Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Council of the Law Society of New South Wales v Feng [2023] NSWCATOD 129 Hearing dates: 14 July 2023 Date of orders: 20 July 2023 Decision date: 30 August 2023 Jurisdiction: Occupational Division Before: Hennessy ADCJ, Deputy President N Matkovich, Senior Member B Thomson, General Member Decision: 1. The Respondent is guilty of professional misconduct. 2. The Tribunal recommends that the name of the Respondent be removed from the roll maintained by the Supreme Court of NSW pursuant to s 23 of the Legal Profession Uniform Law (NSW). 3. The Respondent is to pay the Applicant's costs of these proceedings as agreed or assessed. Catchwords: OCCUPATIONS – legal practitioners – discipline – instrument of consent filed - whether the Tribunal should exercise the power in s 144(1) the Legal Profession Uniform Law Application Act 2014 (the Application Act) to make the orders agreed to by the parties without making any further inquiries or conducting a hearing Legislation Cited: Legal Profession Uniform Law (NSW) Legal Profession Uniform Law Application Act 2014 (NSW) Civil and Administrative Tribunal Act 2013 (NSW) Legal Profession Uniform General Rules 2015 (NSW) Cases Cited: A Solicitor v Council of the Law Society of New South Wales (2004) 216 CLR 253; [2004] HCA 1 Barakat v Law Society of New South Wales [2014] NSWSC 773 Council of the New South Wales Bar Association v Butland [2009] NSWADT 177 Council of the New South Wales Bar Association v EFA (a pseudonym) [2021] NSWCA 339 NSW Legal Services Commissioner v Lal [2022] NSWCATOD 144 Category: Principal judgment Parties: Council of the Law Society of New South Wales (Applicant) James Jianshu Feng (Respondent) Representation: Counsel: G Westgarth (Applicant) Solicitors: Law Society of New South Wales (Applicant) File Number(s): 2022/00370644 Publication restriction: Nil REASONS FOR DECISION Overview 1. On 8 December 2022, the Council of the Law Society of New South Wales (the Law Society) applied to the Tribunal for disciplinary findings and orders against James Feng (the solicitor). The application alleged that the solicitor was guilty of unsatisfactory professional conduct and professional misconduct under the Legal Profession Uniform Law (NSW) (the Uniform Law). 2. The solicitor admitted each of the grounds of the application. The day before the hearing, the Law Society filed an instrument of consent which included an agreed statement of facts. By consent, the Law Society and the solicitor agreed to those facts and requested that the Tribunal make an order recommending that the solicitor's name be removed from the roll of solicitors. The parties also consented to an order that the solicitor pay the Law Society's costs. 3. The solicitor told the Law Society that he would not be attending the hearing. He did not appear. 4. The issue for the Tribunal is whether we should exercise the power in s 144(1) the Legal Profession Uniform Law Application Act 2014 (NSW) (the Application Act) to make the orders agreed to by the parties without making any further inquiries or conducting a hearing. For the following reasons, we have decided to do so. Power of Tribunal to make consent orders 1. The Tribunal's power to make consent orders is set out in s 144(1) of the Application Act: The Tribunal may, with the consent of the respondent lawyer contained in a written instrument, make orders without conducting or completing a hearing in relation to the complaint. 1. Under s 144(10) of the Application Act, the Tribunal may make inquiries of the parties and may conduct a hearing if we consider it to be in the public interest to do so: (10) In deciding whether to make orders pursuant to an instrument of consent, the Tribunal may make such inquiries of the parties as it thinks fit and may, despite any such consent, conduct or complete a hearing in relation to the complaint if it considers it to be in the public interest to do so. 1. The Tribunal's power in s 144(1) of the Application Law is discretionary: Council of the New South Wales Bar Association v Butland [2009] NSWADT 177 at [29]. The Tribunal summarised the legal principles in NSW Legal Services Commissioner v Lal [2022] NSWCATOD 144 at [5]: When considering an instrument of consent, the Tribunal's task is not simply to endorse the agreement for the sole reason that it is agreed. The Tribunal's task is to make its own assessment of the matter, whilst according appropriate weight to the parties' position (see Council of the New South Wales Bar Association v Butland [2009] NSWADT 177 at [29] and Legal Services Commissioner v Maddock [2021] NSWCATOD 46 at [17]-[18]). Grounds for Application (Ground 1). The Respondent is guilty of professional misconduct on the following grounds: 1. The Respondent, after receiving a request for particular documents from the Manager of the Fidelity Fund altered the documents responsive to the request and caused the altered documents to be provided to the Applicant under the pretence that they were true copies of the original and unaltered versions of the documents requested (Ground 2). 2. The Respondent, after receiving a request for particular documents from a trust account investigator employed by the Law Society of New South Wales, altered the documents responsive to the request and provided the altered documents to the investigator under the pretence that they were the original and unaltered versions of the documents requested (Ground 3). 3. The Respondent intentionally deleted electronic copies of documents that he knew were the subject of investigation by the NSW Law Society (Ground 4). 4. The Respondent provided a trust account investigator employed by the Law Society of New South Wales with incorrect information, which he knew to be incorrect, regarding: a. the issuing of costs agreements to Huawei Hao, Jingang Shi and Ya Li; b. the contingency fees clauses in costs agreements that the Law Practice provided to its clients; and c. the sending of messages to Jingang Shi, (Ground 5). 5. The Respondent provided a trust account investigator employed by the Law Society of New South Wales with incorrect information, which he knew to be incorrect, regarding the author of costs agreements that the Law Practice provided to its clients (Ground 6). 6. The Respondent informed a trust account investigator employed by the Law Society of New South Wales that he had reviewed his emails and found no correspondence between the Law Practice and Xiu Chan Mo, Feng Luan, Min Liang, Junyi Chen, Yanli Lei and Shangyong Wu which attached costs disclosures or invoices in circumstances where he had intentionally deleted the correspondence between the Law Practice and Xiu Chan Mo, Feng Luan, Min Liang, Junyi Chen, Yanli Lei and Shangyong Wu which attached costs disclosures or invoices (Ground 7). 