New South Wales Court of Appeal CITATION: Davison v Council of the New South Wales Bar Association [2007] NSWCA 227 HEARING DATE(S): 06/08/07 JUDGMENT DATE: 29 August 2007 JUDGMENT OF: Beazley JA at 1; Ipp JA at 2; Hoeben J at 123 DECISION: Appeal dismissed with costs. CATCHWORDS: LEGAL PRACTITIONERS – conduct of barrister – barrister guilty of professional misconduct by failing to pay income tax for approximately 16 years – barrister had filed taxation returns and was not convicted of any criminal offences – barrister had ample funds to discharge his debts to the Australian Taxation Office and to his trustees in bankruptcy but chose instead to lead an extravagant lifestyle and to give money to family members – sanctions for professional misconduct – striking off – whether dishonesty or fraud in the context of non-payment of income tax is an essential ingredient in ordering a legal practitioner's name to be removed from the roll. D Bankruptcy Act 1966 (Cth), ss 139P, 139ZL Bankruptcy Regulations 1996 (Cth) LEGISLATION CITED: Income Tax Assessment Act 1936 (Cth), s 264 Legal Profession Act 1987 (NSW), ss 127(1)(b), 171C(1)(a), 171F Supreme Court Act 1970 (NSW), s 75A Taxation Administration Act 1953 (Cth), ss 8C(1)(a), (f) Barwick v Council of the Law Society of New South Wales [2004] NSWCA 32 Clyne v The New South Wales Bar Association (1960) 104 CLR 186 Council of the New South Wales Bar Association v Davison [2005] NSWADT 252 Incorporated Law Institute of New South Wales v Meagher (1909) 9 CLR 655 In re Davis (1947) 75 CLR 409 Law Society of New South Wales v Foreman (1994) 34 NSWLR 408 New South Wales Bar Association v Cummins (2001) 52 NSWLR 279 New South Wales Bar Association v Hamman [1999] NSWCA 404 CASES CITED: New South Wales Bar Association v Somosi (2001) 48 ATR 562; [2001] NSWCA 285 New South Wales Bar Association v Stevens (2003) 54 ATR 25; [2003] NSWCA 95 New South Wales Bar Association v Young (2003) 54 ATR 22; [2003] NSWCA 228 Prothonotary of the Supreme Court of New South Wales v Costello [1984] 3 NSWLR 201 Re a Practitioner (1984) 36 SASR 590 Re Evatt; Ex parte New South Wales Bar Association (1967) 67 SR (NSW) 236 The Council of the New South Wales Bar Association v Sahade [2007] NSWCA 145 The Southern Law Society v Westbrook (1910) 10 CLR 609 Wentworth v New South Wales Bar Association (1992) 176 CLR 239 Ziems v The Prothonotary of the Supreme Court of New South Wales (1957) 97 CLR 279 PARTIES: William Roy Davison (Appellant) Council of the New South Wales Bar Association (Respondent) FILE NUMBER(S): CA 40194/06 COUNSEL: P Clay/F Berglund (Appellant) C E Adamson SC/S E Pritchard (Respondent) SOLICITORS: For Self (Appellant) Eakin McCaffery Cox (Respondent) LOWER COURT JURISDICTION: Administrative Decisions Tribunal LOWER COURT FILE NUMBER(S): ADT 042024/04 LOWER COURT JUDICIAL OFFICER: M Chesterman ADCJ (Deputy President) S Norton SC (Judicial Member) C Bennett (Non-Judicial Member) LOWER COURT DATE OF DECISION: 7th November 2005 LOWER COURT MEDIUM NEUTRAL CITATION: [2005] NSWADT 252 IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40194/06 ADT 042024/04 BEAZLEY JA IPP JA HOEBEN J Wednesday 29 August 2007 WILLIAM ROY DAVISON v COUNCIL OF THE NEW SOUTH WALES BAR ASSOCIATION FACTS The appellant, William Roy Davison, was a barrister admitted to practise in New South Wales. He was called to the Bar in 1980 and appointed a Senior Counsel for the State of New South Wales in 1994. From the 1989/1990 financial year he failed to meet his income taxation obligations. This resulted in the non-payment of income tax owed by him for some 16 years. Between the years 1990 to 2005 the appellant had made a number of financial investments that, ultimately, failed, experienced marriage difficulties, and had to endure the death of his son. He was also declared bankrupt on three occasions and, in addition to his owing money to the Australian Taxation Office, was in arrears substantially as regards the contributions to be made by him to his trustees in bankruptcy. The appellant argued that his failure to meet his taxation obligations (the total of which amounted approximately to $1,324,570) was attributable both to his failed investments and familial problems. The respondent, the Council of the New South Wales Bar Association ("the Bar Council"), submitted otherwise, contending that during the relevant 16-year period Mr Davison had the ability to pay in full the tax owed by him and still live a reasonably comfortable life but that he chose instead to spend his money on an extravagant lifestyle and pay various sums of money to members of his family. On 1 November 2001, the respondent decided to cancel the appellant's practising certificate as from 9 November 2001. On 1 July 2004, the Bar Council filed in the Administrative Decisions Tribunal of New South Wales ("the Tribunal") an information under Part 10 of the Legal Profession Act 1987 (NSW) against Mr Davison, alleging that the appellant had been guilty of professional misconduct within the meaning of s 128 of that Act. The Bar Council relied on four grounds in contending that the appellant was guilty of professional misconduct and that, as a consequence, his name should be removed from the roll of legal practitioners. The appellant conceded, before the Tribunal, that he was guilty of professional misconduct. Thus, the sole issue to be determined was whether his name should be removed from the roll of legal practitioners. The Tribunal held that the appellant, from 1989 to 2005, failed to meet his income tax obligations notwithstanding the fact that his income was such that he could have done so, and that he did not make appropriate contributions to his trustees in bankruptcy. In the light of the appellant's untruthful sworn evidence before the Tribunal and the fact that the circumstances underpinning his failure to meet his obligations to the Australian Taxation Office and trustees in bankruptcy reflected adversely on his character, the Tribunal ordered that the appellant's name be struck off the roll of legal practitioners. Mr Davison appealed from the Tribunal's decision. Issues for Determination by the New South Wales Court of Appeal The issues for determination by the Court of Appeal were as follows: (i) whether the Tribunal failed to take into account the reasons for Mr Davison's first and second bankruptcies, such reasons (according to the appellant) detracting from his culpability in not paying income tax; (ii) whether dishonesty or fraud in the context of failing to meet one's taxation obligations is a necessary element for ordering a legal practitioner's name to be removed from the roll; and (iii) whether the Tribunal, in making the order it did, failed properly to take into account the various personal issues in the appellant's life which, according to the appellant, detracted from his culpability in not paying tax. HELD (per Ipp JA; Beazley JA and Hoeben J agreeing): In relation to (i): 1. The failure of the appellant's first financial venture (a $100,000 investment in a dairy cattle project in the Northern Territory promoted by a company named Geneva Finance Limited) did, for a couple of years, affect the appellant's ability to meet his taxation obligations but not complete exonerate the appellant from failing to pay income tax thereafter: [85]. His aggregate taxable income during the relevant period was such that, had he not pursued an extravagant lifestyle, he could have paid more tax than he had, in fact, paid: [86], [89] and [90]. Moreover, the appellant made no attempt to pay the amount of tax for which he would have been liable had the Geneva Finance investment not failed: [87]. 2. The Tribunal was correct in holding that the appellant's non-fulfilment of his civic obligation to pay tax during the relevant period was, on the evidence, deliberate. His conduct over the entire period dwarfed the significance of the failed Geneva Finance investment: [95]. In relation to (ii): 1. When determining whether a legal practitioner's name should be removed from the roll, the court has to determine whether the person is a fit and proper person to remain a member of the legal profession: [79], [82]. Incorporated Law Institute of New South Wales v Meagher (1909) 9 CLR 655; In re Davis (1947) 75 CLR 409; Prothonotary of the Supreme Court of New South Wales v Costello [1984] 3 NSWLR 201; New South Wales Bar Association v Hamman [1999] NSWCA 404, referred to. 2. The appellant in this case had committed no criminal offences relating to income tax (but for a failure to comply with notices under s 264 of the Income Tax Assessment Act 1936 (Cth)) and did not act dishonestly by knowingly making false representations as regards his tax liabilities. On the contrary, he had disclosed his full income in his tax returns: [98]. 