Court of Appeal Supreme Court New South Wales

• Medium Neutral Citation: Scroope v Legal Services Commissioner [2013] NSWCA 178
• Hearing dates: 19 April 2013
• Decision date: 17 June 2013
• Before: Bathurst CJ at [1]; Beazley P at [2]; Hoeben JA at [55]

Decision

1. Appeal allowed;

2. Set aside orders (1) and (3) made by the Tribunal;

3. Order that the conduct of the legal practitioner, Philip Scroope, in the preparation of the narrative bill of costs resulting in the charging of Ms Meng of grossly excessive costs, constitutes unsatisfactory professional conduct within the meaning of the Legal Profession Act 2004;

4. The practitioner, Philip Scroope, is fined the sum of $2,000. That sum is to be paid within 28 days of the date of this decision;

5. Order that the respondent pay the appellant's costs of the appeal.

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

• Catchwords: PROFESSIONS AND TRADES - lawyers - complaints and discipline - Legal Profession Act 2004, ss 496 and 497 - whether role in the preparation of a bill that overcharged a client constituted unsatisfactory professional conduct or professional misconduct
• Legislation Cited: Legal Profession Act 2004; Supreme Court Act 1970
• Cases Cited: D'Alessandro v Legal Practitioners Complaint Committee (1995) 15 WAR 198; De Pardo v Legal Practitioners Complaints Committee & Anor [2000] FCA 335; 170 ALR 709; Kennedy v Council of Incorporated Law Institute of New South Wales (1939) 13 ALJ 563; Law Society of New South Wales v Foreman (1994) 34 NSWLR 408; Re R (A Practitioner of the Supreme Court) [1927] SASR 58; The Law Society of the Australian Capital Territory v Lardner [1998] ACTSC 24; Veghelyi v The Law Society of New South Wales [1995] NSWCA 483
• Category: Principal judgment
• Parties: Philip Scroope (Appellant); Legal Services Commissioner (Respondent)
• Representation: Counsel: T Lynch (Appellant); C Webster SC; P Maddigan (Respondent); Solicitors: T A Williams (Appellant); Office of the Legal Services Commissioner (Respondent)
• File Number(s): CA 2012/190511

Decision under appeal

• Citation: Legal Services Commissioner v Scroope [2012] NSWADT 107
• Date of Decision: 2012-06-04 00:00:00
• Before: Haylen J, Deputy President; N Isenburg, Judicial Member; C Bennett, Non-Judicial Member
• File Number(s): 092010

HEADNOTE

[This headnote is not to be read as part of the judgment]

The appellant, a legal practitioner employed by the legal practice Keddies, was found guilty of professional misconduct within the meaning of the Legal Profession Act 2004 by the Administrative Decisions Tribunal, Legal Services Division. This finding was based on the appellant's conduct in the preparation of a narrative bill of costs resulting in the charging of a client grossly excessive costs.

The appellant appealed against the finding of professional misconduct and the fine imposed against him. The sole issue on the appeal was whether the Tribunal erred in making a finding of professional misconduct against the appellant.

Held per Beazley P allowing the appeal (Bathurst CJ and Hoeben JA agreeing)

(1) The appellant's conduct constituted unsatisfactory professional conduct and not professional misconduct: [49], [51].

(2) The conduct admitted to by the appellant and the appellant's failure to realise that some entries on the narrative bill were inappropriate and warranted further consideration required a finding of unsatisfactory professional conduct within the meaning of the Legal Profession Act, s 496: [49].

(3) In circumstances where the appellant was not responsible for Keddies' failure to have a system in place to facilitate the accurate rendering of bills, the appellant's conduct did not constitute professional misconduct: [50]-[51].