7. The Respondent provided a trust account investigator employed by the Law Society of New South Wales with timesheets that the Respondent prepared without informing the investigator as to the date on, or basis upon, which he had created those timesheets (Ground 8). 8. The Respondent sent a message to a client that contained information which was incorrect in circumstances where the Respondent knew, or ought to have known, that the information was incorrect or did not know whether the information was correct (Ground 9). 9. The Respondent breached an undertaking that he provided to a trust account investigator employed by the Law Society of New South Wales (Ground 10). 10. The Respondent did not comply with requests for the following information issued to him pursuant to section 370 of the Uniform Law on 4 April 2019 and 3 September 2019: a. details of clients who had paid GST to the Law Practice; and b. information regarding Business Activity Statements; (Ground 11). 11. Between about 10 April 2019 and about 23 September 2019, the Respondent provided a trust account investigator employed by the Law Society of New South Wales with extracts of bank statements and bank receipts which purported to show that the Law Practice had refunded monies to clients, namely Xiu Chan Mo, Feng Luan, Min Liang and Junyi Chen between 25 March 2019 and 29 March 2019 (First Client Transfers), and failed to provide the trust account investigator complete bank statements in circumstances where the Respondent knew that the monies the subject of the First Client Transfers had subsequently been returned to the Office Account and not received by the client (Ground 12). Particulars DEFINITIONS Contingency Fees means fees charged by a law practice to its client which are calculated by reference to the amount of any award or settlement or value of any property that may be recovered in any proceedings to which the agreement relates FFMC means the Applicant's Fidelity Fund Management Committee Fidelity Fund means the fidelity fund of the Legal Practitioners Fidelity Fund established under section 115 of the Legal Profession Uniform Law Application Act 2014 (NSW) which is maintained and managed by the Law Society of New South Wales General Rules means the Legal Profession Uniform General Rules 2015 Investigator Mr Ronald Dunlop, the investigator appointed to investigate the Law Practice on 18 October 2018 under s 162 of the Uniform Law Law Practice means the incorporated legal practice known as Peakzon Legal Pty Ltd Peakzon Costs Disclosure and Costs Agreement means a costs disclosure and costs agreement provided by the Law Practice that: (a) related to work that the Law Practice was to carry out for the client in relation to applications to the Fidelity Fund for compensation for losses allegedly sustained as a result of the conduct of a law practice known as SHS Law; and (b) included a Contingency Fee clause Respondent means Mr James Jianshu Feng Uniform Law means the Legal Profession Uniform Law (NSW) Alleged Facts General 1. The Respondent: a. was born on 29 July 1987; b. was admitted as a lawyer in New South Wales on 11 October 2013; c. held practising certificates issued by the Council of the Law Society of New South Wales from 14 November 2013 to 30 June 2014, 24 July 2014 to 4 February 2020 and 27 March 2020 until 30 June 2022; and d. during the following periods held the following positions at the following law practices/entities: Period Law practice/entity Position 14 November 2013 to 30 June 2014 Australian Capital Finance Management Employee 24 July 2014 to 14 September 2016 Loyal One Solicitors Supervised Partner 15 September 2016 to 15 May 2017 Loyal One Solicitors Partner 24 January 2017 to 4 February 2020 Law Practice Sole principal 27 March 2020 to 30 June 2022 WB Legal Pty Ltd Employee Investigation 2. On 18 October 2018, the Professional Standards Department of the NSW Law Society referred the investigation of the Law Practice to the Investigator pursuant to 162 of the Uniform Law. 3. On 29 October 2018, 1 November 2018 and 8 November 2018, the Investigator attended the office of Law Practice in Sydney to carry out the investigation into whether the Law Practice had complied with the requirements of Part 4.2 of the Uniform Law and in respect of matters raised by the Manager of the Law Society's Fidelity Fund in respect of claims lodged with the Fidelity Fund by the Law Practice and others. Ground 1: From around 1 March 2017 to 17 September 2019 the Respondent did not comply with his trust accounting obligations and did not keep trust records in accordance with the provisions of the Uniform Law and the General Rules contrary to: (a) sections 147(2) and 35(1) of the Uniform Law; and (b) rules 36, 43(3), 44(1)(b), 45, 47, 48, 52 and 93 of the General Rules 4. Between about 1 March 2017 and 17 September 2019 the Law Practice: a. did not prepare trust receipts; b. did not record any receipt numbers in its trust receipts cash book; c. did not keep any written trust payments records for any cheque or electronic funds transfer (EFT) payment; d. held a trust payment cash book which did not record: i. whether the payment was by cheque or EFT; ii. any cheque or EFT reference numbers; and iii. in one instance, the name, account number and BSB of the payee was not recorded for a transfer of $44,796.07 on 14 December 2017; e. did not prepare the trust reconciliation statement and trust trial balance statement for the month-end September 2018 within 15 working days of the month-end or by 29 October 2018; f. did not record the date of the preparation of the trust reconciliation statements and trust trial balance statements; g. did not always record the matter description or the matter reference number on the trust trial balance statement; h. did not record any receipt or payment reference numbers in the trust ledger accounts; i. did not record the account name, BSB and account number of the recipient of money transferred in respect of all EFT payments in the trust ledger account; j. did not provide the trust account statements to any clients following the completion of any matter or as soon as practicable after 30 June 2017 and 30 June 2018; and k. did not record entries for clients of the Law Practice in the file register. 5. In the circumstances referred to in paragraphs 1.d and 4 above, the Respondent did not comply with: a. sections 35(1) and 147 of the Uniform Law; and b. rules 36, 43(3), 47, 44(1)(b), 45, 48, 52 and 93 of the General Rules. Ground 2: The Respondent, after receiving a request for particular documents from the Manager of the Fidelity Fund altered the documents responsive to the request and caused the altered documents to be provided to the Applicant under the pretence that they were true copies of the original and unaltered versions of the documents requested 5. On about 28 February 2018, the Respondent sent, or caused to be sent, a Peakzon Costs Agreement and Costs Disclosure to Feng Luan. 6. On about 28 February 2018, Feng Luan signed the Peakzon Costs Agreement and Costs Disclosure referred to in paragraph 5 above (Genuine Luan Costs Disclosure). 