The Legal Services Tribunal of New South Wales CITATION : Timothy Henry William Rybak [1997] NSWLST 6 PARTIES : Timothy Henry William Rybak FILE NUMBER(S) : of 1996 CORAM: Mr A. Martin (Presiding Member) - Ms S Carr-Gregg - Mr D Mahon CATCHWORDS: Professional Misconduct - gross overcharging of client - Professional Misconduct - breach of s. 61 of the Legal Profession Act :- Legal Profession Act 1987 LEGISLATION CITED: Legal Profession Reform Act 1993 Legal Profession Regulation 1994 Legal Practitioners Act 1898 Hodgekiss (1962) 62 SR (NSW) 340; Vickery (1931) 1 Ch 572 at 583; CASES CITED: The Law Society of NSW v Veron (1966) 84 WN Pt 1 NSW 136 at 144; Veghelyi v The Law Society of NSW LPDR No 2 of 1996 ; NSW Crimes Commission v Flemming (1991) 24 NSWLR 1116; The Law Society v Foreman LPDR No 4 of 1994 DATES OF HEARING: 9, 10 and 11 December 1996 DATE OF JUDGMENT: 03/24/1997 LEGAL REPRESENTATIVES: Mr Wales Mr Galasso JUDGMENT: B y a complaint dated 3 June 1994 and filed in the Legal Profession Disciplinary Tribunal ("the Former Tribunal") the Council of the Law Society ("the Law Society") made a complaint under section 135 of the Legal Profession Act 1987 ("the Act") that Timothy Henry William Rybak ("the Solicitor") may be guilty of professional misconduct. The Legal Services Tribunal ("the Tribunal") heard and determines the Complaint under the transitional provisions of the Legal Profession Reform Act 1993 and the Legal Profession Regulation 1994 ("the Regulation"). The grounds of the Complaint are as follows: 1. The Solicitor wilfully breached section 61 of the Act. 2. The Solicitor overcharged clients by: (i) charging excessive amounts for work performed by him; and/or (ii) performing work for clients which need not have been done by him personally, or by a solicitor. Further Particulars of the Complaint are as follows: Breaches of section 61 of the Act Hayter The Solicitor deposited moneys, i.e. amounts of $300, $974 and $184.01 for his professional costs into his general account before he submitted his bill of costs to his client in December 1989. Walters The solicitor paid funds into his general account before rendering an account to the client. Jordan On 17 February 1989, the Solicitor paid $2,000 into his general account and, on later date, a further $2,000 into his general account, on account of costs without having given the client an outline bill. Biotreat (i) On a date prior to 14 April 1989, the Solicitor received $300 on account of costs which ought to have been deposited to his trust account. The Solicitor deposited that money into his general account. No outline bill had been given to his client. (ii) By an account dated 14 April 1959 (sic: should be 1989), the Solicitor sought payment of $1,120 which included an amount of $500 required on account of further costs. The account for $1,120 was paid in full on about 6 June 1989. The Solicitor deposited the entire amount to his general account, notwithstanding the fact that $500 of that amount ought to have been paid into his trust account. No outline bill had been provided to the client in respect of that $500. (iii) On or about 30 August 1989, the Solicitor received a further $300 on account of costs. The Solicitor deposited that amount to his general account. No outline bill had been sent to his client in respect thereof. Simkins (i) The Solicitor paid sums totalling $1,250 into his general account on account of his professional costs without having provided the client an outline bill for this amount. (ii) On or about 21 November 1990, the Solicitor paid the sum of $12,751.50 into his general account on account of his professional costs without having provided the client an outline bill for this amount. (iii) On or about 25 January 1991, the Solicitor transferred the sum of $5,100 from his trust account to his general account on account of his professional costs without having provided the client an outline bill for this amount. Vukelic On a date prior to 4 May 1988, the Solicitor paid the sum of $1,000 into his general account on account of his professional costs without having provided the client an outline bill for this amount. Mitsue (i) On or about 16 November 1988 the Solicitor paid the sum of $1,000 into his general account of his professional costs without having provided the client an outline bill for this amount. (ii) On or about 17 February 1989 the Solicitor paid the sum of $1,000 into his general account on account of his professional costs without having provided the client an outline bill for this amount. (iii) On another date or other dates not presently known, the Solicitor paid the sum of amounts totalling$4,500 into his general account on account of his professional costs without having provided the client an outline bill for this amount. Overcharging and/or Overservicing Clark (i) The Solicitor rendered an account to the client dated 28 February 1990. In that account, the Solicitor charged the client amounts greatly in excess of the then applicable Family Court scale in circumstances where the costs agreement between the Solicitor and the client would not have been upheld in the Family Court. (ii) The Solicitor rendered an account to the client dated 18 April 1990. In that account, the Solicitor charged the client amounts greatly in excess of the then applicable Family Court scale in circumstances where the costs agreement between the Solicitor and the client would not have been upheld in the Family Court. (iii) In his account dated 18 April 1990, the Solicitor charged for some items at a rate which exceeded the amount claimable under his written costs agreement with the client. See the entries for 4 May 1989, 9 May 1989, 29 June 1989, 13 July 1989 and 30 August 1989. (iv) The Solicitor charged amounts for typing which had the effect of substantially increasing the charges made to the client and which led to a gross overcharging. (v) The Solicitor performed tasks (e.g. filing) which could have been performed at a lower rate by a law stationer. Hayter (i) The Solicitor charged the sum of $463.72 for a disbursement which in fact was $63.72. (ii) The Solicitor charged excessive amounts in respect of "Government Fees" and "Title Searches". (iii) The Solicitor charged an excessive amount for trunk calls to Gilgandra. Walters (i) The Solicitor acted for Mrs Walters in respect of a family law property settlement. (ii) On 29 April 1988, the Solicitor quoted costs of approximately $2,000, which would have been a fair figure for the work to be done for the client. In fact, the Solicitor's account for professional fees totalled $5,060, a figure significantly in excess of a fair figure for the work actually performed. Jordan (i) The Solicitor's claim for 14 hours of work in his account dated 28 April 1989 was excessive. (The Council did not press this allegation and it is therefore dismissed). (ii) The Solicitor apparently charged $750 for a mention in the Family Court. This amount was excessive, when an agent would have appeared for substantially less. (iii) The Solicitor, in his account dated 15 September 1989, charged $2,000 for 80 pages of typing. This amount was excessive. (iv) The Solicitor's final claim for 32 hours of work in his account dated 15 September 1989 was excessive. (The Council did not press this allegation and it is therefore dismissed.) Simkins (i) The Solicitor charged interest when there was no agreement to allow him to do so. (ii) The Solicitor, in his account dated 22 November 1990, charged an excessive amount for preparation of three contracts. (iii) The Solicitor, in his account dated 21 March 1991, charged $1,570 for "further matrimonial advice" in circumstances where this amount was a gross overcharge. (iv) The Solicitor, in his account dated 21 March 1991, charged $1,100 for "costs in Family Court to 25 January 1991" in circumstances where this amount was a gross overcharge. (v) The Solicitor's charge of $550 in his account dated 21 March 1991 for preparing a statutory declaration and appearing in the Family Court on a mention was excessive. (vi) The Solicitor charged $7,556.50 for his "fees for Family Court matter up to settlement" in his account of 21 March 1991 in circumstances where this amount was a gross overcharge. Vukelic (i) The Solicitor's charge of $800 for a court appearance on 26 May 1988 was excessive, when an agent could have performed the mention for substantially less. (ii) The Solicitor's charge of $324 on 4 May 1988 for typing was excessive. On 22 August 1991 the Council resolved that Mr Duncan G Holmes solicitor ("the Investigator") be appointed pursuant to section 55 of the Act to investigate the affairs of the Solicitor. The evidence tendered by the Law Society was a declaration by Frederick John Smith the Manager of the Professional Standards Department of the Society annexing copies of the Investigator's report and letters to the Society and also correspondence between the Society and the Solicitor and/or his solicitors, a statutory declaration made by Duncan Godfrey Holmes the Investigator and a statutory declaration made by Susan Jean Pattison legal costs consultant. Mr Holmes the Investigator and Ms Pattison gave oral evidence at the hearing before the Tribunal. The evidence tendered by the Solicitor was a statutory declaration made by himself, a statutory declaration by Michael Joseph Delaney solicitor, two letters from the Professional Standards Department of the Society to the solicitor's solicitor dated 17 February 1995 and 4 September 1994. The Solicitor and Mr Delaney gave oral evidence at the hearing before the Tribunal. The Solicitor filed a Reply to the Complaint and the Tribunal refers to his Reply and the terms thereof in its determination of each of the matters referred to in the Further Particulars of the Complaint set out above. Breaches of section 61 of the Act Section 61 of the Act relevantly provides: "1. If a solicitor, in the course of practising as a solicitor, receives money on behalf of another person, the solicitor shall: (a) hold the money exclusively for the other person; and (b) ensure that sub-section 2 and the regulations are complied with in relation to the money. 