3. Dishonesty, whilst being a ground for the removal of names of legal practitioners from the roll, is simply a means of determining whether a broader set of criteria has been met: [100]. The relevant principles to consider, in this respect, are as follows: (a) A barrister holds a special position of trust in the administration of justice and this position carries exceptional privileges, obligations and responsibilities. (b) Whether a barrister is not a fit and proper person to practise depends on the minimum standards demanded by a due recognition of that special position. (c) Only persons worthy of public confidence as meeting those standards should remain on the roll of legal practitioners. (d) Both conduct leading to convictions for criminal offences and other forms of conduct can lead to removal from the roll. (e) Conduct showing a defect of character incompatible with membership of the Bar, or, short of that, conduct showing unfitness to co-operate with the profession and the judiciary in the working of the courts, is relevant. Incorporated Law Institute of New South Wales v Meagher (1909) 9 CLR 655; The Southern Law Society v Westbrook (1910) 10 CLR 609; Ziems v The Prothonotary of the Supreme Court of New South Wales (1957) 97 CLR 279; Clyne v The New South Wales Bar Association (1960) 104 CLR 186; Re Evatt; Ex parte New South Wales Bar Association (1967) 67 SR (NSW) 236, referred to. 4. In cases where barristers have been convicted of criminal offences, the courts have emphasised that the circumstances underlying such convictions are of overriding importance and not the convictions in and of themselves. The court is to assess the impact of the relevant conduct underlying the conviction on the legal practitioner's fitness to remain on the roll: [106]. In the present case, therefore, the court should focus on the appellant's deliberate strategy for avoiding his civic obligation to pay income tax, and his failure to make contributions to his trustees in bankruptcy, the money for such obligations having been spent on maintaining an extravagant lifestyle and donations to family members: [107]. New South Wales Bar Association v Hamman [1999] NSWCA 404; New South Wales Bar Association v Somosi (2001) 48 ATR 562; [2001] NSWCA 285, referred to. 5. True it is that the act of failing to lodge one's taxation returns is of a more serious nature on the spectrum of professional misconduct than the appellant's conduct in the present case, since persons who engage in the former class of conduct conceal their existence and income from the Australian Taxation Office, but the ultimate evil in both cases is the same: the non-fulfilment of one's taxation liabilities accumulating each and every financial year: [110]. New South Wales Bar Association v Cummins (2001) 52 NSWLR 279; New South Wales Bar Association v Somosi (2001) 48 ATR 562; [2001] NSWCA 285; New South Wales Bar Association v Young (2003) 54 ATR 22; [2003] NSWCA 228; New South Wales Bar Association v Stevens (2003) 54 ATR 25; [2003] NSWCA 95, referred to. 6. As was the case in Hamman, Cummins and Somosi, the appellant in the present case behaved in such complete disregard of his legal and civic obligations that he brought the brought the entire legal profession into disrepute: [108], [111]. He engaged in the hypocrisy of advocating that other people perform their legal obligations whilst systematically failing to perform his own: [112], [113]. New South Wales Bar Association v Hamman [1999] NSWCA 404, referred to. New South Wales Bar Association v Cummins (2001) 52 NSWLR 279; New South Wales Bar Association v Somosi (2001) 48 ATR 562; [2001] NSWCA 285, applied. 7. The appellant's conduct was of such a nature that the public, members of the legal profession and the judiciary would not be able to repose confidence in him to conduct himself in accordance with those standards and qualities of character and trustworthiness which are the necessary attributes of a person entrusted with the responsibilities of a legal practitioner: [114]. In the present case the appellant does not reach the requisite level of ethical fitness for the legal profession: [115]. In re Davis (1947) 75 CLR 409; Re a Practitioner (1984) 36 SASR 590, referred to. The public must be assured that such improper conduct cannot be, and is not, tolerated by the legal profession. The object of protecting the public, therefore, includes an element of general deterrence: [114]. Law Society of New South Wales v Foreman (1994) 34 NSWLR 408, referred to. 8. The appellant's complete disregard of his legal and civic obligations with respect to the payment of income tax was such that, at the relevant time, he must be regarded as permanently unfit to practise law: [116]. New South Wales Bar Association v Cummins (2001) 52 NSWLR 279, applied. 9. The appellant gave untruthful evidence before the Tribunal. The Tribunal, in turn, was entitled to take this into account in considering what order should be made against the appellant: [117], [118]. Barwick v Council of the Law Society of New South Wales [2004] NSWCA 32, referred to. In relation to (iii): 1. The appellant's marital problems and tragic loss of his son were not such that they detracted significantly from the seriousness of the appellant's conduct in not paying tax over such a long period of time: [121]. ORDER Appeal dismissed with costs. IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40194/06 ADT 042024/04 BEAZLEY JA IPP JA HOEBEN J Wednesday 29 August 2007 WILLIAM ROY DAVISON v COUNCIL OF THE NEW SOUTH WALES BAR ASSOCIATION Judgment 1 BEAZLEY JA: I agree with Ipp JA. 2 IPP JA: The removal of the appellant's name from the roll of legal practitioners and the grounds of appeal 3 By this appeal the appellant challenges an order made by the New South Wales Administrative Decisions Tribunal that his name be removed from the roll of legal practitioners: see Council of the New South Wales Bar Association v Davison [2005] NSWADT 252. 4 The appellant was born in 1943. In 1965 he was admitted to practise as a solicitor. In 1980 he was called to the Bar. In 1994 he was appointed Senior Counsel for the State of New South Wales. He specialised in local government law and there were affidavits in evidence from persons who testified to the high quality of his work. 5 As from the end of the 1990 financial year, the appellant experienced difficulties in paying the income tax owed by him. These difficulties continued and increased and were not resolved at the time of the hearing before the Tribunal (in 2005). During the period 1990 to 2005 the appellant made at least two financial investments that failed. He was declared bankrupt on three occasions. In addition, he experienced difficulties in his marriage and one of his children committed suicide. These matters caused him great distress. On 7 November 2001, his practising certificate was cancelled. He was substantially in arrears in regard to his income tax liabilities as well as the contributions he was required to pay to his trustees in bankruptcy. 6 The appellant's taxable income in the financial years from 1989 to 1999 was not less than $3,500,000. The appellant's income tax liability, disregarding penalties and interest (referred to as his "primary tax liability"), for the financial years from 1989 to 1999 was not less than $1,500,000. Of the sum of $1,500,000, the appellant did not pay more than $420,000. The Tribunal found that as at June 2004, the total amount of unpaid tax, including interest and penalties, was in the vicinity of $1,324,570. 7 The appellant contended that his failure to fulfil his tax liabilities was significantly attributable to his failed business investments and his domestic tribulations. The respondent, on the other hand, contended that during the period 1989 to 2005 (some 16 years) the appellant earned sufficient monies to pay his income tax in full and live a reasonably comfortable life; he chose, however, to spend his income on an extravagant lifestyle and to give monies to various family members. 8 The respondent took steps to have the appellant removed from the roll of legal practitioners. Before the Tribunal, the respondent relied on four grounds in contending that the appellant was guilty of professional misconduct and in seeking the relief in question. The grounds were supported by many particulars. Not all the particulars were established. The grounds were established to the extent set out below. 9 Ground 1 (which the Tribunal held was made out) was that: "The barrister has been guilty of long standing non-compliance with, and reckless disregard of, his legal and civic obligations to:- (a) pay tax by reference to his returns in a timely fashion; and (b) pay penalties and interest imposed as a result of late payment of tax." 10 Ground 2 was that: "The barrister has failed to comply with his legal and civic obligation to: (a) pay such of the amounts claimed by statements of claim filed on behalf of the Deputy Commissioner of Taxation as he did not reasonably dispute, prior to the entry of judgment; (b) comply with judgments of courts requiring payment to the Deputy Commissioner of Taxation; (c) comply with notices issued pursuant to section 264 of the Income Tax Assessment Act; (d) make timely contributions to his trustee in bankruptcy in accordance with section 139P of the Bankruptcy Act 1966." 11 The Tribunal held (at [34]) that ground 2(a) "so far as any legal obligation is concerned" was not made out. The Tribunal found that grounds 2(b), (c) and (d) were made out. 12 Ground 3 (which the Tribunal held was made out) was that: "The barrister arranged his affairs in such a manner that his income as a barrister, and assets purchased therefrom, were placed beyond the reach of the Deputy Commissioner of Taxation and his trustees in bankruptcy from time to time, and that the income and assets would therefore not be available to be used to discharge his legal obligation to pay income tax and pay penalties and interest imposed as a result of late payment of tax." 13 Ground 4 (which the Tribunal held was made out) was that: "Since a date not later than 1989 the barrister has used monies which would otherwise have been available to discharge his indebtedness to the Deputy Commissioner of Taxation to fund a lifestyle for himself and his family, in excess of that which he could have afforded, had he complied with his legal and civic obligation to pay tax." 14 The appellant conceded that he was guilty of professional misconduct. Thus, the fundamental issue before the Tribunal was whether he should be removed from the roll. 15 The Tribunal found that the appellant, during the period from 1989 to 2005, failed to pay his income tax liabilities despite the fact that his income was at a level at which he reasonably could have afforded to discharge those liabilities. Furthermore, the appellant failed over several years to make appropriate contributions to his trustees in bankruptcy. 