7. On around 28 February 2018, the Respondent sent, or caused to be sent, a Peakzon Costs Agreement and Costs Disclosure to Xiu Chan Mo. 8. On about 2 March 2018, Xiu Chan Mo signed the Peakzon Costs Agreement and Costs Disclosure referred to in paragraph 7 above (Genuine Mo Costs Disclosure). 9. On about 5 March 2019, the Respondent sent, or caused to be sent, a Peakzon Costs Agreement and Costs Disclosure to Min Liang. 10. On about 7 March 2018, Min Liang signed the Peakzon Costs Agreement and Costs Disclosure referred to in paragraph 9 above (Genuine Liang Costs Disclosure). 11. On 15 May 2018, the Fidelity Fund received claims against SHS Law made by the Law Practice on behalf of Xiu Chan Mo, Feng Luan and Min Liang. 12. On or around 17 August 2018 the FFMC requested the Law Practice provide copies of the costs agreement and costs disclosures that the Law Practice provided to seven named clients for whom the Law Practice acted in relation to claims made on the Fidelity Fund. 13. Between about 17 August 2018 and about 19 September 2018, the Respondent altered each of the Genuine Mo Costs Disclosure, the Genuine Luan Costs Disclosure and the Genuine Liang Costs Disclosure by removing a clause in each agreement that provided the Legal Practice with the right to claim Contingency Fees (Altered Costs Agreements). 14. On or around 19 September 2018, the Respondent caused the Altered Costs Agreements to be provided to the FFMC in answer to its request referred to in paragraph 12 above. 15. Between 19 September 2018 and 19 November 2018, the Respondent did not inform the FFMC that, between about 17 August 2018 and about 19 September 2018, he removed the contingency fee clause in each of the Altered Costs Agreements. Ground 3: The Respondent, after receiving a request for particular documents from a trust account investigator employed by the Law Society of New South Wales, altered the documents responsive to the request and provided the altered documents to the investigator under the pretence that they were the original and unaltered versions of the documents requested 16. The Applicant refers to and repeats paragraphs 2 and 3 above. 17. On around 28 February 2018, the Respondent sent, or caused to be sent, a Peakzon Costs Agreement Costs Disclosure to Shangyong Wu. 18. On around 28 February 2018, Shangyong Wu signed the Peakzon Costs Agreement Costs Disclosure referred to in paragraph 17 above (Genuine Wu Costs Disclosure). 19. On around 28 February 2018, the Respondent sent, or caused to be sent, a Peakzon Costs Agreement and Costs Disclosure to Yanlei Lei. 20. On around 28 February 2018, Yanlei Lei signed the Peakzon Costs Agreement and Costs Disclosure referred to in paragraph 19 above (Genuine Lei Costs Disclosure). 21. On about 28 February 2018, the Respondent sent, or caused to be sent, a Peakzon Costs Agreement and Costs Disclosure to Junyi Chen. 22. On about 5 March 2018, the Law Practice issued an invoice to Min Liang for the payment of $3,500.00 (Genuine Liang Invoice). 23. On about 6 March 2018 the Law Practice issued to Xiu Chan Mo an invoice for the payment of $3,500.00 (Genuine Mo Invoice). 24. On around 8 March 2018 the Law Practice issued to Feng Luan an invoice for the payment of fees in the amount of $3,500.00 (Genuine Luan Invoice). 25. On about 19 March 2018, Junyi Chen signed the Peakzon Costs Agreement and Costs Disclosure referred to in paragraph 21 (Genuine Chen Costs Disclosure). 26. On about 29 October 2018: a. the Investigator requested that the Respondent provide him with copies of costs agreements and costs disclosures that the Law Practice issued to Junyi Chen, Yanli Lei and Shangyong Wu; b. the Respondent altered a copy of the Genuine Lei Costs Disclosure by removing the words "plus 30% of all fees recovered" (Altered Lei Costs Disclosure); and c. the Respondent created an invoice from the Law Practice to Shangyong Wu in the sum of $3,850.00 which was dated 9 July 2018 (False Wu Invoice). 27. Between about 29 October 2018 and 1 November 2018, the Respondent: a. altered a copy of the Genuine Wu Costs Disclosure by removing the words "plus 30% of all fees recovered" (Altered Wu Costs Disclosure); and b. created an invoice from the Law Practice to Xiu Chan Mo for the amount of $3,850.000 and dated 5 March 2018 (False Mo Invoice). 28. On 1 November 2018: a. the Investigator requested that the Respondent provide a copy of invoices that the Law Practice issued to Xiu Chan Mo; b. the Respondent altered a copy of the Genuine Chen Costs Agreement by removing the words "plus 30% of all fees recovered" (Altered Chen Costs Disclosure); c. the Respondent created an invoice from the Law Practice to Junyi Chen for $3,850.00 dated 3 March 2018 (False Chen Invoice); d. the Respondent created an invoice from the Law Practice to Feng Luan dated 5 March 2018 for $3,850.00 (False Luan Invoice); e. the Respondent created an invoice from the Law Practice to Min Liang for the payment of $3,850.00 dated 5 March 2018 (False Liang Invoice). f. the Respondent provided the Investigator with the Altered Chen Costs Disclosure, the False Chen Invoice, the Altered Wu Costs Disclosure, the False Wu Invoice, the False Mo Invoice, the False Luan Invoice and the False Liang Invoice; and g. the Respondent told the Investigator that the False Wu Invoice was provided to Shangyong Wu. 29. On 8 November 2018: a. the Respondent provided the Investigator with the Altered Lei Costs Disclosure; b. the Investigator conducted searches on the Respondent's laptop; c. the Investigator located electronic copies of the Altered Lei Costs Disclosure, the Altered Chen Costs Disclosure, the False Chen Invoice, the False Wu Invoice, the False Mo Invoice, the False Luan Invoice and the False Liang Invoice; d. the properties for the electronic copy of the Altered Lei Costs Disclosure recorded that the document had been created and modified on 29 October 2018 at 9:05pm; e. the properties for the electronic copy of the False Wu Invoice recorded that the document was created on 29 October 2018 at 4:00pm and modified on the same date at 9:04pm. f. the properties for the electronic copy of the Altered Chen Costs Disclosure recorded that the document was created and modified on 1 November 2018; g. the properties for the electronic copy of the False Chen Invoice recorded that the document was created and modified at 11:47am on 1 November 2018; h. the properties for the electronic copy of the False Mo Invoice recorded that the document was created and modified on 1 November 2018 at 12:50pm; i. the properties for the electronic copy of the False Luan Invoice recorded that the invoice was created and modified on 1 November 2018 at 1:03pm; j. the properties for the electronic copy of the False Min Liang invoice recorded that the invoice was created and modified on 1 November 2018 at 12:48pm; and k. the Respondent: i. denied creating Altered Chen Costs Disclosure on 1 November 2018; and ii. stated the Altered Chen Costs Disclosure was prepared sometime before 18 March 2018. 