The Legal Services Tribunal of New South Wales CITATION : Francis William Bannister [1990] NSWLST 7 PARTIES : Francis William Bannister FILE NUMBER(S) : of CORAM: Mr G Williams (Presiding Member) - Mr D F Castle - Mr D Mahon CATCHWORDS: Professional Misconduct - mislead client - Professional Misconduct - fail to act honestly - Professional Misconduct - wilfully breach a court order :- Legal Profession Act 1987 LEGISLATION CITED: Legal Practitioners' Act 1898 Workers Compensation Act 1926 CASES CITED: DATES OF HEARING: 10/04/90 - 18/10/90 DATE OF JUDGMENT: 10/18/1990 Mr G.C. Lindsay LEGAL REPRESENTATIVES: Ms Rosemary MacDougal Mr P.W. Taylor Messrs Allen Allen & Hemsley JUDGMENT: THE LEGAL PROFESSION DISCIPLINARY TRIBUNAL IN THE MATTER of FRANCIS WILLIAM BANNISTER DETERMINATION AND ORDERS Before: Mr G.L. Williams (Presiding Member), Mr D.F. Castle and Mr D. Mahon Appearances: Mr G.C. Lindsay instructed by Ms Rosemary MacDougal for the Law Society; Mr P.W. Taylor instructed by Messrs Allen Allen & Hemsley for the Solicitor. This complaint against the conduct of Francis William Bannister ("the Solicitor") was made to the Legal Profession Disciplinary Tribunal ("the Tribunal") pursuant to the provisions of Section 135 of the Legal Profession Act 1987 by the Council of the Law Society of New South Wales ("the Society"). The Complaint is dated 31 January 1989 and was amended by an Amended Complaint dated 20 December 1989 with the consent of the Solicitor and by leave of the Tribunal. The Society seeks against the Solicitor such orders pursuant to Section 163 of the Legal Profession Act 1987 and such further or other orders as the Tribunal shall consider appropriate and an order for costs upon the following grounds: 1. Wilful breach of Section 42(2) of the Legal Practitioners Act 1898, 2. Wilful misleading of one of his clients, 3. Breach of Section 56(2) of the Workers Compensation Act 1926, and 4. Retention from a Compensation Court award of an amount for costs to which he was not entitled under that award. The complaint was heard by the Tribunal on 10 April 1990 when Mr. G.C. Lindsay instructed by Miss Rosemary MacDougal appeared for the Society and Mr. P.W. Taylor instructed by Messrs. Allen Allen & Hemsley appeared for the Solicitor. Oral evidence was given by the Solicitor and the written evidence before the Tribunal consisted of: 1. Statutory Declarations (2) dated 31 January 1989 and 20 December 1989 of John Richard Hunt, 2. Statutory Declarations (2) dated 16 March 1990 and 20 April 1990 of the Solicitor, and 3. Twenty three (23) Declarations as to the Solicitor's character. The Solicitor is now 41 years of age. Prior to his admission as a solicitor he was employed by the Department of the Attorney General and of Justice in the Magistrates Court Administration and for a short time in the Public Solicitor's Office in Newcastle. He joined the firm of Bruce O'Sullivan & Co. as a law clerk in 1980 and following his admission as a solicitor on 12 June 1981 he became a partner of that firm on 21 September 1981. He is still a partner of that firm of which there a total of four partners. He has practised predominately in common law matters including a small percentage of workers' compensation matters. The grounds all relate to the one client Trevor William Bunn ("the client") for whom the Solicitor acted in 1986 in an application to the Compensation Court of New South Wales for redemption of weekly payments of compensation awarded in his favour. The application resulted in an award being made in favour of the client on 4 December 1986 by His Honour Judge Thompson by consent in the sum of $43,000.00. In his statutory declaration the Solicitor said that on the morning of the hearing he informed the client, in reply to his question as to the quantum of the costs, that they would be $3,000.00 and he said the client agreed to this amount. On or about 22 December 1986 the Solicitor received from the solicitors for the client's employer, Newcastle City Council, a cheque in favour of the client for $43,000.00. On 24 December 1986 the Solicitor had the client endorse the $43,000.00 cheque to make it payable to the Solicitor's firm, Bruce O'Sullivan & Co., and caused the cheque to be paid into the firm's trust account: he then had the client sign authorisations for the drawing of two cheques on that trust account both in favour of the client one for $40,000.00 and one for $3,000.00. The client agreed, at the Solicitor's request, to cash the $3,000.00 cheque and the $3,000.00 was paid in cash to the Solicitor after such cheque had been cashed. The deduction of costs from a sum awarded by the Court as compensation (unless such costs are awarded by the Court) is clearly in breach of Section 56(2) of the Workers' Compensation Act 1926. In fact on 23 December 1986 the Solicitor had written to the employer's solicitors assessing costs of the application at $500.00 and noting Counsel's fees at $539.00. The costs were by consent reduced to $350.00 and the sum of $889.00 was paid by the employer's solicitors to Bruce O'Sullivan & Co. on 6 February 1987. Through his Counsel the Solicitor conceded the basic facts as set out in the particulars (except for one qualification in relation to paragraph (b) of the particulars for ground 2 on which the Tribunal considers little turns), conceded that they amounted to professional misconduct and conceded that this misconduct was sufficiently serious to call into question his fitness to practise. It is obvious to the Tribunal that the Solicitor took advantage of his clients ignorance as to his entitlement and led him to believe that the costs to which the Solicitor