2. Money received on behalf of another person by a solicitor, in the course of practising as a solicitor: (a) shall, except where the person on whose behalf the money is received otherwise directs, be paid, within the prescribed time, to the credit of a general trust account at a bank in New South Wales and be held in accordance with such regulations as may be in force in relation to trust money;" The Act was proclaimed to commence on 1 January 1988 and the Legal Profession (Trust Account and Controlled Money) Regulation 1988 ("the Former Regulation") commenced on 1 April 1988. Clause 8 of the Former Regulation relevantly provided: "1. A solicitor should comply with this clause in respect of all money to which section 61(3)(b) of the Act applies. 2. A solicitor shall, on receipt, or as soon as practicable after receipt, of money from which the solicitor is authorised to receive costs or disbursements, deliver to the client an outline bill unless a bill or account of the costs or disbursements has been delivered to the client before receipt of the money by the solicitor. 3. A solicitor shall not withdraw trust money or controlled money in satisfaction of any costs or disbursements unless - (a) the person for whom the money is held has authorised the withdrawal and the solicitor has delivered to the person an outline bill; (b) the solicitor has delivered to the person an outline bill together with written notice that, unless the person objects, the solicitor intends to withdraw the money and apply it towards payment of the bill at the expiration of one month, and the month has expired without any objection being made; or (c) the solicitor, having received from the person an objection to an outline bill delivered under paragraph (b), has served on the person a bill of costs, or an account, in a form which would enable it to be taxed under the provisions of an applicable act, rule or regulation and the person has not, within the time limited by the provisions, applied for taxation of the bill or account." An "Outline bill" was defined by the Former Regulation to mean "a statement in writing sufficient to identify the general nature of professional work or services, whether performed or to be performed, and the amount and purpose of any disbursement". The Former Regulation, ceased to be of any force or effect on the commencement of the Legal Profession Regulation 1994 ("the Regulation") on 1 July 1994. Clause 32 of the Regulation sets out the procedure for the receipt and withdrawal of money for costs and disbursements which procedure does not provide for the submission of any "outline bill" to the client as provided in clause 8 of the Former Regulation. Clause 8.1 of the Former Regulation provided that a solicitor comply with this clause in respect of all moneys to which section 61(3)(b) of the Act applied. Section 61(3)(b) provides that section 61 does not operate: "(b) to prevent a solicitor from withdrawing or receiving, from trust money or controlled money: (i) reimbursement for disbursements paid by the solicitor; or (ii) money for disbursements to be paid by the solicitor; or (iii) money due, or to accrue due, to the solicitor for costs, if the prescribed procedure is followed." The Tribunal is of the opinion that clause 8 of the Former Regulation and in particular sub-clause 2 of that clause does not apply to the case of a solicitor who has received a direction from his client pursuant to section 61(2) to pay the money into his general account. The Tribunal notes that according to paragraph (7100) of the New South Wales Solicitors Manual (Riley) that the Professional Conduct Committee of the Law Society advised the Council in 1994 that a solicitor who received a direction from a client, pursuant to section 61(2) of the Act, could act on that direction without being required to follow the procedure prescribed in clause 8. Riley however states: "It is a moot point of statutory construction and, for avoidance of uncertainty, compliance with clause 32 (the present applicable provision) is recommended in relation to money within the reach of section 61. That will ensure there is evidence of a client's informed consent to a withdrawal of money by the client." Counsel for the Law Society in his opening submitted there had been significant wilful breaches of section 61 in that the Solicitor paid into his general account funds which ought to have been paid into his trust account. By and large the funds which the client paid the Solicitor were on account of future costs and disbursements. Counsel for the Law Society in his opening said "We certainly accept that if a client gives a solicitor properly informed consent and says, for example, in express terms 'I authorise you to pay this money to the general account' even though it would ordinarily be held in a trust account, section 61 gives the client the power to direct how funds are held and if moneys are held in accordance with that direction, there would be no breach of section 61. But we will say that the evidence of the Solicitor does not get to that point in any of the matters of which the Society complains". The Solicitor in his Reply said in answer to the Further Particulars of Complaint alleging breaches of section 61 that the amounts referred to deposited into his general account, if any, were therein deposited with the authority of the client. The Solicitor in his evidence explained the manner in which he obtained the authority of his clients to pay into his general account future costs and disbursements and the procedure which he adopted by way of providing outline bills at the same time that he obtained this authority. The Solicitor in paragraph 32 of his statutory declaration said that at the first meeting with a client he explained his costs. In cross-examination he gave the text of the conversations he would have with the client when explaining his costs. A relevant part of this evidence was: "Question: You understood that section 61, as I've put it to you, required you to have authority from the client before you put into your general account money that was, prima facie, trust money? Answer: I believe I understood that. Question: And you understood it would be sufficient authority for that purpose, even without an outline bill, if the client said 'Put the money in your general account, not your trust account'? Answer: That was another method, yes. Question: And you understood that? Answer: Yes. Question: There is nothing in any letter you wrote, any letter written on your behalf or in your declaration which suggests that you had those instructions from your client, that is to say 'Put the money in your general account, not your trust account'? Answer: Well, at my first conference with the client I certainly explained my needs. Question: I didn't ask you that, I said in any letter you wrote, written on your behalf or in your declaration there is no reference to any conversation with your client in which you say the client said in substance, 'Put the money into your general account, not your trust account'. Is that right or not right? Answer: Well, I felt I covered it in my statutory declaration. Question: To which part of your declaration do you refer? Answer: Taking instructions on family law and other matters. Question: Can you indicate to the Chairman which portion of your declaration you are referring to? Answer: Well, it is page 6. Question: Would you indicate precisely which portion you are referring to? Answer: Well, the best I can point to is 32, 'I would then explain my costs'. That included what I have just said to you. Question: But where you say in your declaration, 'I would then explain my costs', that clearly, I suggest, is a reference to the basis on which you charged your costs? Answer: Well, the fact was that I explained to the client that I did the work and that what I was requesting on account of costs was for my fees and not trust moneys. That is what I did as a standard course from the inception of my practice when I was on my own. Question: Do you tell the Tribunal that, in the course of these discussions with the client, you say that you expressly told the client in words to this effect, that any moneys they paid on account of costs would not go into your trust account? Answer: Well, I would say they weren't trust moneys, this is for me to pay for my — on account of my costs. I would say that." And then later the Solicitor gave the following evidence: "Question You have no recollection of saying to any of those particular clients, 'Look, trust moneys are yours and they are protected until I send you a proper bill. General moneys go into my funds and become my money.'