Judgment

1 BATHURST CJ: I agree with Beazley P.

2 BEAZLEY P: On 4 June 2012, the Administrative Decisions Tribunal (the Tribunal) constituted by Haylen J (Deputy President), N Isenburg (Judicial Member) and C Bennett (Non-Judicial Member), held that the appellant, Philip Scroope, a legal practitioner employed by the legal practice Keddies, was guilty of professional misconduct within the meaning of the Legal Profession Act 2004. This finding was based on the appellant's conduct in the preparation of a narrative bill of costs resulting in the charging of a client grossly excessive costs. The Tribunal ordered that the appellant be reprimanded, that he be fined in the sum of $5,000 and that he pay the costs of the Legal Services Commissioner.

3 The appellant has appealed against the finding of professional misconduct made against him and against the fine imposed. The appellant does not contend that a finding of unsatisfactory professional conduct should not be made and does not appeal against the order that he be reprimanded. The sole issue on the appeal, therefore, was whether the Tribunal erred in making a finding of professional misconduct against the appellant.

4 The appeal to this Court is brought pursuant to the Legal Profession Act, s 729A(1). Pursuant to s 729A(2), the Supreme Court Act 1970, s 75A applies to an appeal under s 729A. The appeal is thus by way of rehearing. Pursuant to s 75A, the Court has the same powers and duties of the body from which the appeal is brought: s 75A(6); and may make any finding or assessment, give any judgment, make any order or give any direction which ought to have been given or made, or which the nature of the case requires: s 75A(10).

Claim in the Tribunal

5 The proceedings in the Tribunal were conducted on the basis of a Second Amended Application for Original Decision and an agreed statement of facts. The second amended application sought a finding, in the alternative, of either professional misconduct, or unsatisfactory professional conduct.

6 The Legal Services Commissioner advanced three grounds in support of the findings sought in the application. In ground 1, the Legal Services Commissioner alleged that the appellant, in the preparation of a narrative bill, permitted a client, Ms Shang Ying Meng, to be charged grossly excessive amounts of costs. The particulars of the grossly excessive costs were that Ms Meng was charged for: (a) excessive amounts of work performed; (b) amounts representing work in excess of the work performed; (c) work that was not performed; and (d) work undertaken and for time spent on her file which included steps that were excessive and unnecessary. The appellant admitted this ground.

7 Ground 2 alleged over-servicing. The particulars to that charge were: (a) that work was undertaken, and charged for, by persons of inappropriate seniority or qualification; and (b) unnecessary work was undertaken. The appellant admitted that the bill rendered by the legal practice, known as Keddies, charged for work which was undertaken by persons of inappropriate seniority or qualification, and charged for unnecessary work undertaken.

8 Ground 3 alleged that the narrative bill misrepresented costs in the following respects: (a) the narrative bill contained charges in excess of time spent and for work which was not done; (b) the narrative contained duplicated charges for work performed in relation to two matters for Ms Meng's family in which Keddies was acting; and (c) the narrative bill contained charges at professional rates, apparently for the appellant as the fee earner, for work performed by others, which work was also separately invoiced to Ms Meng by way of disbursements. The appellant admitted ground 3.

9 The Legal Services Commissioner did not allege that the appellant had personally overcharged the client, or had personally duplicated costs so as to be guilty of overservicing. Rather, the allegation was that the overcharging, overservicing and duplications occurred at the instance of others who had carried out work in the matter. In the way the matter was presented to the Tribunal, the essential allegation against the appellant was that in the preparation of the narrative bill, he permitted the client to be charged grossly excessive fees. The Legal Services Commissioner submitted to the Tribunal that the appellant's conduct constituted unsatisfactory professional conduct.

10 The appellant conceded to the Tribunal that the narrative bill contained "mistakes, errors and duplications" in the costs charged and the disbursements recorded: Tribunal reasons, at [56]. The appellant acknowledged to the Tribunal that he should have paid closer attention to the narrative bill and ensured that it was accurate, although his evidence was that the accuracy of the bill was never part of his responsibility: Tribunal reasons, at [77].

