Breach of trust: lawyers struck off
By Michael Pelly
Three NSW solicitors have been formally stripped of their licence to practise over trust fund irregularities worth almost $3 million.
Stephen Gill misappropriated almost $1.9 million between 1994 and 2002 as he worked in the Newcastle region, while Kevin Minotti spent about $750,000 belonging to clients of his Bondi Junction practice.
Another solicitor, Malcolm Hansen, lost his right to practise yesterday because a clerk at his Queanbeyan firm had misappropriated more than $310,000.
The Administrative Decisions Tribunal sealed Mr Gill's fate on Tuesday when it granted the Law Society's request to remove his name from the Supreme Court's roll of practitioners - exactly a week after doing the same with Mr Minotti.
In the past three financial years, the NSW Law Society's Fidelity Fund has paid out about $10 million, with the average claim $102,000 in 2002-03 and $63,000 and $68,000 in the preceding years. Many claims are for less than $1000.
Mr Gill, who was admitted to practise in 1983, was acting as the administrator of a deceased estate in 17 of the 18 matters investigated by the Law Society. While the individual amounts that had been misappropriated came to $1,883,000.95, he shuffled money around to avoid detection. The net amount taken from clients was $461,596.
None of the discrepancies was discovered until August 2002, when questions were raised about a bequest to a charity. By that time Mr Gill was working for Newcastle firm Harris Wheeler. He and others have since repaid $258,394 to that firm, leaving the total shortfall at $203,202 - mostly from his time as a sole practitioner.
Mr Gill's doctor said his patient might suffer from attention deficit disorder with hyperactivity which, in the absence of appropriate medication, could result in disorganisation. He also appeared to have a "personality structure of denial", but the tribunal said this did not excuse his behaviour.
Mr Minotti, who was admitted to practise in 1976, did not offer any explanation for his conduct from 1995 to 2001, which mostly involved trust moneys. Five of the amounts were between $100,000 and $200,000. He said he often used the money to pay personal debts.
In Mr Hansen's case, the tribunal accepted that he had recklessly failed to prevent a clerk, Graeme Jackson, from misappropriating $310,305.46 between October 1999 and June 2001.
It said there were failures to account to clients for amounts totalling $221,805.46.
He was also found to have misused his power of attorney with a "vulnerable" client.
When a solicitor receives money on behalf of another person, they must put it into a trust account and use the money only as directed by the law or the client. Any wilful errors constitute professional misconduct.
About 17,000 of the 18,616 solicitors in NSW make contributions - $75 for corporate solicitors and $150 for those in private practice - into the fund each year, which ensures claims involving dishonest failure to account for money are paid.
The Legal Services Commissioner, Steve Mark, said the tribunal handled between 25 and 40 trust fund complaints a year, with the major problems occurring when solicitors acted as developers or financiers.
Only three solicitors were struck off in 2003-04, but between eight and 12 lost their licence in the previous three years.