16 The Tribunal held that the circumstances under which these failures occurred reflected adversely on the appellant's integrity and character. In addition, the Tribunal found that the appellant's sworn evidence before it "fell significantly short of consistent truthfulness" (at [150]). These matters, essentially, persuaded the Tribunal to order that the appellant's name be removed from the roll of practitioners. 17 Mr Clay, who, together with Ms Berglund, appeared for the appellant, submitted that the appeal was brought under s 171F of the Legal Profession Act 1987 (NSW) (the "1987 Act"). Ms Adamson SC, who, together with Ms Pritchard, appeared for the respondent, did not disagree. By s 171F of that Act, s 75A of the Supreme Court Act 1970 (NSW) applies to the appeal. It was common ground between the parties that, as the appeal is governed by s 75A of the Supreme Court Act, it is by way of rehearing and the appellant is not confined to questions of law. (As to the application of s 75A, see The Council of the New South Wales Bar Association v Sahade [2007] NSWCA 145). 18 The appellant relies on three grounds in appealing against the Tribunal's order, namely: (a) The Tribunal failed to take into account the reasons for the appellant's first and second bankruptcies; these reasons, according to the appellant, detracted from his culpability in not paying income tax. (b) The Tribunal "wrongly concluded that, absent an element of dishonesty or fraud, [the appellant's] breach of civic obligation [sic] [was] sufficient to require his name to be struck off the roll". (c) The Tribunal, in deciding that the appellant should be removed from the roll, failed properly to take into account the personal events in the appellant's life that detracted from his culpability in not paying income tax. 19 Although these grounds did not appear in this form in the appellant's notice of appeal, they were the grounds argued by Mr Clay. I shall refer to them as the grounds of appeal. The relevant details relating to the tax assessed and paid 20 It has been difficult for this Court to ascertain the particular details of the appellant's taxable income, the tax assessed and the amounts paid in each of the tax years from 1989 to 2004. Both Mr Clay and Ms Adamson undertook to provide the Court with a table setting out these amounts. These undertakings were not met. According to a letter from Ms Adamson received by the Court after oral argument, "the undertaking given by the respondent to provide a table to the Court can properly be fulfilled only by reference to the table actually prepared by the appellant's accountant by reference to such records as he was able to obtain from the appellant and the Australian Taxation Office, since any other document is likely to be contentious". Neither party submitted a table as each had undertaken, not even one containing the relevant details according to the appellant. The accountant's table to which Ms Adamson referred contains several obscurities and is difficult to understand. The obstacles the Court faced in establishing these basic facts has been compounded by the fact that the exhibits at the hearing amount to 1,390 pages and many of the documents are described in the index to the exhibit books merely as "bundle of documents". 21 It has, therefore, been left to the Court, in these unsatisfactory circumstances, to do the best it can from the mass of apparently disputed and obscure material. 1989 to 1992 22 From the appellant's accountant's table (to which Ms Adamson referred), it appears that the appellant's income tax liabilities for the financial years ending 30 June 1990, 1991 and 1992 were, respectively, $108,881, $112,697 and $113,300. His taxable income for the 1990 financial year was $243,176 and for the 1992 financial year was $258,482. There does not appear to have been information provided as to his taxable income in 1991. The appellant paid $37,424 for 1990, $33,800 for 1991 and nothing for 1992. Thus, while the aggregate amount of his tax liability for these three years was $334,878, the aggregate amount of the payments he made over this period in respect of this liability was $71,224. On these figures, the balance of tax unpaid was $263,654. 23 On 30 March 1992, a judgment was entered in favour of the Deputy Commissioner of Taxation against the appellant (in respect of tax liabilities for 1990 to 1992) in the amount of $556,957. The amount of $556,957 is substantially more than the amount of $263,654 referred to in the preceding paragraph. The Court has been left to speculate as to how this occurred. 24 In 1990, the appellant invested $100,000 in a dairy cattle project in the Northern Territory promoted by Geneva Finance Limited. This investment was intended to provide the appellant with significant tax benefits. The appellant explained that, because the investment was related to primary production and export, he believed that he was entitled to claim a tax deduction of 150 per cent for his investment of $100,000. The project failed, however, as cattle sales were substantially less than expected. The appellant had borrowed his investment from Geneva Finance and his debts increased substantially through interest and other charges. As the venture failed, the 150 per cent taxation deduction for the investment was not allowed. The Australian Taxation Office then required payment of about $200,000 representing the tax that had to be paid in the absence of the deduction, including interest and penalties. These matters may explain the difference between what seems to have been the appellant's assessed income tax liability for the years 1990 to 1992 of $263,654 according to his accountant's report and the judgment debt of $556,957 entered in favour of the Deputy Commissioner of Taxation on 30 March 1992. 25 On the assumption that the appellant earned about $250,000 in the 1991 financial year, his aggregate taxable income over the period 1990 to 1992 was about $750,000, of which he paid only $71,224 as tax, and he ended up on 30 March 1992 owing $556,957 for tax. How these figures came about was never explained but it does seem that, irrespective of the fact that a large tax burden came to be imposed upon the appellant over this three-year period, he made only a perfunctory attempt in that period to pay what he owed in respect of tax. 26 On 9 April 1992, the appellant was bankrupted on the petition of Geneva Finance and a sequestration order was made against his estate. This was the first bankruptcy. 1993 to 1995 27 According to the accountant's table, in 1993 the appellant's taxable income was $252,733, and he was assessed for tax at $108,042, of which he paid nothing. According to my understanding of the accountant's table, the appellant paid his income tax liability for 30 June 1994 (amounting to $135,752) in full. According to the accountant's table, the appellant's taxable income for the financial year ending 30 June 1995 was $334,389 and his income tax for that year was assessed at $208,572 (this seems high, but this is my understanding of the table). The appellant paid $60,153 towards this sum, leaving a balance of tax outstanding of $148,419. 28 On 9 May 1995, the appellant was discharged from the first bankruptcy. He had made total contributions of approximately $163,000. These represented a dividend of approximately 23 cents in the dollar to his unsecured creditors. The proof of debt of the Deputy Commissioner of Taxation amounted to $585,681 and the Deputy Commissioner received dividends from the appellant's trustee in bankruptcy of $133,260. The appellant did not default in his contributions to the first bankruptcy. 29 At the end of the 1995 financial year the appellant was again substantially in arrears with his income tax payments. On my calculations, over the three-year period since 1993, the arrears amounted to more than $290,000. This new blowout appears to have been caused by his failure to pay any tax in 1993 and his failure in 1995 adequately to meet his tax obligations for that year. 30 After 1993 the appellant neither held nor acquired any significant assets in his own name. 1996 to 1999 31 According to the accountant's report, the appellant's taxable income for the financial year 1996 was $318,300. His tax liabilities for that year were assessed at $177,089 of which he paid only $36,866. His taxable income in the year ended 30 June 1997 was $476,193. He was assessed for tax in the amount of $214,412 but made no payment whatever. According to the accountant's report, the appellant's income for the financial year ended 30 June 1998 was $450,696. He was assessed for tax at $243,764 in respect of this year. He made no payments in respect of this liability. According to the accountant's report, in the financial year ended 30 June 1999 the appellant's taxable income was $499,709 of which he appears to have been assessed for tax at $115,899. He made no payments in respect of this liability. 