Asbestos lawyer guilty of trust money breaches and misrepresentingation
January 27, 2017
The Victorian Civil and Administrative Tribunal has found Reservoir solicitor, Mr James Wise, guilty of professional misconduct for handling trust money without authority, and for misrepresenting an unregistered business as a registered law firm.
The Victorian Legal Services Commissioner told VCAT that in 2012 Mr Wise was banned from receiving trust money until 1 July 2015. Despite this, in 2014 Mr Wise received payments from four clients related to asbestos injury claims. The payments were improperly made directly into his office bank account for disbursements for work he had been retained to provide. Mr Wise had also received and unlawfully banked several settlement cheques on behalf of his clients.
The Commissioner noted that the deposits from clients and the cheques Mr Wise banked were classified as trust moneys, meaning that he was in breach of the condition on his practising certificate. Client money properly entrusted to a lawyer who is licensed to handle trust money is protected, audited, and fully refunded if stolen or lost. Client money which is not handled through a trust account has no such protections.
VCAT also heard that in 2014 Mr Wise had publicly promoted a company he co-directed, Acclaim Lawyers, as a law practice which could act for clients with asbestos-related injuries. The Commissioner told VCAT that Acclaim Lawyers had not been registered as a legal entity and was therefore not permitted to provide legal services as Mr Wise had claimed.
VCAT found Mr Wise guilty of two charges of professional misconduct relating to his handling of trust money, and one charge of professional misconduct for implying that Acclaim Lawyers was entitled to engage in legal practice.
Mr Wise was reprimanded, fined a total of $10,000 and ordered to pay the Commissioner’s costs agreed at $10,000. VCAT also ordered that Mr Wise not be granted a principal practising certificate nor be licensed to receive trust money before 1 July 2021.
Following the decision, the Commissioner, Michael McGarvie, reminded all practitioners that the correct handling of trust money was paramount. ‘Trust money is clients’ money, carefully protected by regulation. It must be handled appropriately at all times,’ Mr McGarvie said.
‘This solicitor had been previously banned from receiving trust money but he unlawfully proceeded to handle trust money on several occasions without the protections that exist with a formal trust account. In doing so he compromised the security of the client money and broke the law,’ the Commissioner said.
‘Additionally, all legal services must be offered through registered entities. Over-hyped marketing to vulnerable asbestos disease sufferers through unlawful structures is both dishonest and unethical.’
For further information, download the VCAT decision.