? Answer: I said that what they would be giving me would go into my funds. I did say that. Question: So you can now recall, can you —? Answer: Or words to that effect. Question: — That you said 'These are not trust moneys, they go into my funds'? Answer: No, I don't exactly think these are not trust moneys. I said 'There is a difference between a solicitor's trust account and his general account. The general account is the solicitor's own money, not the client's money and what you will be paying me will be going to me'. That is what I would have said, so I didn't quite say it the way you said it. Question: So there was, was there not, with the clients relevant to this Complaint, a discussion which in express terms dealt with your trust account and your general account? Answer: Well, as I have just what I've said, there was a discussion about how I would receive the moneys. Question: Can I suggest to you, Mr Rybak, that your evidence in that regard is simply untrue? Answer: No, I don't agree. Question: And can I suggest to you if there had been such a conversation with the clients relevant to this Complaint it would have been referred by you in some letter or communication or declaration made by you or on your behalf for the purpose of the investigation of these proceedings? Answer: I thought I was dealing with a failure to have outline bills, so the answer was it didn't seem to be relevant. Question: So that was it in the course of the opening yesterday that you appreciated for the very first time that if you had a conversation in the terms you suggest with your clients that might well be a defence to the case against you? Answer: No, I don't believe it is a defence. I don't believe it is a defence, sir. That conversation I have described is not to my mind my defence. Question: But you heard it said that if there was such a conversation it would have been in answer to an allegation for a breach of section 61? Answer: Yes, but you asked me my view. In my view it is not a defence that I did have a conversation with my clients along those lines. Question: Why do you say that? Answer: Because I don't believe that that is in compliance with what I had to do. My understanding is different. I thought I had to have an outline bill in writing with the client and I thought that my failure to have them was my problem, not my conversation with the client. I didn't have the conversation with the client to comply with some perception that there was a section of the Act that wanted me to. I thought I had to explain to the client in all fairness to the client in my dealings because I was upfront from the very word go at a time when they needed to know how I worked, what they would be paying, who would be doing their work, how it would be paid, how frequently it would be paid. The clients would not ask you. You had to volunteer it to them. Question: I'm sorry to be repetitive, but you were in the Tribunal yesterday when you heard it said by way of observation in the course of the Society's opening that if you had express instructions from the client to pay funds into the general account that would have been an answer to the claim against you? You heard that said, didn't you? Answer: I heard you say. Question: And you didn't say to any of your advisers, 'Look, that is what happened in my case'? Answer: Well, I assume Mr Gillis, what I have said to him before, would understand what I did say to the client. I didn't go any further." Counsel for the Solicitor submitted to the Tribunal that at no time did the Solicitor maintain that a client said to him: "I, client X, authorise you to pay this cheque into your general account as distinct from your trust account." Nevertheless counsel for the Solicitor submitted that by providing his outline bill and by asking for the moneys in the way which he did "on account of my costs" and by the very act of the clients paying in that money, what this Tribunal has is not only the fact of the authority, but also evidence of the authority. The evidence is in the fact of the payment. He also went on further to say: "In circumstances where I say to someone 'Give me $1,000, it will go to me, it is on account of my costs [sc: for work] which I am going to do'. Obviously it is not for work that I have already done because I haven't done any. If the person doesn't want to authorise me to bank them [sc $1,000] into my account, one may ask: why he would pay it? The answer is: because he has given the authority by the payment." The Solicitor in his declaration in answering the allegations of breach of section 61 of the Act stated at paragraph 49: "I recall that it was my practice when requesting from my clients costs in account of work to be done, to make that request in writing either: (a) by handing to my client a request for a specified sum written by me in my hand on a snap pad I kept on my desk. The snap pad had a carbon paper so that I could keep a carbon copy of my request for fees; or (b) including a written request for costs on account either separately or in bills of costs prepared by me, typed and posted or handed, to my clients." Counsel for the Solicitor in his written submissions said that the Solicitor did not avoid the fact that he was unable to produce any handwritten outline bills, and that the Solicitor had openly conceded in cross-examination: (a) in his letter of 23 March 1992 to the Law Society he had mislaid the handwritten outline bills; (b) that he had a less than desirable practice with regards to retention of copies of handwritten outline bills; (c) he could not find any copies of the handwritten outline bills notwithstanding that he had been called upon by the Law Society to produce copies of these documents both in the matters relevant to the complaint and in any other matters in which he rendered handwritten outline bills. The Solicitor gave evidence that his practice was not to file the carbon copy of the outline bill in the relevant file but to file such copies in a miscellaneous file he had been unable to locate. Hayter The Solicitor acted for a Mr and Mrs Hayter in the purchase of a property at Gilgandra. The purchase was settled by the Solicitor's Gilgandra agent on 20 November 1989. There were three deposits of money, namely $300, $974 and $184.01 into the Solicitor's general account before the Solicitor rendered his bill of costs on 8 December 1989. There was no handwritten or typed outline bill submitted to the clients. There is no evidence that the clients gave the Solicitor a direction to pay these amounts into his general account. Walters The Solicitor acted for Mrs Walters in respect of a matrimonial settlement in the Family Court and on 21 July 1988 he rendered the client his bill of costs in total for $5,156 including disbursements and credited the client with $3,000 paid by her. But apart from a typed outline bill of 11 May 1988 for $1,000 there was no evidence of any other outline bill although there were two file notes in the Solicitor's file of 29 April 1988 and 9 May 1988 in which it was noted that $1,000 was requested on account on each occasion. The Solicitor believes that he may have erroneously given credit to the client for $3,000 rather than $2,000. There is no evidence of any direction from the client to pay the $2,000 or $3,000 into the Solicitor's general account. Jordan The Solicitor acted for Mr Jordan in respect of certain matrimonial proceedings and on 28 April 1989 rendered the client a bill of costs in an amount of $3,570 including disbursements giving credit for $2,000 already paid on 17 February 1989 and in the same bill of costs requested a further $2,000 on account of costs. The Solicitor stated that at the time of the receipt of the first $2,000 he had provided the client with an outline bill and that prior to the receipt of the further $2,000 he provided the outline bill dated 28 April 1989. There is no evidence of these outline bills other than the request in the bill of costs of 28 April 1989 for the further $2,000. This request for moneys to be on account cannot be regarded in any way as being an outline bill. There is no evidence of any direction from the client to the Solicitor to pay either of the sums of $2,000 into his general account. Biotreat The Solicitor acted for this client in respect of certain debt recovery proceedings. On 14 April 1989 the Solicitor rendered the client a bill for his costs and disbursements totalling $920 giving credit for $300 paid on account leaving a balance then owing of $620. At the foot of that account he stated "amount required on account of further costs $500" which made the total of the amount requested $1,120. The client paid the $1,120 and the Solicitor paid the whole amount into his general account. Subsequently the Solicitor received a further sum of $300 on account of costs and he paid that amount into his general account on or about 6 June 1989. On or about 30 August 1989 the Solicitor received a further $300 on account of costs and deposited that amount to his general account. In respect of the $500 and the two sums of $300 there is no evidence of any outline bill being given to the client or of any direction from the client to the Solicitor to pay any of these amounts into his