30. On 19 November 2018, the Respondent sent a letter to the Investigator in which he stated that: a. the Altered Lei Costs Disclosure, the Altered Chen Costs Disclosure and Altered Wu Costs Disclosure provided to the Investigator in November 2018 was not genuine; and b. the Respondent had deleted the words "plus 30% of all fees recovered" from a copy of the Genuine Lei Costs Disclosure, the Genuine Chen Costs Disclosure and the Genuine Wu Costs Disclosure to create the Altered Lei Costs Disclosure, the Altered Chen Costs Disclosure and the Altered Wu Costs Disclosure respectively. 31. On 23 November 2018, the Investigator requested that the Respondent request from Min Liang, Feng Luan, Xiu Chan Mo, Yanli Lei, Shangyoung Wu, Janyu Chen and Hauwei Hao a copy of the invoice and costs disclosure each had been issued by the Law Practice. 32. On 28 November 2018 the Respondent: a. emailed Xiu Chan Mo and requested, inter alia, the invoice sent by the Law Practice; b. emailed Feng Luan and requested, inter alia, a copy of the invoice sent by the Law Practice; c. emailed Min Liang and requested, inter alia, a copy of the invoice sent by the Law Practice. 33. On 28 November 2018, Xiu Chan Mo responded to the Respondent with a copy of the Genuine Mo Invoice. 34. On 29 November 2018, Min Liang responded to the Respondent with a copy of the Genuine Liang Invoice. 35. On 3 December 2018: a. the Respondent provided the Investigator with: i. a copy of the Genuine Mo Invoice that he received from Xui Chan Mo on 28 November 2018; ii. a copy of the Genuine Liang Invoice as provided by Min Liang on 29 November 2018; and b. Feng Luan sent the Respondent a copy of the Genuine Luan Invoice. 36. On 19 January 2019: a. the Respondent informed the Investigator that the False Luan Invoice was provided to Feng Luan around 5 March 2018; and b. provided the Investigator with a copy of the Genuine Luan Invoice that the Respondent received from Feng Luan on 3 December 2019. 37. On 4 April 2019, the Respondent told the Investigator during a recorded interview: a. on around 28 February 2018, the Respondent provided Yanli Lei with the Genuine Lei Costs Disclosure; b. on 8 November 2018, the Respondent provided the Investigator with the Altered Lei Costs Disclosure which was not a true copy of the Genuine Lei Costs Disclosure; c. in around 28 February 2018, the Respondent provided to Shangyong Wu the Genuine Wu Costs Disclosure; and d. on 1 November 2018, the Respondent provided the Investigator with the Altered Wu Costs Disclosure which was not a true copy of the Genuine Wu Costs Disclosure; e. on 1 November 2018, the Respondent provided the Investigator with the False Wu Invoice which was created by the Respondent in around 29 October 2018; f. on around 18 March 2018, the Respondent provided to Junyi Chen the Genuine Chen Costs Disclosure; g. on 1 November 2018, the Respondent provided the Investigator with the Altered Chen Costs Disclosure which was not a true copy of the Genuine Chen Costs Disclosure; h. on 1 November 2018, the Respondent provided to the Investigator the False Chen Invoice which was not genuine and was not a true copy of the invoice provided to Junyi Chen; i. the Genuine Mo Invoice was provided to Xiu Chan Mo in around March 2018; j. the False Mo Invoice was not genuine and had not been sent to Xiu Chan Mo; k. the False Luan Invoice that the Respondent provided the Investigator on 1 November 2018 was not genuine; l. the Respondent created the False Luan Invoice on 1 November 2018; m. the Genuine Luan Invoice was provided to Feng Luan in or around 8 March 2018; n. the Genuine Liang Invoice was provided to Min Liang in around March 2018; o. the False Liang Invoice was not genuine and had never been provided to Min Liang; p. the Respondent created the False Liang Invoice on 1 November 2018. 38. Prior to: a. 19 November 2018, the Respondent did not inform the Investigator that: i. he had altered documents referred to at 30 above; or ii. he had provided the Investigator with documents that were not true copies of the originals. b. 4 April 2019, did not inform the Investigator that: i. he had altered documents referred to at 37 above; or ii. he had provided the Investigator with documents that were not true copies of the originals. Ground 4: The Respondent intentionally deleted electronic copies of documents that he knew were the subject of investigation by the NSW Law Society 39. The Applicant refers to and repeats particulars at paragraphs 2, 3, 6, 8, 10, 12, 13, 18, 20 and 25 above. 40. On about 19 July 2018, the Respondent sent, or caused to be sent, a Peakzon Costs Agreement and Costs Disclosure to Huawei Hao. 41. On about 19 July 2018, Huawei Hao signed the Peakzon Costs Agreement and Costs Disclosure received by Huawei Hao referred to in paragraph 40 above (Genuine Hao Costs Disclosure). 42. On about 30 March 2018 the Respondent sent, or caused to be sent, a Peakzon Costs Agreement and Costs Disclosure to Ya Li (Draft Ya Li Costs Disclosure). 43. On about 2 May 2018, the Respondent sent, or caused to be sent, a Peakzon Costs Agreement and Disclosure to Jingang Shi (Draft Shi Costs Disclosure). 44. Between about 17 August 2017 and 29 October 201[8]: a. the Respondent deleted the electronic copies that the Law Practice possessed of the Genuine Lei Costs Disclosure, the Draft Ya Li Costs Disclosure, the Genuine Hao Costs Disclosure, the Genuine Mo Costs Disclosure, the Genuine Luan Costs Disclosure, the Genuine Liang Costs Disclosure, the Genuine Wu Costs Disclosure, the Draft Shi Costs Disclosure and the Genuine Chen Costs Disclosure (together, the Genuine Costs Disclosures); and b. the Respondent deleted the Genuine Costs Disclosures to avoid getting into trouble by the NSW Law Society. 45. On 29 October 201[8], the Investigator: a. whilst attending the Law Practice's offices in Sydney, conducted keyword searches on the laptops of the Respondent and a staff member of the Law Practice named April; and b. was unable to find copies of any of the Genuine Costs Disclosures. 46. In view of what has been outlined at paragraphs 39 to 45 above, the Respondent intentionally deleted the Genuine Costs Disclosure to conceal from the NSW Law Society that the Genuine Costs Disclosures had been issued to clients or potential clients of the Law Practice. Ground 5: The Respondent provided a trust account investigator employed by the Law Society of New South Wales with incorrect information, which he knew to be incorrect, regarding: (a) the issuing of costs agreements of Huawei Hao, Jingang Shi and Ya Li; (b) the contingency fees clauses in costs agreements that the Law Practice provided to its clients; and (c) the sending of messages to Jingang Shi 47. The Applicant refers to and repeats paragraphs 2, 3, 6, 8, 10, 12, 13, 18, 20, 25, 40, 41, 42 and 43. 