11 In his defence, however, the appellant submitted that although he was a personal injury accredited specialist: (i) he was no more than an employed solicitor; (ii) he had no control over the computerised costing system adopted by Keddies; (iii) he had only a rudimentary knowledge of the computer system; (iv) he received little assistance in understanding it; (v) when the computerised system was introduced, a costing clerk only was employed to assist with the new system; (vi) he had no knowledge of the capacity of other solicitors and employees to enter cost items on the computer system using his initials; (vii) he had adopted the usual practice of having a narrative bill prepared by his secretary in accordance with the firm's practice; (viii) he had no reason to believe that any entries were inaccurate; (ix) he had informed Mr Keddie, a partner in the firm, of the professional fees outstanding prior to the settlement conference; and (x) Mr Keddie had regarded the fees as reasonable having regard to the nature of the case: Tribunal reasons, at [77].

Relevant legislation

12 The Legal Profession Act, Ch 4 provides for "Complaints and discipline" of legal practitioners. The purposes of the Chapter include the promotion and enforcement of the professional standards, competence and honesty of the legal profession: s 494(1)(b); and the provision of a means of redress for complaints about lawyers: s 494(1)(c).

13 Unsatisfactory professional conduct is defined in s 496 to include:

"... conduct of an Australian legal practitioner occurring in connection with the practice of law that falls short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent Australian legal practitioner."

14 Professional misconduct is defined in s 497(1) as including:

"(a) unsatisfactory professional conduct of an Australian legal practitioner, where the conduct involves a substantial or consistent failure to reach or maintain a reasonable standard of competence and diligence, and

(b) conduct of an Australian legal practitioner whether occurring in connection with the practice of law or occurring otherwise than in connection with the practice of law that would, if established, justify a finding that the practitioner is not a fit and proper person to engage in legal practice."

15 Without limiting ss 496 and 497, s 498 specifies certain conduct that is capable of constituting unsatisfactory professional conduct or professional misconduct, including:

"(b) charging of excessive legal costs in connection with the practice of law"

Tribunal's consideration of the case law

16 The Tribunal, at [76], after a review of a number of authorities, considered that the following propositions emerged:

(1) Unsatisfactory professional conduct was not limited to conduct that was "disgraceful or dishonourable": see Re R - A Practitioner of the Supreme Court [1927] SASR 58 at 60. Unsatisfactory professional conduct included conduct that may reasonably be held to violate or to fall short, to a substantial degree, of the standard of professional conduct observed or approved by members of the profession of good repute and competency: De Pardo v Legal Practitioners Complaints Committee & Anor [2000] FCA 335; 170 ALR 709 at [41].

(2) Disciplinary proceedings and consequential orders made in such proceedings were not for the punishment of the practitioner, but for the protection of the public: De Pardo at [42]; Law Society of New South Wales v Foreman (1994) 34 NSWLR 408 at 441.

(3) The inquiry into what amounts to grossly excessive costs "would ordinarily involve, first, a determination of what, in the particular circumstances, would be a reasonable sum to charge": D'Alessandro v Legal Practitioners Complaint Committee (1995) 15 WAR 198 at 214 per Ipp J (Pidgeon and Franklyn JJ agreeing). A charge of overcharging depended significantly upon the degree and frequency of the overcharging: The Law Society of the Australian Capital Territory v Lardner [1998] ACTSC 24 at [104].

(4) Gross overcharging may constitute professional misconduct. In this regard, it was not necessary that fraud be proved against the legal practitioner: Veghelyi v The Law Society of New South Wales [1995] NSWCA 483.

(5) Professional misconduct "amounted to grave impropriety affecting [a legal practitioner's] professional character and was indicative of a failure either to understand or to practise the precepts of honesty or fair dealing in relation to the courts, his clients or the public": Kennedy v Council of Incorporated Law Institute of New South Wales (1939) 13 ALJ 563 at 563 per Rich J.

17 These propositions are well established and do not need further elaboration in this judgment. This is particularly so in circumstances where the question in issue is whether the appellant's conduct constituted professional misconduct or unsatisfactory professional conduct, which involves an evaluation of the appellant's conduct underlying the particulars of the charge brought against him. In this case, the underlying conduct was, in essential respects, admitted. There was no dispute that there was gross overcharging, a misrepresentation of certain matters in the narrative bill and the overservicing of the client.