general account. Simkins The Solicitor acted for Mrs Simkins in respect of her matrimonial affairs including the sale of the matrimonial property which sale was completed on 21 November 1990. The allegation is that the Solicitor paid into his general account $1,250 on account of his costs without the authority or direction of his client and without rendering an outline bill for this amount. It appears however that from a file note of 23 December 1988 the solicitor did request $1,000 on account of costs. On 31 January 1989 the Solicitor rendered the client a bill of costs for $250 being the charge for a conference of one hour at the rate of $250 per hour. The Solicitor stated that $1,000 was paid into his general account but he could not find any copy of any handwritten request for this sum, although such a request was his usual practice. The Solicitor rendered the client a bill of costs on 5 April 1990 being $7,500 for costs and $100 for disbursements leaving $6,350 due after deducting the amount of $1,250 already paid. There is no evidence of any direction from the client to the Solicitor to pay the $1,000 on account of his costs into his general account. On the settlement of the sale of the matrimonial property the Solicitor directed the purchaser's solicitors to pay to him the sum of $12,751.50, which sum the Solicitor paid into his general account on 21 November 1990. This sum of $12,751.50 represented the Solicitor's costs of $2,795 on the sale of the property (for which amount he rendered a bill of costs on 22 November 1990) and the sum of $9,956.50 being his costs for acting in the Family Court matter, drawing a will and a power of attorney, arranging a pay-out for a car and matrimonial advice between the settlement of the proceedings in the Family Court and the final sale of the family home. It appears from the Solicitor's letter and statement of account of 21 March 1991 (to the client's sister, a Mrs Lyon) that this sum of $9,956.50 included the $6,350 owing under the bill of costs of 5 April 1990. However there is no evidence of the client directing the Solicitor to pay the sum of $12,751.50 or any part thereof into his general account. On or about 25 January 1991 the Solicitor transferred from his trust account to his general account on account of his costs the sum of $5,100. In his Reply the Solicitor stated that that amount comprised two components, the first being the sum of $1,100 for costs incurred by the Solicitor as at that date, and the second being the sum of $4,000 for costs which may be incurred by the Solicitor following that date. He admitted that no outline bill was provided to the client in respect of the $4,000, his excuse being that this bill was not provided due to an oversight on his part, and the fact that the client was not within Australia and was then in South Africa. As to the sum of $1,100 this amount was referred to as additional costs in the Family Court to 25 January 1991 in the letter and statement from the Solicitor to Mrs Lyons dated 21 March 1991. There is no evidence of any direction given by the client to the Solicitor to transfer these amounts of $1,100 and $4,000 into his general account from his trust account. Vukelic The Solicitor acted for Mr Vukelic in respect of matrimonial proceedings and on 29 April 1988 he rendered a typed outline bill to his client for $1,000 for work to be done in the Family Court. The Solicitor stated that $1,000 was paid into his general account after 29 April 1988 prior to 4 May 1988. This amount was credited to the client in the final account rendered by the Solicitor but there is no evidence that the client directed the Solicitor to pay this sum of $1,000 into his general account. Mitsue The Solicitor acted for Mrs Mitsue in respect of certain Family Law proceedings. On 16 November 1988 the client paid the Solicitor the sum of $1,000 on account of his costs and the Solicitor paid that sum into his general account. The Solicitor admitted that his file contained no record of an outline bill having been given to the client but says that in accordance with his normal practice he would have provided an outline bill to the client prior to depositing these moneys. On 17 February 1989 the Solicitor paid the further sum of $1,000 into his general account on account of his costs. He denies that no outline bill had been given to the client prior to payment of this sum of $1,000 – saying that such outline bill was incorporated into his account to the client dated 9 December 1988. In that account the costs for work done was $1,250 less paid the sum of $1,000 leaving a balance of $250, but the Solicitor added to the account a statement: "Amount required on account of further costs $1,000" making the total amount payable under this account $1,250. On 13 July 1989 the Solicitor sent to the client a bill of costs in respect of Children's Court proceedings for $1,937.50 crediting paid on account $1,000 leaving a balance owing of $937.50. By a letter of the same date he advised the client that if she wished him to act for her in respect of access and custody proceedings, in addition to payment of his account for $937.50 he required a further sum of $4,500 so that "proper preparation can be made, affidavits prepared and subpoenas issued with notifications sent to all immigration officers to protect your position with respect to your daughter against being snatched by your husband and taken to Japan where you would have little or no opportunity of ever getting her back". The client paid this sum of $4,500 to the Solicitor who paid it into his general account. Subsequently the Solicitor rendered his bill of costs on 16 November 1989 being $4,400 for his costs and $100 for disbursements. There is no evidence of any direction given by the client to the Solicitor to pay either the sum of $1,000 or the sum of $4,500 into his general account. Breaches of section 61 The Solicitor paid into his general account either directly or by transferring from his trust account costs and disbursements without any direction from the client so to do. The Tribunal finds that these payments by the Solicitor into his general account were in breach of Section 61 of the Act. Section 61(7) of the Act provides that a wilful contravention of section 61(1) is professional misconduct. The meaning of "wilful" in the conduct which might constitute a wilful failure in terms of section 43 of the Legal Practitioners Act 1898 (the Former Act and section 43 being the predecessor to section 61(7) of the Act) was considered in Re Hodgekiss (1962) 62 SR (NSW) 340 (an appeal to the Full Court of the Supreme Court of New South Wales from an order of the Solicitors' Statutory Committee) when Hardie J reviewed a number of English cases which dealt with the concept of "wilful neglect or default". He noted among them a statement by Maugham J (as he then was) in Re Vickery (1931) 1 Ch 572 at 583 in the following terms: "A person is not guilty of wilful neglect or default unless he is conscious that, in doing the act which is complained of or in omitting to do the act which it is said he ought to have done, he is committing a breach of his duty, or is recklessly careless whether it is a breach of his duty or not." Hardie J concluded that the conduct would be "wilful": "on occasions when the solicitor knew or believed that he was committing such breaches or was recklessly careless in that regard. It is thus an essential in an enquiry as to whether there have been wilful breaches by a solicitor of the provisions of sections 41 and 42 to examine the facts and circumstances relevant to his state of mind, knowledge and intention at the material dates." It is not suggested or submitted by the Law Society that the Solicitor deliberately or purposefully breached the provisions of section 61 of the Act. Indeed the evidence is that the Solicitor did not know and did not believe that he was committing any such breaches. The question that the Tribunal has to determine is whether the Solicitor was "recklessly careless in committing these breaches of his duty". The Law Society submitted that in effect the Solicitor says "'Look, I had no idea what section 61 provided and although I was the person who, in a hands on sense, was entirely responsible' – (the Solicitor doing all of his own accounting and filing as well as the legal work of his practice) and that if the Tribunal takes the view that the Solicitor simply did not ever bother to read section 61 to satisfy himself as to what the requirements were, then that is recklessness which is tantamount to wilfulness". Counsel for the Solicitor submitted that from the date that the Investigator Mr Holmes first interviewed the Solicitor in his office he always maintained that what he was doing he understood to be in compliance with what was required of him under the Act and in particular: (a) he was not of the belief that "direct authority" in the manner in which the Law Society opened its case was required or importantly, sufficient so as to discharge the statutory requirements; (b) he believed that an "outline bill" was what the client required and understood the need to give an outline bill; (c) he explained to clients that what they were giving him were going into his funds. The Law Society presented its case on the basis that no outline bills had been provided by the Solicitor to his