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Barry Lane
16 November, 2005  
The cheque's in the mail

Witholding payment from needy types such as barristers apparently is not viewed terribly seriously by the stipes in Victoria. A couple of tightwad solicitors got a tickle with the feather duster for holding back cheques worth $126,000

How many times must barristers and their clerks have been fobbed off with excuses about non-payment by Victorian solicitors Simon Parsons and Gary Singer? If a report in Saturday’s Herald Sun is any guide, they have admitted to 75 occasions at least, although they were charged with withholding 116 cheques for payment.

Victoria’s Bureau de Spank got out the fluffy end of the feather duster last Thursday and fined the pair $10,000 each. They pleaded guilty to three counts of “misconduct” involving the withholding of 75 cheques drawn on the office account for the sum of $126,000.

The modus operandi in relation to withholding payment to outsiders, namely “barristers and other professionals”, was to extract the fee from the client, pay it into the trust account, then pay it into the office account, draw a cheque on the office account and then put it in a manila folder where it happily “rested” in a drawer, interest free, until the Law Institute’s sleuths came calling.

This method of controlling the firm’s overdraft had been going on for years.

One wonders what the barristers’ trade union, VicBar, was doing all this time because it can’t have gone unnoticed, particularly among juniors who are the usual victims of schemes such as this.

The odd complaint must surely have been made by a newly minted barrister who, eager for a brief, schlepped down to the Valley outlaying scarce cash on a train fare or petrol and never got paid for anything.

Perhaps in light of the bureau’s action, some of those barristers might seek further and better particulars from their clerks and union. It is understood that among experienced hands, Simon Parsons and Co (motto: “If you don’t fight you lose”) had priors for doing business in this way.

imageSinger (seen here), currently Melbourne’s Deputy Lord Mayor, is reported as having said that, “at no time were any clients affected”.

“The tribunal took no action against my status as a lawyer and I will be able to continue my business activities and community obligations without impediment.”

Well, at least he’s warned us.

Frankly, the way the system deals with these sorts of “irregularities” is quite intriguing. If the relevant “misconduct” had been committed by a staff member, rather that the firm’s principals, then the people going through the drawers might have been wearing blue uniforms and the charges flowing from the discovery of the “resting” cheques might have been made under the Crimes Act 1958. But then life is full of different strokes for different folks.

All the outstanding accounts were paid as soon as the “irregularity” was discovered, but why wasn’t it discovered as soon as a new cheque was added to the pile already “resting” in the manila folder?

It’s just as well that the institute’s sleuths finally got to the relevant desk drawer and folder or else the resting pile might be growing fatter.

In the spirit of goodwill I’ve assumed that interest on the outstanding accounts was included when they were finally paid. Otherwise, Parsons and Singer would have profited at the expense of both the clients who paid early and the barristers and others who were paid late.

Unfortunately, the bureau’s less than friendly website does not seem to have posted the determination for public inspection. I, for one, am interested to know how it was that Parsons and Singer didn’t lose their tickets for such “misconduct”. It seems to me that “irregularities” of this magnitude committed by a solicitor would normally warrant the disciplinary umpire flashing the red card.

I suppose there’s a precedent here. The partners of Mills Oakley were each fined $10,000 for similar “misconduct” in 2003. They blamed their “irregularities” on Nick Petroulias, a new partner who had been taken into the fold. It was later claimed that Young Nick was a bit of a flake, but that’s another story.

In any event, the arrival of Petroulias apparently caused problems with the firm’s internal cash flow which resulted in 403 cheques nodding off somewhere in the office account rather than the trust account. It appears that 175 of those cheques, totalling $327,667.42, were for payments to barristers and others. How this could happen is a mystery to me, but then accounts and cheques were never my forte.

You’ll be relieved to know that the partners of Mills Oakley were able to borrow enough to cover the deficiency in the trust account and no client lost money. Whether barristers and others were recompensed for being out of the money is not so clear.

Parsons has been mentioned in prior dispatches. He was the solicitor who organised for a D9 bulldozer to rearrange some trees and other markers on the boundary between his and another rural property.

When an injunction from Justice Beach was served on Parsons in an attempt to stop him interfering with the boundary the solicitor told the representatives of the neighbouring property that, “Justice Beach has got his hand on his dick”.

Justice Cummins said that he did not believe Parsons when he denied he had said Beach J was a wanker, but went on to find that while it may be offensive, the remark is not a contempt of court.

As far as sleeping cheques are concerned, hounds with special skills need to be engaged to sniff them out.

But it does seem to me that unless the bureau occasionally sends characters like Parsons and Singer off the field then the message, like the cheques, might still be “resting” in quiet corners.