was entitled amounted to $3,000.00. This was done at a time when the Solicitor was negotiating with the client's employer's solicitors as to the quantum of the costs of the application to be paid by the employer. Clearly the drawing of the funds was wilfully shown in the Solicitor's firm's trust account ledger in a manner which concealed the real destination of the $3,000.00. The Solicitor's conduct was undoubtedly premeditated (some twenty days having elapsed between the Solicitors advice as to the amount of the costs and the date of payment) and must be viewed more seriously still when it is realised, as the Solicitor admitted, that the taking of the $3,000.00 in cash, under the guise of costs, was concealed from his partners and the funds were kept by the Solicitor for his own purposes and were not paid into the partnership bank account. His conduct was both dishonest and deceitful. In his declaration of 16 March 1990 the Solicitor said: The only explanation that I can give for this, and I recognise that it provides no justification whatever, is that I was conscious of the fact that my ~section of the practice had been bringing in over half the firm's gross income, whereas the Partnership Agreement provided for a splitting of net profit in 4 equal shares. I appreciate that this is a form of rationalisation which does me no credit but I feel it necessary to express it as indicating something of my thought processes at the time. I do not proffer it as any kind of justification but I consider it is something to be taken into account in understanding my personal thoughts at the time." There has been no satisfactory explanation whatsoever for the conduct complained of and there is not one redeeming feature in its favour. It was not till after the police had intervened and had drawn the matter to the Society's attention after a complaint by the client's employer that the sum of $3,000.00 was refunded to the client but no interest was offered to compensate the client for being without the $3,000.00 for some 18 months: indeed the sum of $1,026.30 was ultimately paid to the client by way of interest on 20 April 1990 after the failure to pay interest drew adverse comment from the Tribunal at the hearing. It is against the background of this behaviour that the Tribunal has to consider the Solicitor's fitness to practise now and the delay in making good does not assist the Solicitor in making his case that his behaviour was an isolated aberration: the isolation became somewhat extended. Where misconduct is established the task for a professional tribunal is to determine whether it indicates unfitness or is more properly to be treated as an isolated or passing departure from proper professional standards amounting to something less than proved unfitness. The Tribunal appreciates the common sense of the Solicitor's concessions, even though as to matters the proof of which was inevitable, and believes the Solicitor, in his declaration and in his oral evidence, when he indicates his contrition, his having learnt from his misdeed and his concern for the standing of his profession. Independent evidence as to the character of the Solicitor was given by no less than twenty-three persons comprising a fairly representative cross section of the community and including a number of members of both branches of the legal profession and all of the Solicitor's other three partners. These partners, Peter Raymond Hartley, Stephen Ross Gill and David Geoffrey Parke regarded the Solicitor's conduct as an isolated out-of-character occurrence and were unqualified in their support for his remaining in their partnership as a full and trusted member. These impressive references have reinforced the Tribunal's considered opinion (after carefully observing his behaviour in the witness box) that the Solicitor is fit to continue in practice and that cancellation or suspension of his practising certificate is neither necessary nor appropriate to protect the interests of the public. This opinion is also reinforced by the length of time the Solicitor has been in practice the absence of any previous complaints and no subsequent complaints having been brought forward at the hearing. The Tribunal's members were initially divided in their opinions as to this, the minority view being in favour of a protective order, and it was only after reconsideration of all aspects of the conduct and all the character and other evidence that unanimity was reached in the Tribunal's orders. Some three and a half years have passed since the behaviour complained of and, clearly dishonest and deceitful though it was, the Tribunal believes the Solicitor has learnt his lesson. The Tribunal finds the four grounds proved (and also notes the Solicitor's concessions as to these). Accordingly the Tribunal formally finds professional misconduct in relation to each of the four grounds and considers that, in all the circumstances, such misconduct should attract a heavy pecuniary penalty. Orders The Tribunal therefore orders: 1. That Francis William Bannister be fined the sum of ten thousand dollars ($10,000). 2. That the said sum be paid within one month from the date of this order and that thereafter the Solicitor be suspended from practice until the said fine be paid. 3. That the Solicitor pay the costs of the Law Society such costs to be assessed on a solicitor and client basis as if taxed in the Supreme Court. 4. That if agreement cannot be reached between the Solicitor and the Law Society on the amount of costs, either party shall have liberty to apply. Dated this 18th day of October 1990. 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.