clients prior to or shortly after funds on account of costs were paid into his general account. Counsel in opening for the case of the Law Society stated that if the Solicitor had had direction or authority from the client to pay these funds into his general account this would have been an adequate answer to the section 61 allegations. However counsel for the Law Society later in his final submission in answer to a question of the Chairman said that there were two things required to comply with section 61 namely: (1) a direction under section 61(2) and (2) an outline bill as required by clause 8 subclause 2 of the Former Regulation. The Tribunal has already expressed its opinion that what was required was direction from the client as to payment and if such a direction was given there was no breach of section 61 if the Solicitor failed to render to the client an outline bill. It would however have been prudent for the Solicitor to render such an outline bill so that there would have been a record of the client's informed consent to pay these moneys into his general account. Were the breaches of section 61 wilful? In order to answer this question it is necessary to examine the facts and circumstances relevant to the state of mind, knowledge and intention of the Solicitor at the material dates. In the matters where the Solicitor paid costs and disbursements directly into his general account for his costs and disbursements to be incurred the Tribunal is satisfied that the state of his mind and intention on his evidence was to comply with the statutory requirements and that he held the belief that the delivery of an outline bill was an adequate compliance in each case. The Tribunal is satisfied that in these matters the Solicitor did have an honest belief that he was complying with all the necessary statutory requirements. The further question to be answered is whether the Solicitor in paying his moneys into his general account, was recklessly careless whether it was a breach of his duty or not. The Tribunal finds that the Solicitor was careless when he committed these breaches of section 61, but nevertheless the Tribunal is satisfied that this lack of care was not reckless and thus his conduct in each of these matters did not amount to professional misconduct. In the matter of Simkins on 25 January 1991 the Solicitor transferred from his trust account to his general account the sum of $4,000 for costs that may have been incurred by the Solicitor following that date. The Tribunal is satisfied that the Solicitor well knew that he had no authority from his client to make this transfer and that indeed in doing so, he knew that he was in breach of section 61. The Tribunal finds that this breach was wilful and amounts to professional misconduct. Overcharging/Overservicing It has long been recognised that the charging of extortionate or grossly excessive costs by a solicitor may amount to professional misconduct – The Law Society of NSW v Veron (1966) 84 WN Pt 1 NSW 136 at 144. Mahoney JA in the case of Veghelyi v The Law Society of NSW LPDR No 2 of 1996 (an appeal from the former Tribunal to the NSW Court of Appeal) in reviewing the authorities on gross overcharging stated that it was relevant to consider the reason why gross overcharging, as such, may be held professional misconduct. He said (inter alia): "Clients are, or may frequently be, in a vulnerable position vis-B-vis their solicitors; the presumption of undue influence is, I think, based at least in part upon the fact that when making decisions clients ordinarily or at least frequently place trust in their solicitors. They ordinarily are not in a position to know without investigation what work must be done and what charges are fair and reasonable; they ordinarily assume that the solicitor will only make such charges. "Solicitors are, on the other hand, informed or in a position to inform themselves, of what work may be required and what are fair and reasonable charges. They are, in that sense, in a position of advantage and trust is placed in them. Clients are entitled to be protected against the abuse of such an advantage. It is, I am inclined to think, the fact that that advantage has been misused which may, in a particular case, warrant what the solicitor does being categorised as professional misconduct." In considering the principles on which charges are to be categorised as gross overcharges in the relevant sense Mahoney JA said: "A solicitor's entitlement to remuneration is conventionally stated in terms of what is fair and reasonable in the circumstances. ... Where charges are so beyond that as to be grossly disproportionate, professional misconduct may be involved ... a principle stated in such terms is, of course inherently indeterminative. But I do not think that it is possible to formulate the principle in terms which are more specific. "The determination of what in a particular case is fair and reasonable will require consideration of various factors. Section 208G of the Act provides: "That in assessing what is a fair and reasonable amount of costs, the costs assessor may have regard to any or all the following matters: (a) the skill, labour, responsibility displayed on the part of the barrister or solicitor responsible for the matter; (b) the complexity, novelty or difficulty of the matter; (c) the quality of the work done and whether the level of expertise was appropriate to the nature of the work done; (d) the place where and the circumstances in which the legal services were provided; (e) the time within which the work was required to be done; (f) the outcome of the matter." Mahoney JA also referred to the case of NSW Crimes Commission v Flemming (1991) 24 NSWLR 1116 in which case Gleeson CJ discussed the determination of "reasonable legal expenses" by reference to "the market for legal services in which the client, as a consumer is obliged to seek such services". Mahoney JA went on to say: "Such factors assist in the determination both of what is fair and reasonable and what is grossly disproportionate. But in the end, the quantification of costs remains an exercise in judgment, upon the result of which minds may legitimately differ." Mahoney JA said in his opinion there was force in the suggestions that, it would be wrong to categorise as grossly excessive and so professional misconduct a solicitor's quantification of costs where the solicitor relied upon the terms of a written costs agreement and calculated his costs accordingly or where the quantification resulted from the fact that he had an excessive view of his own services." In further discussing costs agreements Mahoney JA said: "A solicitor may desire to have a large small practice or he may believe his services to be of such value that he can successfully practice by doing a few things for large fees. Within limits, a solicitor may choose the nature of the practice he conducts and have costs agreements which are appropriate to it. But, as I have said, there are limits. There are circumstances in which costs, though calculated according to a costs agreement, will in total be unacceptably excessive. "Cases dealt with by the Tribunal (sc: in that case) illustrate this. They include cases in which the total of the fees charged was, in my opinion, far beyond what would ordinarily be reasonable for the work shown to have been done." "Overservicing" can occur a number of ways. For example – a service performed by a practitioner may be unnecessary or take an unnecessary length of time to be performed or the task may fall within a category which would normally be carried out by a person less qualified than the practitioner. The Solicitor in his Reply denied that the alleged overcharges were excessive and said that his charges in the Family Court matter were in accordance with costs agreements in all cases. In the matters of Hayter and Simkins (so far as that latter matter included conveyancing matters) he claimed that his charges were in accordance with the appropriate conveyancing scale. In the Family Court matters the Law Society alleged that the cost agreements would not have been upheld by the Family Court. The Tribunal during the hearing ruled that it would not accept evidence from either the Investigator Mr Holmes or Ms Pattison as to their opinion of the law which applied to a determination of whether or not the Family Court would have upheld the costs agreements. The Tribunal is of the opinion that it is not open for the Tribunal to make a finding that the Family Court would not have upheld any or all of these costs agreements. Nevertheless the Tribunal in its opinion is entitled to examine and make its finding on any particular aspect of these costs agreement or the charges made by the Solicitor under such costs agreement to determine whether or not the charges were reasonable in all the circumstances or were disproportionate to what would have been regarded as reasonable charges. Clark The Solicitor acted for Mrs Clark in Family Law proceedings and following settlement of those proceedings he rendered a lump sum bill to her totalling $17,857. When the client complained about the amount charged the Solicitor rendered an itemised account dated 18 April 1990 totalling $27,730.50. Ms Pattison assessed the scale costs (without regard to the charges set out in the costs agreement) at $7,800.30. Mr