The Tribunal's reasons

18 The Tribunal, at [77]-[78], posed the question for determination as being the characterisation of the appellant's conduct in relation to the gross overcharging in the narrative bill that contained "mistakes, errors and duplications in the costs charged and the disbursements".

19 The Tribunal had earlier, at [70], noted the submission that Keddies' computer costs system lacked any chain of authority or any chain of responsibility to ensure that the costing record was accurate and had "an enormous potential to do an injustice to clients". The Tribunal concluded, at [70], that it could not find that the appellant "was embarking on any kind of cynical exercise of overcharging 'in the loose sense'".

20 The Tribunal also noted, at [74], that the Legal Services Commissioner accepted that Mr Keddie, as the appellant's managing partner and the supervisor of the client's file, in a "technical sense" charged the fees that were grossly excessive. However, the Tribunal did not accept that an employed solicitor could never be found to have charged excessive or grossly excessive fees. This proposition was not challenged, nor could it be. Whether or not a particular solicitor is personally responsible for charging excessive fees will depend upon the facts and circumstances of each case.

21 At [78]-[84], the Tribunal compared the appellant's arguments as against those that had been advanced on behalf of Mr Keddie.

22 The Tribunal, at [84], summarised the appellant's case as being that the overcharging was mostly due to the firm's computerised accounting system in respect of which he had limited knowledge, no real training and no understanding of the capacity of other persons to make entries under his name. Mr Keddie's case was that although he had overall responsibility for what had occurred in the client's matter, including the overcharging, he lacked any personal involvement in or knowledge of the matter. In this regard, Mr Keddie had argued that he was entitled to rely upon the appellant to prepare an accurate bill of costs in circumstances where the appellant, an accredited specialist in the relevant area of law, had the day to day conduct of the matter. This caused the Tribunal to observe:

"... By proceeding on the limited basis of a Statement of Agreed Facts and having no affidavit or oral evidence from Mr Keddie or [the costs consultant], the Tribunal is left in the unsatisfactory position of not being able to examine closely the assertions about the firm's system for recording costs and the level of responsibility within the firm expected of an accredited specialist with supervision of a matter, the role of the costs consultant and the use that might be made of the accounts department."

23 The Tribunal's expressed concern, however, has to be considered in light of the circumstances that the case brought against the appellant was limited and that it was accepted that the computing costs system was inadequate. The inadequacies of the system were recorded by the Tribunal, at [69] and [70]. Mr Keddie had also conceded the inadequacies of the system, as the Tribunal noted, at [83]. In particular, Mr Keddie had admitted that the firm's "costing system allowed errors that could not easily be picked up".

24 The Tribunal, at [89], noted the appellant's concession that the client, in a bill of $558,000 for professional costs, had been overcharged in the sum of $215,000 in respect of those professional costs, and that this level of overcharging was "grossly excessive". The Tribunal also noted the appellant's admission of overcharging and overservicing, in the sense described at [6]-[8] above, that work had been undertaken by persons of inappropriate experience and qualification and that unnecessary work had been done and that overall there had been a misrepresentation of costs. The Tribunal observed that the appellant accepted he had a "high or significant level of responsibility" in respect of the client's matter, being the team leader and a supervisor, with the day to day management of the file. The Tribunal, at [89], considered that:

"The amount of the overcharging, overservicing and misrepresentation suggests that there were many entries in the narrative bill that were inaccurate, or wrong."

25 The Tribunal concluded, at [90], that the appellant's conduct in the preparation of the narrative bill was so lacking in professional competence and diligence as to amount to professional misconduct. The Tribunal stated that:

"The level and frequency of the overcharging during a period of three years and the charging of fees at a level considered by the Tribunal to be quite extraordinary requires such a finding."