48. On or around 5 March 2018 from around 5:28pm to 7:38 pm, the Respondent sent and received messages via WeChat to and from Jingjang Shi in which: a. the Respondent enquired whether Jingjang Shi would like to make a claim with an insurance company in respect of SHS's conduct; and b. the Respondent told Jingjang Shi that the fee for such a claim is $3,500.00 and, in addition, 30% of all money recovered. 49. On 29 October 2018, the Respondent stated to the Investigator words to the following effect: a. neither the Respondent nor the Law Practice issued the Genuine Hao Costs Disclosure, the Draft Shi Costs Disclosure and the Draft Ya Li Costs Disclosure; b. Huawei Hao was not a client of the Law Practice; c. the Law Practice did not include a clause for Contingency Fees in the costs agreements issued to Junyi Chen, Yanli Lei, Xuie Chan Mo, Feng Luan and Min Liang; and d. he did not send Jingjang Shi the WeChat Messages referred to in paragraph 48 above and does not know who sent those messages to Jingjang Shi. 50. By reason of paragraphs 47 and 48 above, the statements made by the Respondent on 29 October 2018 and referred to in paragraph 49 were incorrect and the Respondent knew that they were incorrect. Ground 6: The Respondent provided a trust account investigator employed by the Law Society of New South Wales with incorrect information, which he knew to be incorrect, regarding the author of costs agreements that the Law Practice provided to its clients 51. The Applicant refers to and repeats paragraphs 40, 41, 42 and 43 above. 52. On 29 October 2018, the Respondent participated in an interview with the Investigator in which: a. the Investigator asked the Respondent a question to the effect of whether he could explain how copies of the Draft Ya Li Costs Disclosure, Draft Shi Costs Disclosure and Genuine Hao Costs Disclosure were submitted to the Fidelity Fund if the costs agreements were not issued by the Respondent; and b. the Respondent replied: "Perhaps other competing firms for SHS matters obtained a copy of Peakzon Legal costs agreement through their resources and possibly made changes in order to demonstrate to the client or purported client that Peakzon Legal were acting in an improper manner to enable them to win the client". 53. By reason of paragraphs 40, 41, 42 and 43 above: a. the Respondent's statement in paragraph 52.b above was incorrect; and b. the Respondent knew his statement in paragraph 52.b above was incorrect. Ground 7: The Respondent informed a trust account investigator employed by the Law Society of New South Wales that he had reviewed his emails and found no correspondence between the Law Practice and Xiu Chan Mo, Feng Luan, Min Liang, Junyi Chen, Yanli Lei and Shangyong Wu which attached costs disclosures or invoices in circumstances where he had intentionally deleted the correspondence between the Law Practice and Xiu Chan Mo, Feng Luan, Min Liang, Junyi Chen, Yanli Lei and Shangyong Wu which attached costs disclosures or invoices 54. The Applicant refers to and repeats paragraphs 2, 3 and 12 above. 55. Between about 17 August 2018 and about 29 October 2018, the Respondent deleted emails between the Law Practice and Xui Chan Mo, Feng Luan, Junyi Chen, Yali Lei, Shanyong Wu and Min Liang which attached a signed costs agreement, an unsigned costs agreement and/or an invoice. 56. On 29 October 2018, the Investigator: a. conducted keyword searches on the laptops of the Respondent and a staff member of the Law Practice named April in order to identify any costs agreements which provide for Contingency Fees or invoices which contain Contingency Fees issued to Xiu Chan Mo, Feng Luan, Min Liang, Junyi Chen, Yanli Lei, Shangyong Wu; and b. the Investigator's keyword searches returned nil results. 57. On 1 November 2018, the Respondent informed the Investigator that: a. the Law Practice did not maintain hard copy client files for Junyi Chen, Yanli Lei, Xui Chan Mo, Feng Luan, Min Liang and Shangyong Wu; and b. the documents created in Microsoft Word and Outlook (for emails) for the clients referred to in paragraph 57.a above were held electronically. 58. On 8 November 2018, the Investigator asked the Respondent to provide him with copies of the emails between the Law Practice and Xui Chan Mo, Feng Luan, Junyi Chen, Yali Lei, Shanyong Wu and Min Liang which attached a signed costs agreement, an unsigned costs agreement and/or an invoice. 59. On 12 November 2018, the Investigator issued a notice pursuant to section 370 of the Uniform Law to the Respondent which required the Respondent to provide inter alia the emails referred to in paragraph 58 above by 19 November 2018. 60. On 23 November 2018: a. the Investigator sent the Respondent an email requesting the documents sought in the notice referred to in paragraph 59 above. b. the Respondent sent the Investigator an email which: i. attached emails between the Law Practice and Junyi Chen which were non-responsive to the notice issued in paragraph 59 above and not relevant to the investigation conducted by the Investigator; and ii. stated: "I have looked through my emails and have not found communications relating to the following clients: • Min Liang • Feng Luan • Xiuchan Mo • Yanli Lei • Shangyong Wu • Huawei Hao I have however 3 correspondences with Junyi Chen which I will forward to you now". c. the Respondent knew that he had deleted the emails referred to in paragraph 55 above. Ground 8: The Respondent provided a trust account investigator employed by the Law Society of New South Wales with timesheets that the Respondent prepared without informing the investigator as to the date on, or basis upon, which he had created those timesheets 61. The Applicant refers to and repeats paragraphs 2 and 3 above. 62. Between about 28 October 20189 and 1 November 2018, the Respondent created timesheets in relation to work that the Law Practice purportedly carried out for the following clients during the following periods: Person Period Junyi Chen 7 to 24 March 2018 Yanlei Lei 14 to 30 March 2018 Xiu Chan Mo 28 February 2018 to 25 September 2018 Feng Luan 1 March 2018 to 20 September 2018 Min Liang 3 March 2018 to 22 June 2018 Shangyong Wu 16 to 30 March 2018 63. The Respondent created the timesheets referred to in paragraph 62 above based on his estimates of the hours the Law Practice spent providing the legal services for each of the clients. 64. On 1 November 2018: a. the Investigator requested that the Respondent provide him with copies of costs agreements, costs disclosure documents and invoices that the Law Practice provided to Junyi Chen, Yanlei Lei, Xiu Chan Mo, Feng Luan, Min Liang and Shangyong Wu; and b. the Respondent provided the Investigator with, among other documents, the timesheets referred to in paragraph 62 above. 