Holmes, the Investigator, took an overall view of the file and considered that a reasonable fee would be in the range of $8,000 to $10,000. However he later assessed the solicitor's profit costs on a time costing basis at the Solicitor's hourly charge at $250 as provided by the costs agreement at $11,590. Mr Delaney who is a senior and experienced solicitor in Family Court matters expressed the opinion in his statutory declaration (see paragraph 16) that the actual figure for costs charged by the Solicitor do not appear to be excessive in accordance with his scale for the work done. He did qualify this opinion by saying that the bill of 18 April 1990 did contain a number of mathematical errors in relation to the hours spent and the amounts charged. In cross-examination Mr Delaney stated that he could not recall on what basis he had taken the view that the errors were mathematical and were not simply the application of the formula in the costs agreement. In the costs agreement clause 5 provided the Solicitor would charge the client at the following rates (inter alia): "(a) typing of documents at the rate of $30 per page ... (d) telephone calls with professional personnel at the rate of $40 for the first 10 minutes or any part thereof and thereafter at the rate for professional time ... (f) filing, serving, searching or making enquiries or to deliver any document $100 per attendance (g) professional time spent in conference, receiving instructions, drafting, advising, perusing documents, travelling from and back to the office, awaiting time at court or any other attendances at the rate of $250 per 60 minutes or part thereof. Typing The Family Court scale at that time provided a rate of $7.50 per page (which only applied to Court documents). In the opinion of the Tribunal a charge of $30 to type a page was unreasonable. At times the Solicitor personally typed documents. At those times he did not charge $30 per page. He charged at his hourly rate for professional time of $250 or part thereof. Mr Holmes, the Investigator referred to the charges on 29 June 1989 for typing (apparently done by the Solicitor) were submitted at the Solicitor=s hourly rate of $250 or part thereof and the charge was $750. The time for this task that the Solicitor took as noted on the file was 2.5 hours although the Solicitor rounded his charge up to $750 for 3 complete hours. On the same day $30 per page was charged typing an affidavit and an application. These documents were the original version of the documents later typed by the Solicitor for which he charged $750. Telephone Calls The Solicitor charged a rate of $40 for the first 10 minutes or any part thereof for any telephone calls irrespective of whether these calls were with professional personnel, his client or any other person. This charge of $40 for a telephone call was charged by the Solicitor on 16 June 1989 for receiving a message which had no content except that the person rang and would ring back. Filing and Delivery of Documents This rate of $100 for fixed charge irrespective of the time taken in performing the task, is referred to by Mr Holmes, the Investigator in these terms. "Such attendances were to be contrasted to the Family Court scale rate of $60 per hour. Such attendance would likely take half an hour or less with outside contractors who are readily available who work to the unit cost of under $20 per attendance to file documents". The following are relevant: 12 May 1989 – filing application in Family Court $100 26 May 1989 – sending letter by security post $250 31 May 1989 – sending further sealed copies of documents to Court $250 13 June 1989 – Court to uplift order $250 3 July 1989 – filing letter at Court $100 13 July 1989 – filing $100 25 September 1989 – filing application for discovery and particulars $100 In a letter from the Solicitor to the Law Society of 23 March 1992 he stated: AI do not employ a registration clerk but since I'm often in the Family Court, I mostly file documents at the same time I am awaiting my other proceedings with the result that I do not charge for the filing of the document. Accordingly, that part of the service provided to me is totally free notwithstanding my right to charge in accordance with my costs agreement. Professional Time The rate was A$250 per 60 minutes or part thereof. The rate if applied at the full rate of $250 to part of an hour was clearly unreasonable and unfair to the client. There are a number of instances of the Solicitor charging $500 for attendances of 1.5 hours each. There are also instances of the solicitor charging a full hour of $250 to prepare documents which were not of such a complexity that would require an hour to prepare. The following matters are relevant: 4 May 1989 – attending you in conference – 1.5 hours $500 9 May 1989 – attending Childrens Court – 1.5 hours $500 29 June 1989 – attending personally to preparation of typed documents – 2.5 hours $750 30 June 1989 – attending you in conference $250 (noted in file 15 minutes spent) 13 July 1989 – attending in conference – 1.5 hours $500 30 August 1989 – conference – 1.5 hours $500 22 September 1989 – conference $250 (noted in file 15 minutes spent) 7 November 1989 – attending you in conference $250 (noted in file half an hour spent) 7 November 1989 – attending Order 24 conference – 3 hours $750 (noted in file 2.75 hours spent) 7 December 1989 – appointment $250 Instances of the documents for which the Solicitor charged $250 an hour for drafting were: 1 May 1989 Drafting application for injunction $250 Drafting statement of financial circumstances $250 Drafting affidavit in support $250 Drafting application to dispense with personal service $250 Drafting affidavit in support of application $250 Drafting application for maintenance for Childrens Court $250 Drafting affidavit in support for Childrens Court $250 Drafting statement of financial circumstances for Childrens Court $250 Drafting application to Dispense (with personal service) in Childrens Court $250 Drafting affidavit in support of application to suspense in Childrens Court $250 There was a duplication of the documents prepared in the Family Court and the Children's Court. For example, the statements of financial circumstances were for all purposes identical. The Tribunal finds that the Solicitors account of 18 April 1990 of $27,603.50 represented a grossly excessive overcharging on the part of the Solicitor with the total of the fees charges being far beyond what would ordinarily be reasonable for the work shown to have been done. This overcharging amounted to professional misconduct. Hayter The Solicitor acted for Mr Hayter in respect of the purchase of a property at Gilgandra. The Solicitor instructed solicitors at Gilgandra to act as his agents on the settlement of the purchase. Following settlement the Gilgandra solicitors sent a trust account statement to the Solicitor together with the cheque for refund in favour of the Solicitor for $184.01. In this statement the Gilgandra solicitors charged for their services $63.72. The Solicitor by his memorandum of costs dated 8 December 1989 to the client billed the client $463.72 for the Gilgandra solicitors for acting as his agent – an overcharge of $400.00. On the day following the inspection of the file by the Investigator Mr Holmes the solicitor sent to the client a cheque for $500.00 and told Mr Holmes that he noticed his error and it was entirely innocent on his part. The extra $100 was for interest for holding the $400.00 for two years. A draft of the Solicitors memorandum of costs in his own handwriting revealed that the agents charges were noted at $63.72 and were altered by him to $463.72. In his memorandum of costs to the client, the client also charged as disbursements government fees of $145.00, title searches of $261.00 and trunk calls to Gilgandra of $65.00. There was no material in the file which could verify the payment or quantum of these disbursements. While the Solicitor was unable to justify these charges the evidence does not satisfy the Tribunal that these disbursements were overcharges. The charge of $463.72 stated as being a disbursement to the Gilgandra agents was a grossly excessive overcharge and amounted to professional misconduct. Walters The Solicitor acted for Mrs Walters in respect of a family law property settlement. The Solicitor on 29 April 1988 quoted their costs to be approximately $2,000.00. The client signed a costs agreement dated 13 May 1988 providing the Solicitors charge for professional time at $220 per hour and typing $20 per page. Following completion of the matter the Solicitor rendered the client an account dated 21 July 1988 for fees totalling $5,060. When the investigator Mr Holmes asked the Solicitor: Why was the bill $5,060? the reply was that There was a lot of extra work done. She is trustee of a number of trusts of her fathers. She has never complained or objected. I would have told her that the costs were escalating. If you look at the file you will see the work that was done.. In the opinion of Mr Holmes an amount of 9 to 10 hours of the Solicitors time to conclude the matter would have been fair for the work to be done. On reviewing the file Mr Holmes would have added the maximum of say another 4 hours for negotiations and Aextra work as claimed by the Solicitor and thus applying the Solicitors hourly rate of $220 the fees should not have exceeded $3,000. On the other hand Ms Pattison found that assuming the hours claimed by the Solicitor were in fact accurate, upon the assumptions they were and in accordance with the costs agreement, the total costs would have amounted to $6,117. The Tribunal is not satisfied that the charge of the Solicitor of $5,060 for his fees in this matter was a grossly excessive overcharge. Accordingly the Tribunal dismisses this ground of the complaint. Jordan The Solicitor acted for Mr Jordan in family law property settlement proceedings. The Solicitors charge for professional time as provided by the costs agreement was $250 for 60 minutes or part thereof. Two charges were alleged to be excessive overcharges namely: 1. Charge of $750 for the Solicitors attendance at the Family Court in Parramatta for a directions hearing. 