26 The Tribunal, at [91] and [92], then considered the appropriate penalty for the appellant. The Tribunal noted that although the appellant had the day to day control and supervision of the client's matter, Mr Keddie had the ultimate responsibility for the matter within the firm. The Tribunal considered it was likely that many of the errors in the narrative bill were attributable, at least in part, to the inappropriate computerised costing system operated by Keddies. The Tribunal noted that there was no evidence suggesting the appellant had a personal interest or had financially benefited from the excessive costs charged to the client. In those circumstances, the Tribunal imposed a fine of $5,000 and ordered that the appellant be reprimanded.

Consideration

27 Overcharging and overservicing a client is a serious matter. The authorities have stated that to be so for the last century, although, in reality, authority is not needed to make that observation. The extent of overcharging of the client in this case was very serious.

28 There is another proposition for which no authority is required, namely, that a practitioner is only to be disciplined for the wrongful conduct of which he or she has been charged and found guilty. It is the underlying conduct upon which the charge is based that determines the proper characterisation of the conduct: in this case, either unsatisfactory professional conduct or professional misconduct. Although the prosecuting or disciplinary body is entitled to inform the Tribunal of its view of the underlying conduct, it is for the Tribunal to determine whether the person concerned is guilty of unsatisfactory professional conduct, or professional misconduct, or neither. The Tribunal understood that was its task: see at [74].

29 The Tribunal, at [67], recognised that the charge against the appellant in the amended application related to his conduct in the preparation of the bill in circumstances where there was a "poor system", being a reference to the computer costs system: see also at [84]. There was no allegation that the appellant had personally overserviced the client or personally duplicated costs. As the Tribunal observed, at [67]:

"What was recognised in the Amended Application was that Mr Scroope was not one of the persons overcharging. Mr Scroope's offence and shortcomings in this case were to be measured by his participation in what was submitted to be a 'poor system.' The introduction of the computer costing system sometime before 2005 placed Mr Scroope in an office environment which in many senses took out of his direct knowledge everything that was happening on Ms Meng's file."

30 The unsatisfactory nature of both the computer system and the manner of charging by way of a narrative bill derived from entries in the computer system were also noted by the Tribunal, at [69]. The significant deficiency of the narrative form of bill was that it did not permit the entries to be checked, as the computer system did not attribute to any particular item the time taken, the costs incurred, charges to be made in respect of that item of work, or the person who performed the work. Particular problems with the computer system, identified by the Tribunal, at [70], were that entries were treated as correct and there was no clear line of authority as to who was responsible to monitor the system and ensure the record was correct. The Tribunal noted, at [83], that Mr Keddie had conceded the firm's computer costing system allowed errors that could not easily be picked up.

31 The Tribunal found certain aspects of the appellant's evidence to be unsatisfactory. The Tribunal was critical that the appellant appeared to downplay the level of costs expertise available to assist him both in understanding the computerised cost system and in the preparation of accurate bills of costs: see at [85]. The Tribunal was also critical of the appellant's tendency to downplay his involvement in the preparation of an itemised bill in 2007 following a request from the new solicitors acting for Ms Meng: see at [86].

32 The first of these criticisms were based substantially upon an untested unsworn statement of Mr Keddie in the agreed statement of facts and upon a letter to the Legal Services Commissioner from the firm Keddies in 2009. In that letter, examined by the Tribunal, at [80], Keddies had informed the Legal Services Commissioner that it had engaged a costs consultant since November 2000 whose job description required him to assist with the timely collection of costs rendered by the firm. The costs consultant was also required to have experience of the costing regimes relevant to the conduct of litigation in New South Wales. His required skills included computer, time management and communication skills, and an ability to work in a team. The letter also stated:

"Fee earners requiring costing advice contacted Charles Ackroyd [the costs consultant] to discuss the preparation of the bills and the negotiation of the costs. Mostly Charles prepared itemised bills, although at times instructed costs consultants. Charles had been in his role at Keddies since November 2000." (at [85])

33 This letter was written to the Legal Services Commissioner in circumstances where the partners of the firm had been charged with gross overcharging. A list of duties of the costs consultant may have been attached to the letter, as the appellant was cross-examined in respect of that list. The appellant had never seen a copy of the letter or the list of duties of the costs assessor, prior to his cross-examination. The appellant had never heard of the 'tracking system' referred to in the list of duties as one of the matters that the costs consultant was to develop and maintain. There was no evidence that any such system had been developed. The costs consultant referred to in the letter, Mr Ackroyd, was not called by the Legal Services Commissioner to give evidence. Nor did Mr Keddie give evidence. The letter was not a business record and, in my opinion, should not have been accorded any more weight than untested assertions of the Keddies partners who were seeking to protect their own positions.