65. At no time prior to 4 April 2019, did the Respondent inform the Investigator that: a. the timesheets provided to the Investigator on 1 November 2018 were not created at, or proximate to, the period of time when the legal services were provided to each client; b. the Respondent created each of the timesheets provided to the Investigator on 1 November 2018 between 28 October 201[8] and 1 November 201[8]; and c. the contents of each of the time sheets were based on the Respondent's estimates regarding work the Law Practice had carried out for each client. Ground 9: The Respondent sent a message to a client that contained information which was incorrect in circumstances where the Respondent knew, or ought to have known, that the information was incorrect or did not know whether the information was correct 66. Repeat and refer to paragraph 1.d. 67. On 28 March 2018, the Respondent sent Ya Li a WeChat message which indicated that the Law Practice was close to obtaining compensation for a client from the Fidelity Fund. 68. When the Respondent sent the WeChat message referred to in paragraph 6766 above: a. the Law Practice had not submitted any claims to the Fidelity Fund; b. the Law Practice was not close to obtaining compensation for a client from the Fidelity Fund; and c. the Respondent knew, or ought to have known, or did not know that the representation referred to in paragraph 6766 above was incorrect. Ground 10: The Respondent breached an undertaking that he provided to a trust account investigator employed by the Law Society of New South Wales 69. The Applicant refers to and repeats paragraphs 2 and 3 above. 70. On 4 April 2019, the Respondent provided the Investigator with an undertaking to provide him, by 26 April 2019, with: "details of clients from whom Peakzon has received GST, the date, invoice and amount of GST received in respect of each client, details of the banking of such GST, and details as to the purpose for which such GST was used". 71. The Respondent did not, by 26 April 2019, provide the Investigator with the information referred to in paragraph 70 above. 72. On 23 September 2019, the Respondent sent an email to the Investigator in which he attached invoices for the period of March 2018 until September 2018 which showed GST payments received by the Law Practice in that period. 73. As at 30 March 2020, except for the information provided on 23 September 2019 referred to in paragraph 72 above, the Respondent had not provided the Investigator with all of the information which the Respondent undertook to provide on 4 April 2019. Ground 11: The Respondent did not comply with requests for the following information issued to him pursuant to section 370 of the Uniform Law on 4 April 2019 and 3 September 2019: (a) details of clients who had paid GST to the Law Practice; and (b) information regarding Business Activity Statements; 74. The Applicant refers to and repeats paragraphs 2, 3, 70, 71 and 72 above. 75. On 16 July 2019: a. the Respondent had not provided the Investigator with the information referred to in paragraph 70 above; and b. the Investigator sent the Respondent an email which asked the Respondent to provide the Investigator with the information referred to in paragraph 70 above "without any further delay". 76. On 19 July 2019: a. the Respondent had not provided the Investigator with the information referred to in paragraph 70 above; and b. the Investigator sent the Respondent an email in which: i. the Investigator reminded the Respondent that the request made on 4 April 2019 referred to in paragraph 70 above was made under s 370 of the Uniform Law and was to be complied with by 26 April 2019; and ii. informed the Respondent that he must comply with the notice to produce referred to in paragraph 70 above by 26 July 2019. 77. On 26 July 2019, the Respondent: a. had not provided the Investigator with the information referred to in paragraphs 70 and 76bii above by 26 July 2019; and b. sent the Investigator an email attaching eight unsigned draft Business Activity Statements for the quarterly periods between 1 October 2016 and 30 September 2018, each of which was dated 13 December 2018. 78. On 29 July 2019: a. the Respondent had not provided the Investigator with the information referred to in paragraph 70 above; and b. the Investigator sent the Respondent an email requesting the following information "forthwith": i. the information referred to in paragraph 70 above; and ii. information concerning the Business Account Statements referred to in paragraph 77b above; and iii. an explanation as to why the Respondent did not provide draft Business Account Statements for the quarterly periods ended 31 December 2018, 31 March 2019 and 30 June 2019. 79. On 3 September 2019: a. the Respondent had not provided the Investigator with the information called for in paragraph 78b above; and b. the Investigator sent the Respondent an email requesting the information that had been requested in the email referred to in paragraph 78b above, to be provided "forthwith" pursuant to section 370 of the Uniform Law. 80. As at 13 March 2020, save for the documents referred to in paragraph 72 above, the Respondent had not provided the Investigator with the documents sought and referred to in paragraphs 70 and 79.b above. Ground 12: Between about 10 April 2019 and about 23 September 2019, the Respondent provided a trust account investigator employed by the Law Society of New South Wales with extracts of bank statements and bank receipts which purported to show that the Law Practice had refunded monies to clients, namely Xiu Chan Mo, Feng Luan, Min Liang and Junyi Chen between 25 March 2019 and 29 March 2019 (First Client Transfers), and failed to provide the trust account investigator complete bank statements in circumstances where the Respondent knew that the monies the subject of the First Client Transfers had subsequently been returned to the Office Account and not received by the client 81. The Applicant refers to and repeats paragraphs 2 and 3 above. 82. On 25 March 2019, the Law Practice transferred $3,500.00 from its Commonwealth Bank Account with account number 1039-7003 (Office Account) to a bank account in the name of Xiu Chan Mo with receipt number C084900007141 (First Mo Transfer). 83. On 26 March 2019, the Law Practice transferred $3,500.00 from its Office Account to an account in the name of Feng Luan with receipt number CO85900221637 (First Luan Transfer). 84. On 29 March 2019, the Law Practice transferred $3,500.00 from its Office Account to an account in the name of Min Liang with receipt number 6217680900941308 (First Liang Transfer). 