2. Charge of typing of 80 pages of $2,000. The charge for $750 is 3 hours at $250 per hour including 2 hours of travelling time from Sydney to Parramatta and back from Parramatta to Sydney. The claim by the Law Society was that it was unnecessary for the Solicitor to personally attend at Parramatta to appear at the directions hearing in that he could have appointed an agent, a solicitor in Parramatta, or briefed a barrister to appear for his client which could have resulted in a much lesser charge to the client. The Solicitor in his evidence maintained that he acted in the interests of his client in making this personal appearance at Parramatta and maintained that in fact he had told his client that he would be making personal attendances at Parramatta and in speaking of this client and also of Mr Vukelic (see later) he said: I would say it would be cheaper if they used an agent but that I had what I called hands on to make sure nothing ever went wrong. and he further stated that in this and the case of Vukelic there was a compelling need for him to attend personally at Parramatta. Mr Jordan was not called to give evidence to the contrary and in the absence of any such evidence the Tribunal accepts the evidence of the Solicitor as to the necessity and his instructions to attend personally at Parramatta for the directions hearing. The Tribunal is satisfied that the time spent in the Solicitor travelling to and from Parramatta and attending Court namely 3 hours was not unreasonable in the circumstances. The Tribunal is not satisfied the charge of $750 was a grossly excessive charge in the circumstances although the Tribunal would have regarded a lesser charge should have been made for the travelling time of $250 per hour. In respect of the claim that there was an overcharge for typing 80 pages at $25 per page the Tribunal is satisfied that the charge of $25 per page was unreasonable and unfair to the client. The Tribunal is not satisfied on the evidence that the typing of 80 pages was an over-service. The charging of $25 per page for typing was a grossly excessive overcharge and amounts to professional misconduct. Simkins The Solicitor acted for Mrs Simkins in respect of her matrimonial affairs including the sale of the matrimonial property. A costs agreement dated 1 March 1989 was entered into by the client with the Solicitor for work done during the year 1989. The charge for professional time was $250 per 60 minutes or part thereof. On 13 February 1990 (the date 13 February 1992 referred to in Ms Pattison's report of 30 September 1994 being incorrect) was entered into by the client with the Solicitor and the rate for charge for professional time in this agreement was $300 per 60 minutes or part thereof. Neither of these costs agreements related to or incorporated for fees to be charged by the Solicitor for conveyancing or any work other than family law matters. The Solicitor acted for the client in concurrent proceedings for property settlement in the Family Court and maintenance in the Children's Court. The matter was settled at the time of an Order 24 conference in November 1989. Consent orders were made by the Family Court for the sale of the matrimonial property with 75 per cent of the net proceeds to be paid to the wife, the balance to the husband. The orders provided that the Solicitor was to act on the sale charging 75 per cent of the scale and the husband's solicitors were to charge 25 per cent of scale for their work. On 5 April 1990 the Solicitor rendered a short form account to the client for acting on the "proceedings in the Family Court" for $7,600 being profit costs of $7,500 (expressed to be 30 hours at $250 per hour) and sundries of $100 – the actual amount payable being $6,350, with credit given for $1,250 already paid on account. By letter of 21 March 1991 the Solicitor sent a letter and statement of account to the client's sister a Mrs Lyons in which these costs and disbursements of $7,600 were increased to $8,806.50. The additional $1,206.50 was interest charged by the Solicitor from 5 April 1990 to 21 November 1990. This interest charge represented a rate of interest of approximately 29 per cent per annum. There was no provision in the cost agreement which entitled the Solicitor to charge interest. The Solicitor claimed that there was an oral agreement with the client that she would pay interest for the outstanding amount. However the Solicitor could not recall any discussion with the client which identified the rate of interest to be charged. The Tribunal is satisfied that the charge by the Solicitor of $1,206.50 for interest was a grossly excessive overcharge. There is no acceptable evidence that the client had agreed to pay any interest at all and this grossly excessive overcharge amounts to professional misconduct on the part of the Solicitor. In respect of the profit costs of $7,500 charged by the Solicitor in his account of 5 April 1990 the Investigator Mr Holmes and Ms Pattison had difficulty owing to the lack of information in the records in the file to estimate the time spent or the time that should have been spent by the Solicitor to justify 30 hours of his professional time. Holmes estimated that a fair fee would have been $5,000. Mr Pattison estimated a fair fee of $3,145 in accordance with the Family Court Scale. Nevertheless the Solicitor was entitled to the benefit of the costs agreement and while the Tribunal is of the opinion that its charge of $7,500 for his profit costs was an overcharge the Tribunal was not satisfied that that overcharge was grossly excessive. On 22 November 1990 the Solicitor rendered to his account for acting on the sale of the matrimonial property for $2,795 being profit costs of $2,482 and $313 disbursements. In this matter the Solicitor had prepared four contracts of sale, the last contract prepared being the contract for the eventual sale. In respect of the three contracts which did not proceed the Solicitor charged $380 costs for the preparation of each contract – his fees for these contracts thus totalling $1,140. Fees that the Solicitor charged for these conveyancing matters were not the subject of any costs agreement. The Solicitor relied on the conveyancing scale in justifying a fee of $380 for the preparation of each contract. Mr Holmes the Investigator assessed the scale costs under schedule 2 of the Conveyancing Act at $420 for the three additional contracts assuming that the special conditions were retyped each time (rather than photocopied). Mr Holmes the Investigator stated that the file contained no evidence to justify fees for issuing contracts for fees totalling $1,140 and in his opinion $400 would have been a fair fee for that work. The Tribunal is satisfied that the charge by the Solicitor for the preparation of the three additional contracts for a total fee of $1,140 was a grossly excessive overcharge and amounts to professional misconduct on the part of the Solicitor. In the statement of account of 21 March 1991 from the Solicitor to the sister of Mrs Simkins, Mrs Lyons, the Solicitor charged $1,500 for "costs for further matrimonial advice between settlement of the proceedings in the Family Court and the final sale of the family home". Mr Holmes was unable to find evidence in the file to justify this fee even on the basis of the time costing of the Solicitor at his rate of $250 in the costs agreement. Mr Holmes considers that a fair fee would have been in the order of $300-$400. Ms Pattison assessed the scale costs at $340 and that she could not find information in the file to support the claim for the numbers of hours that the Solicitor evidently claimed for his professional time in accordance with the costs agreement. In the statement of 21 March 1991 the further charge of $1,100 was for "costs in Family Court to 25/1/91". Mr Holmes was of the view that this fee was excessive and that a fair fee for the work done would have been not more than $600-$700. Ms Pattison assessed the approximate scale costs at $640. It is evident that the Solicitor was entitled to the benefit of the later costs agreement and thus able to charge $300 per hour or part thereof for his professional time. While the Tribunal considers that the charges of $1,500 and $1,100 were overcharges the Tribunal is not satisfied on the evidence that these overcharges were grossly excessive. The further charge referred to in the statement of 21 March 1991 was a fee of $550 for preparing a statutory declaration by the solicitor of