34 But in any event, the letter did not counter or negate the appellant's sworn evidence that he was not provided with adequate assistance understanding the computer system or in the preparation of accurate bills of costs. Nor did the letter deal with the undisputed evidence that the method of recording the necessary information so as to properly cost a matter was quite inadequate.

35 Further, the letter stated that the role of the costs consultant was to recover costs owed to the firm. That is quite a different function from the matters that were the subject of the complaints here, which related to the preparation of a bill. Admittedly, the letter asserted that fee earners requiring costs advice contacted the costs consultant. However, this assertion was not supported by any sworn evidence to that effect, did not reveal whether any, or what, instruction had been given to employed solicitors in that regard and was contrary to the appellant's sworn evidence that he did not really know what the function of the costs consultant was. The appellant thought the person concerned was a costs clerk. That is consistent with the statement in the letter that the function of the person referred to in a letter as a cost consultant was in fact a costs recovery clerk.

36 The second matter in respect of which the Tribunal considered the appellant's evidence was unsatisfactory was his tendency to downplay his role in the preparation of an itemised bill in 2007. The Tribunal's reasoning on this was as follows. First, the Tribunal referred to the appellant's role in having the carriage of Ms Meng's matter so as to be best placed to "analyse the narrative bill to ensure that it was accurate in every respect".

37 The Tribunal next referred to the increase in the itemised bill of $100,000 and that the appellant denied a role in that calculation, his evidence being that he had been directed to look for "leakages", that is, items that had been overlooked in the narrative bill. The Tribunal then referred to the Statement of Agreed Facts in the Keddies matter, in which Mr Keddie stated that the appellant had reviewed the file between December 2006 and March 2007 and had reviewed the time costing records with Mr Ackroyd, the costs consultant. It was said that notes were given to the accounts department for additional entries to be made.

38 The Tribunal then noted that the appellant "signed this itemised bill" and continued, at [86]:

"... the tone of Mr Keddie's statement suggests a greater role for Mr Scroope in reviewing the narrative bill. It seems extraordinary that having this involvement in preparing the itemised bill that Mr Scroope had no role in ensuring that the narrative bill he had supervised, prepared and signed was indeed accurate. There was no evidence to suggest that Mr Keddie had any role apart from a brief period during 2007 in relation to this itemised bill. Mr Ackroyd was not called to give evidence."

39 I have a number of difficulties with the Tribunal's reasoning. In the first place, the 2007 bill was not the subject of the allegations against the appellant. Secondly, the Tribunal was concerned with a disciplinary matter. In relying upon "the tone" of an unsworn statement in a different, albeit associated matter, the Tribunal failed to differentiate between sworn evidence and unsworn, self-serving material. In my opinion, it placed undue weight on the unsworn self-serving statement of Mr Keddie. The Tribunal also failed to keep separate the different proceedings as between the appellant and Mr Keddie. Although those proceedings were heard together, the charges against the appellant were distinct from those brought against Mr Keddie. This passage is one of a number of occasions on which the Tribunal's reasons seemingly failed to maintain the distinction between the two matters. The next difficulty I have is that the reasoning appears to be circular. It relies upon the later itemisation of a bill to doubt that the appellant had no role in ensuring that the narrative bill was accurate. In any event, the appellant had admitted that to be the case. He also gave evidence that he had changed his practice so as to ensure that the same problem did not recur.