85. On 1 April 2019, the Respondent sent the Investigator an email: a. to which he attached copies of Commonwealth Bank Transfer Receipts for the First Mo Transfer, First Luan Transfer and First Liang Transfer; and b. in which he stated that the receipts referred to in paragraph 85(a) above record the remittance records for the refunds to Xiu Chan Mo, Feng Luan and Min Liang. 86. On 3 April 2019: a. the Law Practice transferred $3,500.00 from its Office Account to an account in the name of Junyi Chen with receipt number CO93901480152 (First Chen Transfer); and b. the Respondent emailed the Commonwealth Bank Transfer Receipt of the First Chen Transfer to the Investigator. 87. On 4 April 2019, the Investigator requested that the Respondent provide a copy of the Office Account's bank statements recording the refund to Feng Luan, Junyi Chen, Xiu Chan Mo and Min Liang. 88. On 10 April 2019: a. the Office Account received a refund in respect of the First Luan Transfer and the First Mo Transfer; b. an email was sent to the Respondent from Commonwealth Bank of Australia to notify him that the First Luan Transfer did not reach the recipient and was returned to the Office Account; and c. an email was sent to the Respondent from Commonwealth Bank of Australia to notify him that the First Mo Transfer did not reach the recipient and was returned to the Office Account. 89. On 12 April 2019: a. the Office Account received a refund in respect of the First Liang Transfer; and b. an email was sent to the Respondent to notify him that the First Chen Transfer did not reach the recipient and was returned to the Office Account. 90. On 18 April 2019: a. the Office Account received a refund in respect of the First Chen Transfer; and b. an email was sent to the Respondent to notify him that the First Chen Transfer did not reach the recipient and was returned to the Office Account. 91. On 24 April 2019, $3,500.00 was paid from the Office Account to Feng Luan (Second Luan Transfer). 92. On 21 May 2019, the Law Practice transferred $3,500.00 to an account in the name of Dong Fang with the description as "Chen Refund" (Second Chen Transfer). 93. On 16 July 2019, the Investigator requested, for a second time, that the Respondent provide a copy of the bank statements of the Office Account recording the refund to Feng Luan, Junyi Chen, Xiu Chan Mo and Min Liang. 94. On 19 July 2019: a. at around 3:11pm the Respondent emailed to the Investigator copies of the Commonwealth Bank Transfer Receipts for the Second Luan Transfer, the Second Chen Transfer, the First Mo Transfer and the First Liang Transfer; b. the Respondent did not inform the Investigator that the First Luan Transfer, the First Chen Transfer, the First Mo Transfer and the First Liang Transfer were each refunded into the Office Account; c. the Respondent did not provide to the Investigator the bank statements of the Office Account recording the refunds respectively to Feng Luan, Junyi Chen, Xiu Chan Mo and Min Liang; d. the Law Practice transferred $3,500.00 to an account in the name of Boujon Pan and the transaction description was "Mo Refund" (Second Mo Transfer); and e. at around 4:23pm the investigator requested, for the third time, that the Respondent provide a copy of the bank statements of the Office Account recording the refund to Feng Luan, Junyi Chen, Xiu Chan Mo and Min Liang. 95. On 26 July 2019, the Respondent emailed the Investigator a photo image of the Office Account bank statement between 14 March and 28 March 2019 which: a. showed the First Luan Transfer, the First Chen Transfer, the First Mo Transfer and the First Liang Transfer; and b. did not show the refunds of the First Luan Transfer, the First Chen Transfer, the First Mo Transfer or the First Liang Transfer. 96. On 3 September 2019, the Investigator requested, for the fourth time, that the Respondent provide a copy of the bank statements for the Office Account recording the refund to Feng Luan and Junyi Chen. 97. On 12 September 2019, the Law Practice transferred $3,500.00 from the Office Account to an Australian Bank account of a person named "Meng Wang" with transfer description as "Min Liang Refund" (Second Liang Transfer). 98. On 23 September 2019, the Respondent sent the Investigator an email: a. in which he stated that: i. the First Luan Transfer and First Chen Transfer was refunded into the Office Account; and ii. the Respondent caused the Second Luan Transfer and the Second Chen Transfer to occur; and b. which did not provide a copy of the Legal Practice's bank statements recording the refund to Feng Luan, Junyi Chen, Xiu Chan Mo and Min Liang. 99. Between 10 April 2019 and 2[3] September 2019, the Respondent: a. provided the Investigator with extracts of bank statements of the Office Account and Commonwealth Bank Receipts which evidenced the First Luan Transfer, the First Chen Transfer, the First Mo Transfer and the First Liang Transfer; b. from around 18 April 2019, knew that the monies the subject of each of the First Luan Transfer, the First Chen Transfer, the First Mo Transfer and the First Liang Transfer had been refunded to the Office Account; c. did not inform the Investigator that the monies the subject of the First Luan Transfer, the First Chen Transfer, the First Mo Transfer and the First Liang Transfer had been refunded to the Office Account; and d. failed to comply with the Investigator's requests on 3 August April 2019, 16 July 2019, 19 July 2019 and 3 September 2019 to provide bank statements of the Office Account which, if produced, would have revealed the First Luan Transfer, the First Chen Transfer, the First Mo Transfer and the First Liang Transfer had been refunded to the Office Account. Is the solicitor guilty of unsatisfactory professional conduct and professional misconduct? 1. The Uniform Law defines unsatisfactory professional conduct and professional misconduct in ss 296 and 297: 296 Unsatisfactory professional conduct For the purposes of this Law, unsatisfactory professional conduct includes conduct of a lawyer occurring in connection with the practice of law that falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent lawyer. 297 Professional misconduct (1) For the purposes of this Law, professional misconduct includes— (a) unsatisfactory professional conduct of a lawyer, where the conduct involves a substantial or consistent failure to reach or maintain a reasonable standard of competence and diligence; and (b) conduct of a lawyer whether occurring in connection with the practice of law or occurring otherwise than in connection with the practice of law that would, if established, justify a finding that the lawyer is not a fit and proper person to engage in legal practice. (2) For the purpose of deciding whether a lawyer is or is not a fit and proper person to engage in legal practice as referred to in subsection (1)(b), regard may be had to the matters that would be considered if the lawyer were an applicant for admission to the Australian legal profession or for the grant or renewal of an Australian practising certificate and any other relevant matters. 