association, grant to the plaintiff a local practising certificate pursuant to s 48 of the Legal Profession Act 2004 for the year ending 30 June 2016.
2. I will hear the parties on the form of orders proposed and on the question of costs of the proceedings.

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