40 The Tribunal, at [87], made other findings of the unsatisfactory aspects of the appellant's evidence that were "perhaps of lesser significance". The first matter to which the Tribunal referred related to the failure to check the personal computer records of fee earners who entered work on the cost ledger to ensure the accuracy of entries on the costs bill. The appellant had essentially admitted this. It is difficult to see how an admission of conduct that was subject of the 'charge' against him could be seen as an unsatisfactory aspect of his evidence. It was, of course, an unsatisfactory aspect of his conduct that was before the tribunal for consideration.

41 The second matter related to the appellant's "detailed" evidence as to how the computer system worked in circumstances where the appellant had stated that he had no understanding of the computerised costs system. An examination of the evidence does not bear this out. In any event, the material before the Tribunal established that the computer system was not an accurate or adequate costing system. The appellant bore no responsibility for that system.

42 The third matter related to the change the appellant had made to his personal billing practices after the disciplinary charges had been brought against him, in circumstances where the appellant had stated that detailed checking of entries in the costs ledger were "impossible" because of work pressures. The appellant's changed billing practices should have been subject to commendation not condemnation, particularly in circumstances where the appellant had, in substance, admitted the allegations against him and the firm had changed its costing system following Ms Meng's complaint.

43 The final matter noted by the Tribunal was the uncertainty regarding the circumstances when the appellant would assist the senior secretary in preparing a bill of costs. The appellant's evidence on this was general in its terms and, therefore, it is difficult to gauge if there was any serious inconsistency between his evidence at the hearing and his earlier statement.

44 The Tribunal stated, at [89], "[a]side from these unsatisfactory aspects of the evidence and the manner in which the matter proceeded", there was an agreement by the parties as to the amount by which Ms Meng had been overcharged. The Tribunal also noted the other admissions the appellant had made.

45 Given the particulars of the charge brought against the appellant and the limited allegations the Legal Services Commissioner made against him, I am of the opinion that the Tribunal's finding, at [90], that it was "the level and frequency of overcharging" that compelled a finding of professional misconduct, reveals error. No case of personal overcharging was made against the appellant, let alone for any period of time or at any level of frequency. The appellant's conduct alleged to constitute either unsatisfactory professional conduct or professional misconduct was his role in preparing the bill that caused the client to be overcharged. The Tribunal, at [67] and [75], had observed that that was the case brought against the appellant. That was also the basis upon which the Tribunal determined the penalty to be imposed. At [91], the Tribunal observed:

"Mr Scroope's case arises in somewhat unusual circumstances: although he had the day-to-day control and supervision of Ms Meng's matter, the ultimate responsibility for the matter within the firm was in the hands of Mr Keddie and the Tribunal has accepted submissions to that effect. Importantly, Mr Keddie has accepted 'ultimate responsibility' for the acts and omissions of Mr Scroope. It is likely that many of the errors in the narrative bill prepared by Mr Scroope's secretary and signed by him were at least, in part, attributable to the inappropriate computerised costing system operated by the firm. There is no evidence in the present matter suggesting that Mr Scroope had a personal interest or financially benefited in what was ultimately agreed to be the grossly excessive charging of Ms Meng."

46 The basis of the Tribunal's finding of professional misconduct, at [90], was thus also inconsistent with its earlier observations, at [67] and [75], and its observations at [91] to which I have already referred. Those paragraphs correctly reflected the allegations which were the subject of the charges brought against the appellant.

47 A further difficulty with the Tribunal's approach to the characterisation of the appellant's conduct as professional misconduct was in its assessment of various aspects of the appellant's evidence as unsatisfactory, to which I have referred at [31]-[43] above. The Legal Services Commissioner submitted that it was apparent from the opening words of [89] of its reasons that the Tribunal's criticisms were not necessary for its conclusion as to the proper characterisation of the appellant's conduct. The opening words, to which I have already referred, were "[a]side from these unsatisfactory aspects of the [appellant's] evidence ...". In my opinion, the Tribunal was not putting to one side, in the sense of being irrelevant to the characterisation of the appellant's evidence, the "unsatisfactory aspects" of the appellant's evidence it had discussed at [85]-[87]. Rather, those matters were additional to those to which it referred at [89]. As I have indicated, the matters to which the Tribunal referred in those paragraphs did not bear the negative or inculpatory connotation attributed to them by the Tribunal. This reveals another error in the Tribunal's approach to its determination.

