Council of the Law Society of New South Wales v Vaughan [2011] NSWADT 118

Administrative Decisions Tribunal New South Wales Medium Neutral Citation: Council of the Law Society of New South Wales v Vaughan [2011] NSWADT 118 Hearing dates: 21 April 2011 Decision date: 21 April 2011 Jurisdiction: Legal Services Division Before: M Chesterman, Deputy President N Isenberg, Judicial Member R Fitzgerald, Non-judicial Member Decision: 1. The Respondent is reprimanded. 2. The Respondent is to pay the Applicant's costs of and incidental to these proceedings, as agreed or assessed. Catchwords: Disciplinary application - solicitor - failure to place client's monies in interest-bearing account - instrument of consent Legislation Cited: Family Law Act 1975 (Cth) Legal Profession Act 2004 Cases Cited: Council of the New South Wales Bar Association v Butland [2009] NSWADT 177 Category: Principal judgment Parties: Council of the Law Society of New South Wales (Applicant) Legal Services Commissioner (Intervenor) Michael John Vaughan (Respondent) Representation: J Conomos (Respondent) A Matalani (Applicant) L Muston (Intervenor) File Number(s): 102031 Publication restriction: The names of the complainants are not to be published.

REASONS FOR DECISION

The course of these proceedings 1On 26 November 2010, the Council of the Law Society of New South Wales ('the Law Society') filed an Application alleging that the Respondent, Michael John Vaughan ('the solicitor'), while practising as a solicitor, engaged in unsatisfactory professional conduct on the following Grounds: (1) failing to place monies in an interest bearing account (complaint by AB) and (2) failing to place monies in an interest bearing account (complaint by YZ). Particulars of the alleged conduct were supplied in a schedule to the Application. 2In this description of the Application, the names of the two complainants have been replaced by the pseudonyms AB and YZ. The reason is that in the Particulars and in an Instrument of Consent (reproduced below) it was stated that they had been parties to Family Court proceedings. Publication of their names is therefore prohibited under section 121 of the Family Law Act 1975 (Cth). 3The orders sought in the Application were that the solicitor be reprimanded and that he pay the Law Society's costs. The Application also indicated that one of the two complainants sought an order for compensation. 4Also on 26 November 2010, the Law Society filed an affidavit in support of the Application, sworn by its solicitor, Ms Anne-Marie Foord, on 17 November 2010. 5In this affidavit, Ms Foord stated that the solicitor was admitted to practice on 9 July 1982 and that between 15 September 1989 and 19 July 2010, he was the principal of the law practice known as Johnston Vaughan. 6The solicitor did not file a Reply to the Application. 7On 8 March 2011, an Instrument of Consent dated 1 March 2011, which included a statement of the two Grounds set out in the Application and a section headed 'Particulars of Agreed Facts', was filed in the Tribunal. It was executed by the Law Society, the solicitor and the Legal Services Commissioner. It indicated that the signatories gave their consent to the Tribunal making (a) a finding that the conduct of the solicitor described in the Particulars of Agreed Facts amounted to unsatisfactory professional conduct and (b) the following orders, by consent:- 1. That the solicitor be reprimanded. 2. That the solicitor pay the Society's costs of and incidental to these proceedings, as agreed or assessed. 8At the hearing before us, which took place on 21 April 2011, Ms Muston represented the Legal Services Commissioner. Through so appearing, pursuant to an entitlement to intervene conferred by section 559(1)(c) of the Legal Profession Act 2004 ('the LP Act'), the Commissioner became a party to the proceedings under section 559(5). 9Mr Matalani, appearing for the Law Society, tendered unopposed the affidavit sworn by Ms Foord and the Instrument of Consent. He requested and was granted leave to make a minor amendment to clause I of the Particulars of Grounds of Complaint in the Application and of the Particulars of Agreed Facts. He pointed out that the Particulars set out in these documents were identical. 10The Solicitor, for whom Mr Conomos of counsel appeared, did not tender any evidence. 11Mr Matalani requested us to make orders in terms of those set out in the Instrument of Consent. He submitted that members of the public were entitled to expect that a solicitor holding funds on their behalf would deposit those funds in an interest-bearing account and that the failure by the solicitor in this case to so accordingly amounted to unsatisfactory professional conduct under section 496 of the LP Act. He pointed out also that by virtue of section 569 of this Act the orders sought by the Law Society do not affect the claim for compensation being brought by one of the complainants. 12Ms Muston and Mr Conomos indicated that they supported this request made on behalf of the Law Society. 13At the conclusion of the hearing, we stated that we would grant this request. We made orders in the terms proposed in the Instrument of Consent, preceded by a finding that the Solicitor had engaged in unsatisfactory professional conduct. Those orders took effect on the date of the hearing and were incorporated in a Notice of Decision sent to the parties on the same day. We also gave directions relating to the disposal of the compensation claim. 14In addition, we indicated that we would publish written reasons. The present decision constitutes those reasons.