32 From a date not later than April 1996, the appellant used a company called "Comserv (No 1482) Pty Limited" to operate as a service company for his practice. This company paid the appellant's expenses relating to his practice and charged the appellant for the services rendered by it. From the time that Comserv entered the picture, the appellant did not deposit the cheques he received from his practice into his personal bank account but banked those cheques into the Comserv bank account, his wife's bank account or his brother's bank account. The appellant was the only source of income for Comserv. He took these steps notwithstanding that he had insufficient cash or other assets to meet his tax obligations. 33 In April 1996, the Deputy Commissioner of Taxation commenced proceedings against the appellant to recover taxation due by him. On 21 March 1997, the appellant admitted in a verified defence filed in those proceedings that, at that date, he owed the Deputy Commissioner $427,367. 34 On 10 January 1997, the appellant's son committed suicide. 35 On 10 March 1999, judgment was entered against the appellant in favour of the Deputy Commissioner of Taxation in the amount of $517,770. On 12 March 1999, the Deputy Commissioner of Taxation called upon the appellant to attend a specified place on 9 April 1999 to produce specified material. The appellant did not comply with these notices. He did not furnish the information and he did not attend at the specified place as required. On 18 August 1999, the appellant acknowledged that he had, in consequence, committed offences under ss 8C(1)(a) and 8C(1)(f) of the Taxation Administration Act 1953 (Cth) and was convicted of offences under those sections. 36 On 7 April 1999, the appellant filed a petition for bankruptcy in the Federal Court. The appellant had paid no portion of his admitted (as at 21 March 1997) debt of $427,367 to the Commissioner of Taxation at the time he filed his bankruptcy petition. From the time of the filing of the petition until 9 June 1999, when the appellant was declared bankrupt for a second time, the appellant and Mrs Davison incurred debts of approximately $65,000 on their credit card. 37 The petition showed that he had only one unsecured creditor, namely, the Australian Taxation Office, in an amount of $1,525,221. His only assets were personal effects amounting to $5,000. According to the petition, his income over the last 12 months had been $637,566 and income expected in the next 12 months was $637,750. 38 Between the appellant's discharge from his first bankruptcy on 9 May 1995 and the filing of the debtor's petition leading to his second bankruptcy on 7 April 1999, his gross income was $2,240,200, his taxable income was $1,740,431, his primary tax liability was $796,847.71 and the total of his tax payments was $75,777.12. As the Tribunal pointed out, his tax payments amounted to less than 10% of his primary tax liability. 39 Between 1996 and April 1998, the appellant made payments to family members including weekly payments of $1,500 or $2,000 as living expenses to his brother. This enabled his brother to work on a joint venture in which the two of them held equal shares. This was a speculative enterprise that failed, causing the appellant to incur losses. 2000 to 2001 40 In the financial year ended 30 June 2000, the appellant was assessed for income tax in an amount of $308,862 of which he paid $107,421. 41 In January 2001, the appellant caused monies to be paid to Comserv to enable it to pay the arrears of lease payments owing in respect of a 1998 Mercedes Benz motor vehicle owned and driven by his wife. 42 As at 28 May 2001, the appellant's income tax liability, including penalties and interest, exceeded $425,000. His tax liability for the year ended 30 June 2001 was assessed at $229,478 and for the financial year ending 30 June 2002 at $101,135. For the three years 1 July 1999 to 30 June 2002 the aggregate of his assessed tax liability was $639,476. Of this sum he paid $124,421. SDS and the appellant's tax liabilities from 2002 43 In November 2001, the appellant's practising certificate was cancelled. 44 Shortly thereafter, in November or December 2001, the appellant caused a company known as Sydney Development Services Pty Ltd ("SDS") to be registered. SDS engaged the appellant as a consultant on matters of environmental law at an annual salary of $50,000. It did not, however, issue a group certificate to him with respect to his salary. SDS did not employ anyone else. The persons who engaged SDS were "in the main" clients who briefed the appellant when he had a practising certificate. 45 When asked in cross-examination whether he was aware that an annual income of $50,000 was insufficient to render him liable to make contributions to his bankruptcy, the appellant replied that he thought that the threshold was fixed at only $32,000. 46 This exchange referred to the fact that the level of the appellant's income from SDS was fixed at a figure the effect of which, by reason of the "base income threshold" provisions of the Bankruptcy Act 1966 (Cth) and the Bankruptcy Regulations 1996 (Cth), was that the appellant was not obliged to make contributions to his trustee in bankruptcy. As was pointed out by Ms Adamson, at all material times the appellant's gross income of $50,000 from SDS produced a net income that was less than the base income threshold amount that applied to him. 47 Mrs Davison was, from the outset, the sole director and shareholder of SDS. The Tribunal observed that in cross-examination the appellant had initially stated that he himself played no role in SDS's financial management or in the preparation of its tax returns. Nevertheless, the appellant testified that his wife had no knowledge of his financial affairs and did not pay much attention to how the family's finances were organised. The Tribunal found that the financial management of SDS was effectively in the appellant's hands and this finding was not challenged on appeal. 48 Although SDS paid the appellant $50,000 only, his total income for the year ended 30 June 2002 was $301,712. Of the latter sum, $251,712 was from work the appellant had performed prior to the cancellation of his certificate. This income straddled the financial years 2001 and 2002. Thereafter, the income the appellant declared to his trustee was the $50,000 he received from SDS. That did not take into account the fact that SDS was receiving a much larger income (earned entirely by the appellant). 49 The appellant did not file tax returns for the 2003 or 2004 financial years. 50 SDS's company tax return for 2002 recorded a total income of $63,275. This included a figure of $50,000 for total salary and wage expenses. Obviously, this was the payment of $50,000 made to the appellant. 51 After October 2002, a company called Walker Corporation paid SDS a monthly retainer of $10,000 in respect of services provided by the appellant. The appellant had also proposed to Walker Corporation that it pay a "success fee" to SDS if it succeeded in certain litigation in relation to which the appellant, on behalf of SDS, was providing consultancy services. 52 SDS's tax return for 2003 recorded a total income of $228,400 and total expenses of the same amount. It also contained figures of $50,000 for total salary and wage expenses and $211,051 for "payments to associated persons". Of the sum of $228,400 (earned by the appellant) the appellant received only $50,000. 53 When the trustee discovered the arrangement between SDS and the appellant, he caused notices to be issued to SDS under s 139ZL of the Bankruptcy Act requiring payments to be made by SDS as the appellant's employer, towards the appellant's bankruptcy. This prompted the making of contributions totalling $7,100. 54 The respondent contended that the appellant's conduct in not revealing to his trustee the extent of his financial arrangements with SDS and the income that SDS was receiving from services provided by the appellant was, at best, misleading. The respondent did not rely on this material to prove professional misconduct. The respondent drew attention to it merely as a reason why the "sincerity of his apology" should not be accepted and why the appellant's name should be removed from the roll. As Ms Adamson put the argument, the appellant's defence was essentially that he could not make substantial contributions because his income had been massively affected by the adverse publicity relating to his non-payment of tax. The facts, however, reveal that he was still able to earn a substantial income but he had deflected this income into the coffers of SDS, a fact that had not been revealed to his trustee. 55 Between June and November 2003 the trustee made several unsuccessful requests to the appellant (directly or through his accountant) for completion of an income questionnaire in order that the level of any further contributions might be assessed. The trustee gave the appellant ten days' notice of a date and time in November 2003 at which the appellant was to attend the trustee's office to discuss the administration of the bankruptcy. The appellant was then engaged in consultancy work for SDS. Nothing came of the trustee's requests. 