48 The question remains, however, as to the proper characterisation of the appellant's conduct and whether this Court should embark upon the process of itself determining that matter. Both parties considered it was appropriate for this Court to make that determination rather than remit the matter for redetermination by the Tribunal. In my opinion, it is appropriate for this Court to determine whether the appellant's conduct is properly characterised as unsatisfactory professional conduct or professional misconduct. The Legal Services Commissioner did not assert that there were credit issues involved. To the extent that the Tribunal found unsatisfactory aspects of the appellant's evidence, those criticisms were essentially unfounded but in any event did not touch upon the appellant's credit, or only marginally did so.

49 The case alleged against and largely admitted by the appellant was that he prepared a form of bill that was inaccurate in the serious respects to which I have referred. It was clear from the evidence that a significant cause of the inaccuracies in the bill was the entirely inadequate computerised system the firm Keddies operated. However, there was no challenge to the Tribunal's finding, at [89], that it was difficult to understand from the size of the bill how the appellant did not realise some entries were inappropriate and warranted further consideration. That finding, in conjunction with the admissions made by the appellant and his evidence that he had subsequently changed his billing practices, demonstrates that in his preparation of the narrative bill in Ms Meng's case, his conduct fell "short of the standard of competence and diligence that a member of the public is entitled to expect of a reasonably competent Australian legal practitioner": Legal Profession Act, s 496.

50 Although the amount of overcharging was substantial, being approximately 63 per cent more than the client should have been charged, the firm Keddies did not have a system in place to facilitate the accurate rendering of bills. The appellant also had the bill approved by his supervising partner Mr Keddie. The appellant's failure to be astute to the possibility of overcharging allowed a bill to be forwarded to the client with the serious deficiencies reflected in the charged allegations. There was thus clearly a deficiency in the way the appellant managed the costs aspects of the client's file and his conduct is to be characterised on that basis.

51 However, the circumstances in which the appellant so conducted himself in relation to the bill were not, in significant respects, of his own making. His conduct falls to be characterised having regard, amongst other matters, to that circumstance. The fact that, subsequently, the appellant was able to introduce a more rigorous system for the recording of work performed demonstrates, nonetheless, that his conduct in the preparation of the narrative bill fell short of the standard expected of a reasonably competent solicitor. In my opinion, the appellant's conduct was unsatisfactory professional conduct. The appellant's conduct, in the circumstances discussed in these reasons, did not involve a substantial or consistent failure to maintain a reasonable standard of competence and diligence so as to be characterised as professional misconduct.

52 As a reprimand has already been administered to the appellant, no order by this Court is necessary in that regard. I consider that the appellant should also be fined and that an appropriate fine is $2,000. I am of the opinion that the appellant should pay the costs as ordered by the Tribunal, but should have his costs of the appeal.

53 Having regard to my conclusion, I do not consider that it is necessary to deal with his ground of appeal relating to the denial of procedural fairness by the Tribunal. This ground of appeal, in essence, was that the Tribunal had failed to give notice that it proposed to deal with the application on the basis that the appellant's conduct was properly characterised as professional misconduct rather than unsatisfactory professional conduct.

54 Accordingly, I propose the following orders:

1. Appeal allowed;

2. Set aside orders (1) and (3) made by the Tribunal;

3. Order that the conduct of the legal practitioner, Philip Scroope, in the preparation of the narrative bill of costs resulting in the charging of Ms Meng of grossly excessive costs, constitutes unsatisfactory professional conduct within the meaning of the Legal Profession Act 2004;

4. The practitioner, Philip Scroope, is fined the sum of $2,000. That sum is to be paid within 28 days of the date of this decision;

5. Order that the respondent pay the appellant's costs of the appeal.

55 HOEBEN JA: I agree with Beazley P and the orders which she proposes.

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Decision last updated: 17 June 2013