1. In Barakat v Law Society of New South Wales [2014] NSWSC 773 at [150]–[151] Beech-Jones J held that: 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 practise (Murphy at [172]). A finding of dishonesty is clearly sufficient to warrant that conclusion … 1. In Council of the New South Wales Bar Association v EFA (a pseudonym) [2021] NSWCA 339 at [164], the Court of Appeal clarified that the conduct that would justify a finding of unfitness to engage in legal practice is not necessarily conduct that must result in such a finding. 2. Ground 1 relates to the solicitor's non-compliance with trust accounting obligations. That conduct amounts to unsatisfactory professional conduct as it entailed a number of contraventions of the Uniform Law and Legal Profession Uniform General Rules 2015 (NSW). The conduct falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent lawyer. 3. Grounds 2 – 12 involve a substantial and consistent failure to reach a reasonable standard of competence and diligence. That conduct justifies a finding that the solicitor is not a fit and proper person for the following reasons: 1. the conduct was objectively serious as it included falsifying documents, lying to a trust investigator employed by the professional regulator and destroying documents so that the trust investigator would not find them; 2. the conduct was not an isolated incident and occurred over about 13 months. During that time the solicitor engaged in a series of related but distinct acts of misconduct; and 3. some of the conduct, such as creating false costs agreements and invoices, was planned. 1. For these reasons we find that the conduct the subject of Grounds 2 to 12 amounts to professional misconduct. What orders should the Tribunal make? 1. Following a finding of professional misconduct or unsatisfactory professional conduct, the Tribunal has power to make disciplinary orders: Uniform Law, s 302. 302 Determination by designated tribunal—disciplinary matters (1) If, after it has completed a hearing under this Part into the conduct of a respondent lawyer, the designated tribunal finds that the lawyer is guilty of unsatisfactory professional conduct or professional misconduct, the designated tribunal may make any orders that it thinks fit, including any of the orders that a local regulatory authority can make under section 299 in relation to a lawyer and any one or more of the following— (a) an order that the lawyer do or refrain from doing something in connection with the practice of law; (b) an order that the lawyer cease to accept instructions as a public notary in relation to notarial services; (c) an order that the lawyer's practice be managed for a specified period in a specified way or subject to specified conditions; (d) an order that the lawyer's practice be subject to periodic inspection by a specified person for a specified period; (e) an order that the lawyer seek advice in relation to the management of the lawyer's practice from a specified person; (f) an order recommending that the name of the lawyer be removed from a roll kept by a Supreme Court, a register of lawyers kept under jurisdictional legislation or the Australian Legal Profession Register; (g) an order directing that a specified condition be imposed on the Australian practising certificate or Australian registration certificate of the lawyer; (h) an order directing that the lawyer's Australian practising certificate or Australian registration certificate be suspended for a specified period or cancelled; (i) an order directing that an Australian practising certificate or Australian registration certificate not be granted to the lawyer before the end of a specified period; (j) an order that the lawyer not apply for an Australian practising certificate or Australian registration certificate before the end of a specified period; (k) a compensation order against the lawyer in accordance with Part 5.5; (l) an order that the lawyer pay a fine of a specified amount not exceeding $100 000 if the lawyer is found guilty of professional misconduct. 1. Under s 302(f), one of those orders the Tribunal has power to make is an order recommending that the name of the lawyer be removed from a roll kept by the Supreme Court of New South Wales. In determining whether such an order should be made, the Tribunal must consider whether the practitioner is not a fit and proper person to be an officer of the Supreme Court and is likely to be unfit for the indefinite future: A Solicitor v Council of the Law Society of New South Wales (2004) 216 CLR 253; [2004] HCA 1 at [15] and [21]. 2. The solicitor's conduct is antithetical to the central requirements for being a fit and proper person, namely honesty and integrity. He engaged in a systematic course of conduct in which he was dishonest including creating false documents, lying to a trust investigator on a number of occasions, destroying documents so that the trust investigator would not be able to locate them, failing to comply with an undertaking and compulsory notice issued under the Uniform Law and failing to be candid in respect of the investigation. The conduct occurred over a period over more than a year and could not be described as a momentary lapse of judgment. 3. The solicitor did not appear at the hearing. There is no evidence of any rehabilitation. We are satisfied that the practitioner is not a fit and proper person to be an officer of the Supreme Court and is likely to be unfit for the indefinite future. We recommend that the name of the solicitor be removed from the roll maintained by the Supreme Court of NSW pursuant to s 23 of the Uniform Law. Costs 1. The Instrument of Consent seeks an order that the solicitor pay the costs of the Law Society. Clause 23 of Schedule 5 of the Civil and Administrative Tribunal Act 2013 (NSW) provides that the Tribunal must make orders requiring a respondent lawyer, whom it has found to have engaged in unsatisfactory professional conduct or professional misconduct, to pay costs unless the Tribunal is satisfied that exceptional circumstances exist. There was no evidence of exceptional circumstances. Orders 1. Having found that the conduct of the Respondent particularised in the Agreed Statement of Facts amounts to unsatisfactory professional conduct and professional misconduct within the meaning of the Uniform Law, we make the following orders: 1. The Respondent is guilty of professional misconduct. 2. The Tribunal recommends that the name of the Respondent be removed from the roll maintained by the Supreme Court of NSW pursuant to s 23 of the Legal Profession Uniform Law (NSW). 3. The Respondent is to pay the Applicant's costs of these proceedings as agreed or assessed. ********** I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 30 August 2023