56 On 20 February 2004, the Deputy Commissioner for Taxation commenced proceedings against the appellant in respect of tax liabilities outstanding for the period July 2000 to June 2003. On 6 August 2004, judgment was entered against the appellant in favour of the Deputy Commissioner of Taxation in an amount of some $612,000. This debt has not been satisfied. 57 On 23 March 2005, a third bankruptcy order was made against the appellant based on an act of bankruptcy occurring on 6 December 2004. Dealings with the appellant's trustee in bankruptcy 58 In January 2001, the appellant was in arrears with contributions to his trustee in respect of his second bankruptcy to the extent of approximately $36,000. He, nonetheless, caused approximately $11,000 to be paid to Comserv in order that it could pay the arrears of lease payments owing in respect of the Mercedes Benz driven by his wife. As at 30 August 2001, the appellant was up to date with his contributions in regard to his second bankruptcy. These contributions exceeded $350,000. 59 As at 19 August 2002, the amount the appellant owed to his trustee was $36,438. By 28 June 2005 that amount had been reduced to $19,835, the inference being that about $16,600 had been paid in the interim. 60 The appellant was not assessed for any further contributions after 16 June 2002, because his income fell below the "actual income threshold amount" applicable to him. This was due to the interposing of SDS. 61 By June 2005, payment of the balance of $19,835 owing to his trustee had been due for at least three years. The Tribunal pointed out (at [42]) that the evidence suggested that "his failure to reduce this balance cannot be attributed to any lack of capacity to pay". 62 Mrs Davison was paid $5,000 per month for typing services which occupied her from between one and five hours of her time each week. In 2001, the appellant's trustee in regard to the second bankruptcy commenced Federal Court proceedings claiming, amongst other things, that Mrs Davison had been paid more than the value of the commercial services that she had provided to Comserv. These were resolved by consent orders requiring, amongst other things, that she pay $150,000 to the trustee. 63 The appellant lived in a house with his wife that was registered in her name. He made substantial contributions towards its purchase. The trustee in regard to the second bankruptcy made a claim against Mrs Davison with respect to the appellant's share in the home and this was settled by her as part of the payment of $150,000 to which I have referred. 64 In considering the appellant's conduct towards his trustee in bankruptcy the Tribunal said (at [66] to [68]): "On 30 June 2000, Mr Ellison [the trustee] wrote to the Barrister expressing his concern at the Barrister's failure to comply with arrangements whereby he controlled the Barrister's income. He pointed out that between 28 October 1999 and 28 June 2000, the Barrister had paid cheques totalling $73,950 into Comserv's bank account and cheques totalling $32,500 into his personal account. Mr Ellison calculated that of the $73,950 paid to Comserv, $21,179.94 had been spent on that company's expenses and the balance ($52,770.06) on 'personal expenditure'. The outcome was that out of the total of $106,450 paid into these two accounts, $85,270.26 had been allocated towards personal expenditure. The Barrister, Mr Ellison wrote, had not disclosed any of these payments to him. At a later examination in his bankruptcy, held on 7 February 2001, the Barrister admitted that, although he had arranged with Mr Ellison that his deposits into his personal account for living expenses would not exceed $2,500 per month, he in fact deposited a total sum of $133,000 into this account during the period of eleven months between February and December 2000. This evidence clearly shows, contrary to the Barrister's assertion in his Amended Reply, that (a) at the time when he paid these funds into these accounts he appreciated that his personal expenses were excessive, and (b) through this conduct he 'thwarted attempts by his accountants to curb his expenditure'. Particular 4(b) is established in full." The banking of cheques, the payments to family members and the appellant's lifestyle 65 The Tribunal gave three illustrations of the use of monies by the appellant to fund a lifestyle that would have been unaffordable if his tax obligations had been met. 66 First, the appellant spent $450,671 for personal expenditure in the tax year 1996 to 1997. The Tribunal said (at [61]), "[n]o evidence of any unusual events subjecting the Barrister or members of his family to particularly heavy expenditure was put forward to suggest that this amount should not be deemed excessive". 67 Secondly, as I have mentioned, in the two months prior to 7 April 1999, when the appellant filed his petition leading to his second bankruptcy, he and his wife incurred debts of approximately $65,000 on their credit card. The appellant admitted in cross-examination that none of this expenditure was on assets that his trustee could sell for the benefit of his creditors. The Tribunal drew attention to the fact that the value of the assets the appellant disclosed on bankruptcy was $5,000. 68 Thirdly, on 5 September 2000, the appellant held an auction sale of his wine collection. It comprised 389 lots, many of which were made up of dozens, not single bottles, of wine. The Tribunal said about this matter (at [63]), "[t]he Barrister claimed in an affidavit sworn on 10 December 2004 that the wine was bought before 1992, the date of his first bankruptcy, and 'mostly in the 1980s'. This claim was however contradicted by the auctioneer's description in the notice of sale. It showed that the vintage of many of the lots sold was later than 1992". Employment by Walker Corporation 69 On the fourth day of the hearing, after the conclusion of the appellant's testimony, senior counsel for the appellant recalled him for further examination. The appellant then testified that since 7 April 2005 he had been employed by Walker Corporation on a "trial basis", for an annual base salary of $110,091.74. He tendered two pay slips showing that group tax had been deducted. These matters were not mentioned previously, either in evidence to the Tribunal or, indeed, in communications between the appellant and his trustee in bankruptcy. The findings of the Tribunal 70 The Tribunal found that the appellant's conduct preceding the second bankruptcy and during the early years of that bankruptcy "constituted a deliberate strategy for ensuring that [he] did not fulfil his civic obligations with regard to very substantial tax liabilities" (at [93]). 71 The Tribunal found that the conduct of the appellant since 2001, as disclosed at the hearing, "similarly amounts to a deliberate strategy precluding any discharge of his civic obligations (and possibly also his legal obligations) to make appropriate contributions to his second bankruptcy and thereby to reimburse the Commissioner of Taxation for some at least of the unpaid tax" (at [94]). 72 The Tribunal said (at [95]): "In the light of all this evidence, taken together with the statements acknowledging some element of wrongdoing by the Barrister and (on his behalf) by Mr Ellicott, we are comfortably satisfied that the allegations of breaches of civic obligations in the Information are fully made out." 73 In determining that the appellant should be removed from the roll of practitioners, the Tribunal said (at [103]): "In a nutshell, our principal reasons for so concluding are these. First, over a period of about 15 years the Barrister has intentionally or recklessly breached his civic responsibilities with regard to the payment of income tax, with the consequence that a very substantial sum of money has been lost to the Revenue. Secondly, his conduct in recent years provides good grounds for believing that the ethical shortcomings that underlie these breaches have not been remedied." 74 In concluding that there was no likelihood that the appellant would, in the future, comply with his legal and civic obligations relating to tax, the Tribunal said (at [137] to [138]): "In ways set out above, he has failed during the last five years to (a) adhere to the regime established by his accountant for controlling his personal expenditure; (b) provide for group tax to be deducted from the annual salary of $50,000 that was shown in tax returns of himself and of SDS to have been paid to him by SDS; (c) file two personal income tax returns within the period stipulated by law; (d) give priority to paying arrears of contributions to his second bankruptcy over paying an amount due on a lease of an expensive car for his wife; (e) pay an amount outstanding for more than three years by way of contribution to this bankruptcy; (e) [sic] assist his trustee in bankruptcy to determine his current income with a view to assessing future contributions; (f) give notice in due time to his trustee, or indeed to the Tribunal, of the commencement of his employment by Walker Corporation. This record of failures by the Barrister to make good his past tax defaults and to discharge properly his current tax obligations is counterbalanced only by the evidence of his contributions, totalling about $369,500, that he did make to his second bankruptcy … . Even taking these into account, however, we are comfortably satisfied that, as we indicated earlier, the ethical shortcomings that underlie the Barrister's past breaches of his legal and civic obligations with regard to taxation have not been remedied." 