A New South Wales lawyer who misappropriated more than $4.4 million in trust money and was subsequently jailed, has been struck off the roll.
In the NSW Court of Appeal decision made on Tuesday, Chief Justice Bell, and Justices Payne and Stern, said this was a “plain case” for the making of the declaration sought by the Law Society of NSW that “XX” was not a fit and proper person to remain on the roll, and an order that his name be removed from it.
Over 14 months between February 2018 and May 2019, the principal of incorporated legal practice “XX Law”, and operator of a second incorporated legal practice “YY Lawyers”, misappropriated a total of $4,436,763.57 of client trust money or purported trust money.
In December 2020, he was convicted, following a guilty plea, to five counts of dishonestly gaining a financial advantage by deception contrary to Section 192E(1)(b) of the Crimes Act 1900 (NSW), with a further five counts being considered on a Form 1 certificate.
He was sentenced to eight years’ imprisonment, with a non-parole period of four years and nine months, but was released on home detention in February last year.
In July last year, the Society applied to have his name removed from the roll on eight grounds related to his criminal convictions; unauthorised dealing with trust money; and unauthorised legal practice during suspension of his practising certificate and after the grant of injunctions.
The Society had first suspended XX’s practising certificate in December 2018, after a trust investigator reported to the Society that they believed XX had misappropriated $1.58 million from client trust funds.
His practising certificate was further suspended in January 2019 for six months. In April, the Society was notified by the receiver of the two firms that there had been a transfer of clients between the firms. In June, interim injunctions were ordered restraining XX from engaging in legal practice, and final injunctions were ordered in August.
XX continued to purport to engage in legal practice until November 2019, making representations to several clients that he was advancing matters when he was not.
The Society submitted that XX’s convictions and conduct, severally and cumulatively, rendered him not a fit and proper person to remain on the roll, and that he was permanently, or at least indefinitely, unfit to engage in legal practice.
Their Honours said: “the appropriate maintenance of trust accounts is critical to upholding confidence in the legal profession and the misappropriation of any sum of money by a lawyer is a gross violation of the oath or affirmation which every new lawyer makes on admission to practice”.
They said misappropriation of the scale and extent of that perpetrated by XX warranted his removal from the roll.
“As has been seen, that disgraceful conduct was compounded by the respondent’s brazen disregard of his suspension from practice by the Law Society and his contempt of on multiple occasions for serious orders of this court restraining his continuation of practice,” they said.
“The respondent’s conduct involved engagement with multiple clients when either without a practising certificate and also when restrained from doing so, deceit of those clients both as to what the respondent was doing and achieving for them, his lack of his entitlement to be acting for them and that he was in fact suspended from practice and subject of court orders restraining him from purporting to do so.
“Still more disgraceful was his evident fabrication, in at least one case, of court documents which purported to have emanated from the District Court and been stamped accordingly.”
The Society also sought and was granted non-publication and suppression orders which largely mirrored those made in XX’s criminal and injunctive proceedings, over concerns about his mental illness.
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