some 10 lines, faxing it to South Africa to the client and also for the Solicitor's attendance at a short mention of 45 minutes duration in the Family Court terminating the husband's application. Mr Holmes would have assessed a fair fee for work done would be in the range of $300-$500. Ms Pattison assessed the scale costs at $300. The Tribunal is not satisfied that this charge of $550 was an overcharge having regard to the charge that the Solicitor was entitled to charge under the costs agreement of January 1990. Vukelic The Solicitor acted for Mr Vukelic in respect of matrimonial proceedings. The client entered into a costs agreement with the Solicitor under which agreement the Solicitor was entitled to charge $200 per hour for his professional time and typing at $12 per page. On 26 May 1988 the Solicitor attended at the Family Court, Parramatta on a directions hearing and charged $800 for his costs of 4 hours of professional time including travelling. The Solicitor claimed that he had instructions from his client to personally attend at Parramatta having similar instructions that he had in the mater of Jordan. The time spent and charged by the Solicitor for attendance at the Family Court in Parramatta in the opinion of the Tribunal was not unreasonable and while the Tribunal is of the opinion that the charge made by the Solicitor in the circumstances was on the high side, the Tribunal is not satisfied in all the circumstances that the charge of $800 was a grossly excessive overcharge. The further allegation of overcharging is that on 4 May 1988 the Solicitor charged $324 for typing being 27 pages at $12 a page. Ms Pattison in her report stated that the documents typed were Family Court documents consisting of statements of financial circumstances, husband's cross-application and affidavit and notice of address for service. Of the 27 pages 4 were cover sheets which averaged 70 words each and 7 of the pages (the statement of financial circumstances minus cover sheet) constituted a printed form in which the blanks had been typed in being approximately 200 words. She commented that accordingly $132 was charged for typing the 11 pages of cover sheet and form. While the Tribunal is of the opinion that the charge of $324 for typing 27 pages was an overcharge, the Tribunal is not satisfied that this overcharge was grossly excessive. Solicitor's Background The Solicitor was admitted as a solicitor of the Supreme Court in 1971 after having served articles of clerkship with Aitken & Pluck. He was then employed for a period of years by Gadens Ridgeway (then Gaden Bowen & Stewart) until he commenced practice as a sole practitioner in 1975. The Solicitor states that he retired from the legal profession on 30 June 1992 and that he does not hold a current practising certificate. He is presently employed as a legal costs consultant. The Solicitor was educated at Sydney Grammar School and at Sydney University. In 1970 he graduated as a BA, LLB from Sydney University, being placed twentieth out of a class of 400. The Solicitor is a married man with two children. The Solicitor says that during the 2 year period following the complaint of Mrs Clark (which was notified to him by the letter from the Law Society of 18 May 1990) his mental health deteriorated to the point where he became suicidal. He attributed his deteriorating mental health to the additional stress occasioned by the complaint and the protracted investigation by the Law Society. For these reasons as he was unable to cope with the stress in June 1992 he closed his legal practice and retired from the legal profession. During this time the Solicitor had consulted his family doctor Dr Morris Segal and a consultant psychiatrist Dr Edgar Freed. The Solicitor was seen by Dr John Ellard, psychiatrist, on 9 December 1992 and a copy of Dr Ellard's report of 11 December 1992 was before the Tribunal. Dr Ellard in his report which was addressed to the Solicitor said (inter alia): "It would seem important that should you resume practice you resume in a professional role which prevents you – or at least discourages you – from becoming excessively involved. For example, it would be very wise for you to avoid Family Court matters and very wise for you to be an employed solicitor in a firm in which you were able to discuss matters of concern with colleagues." And later: "To put it shortly I think that you have a personality structure which has made you vulnerable to developing the excessive involvement which I have mentioned above." At the interview of the Solicitor by the Investigator Mr Holmes in 1991 he stated that he had a support staff of 2 part-time secretaries who shared the one secretarial position. The secretarial position was basically one of typing duties only. If the Solicitor was in his office he took all his own telephone calls. His practice comprised mainly litigation being approximately 90 per cent of his workload with the balance being probate and conveyancing work. He did not undertake legal aid work nor did he conduct third party or workers compensation matters. The Solicitor told Mr Holmes that he offered his clients the expertise of himself as an advocate, "that is my selling point". From a random inspection of the files of the solicitors Mr Holmes was able to confirm that the Solicitor had not briefed counsel in any of the matters which Mr Holmes inspected. It is apparent from the evidence in the reports of Mr Holmes and Ms Pattison that the records the Solicitor kept of his practice and of his client's affairs, and in particular records of the time that was spent on individual attendances for clients and his file notes, recording instructions from its clients and its advice to them, were either absent or if present lacking the detail which a solicitor would normally keep. Conclusion and Orders The Tribunal has found that in one matter the Solicitor wilfully breached Section 61 of the Act which wilful breach constitutes professional misconduct. The Tribunal has in a number of matters also found that he charged amounts for his services which were grossly excessive overcharges, which overcharging amounts to professional misconduct. In The Law Society v Foreman LPDR No 4 of 1994 Giles AJA, in referring to the jurisdiction of the Tribunal in discipline matters, said: "The jurisdiction of the Tribunal and of this Court in disciplinary matters is exercised to protect the public, not to punish the solicitor. The object of protection of the public may require that the legal practitioner be removed from the Roll, be suspended from practice, or only be permitted to practice under particular circumstances, where the practitioner is not fit to be held out to be trusted, at all, for a time, or without qualification, with the heavy responsibilities attendant on the office. The public is protected by ensuring that those unfit to practise do not continue to hold themselves out as fit to practise. But the object of protection of the public also includes deterring the legal practitioner in question from repeating the misconduct, and deterring others who might be tempted to fall short of the high standards required of them. And the public, and professional colleagues, who practise in the public interest, must be able to repose confidence in legal practitioners, so an element in deterrence is an assurance to the public that serious lapses in the conduct of legal practitioners will not be passed over or lightly put aside, but will be appropriately dealt with." The Tribunal does not consider that this is a case where it is necessary for the Solicitor to be removed from the Roll in order to protect the public. However, the Tribunal is of the opinion the right of the Solicitor to practice in the future must be restricted or qualified so that he may not practise as a principal (that is to say either as a sole practitioner or in partnership) until such time as he is able to demonstrate that he is competent so to do. The professional misconduct of the Solicitor calls for the imposition of a fine and an order that he pay the costs of the Law Society of these proceedings. While the Tribunal found in a number of matters that breaches by the Solicitor of section 61 were not wilful, the Tribunal is of the opinion that the Law Society was justified in alleging that these breaches of section 61 were wilful. It was the evidence of the Solicitor at the hearing which persuaded the Tribunal to find that these breaches of section 61 were not wilful. Consequently the Tribunal is of the opinion that the Law Society is entitled to an order for its costs of the whole of the proceedings. The Tribunal orders that: 1. the Solicitor pay a fine of $8,000 within 60 days; 2. the Solicitor not be issued with an unrestricted practising certificate so as to allow him to practise as a principal unless and until the Solicitor has undertaken and successfully completed such courses in legal education and practice as may be nominated by the Law Society and the Law Society is satisfied that the Solicitor is competent to practise as a principal; 3. the Solicitor pay the costs of the Law Society; 4. if agreement cannot be reached as to the amount of such costs either party shall have liberty to apply to the Tribunal for a determination of those costs under section 171E of the Act. 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.