75 The Tribunal found that the appellant had not been a truthful and reliable witness. On a number of occasions he had been compelled during cross-examination to retract, wholly or substantially, statements made by him in an affidavit tendered in evidence or in his oral evidence. The Tribunal found that a number of claims made by the appellant in his affidavit concerning his explanations for failing to pay tax and his failure to disclose his engagement by Walker Corporation either to the Tribunal or to his trustee in bankruptcy "fell significantly short of consistent truthfulness and this is a matter which [the Tribunal] may and should take into account in determining what order should be made" (at [150]). The relevant statutory provisions 76 Section 171C(1)(a) of the 1987 Act (which, as I have mentioned, the parties accepted applies to the issues raised by this appeal) provided that if the Tribunal is satisfied that the legal practitioner is guilty of "professional misconduct", it may order the name of the legal practitioner be removed from the roll. By other paragraphs in s 171C(1), the Tribunal may make other, less severe, orders. 77 Section 127(1) of the 1987 Act provided: "(1) For the purposes of this Part, 'professional misconduct' includes: (a) unsatisfactory professional conduct, where the conduct is such that it involves a substantial or consistent failure to reach reasonable standards of competence and diligence, or (b) conduct (whether consisting of an act or omission) occurring otherwise than in connection with the practice of law which, if established, would justify a finding that a legal practitioner is not of good fame and character or is not a fit and proper person to remain on the roll of legal practitioners, or (c) conduct that is declared to be professional misconduct by any provision of this Act, or (d) a contravention of a provision of this Act or the regulations, being a contravention that is declared by the regulations to be professional misconduct." 78 Only s 127(1)(b) appropriately applies to the appellant's conduct. As I have noted, the appellant admitted that he was guilty of professional misconduct within the meaning of s 127. It follows that he has admitted that he is guilty of professional misconduct within the meaning of s 127(1)(b). That, in turn, means that it was open to the Tribunal to make a finding that he was not a fit and proper person to remain on the roll of legal practitioners. The appellant, however, submits that the Tribunal wrongly exercised its discretion in ordering that his name be removed from the roll of practitioners. General principles relating to the making of an order for removal from the roll 79 It is generally accepted that, upon an application for removal of the name of a legal practitioner from the roll, the question which has to be determined is whether the practitioner is a fit and proper person to remain a member of the profession: In re Davis (1947) 75 CLR 409 at 416 per Latham CJ. 80 The jurisdiction to remove a legal practitioner from the roll is protective, not punitive: Prothonotary of the Supreme Court of New South Wales v Costello [1984] 3 NSWLR 201 (at 204 per Glass and Samuels JJA). Disciplinary proceedings against a legal practitioner are concerned with the protection of the public: Wentworth v New South Wales Bar Association (1992) 176 CLR 239 (at 250 to 251 per Deane, Dawson, Toohey and Gaudron JJ). In New South Wales Bar Association v Hamman [1999] NSWCA 404, Mason P (at [21]) said: "Their object is not to punish the practitioner but to protect the public and to maintain proper standards in the legal profession." 81 As I have noted, by the 1987 Act an order for removal can be made if professional misconduct is established. In this case, professional misconduct was admitted. Professional misconduct on the part of a barrister consists of behaviour which would reasonably be regarded as disgraceful and dishonourable by his professional brethren of good repute and competency: Costello (at 203 per Glass and Samuels JJA). 82 Whether an order for removal should be made, once professional misconduct is established, depends on the nature and degree of the misconduct. Removal may be ordered if it is proved that a barrister is guilty of misconduct of such a character as to show that he or she is no longer fit to remain on it: Costello (at 205 per Priestley JA). The court is required to ask whether the practitioner whose character and conduct is under review can properly be held out as a fit and proper person to remain a practitioner of the Court: Incorporated Law Institute of New South Wales v Meagher (1909) 9 CLR 655 (at 681 per Isaacs J); Hamman (at [22] per Mason P). The first ground of appeal: the failed business ventures reasons and the appellant's first two bankruptcies 83 This ground concerns the Tribunal's finding that over a period of about 15 years the appellant intentionally or recklessly breached his civic responsibilities with regard to the payment of income tax. The appellant contended that in making this finding the Tribunal failed to take into account the consequences to the appellant of his failed business ventures with Geneva Finance and the joint venture with his brother. 84 I have set out in [24] the basic facts relating to the appellant's investment in 1990 in Geneva Finance. In summary, the appellant appears to have lost his investment of $100,000, he had 150 per cent taxation deduction for his investment disallowed, and was required to pay about $200,000 tax, including interest and penalties, as a consequence of the disallowance of the deduction. 85 Undoubtedly, the failure of the Geneva Finance investment had serious consequences for the appellant's tax position, at least for a couple of years after the investment failed. Nevertheless, this failure was by no means a complete explanation for the appellant's failure to pay his tax. 86 I have noted that for the period 1 July 1989 to 30 June 1992, the aggregate amount of the appellant's tax liability was $334,878, of which he paid only $71,224. $263,654 was not paid. On 13 March 1992, a judgment was entered in favour of the Deputy Commissioner of Taxation against the appellant in the amount of $556,957. I have observed that the increased amount of the appellant's tax indebtedness represented by this judgment may have been caused by the disallowance of tax deductions brought about by the failure of the Geneva Finance investment. Be that as it may, the appellant's aggregate taxable income over the period in question was about $750,000. This meant that the appellant was in a position to pay far more than the $71,224 that he in fact paid for the tax owing during this period. Thus, while the failure of the Geneva Finance investment may explain the very large amount the appellant came to owe for tax as at 30 June 1992, it does not explain his failure to make serious attempts to pay off the tax that he owed. 87 On the evidence, the appellant made no attempts to come to terms with his increased tax liability caused by the failure of his Geneva Finance investment and, indeed, made no attempt to pay the tax that he would have been obliged to pay in the ordinary course, had the Geneva Finance investment not failed. 88 In an affidavit filed by the appellant, he stated that in the period leading up to his first bankruptcy he did not make allowance for his tax liability. He explained this by reference to "the commitments to providing for a young and growing family". He acknowledged his "overspending". 89 As the facts set out above indicate, in the period after the failure of the Geneva Finance investment, and, in particular, after the appellant's bankruptcy on 9 April 1992, he made only desultory payments of tax (save for the financial year ending 30 June 1994), despite maintaining what appears to have been an affluent lifestyle with a high standard of living. By 30 June 1995, the appellant was again in arrears in respect of his tax in an amount of more than $290,000. He had not paid tax in 1993 and had paid little tax in 1995. The appellant's taxable income over this period appears to have been something in the vicinity of $900,000 of which he made contributions to his trustee in bankruptcy of approximately $163,000. The inference to be drawn from these facts is that the appellant should have been able to pay far more in respect of tax during this period than he did. 90 I have noted that between the appellant's discharge from his first bankruptcy on 9 May 1995 to his second bankruptcy on 7 April 1999, his taxable income was $1,740,431, his tax liability was $796,847.71 and the total of the payments he made in respect of tax was $75,777.12. This represented a gross underpayment of his tax liabilities. 91 For the three years from 1 July 1999 to 30 June 2002 the aggregate of the appellant's assessed tax liability was $639,476, of which sum he paid $124,421. Since 2002, the appellant's tax liabilities have been limited by the interposition of SDS. Notwithstanding this means of reducing the income tax payable by him, on 6 August 2004 judgment was entered against the appellant in favour of the Deputy Commissioner of Taxation in respect of his tax liabilities in an amount of about $612,000. 92 The appellant said in his affidavit: "Between 1996 and 1998 I did not make provision for payment of income tax as the amount due against me was always more than I could manage and the expense of investing in the computing projects by supporting my brother … together with my, by then well entrenched, pattern of spending meant that there was insufficient money available to pay tax." He said that he pinned all his hopes on resolving his tax problems on the joint venture into which he had entered with his brother. 93 This joint venture involved an investment in a computer program that he said he thought would be extremely profitable. During a period not specifically identified but apparently after 1996, the appellant paid his brother's "living expenses" of $1,500 per week (which later increased to $2,000 per week) so that he could work on the program. The program, however, was not successful. 94 The argument based on the joint venture with the appellant's brother was not pressed. Mr Clay did not draw attention to any proved consequences flowing from that venture and made no submissions therewith. Thus, this ground depends solely on the submissions concerning the investment in Geneva Finance. 95 The evidence amply bears out the findings of the Tribunal that over the period 1989 to 2004 the appellant's conduct constituted a deliberate strategy for ensuring that he did not fulfil his civic obligations with regard to his very substantial tax liabilities. Whatever the effect was of his failed Geneva Finance investment, that pales into insignificance when compared with his conduct as a whole over the entire relevant period. In my view, the way the Tribunal treated the consequences of the appellant's failed investment in Geneva Finance did not constitute error on its part. The second ground of appeal: the absence of dishonesty in the appellant's failure to meet his tax liabilities 96 Mr Clay submitted: "[T]he Tribunal wrongly concluded that absent an element of dishonesty or fraud, the [appellant's] breach of civic obligation [sic] [was] sufficient to require his name to be struck off the roll." 97 Before the Tribunal, senior counsel then appearing for the appellant submitted that an order for the removal from the roll should not be made on the ground of breaches of legal and civic obligations relating to payment of tax unless those breaches involved either the commission of criminal offences or dishonesty, in the sense of knowingly making false representations. 98 Except for failing to comply with notices under s 264 of the Income Tax Assessment Act 1936 (Cth) as alleged in ground 2(c), the appellant committed no criminal offences under the income tax legislation and was not guilty of dishonesty in the sense of knowingly making false representations in relation to his tax liabilities. The appellant had openly disclosed his full income in his tax returns, thereby exposing himself to liability to pay tax. On these grounds, senior counsel submitted that the appellant could not be compared with the barristers in New South Wales Bar Association v Cummins (2001) 52 NSWLR 279; New South Wales Bar Association v Somosi (2001) 48 ATR 562; [2001] NSWCA 285; New South Wales Bar Association v Young (2003) 54 ATR 22; [2003] NSWCA 228 and New South Wales Bar Association v Stevens (2003) 54 ATR 25; [2003] NSWCA 95 who had filed tax returns, and the barrister in Hamman who had deliberately understated his income in his tax returns. The barristers in those cases had all committed criminal offences and had deceived the tax authorities. The appellant's conduct was not of this kind. 99 The Tribunal, however, rejected these submissions. On appeal, Mr Clay reiterated them. 100 While dishonesty has often been a ground for removing legal practitioners from the roll, it is merely a means of determining whether a broader set of criteria has been met. These criteria are well established and well understood. I shall refer to some of the leading statements of principle in this regard. 101 In Incorporated Law Institute of New South Wales v Meagher (1909) 9 CLR 655, Isaacs J said (at 681): "There is therefore a serious responsibility on the Court – a duty to itself, to the rest of the profession, to its suitors, and to the whole of the community to be careful not to accredit any person as worthy of public confidence who cannot satisfactorily establish his right to that credential. It is not a question of what he has suffered in the past, it is a question of his worthiness and the reliability for the future." 102 In The Southern Law Society v Westbrook (1910) 10 CLR 609, O'Connor J said (at 619): "… [T]he Court in maintaining a solicitor on the roll is holding out to the public that he is a fit and proper person to be entrusted by the public with those difficult and delicate duties and that absolute confidence which the public must repose in persons who fulfil the duties of solicitors." 103 In Ziems v The Prothonotary of the Supreme Court of New South Wales (1957) 97 CLR 279, Kitto J said (at 297 to 298): "The issue is whether the appellant is shown not to be a fit and proper person to be a member of the Bar of New South Wales. It is not capable of more precise statement. The answer must depend upon one's conception of the minimum standards demanded by a due recognition of the peculiar position and functions of a barrister in a system which treats the Bar as in fact, whether or not it is also in law, a separate and distinct branch of the legal profession. It has been said before, and in this case the Chief Justice of the Supreme Court has said again, that the Bar is no ordinary profession or occupation. These are not empty words, nor is it their purpose to express or encourage professional pretensions. They should be understood as a reminder that a barrister is more than his client's confidant, advisor and advocate, and must therefore possess more than honesty, learning and forensic ability. He is, by virtue of a long tradition, in a relationship of intimate collaboration with the judges, as well as with his fellow- members of the Bar, in the high task of endeavouring to make successful the service of the law to the community. That is a delicate relationship, and it carries exceptional privileges and exceptional obligations. If a barrister is found to be, for any reason, an unsuitable person to share in the enjoyment of those privileges and in the effective discharge of those responsibilities, he is not a fit and proper person to remain at the Bar. Yet it cannot be that every proof of which he may give of human frailty so disqualifies him. The ends which he has to serve are lofty indeed, but it is with men and not with paragons that he is required to pursue them. It is not difficult to see in some forms of conduct, or in convictions of some kinds of offences, instant demonstration of unfitness for the Bar. Conduct may show a defect of character incompatible with membership of a self- respecting profession; or, short of that, it may show unfitness to be joined with the Bench and the Bar in the daily co-operation which the satisfactory working of the courts demands. A conviction may of its own force carry such a stigma that judges and members of the profession may be expected to find it too much for their self respect to share with the person convicted the kind and degree of association which membership of the Bar entails. But it will be generally agreed that there are many kinds of conduct deserving of disapproval, and many kinds of convictions of breaches of the law, which do not spell unfitness for the Bar; and to draw the dividing line is by no means always an easy task." 104 The first part of the passage from the reasons of Kitto J in Ziems was adopted by the Full High Court in Clyne v The New South Wales Bar Association (1960) 104 CLR 186 (at 189) and the whole of it by this Court in Re Evatt; Ex parte New South Wales Bar Association (1967) 67 SR (NSW) 236 (at 240, 241 per Herron CJ, Sugerman and McLelland JJA). 105 These statements emphasise the following relevant factors: (a) A barrister holds a special position of trust in the system of administration of justice; the position carries exceptional privileges, obligations and responsibilities. (b) Whether a barrister is not a fit and proper person to be a member of the Bar of New South Wales depends on the minimum standards demanded by a due recognition of that special position. (c) Only persons worthy of public confidence as meeting those standards should remain on the roll. (d) Both conduct leading to convictions for criminal offences and other forms of conduct can lead to removal from the roll. (e) Conduct showing a defect of character incompatible with membership of the Bar is relevant; or short of that, conduct showing unfitness to co-operate with the profession and the judiciary in the working of the courts. 106 In those cases where a barrister has been convicted of a criminal offence, the court has been at pains to point out that it is not the fact of conviction that is of overriding importance; all the circumstances lying behind the conviction must be taken into account. The court is required to look behind the conviction at the conduct which gave rise to it, and the impact of such conduct upon the practitioner's fitness to remain a barrister: Hamman (at [72]); see also Somosi (at 576, [75] per Spigelman CJ). 107 Confining the issue at this stage only to the appellant's failure to pay his tax liabilities and contributions to his trustees in bankruptcy, focus must be directed to the Tribunal's unchallenged findings that the appellant deployed a deliberate strategy for avoiding his civic obligations. The strategy involved the means by which, over a period of many years, he earned large sums of money, paid very little tax, made few contributions to his trustees in bankruptcy, and used the money that should have gone towards his tax liabilities to fund his lifestyle and make donations to members of his family. 108 The profession's reputation was tarnished by the appellant's conduct. The consequences of this occurring through a deliberate failure to pay tax over a lengthy period were discussed In Hamman. Mason P said (at [87] to [89]): "This leads to the issue of the reputation of the legal profession. The barrister properly acknowledges that his actions have jeopardised the reputation and standing of the legal profession. These mean little in themselves, but they are an important element in the effectiveness of legal practitioners in their role as ministers of justice. Certain practices send out messages (intended and unintended) about what is acceptable to lawyers and acceptable generally. The response to proven violations also sends out messages. In their article Income Tax Offences by Lawyers: An Ethical Problem (1972) ABAJ 842 at 845, Sanford M Stoddard and Carl A Stutsman Jr conclude as follows: 'In its own interest, the organized Bar simply cannot permit the public to gain the impression that its members flout the revenue laws or that it condones or tolerates or belittles the seriousness of crimes against the revenue. 'Obedience to law exemplifies respect for law', states EC 1-5. 'To lawyers especially, respect for the law should be more than a platitude.' [EC 1-5 is a reference to part of the American Bar Association's Code of Professional Responsibility .]' I agree. A similar attitude should inform the Court's response to a proven infraction, not overlooking the need for due proportionality. To do less would be to abandon the underlying functions of the Court's disciplinary jurisdiction. The legal profession enjoys a monopoly of the right to practise on the theory that those possessed of the requisite learning, skill and character can be trusted to perform legal services involving high levels of trustworthiness. Removal from the rolls [sic] for unfitness is an extreme remedy, but it is necessary in order to maintain public respect for the legal process." 109 In Cummins, Spigelman CJ (with whom Mason P and Handley JA agreed) pointed out (at 283 [16]) that the barrister in that case was perfectly capable of conducting his personal and financial affairs save in one respect; he never performed his duties as a citizen and taxpayer. The Chief Justice said of this (at 283, [17]): "This Court made in clear in New South Wales Bar Association v Hamman that there is nothing acceptable, let alone smart or clever, about evading taxation." 110 It is true that the barrister in Cummins failed to lodge taxation returns for 38 years, and the appellant in this case did lodge his returns (at least until 30 June 2002). But the barrister's failure in Cummins to lodge his taxation returns and the appellant's deliberate strategy that he adopted in order to enjoy his entire taxable income for his own personal ends and those of his family were aimed at the identical purpose, namely, avoiding the lawful tax liabilities that were accruing each year. I accept that the failure to lodge taxation returns is more serious professional misconduct than that committed by the appellant. That is because the failure to lodge returns means that the barrister's existence and income is concealed from the tax authorities, while the appellant informed the authorities each year of his income (until 30 June 2002). But the appellant (like Mr Cummins and the other barristers in Somosi, Young and Stevens), by his conduct, increased the burden on taxpayers generally "because rates of tax inevitably reflect effective collection levels" (see Hamman at [85]). The ultimate evil in the two respective situations is the same. 111 In Cummins, Spigelman CJ (at 286, [30]) said: "The conduct of a barrister, particularly a barrister who has received the distinction of a commission as one of Her Majesty's Counsel, who has behaved in such complete disregard of his legal and civic obligations, was necessarily such as to bring the entire legal profession into disrepute." The Chief Justice thought that it was important that the public should be assured that conduct of this character cannot be, and is not, tolerated in the profession. These comments apply equally to the appellant. 112 In Somosi, the barrister had neither filed any income tax returns nor paid income tax for 17 years. Spigelman CJ (with whom Sheller and Giles JJA agreed) said (at 574 to 575, [63]): "This was deliberate conduct which had the effect of concealing his income and ensuring that he paid no tax. No inadvertence or accident could conceivably explain such a sustained period of conduct over such a long period. The only inference is that he deliberately and intentionally evaded tax." At (575, [67]), Spigelman CJ said: "In New South Wales Bar Association v Hamman [1999] NSWCA 404 this court made it clear that a systematic course of tax evasion demonstrated unfitness for practice. The requirements of honesty and integrity in legal practice are such that conduct of this character must be regarded as impermissible. This has been confirmed in Cummins." Spigelman CJ said (at 575, [68]) that the barrister had acted "in complete disregard of his legal and civic obligations". He said: "Furthermore, for a period of almost 2 decades he engaged in what I described in Cummins as the hypocrisy of putting himself in a position, as a legal practitioner, in which he advocated that other people should perform their legal obligations, whilst systematically failing to perform his own." 113 In the present case, the appellant, from the period 1990 to at least 2004, deliberately and intentionally failed to pay or make appropriate contributions to his tax liabilities. He did so in complete disregard of his legal and civic obligations. As Senior Counsel for the State of New South Wales, his conduct was permeated with the hypocrisy to which Spigelman CJ referred in Somosi. Spigelman CJ's comments in Somosi referred to in the preceding paragraph apply equally to the appellant. 114 In Law Society of New South Wales v Foreman (1994) 34 NSWLR 408, Giles AJA, in referring to the protective function of general deterrence, said (at 471): "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." In my opinion, the appellant's persistent failure over so many years to pay his tax, his enjoyment of the extra money that thereby became available to him, and the deliberate strategy he employed to achieve his purposes, are of such a nature that the public, professional colleagues, and the judiciary would not be able to repose confidence in him to conduct himself in accordance with the standards expected of a barrister. The appellant's conduct establishes that he "lacks the qualities of character and trustworthiness which are the necessary attributes of a person entrusted with the responsibilities of a legal practitioner": Re a Practitioner (1984) 36 SASR 590 (at 593 per King CJ). 115 In re Davis, Dixon J, with whose reasons Williams J agreed, referred (at 420) to "the reputation and the more enduring moral qualities denoted by the expression, 'good fame and character', which described the test of [the practitioner's] ethical fitness for the profession." The conduct of the appellant, in my view, demonstrates that he does not reach the requisite level of ethical fitness. That is the case, even though his conduct did not involve either the commission of criminal offences or dishonesty, in the sense of knowingly making false representations. 116 In Cummins, Spigelman CJ said (at 285, [28]): "In the present case, I am satisfied that the barrister's complete disregard of his legal and civic obligations with respect to the payment of income tax were such that he must be regarded, at the present time, as permanently unfit to practice [sic]." In my opinion, these comments apply equally to the appellant. Unsatisfactory evidence given at the Tribunal 117 I have noted that the Tribunal found that the appellant was not a truthful and reliable witness. His evidence in certain respects, according to the Tribunal, had fallen "significantly short of consistent truthfulness" (at [150]). The Tribunal had regard to this in determining that the appellant's name should be removed from the roll of practitioners. 118 There is ample authority to the effect that untruthfulness in giving evidence in disciplinary proceedings may be taken into account in considering what order should be made: see Barwick v Council of the Law Society of New South Wales [2004] NSWCA 32 and the authorities therein referred to at [105]. 119 The findings of the Tribunal in this regard support the conclusion to which it came. Third Ground: the personal events in the appellant's life 120 Mr Clay submitted that the Tribunal had not properly taken into account the effect on the appellant of the tragic loss of his son and his marital difficulties. 121 I do not intend in any way to detract from the personal loss and problems suffered by the appellant over the period in question. Nevertheless, I am not persuaded that these matters detract significantly from the egregiousness of his conduct over the very long period in which he failed to meet his tax obligations. Conclusion 122 In my opinion, the appeal should be dismissed with costs. 123 HOEBEN J: I agree with Ipp JA and the orders he proposes. ********** 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.