A Brisbane principal has been barred from practising until 2026 as a result of his almost 100 tax offences committed over more than a decade.
Sole practitioner Michael Anthony Graham was convicted and fined for various tax offences committed every year between 2005 and 2014, and in 2017, including a failure to lodge nine yearly income tax returns, and 66 monthly GST returns.
The Legal Services Commission (LSC) laid five charges against Mr Graham, arguing his conduct amounted to professional misconduct and recommending his name be removed from the roll of solicitors. It also submitted he engaged in conduct that was likely to a material degree to bring the profession into disrepute, contrary to Rule 5 of the Australian Solicitors Conduct Rules 2012.
Mr Graham agreed with the characterisation of his behaviour, but argued he was not permanently unfit to practise, contending that a five-year suspension was an appropriate penalty.
In a 48-page decision delivered on Wednesday in the Queensland Civil and Administrative Tribunal (QCAT), Justice Williams ordered Mr Graham not be granted a practising certificate before 27 February 2026, that he complete a Queensland Law Society Practice Management Course before being granted a principal’s practising certificate, and that he be publicly reprimanded.
The lawyer’s unrestricted principal practising certificate had been cancelled by QLS on 26 February 2021 for three years, so the sanction effectively created a five-year suspension.
Justice Williams said particular features of Mr Graham’s conduct placed it in the category of professional misconduct, including that the conduct involved repeated failures, over a period of 12 years, and attracted a total of 96 convictions.
He also pointed out Mr Graham’s disciplinary history, which included document forgery, and failures to maintain standards of competence and diligence in relation to a costs statement and a costs assessment.
These disciplinary proceedings and other “wake-up calls”, including a notice to lodge outstanding returns and convictions for tax offences in 2007, should have put Mr Graham on notice that failure to exercise vigilance in respect of his own personal tax affairs was conduct that could subject him to further disciplinary proceedings, he said.
Mr Graham, who had held an unrestricted principal practising certificate since 2003, submitted that his failures were as a result of negligence and not an attempt to avoid paying tax.
In his affidavit, he stated he “had a mental barrier towards addressing his taxation obligations and each year the problem grew bigger and administratively more difficult”, and that his “record keeping was in disarray and spread ‘indiscriminately’ over five different storage premises”.
His financial position collapsed in 2008 and his assets were liquidated to pay down debt.
Justice Williams stated this included the loss of the family home in 2014.
“The respondent’s focus on his practice at the expense of other priorities is to be considered in this context,” he said.
“The respondent accepts the gravity of his conduct, (and) has shown remorse and insight into the effect on the profession’s standing.
“The respondent ultimately did deal with the nine annual income returns and 66 monthly BAS, which took approximately 18 months to locate, compile and sort records and professional accounting fees of $18,000.
“This task took longer than the six weeks given in the final notice but was completed prior to the respondent’s appearance in court.
“The respondent did not avoid the payment of tax by entering bankruptcy but rather entered into a very long and onerous long-term repayment agreement with the ATO relating to all tax outstanding and interest.”
Justice Williams said Mr Graham had put in place arrangements to prevent further lapses and had been compliant with his tax obligations since 2018.
The LSC submitted that Mr Graham’s conduct was deliberate to avoid tax liability, and that in the years leading up to and during the conduct, he opened businesses, and bought investment properties and shares, which generated substantial returns.
This evidence supported the contention that he was motivated by enrichment and financial gain, and that exposure to tax liability was a low priority, it said. The LSC also pointed to the lawyer’s many “wake-up calls” including that the conduct occurred while he was subject to disciplinary proceedings for two other matters.
Justice Williams said although parts of Mr Graham’s explanation for his conduct were difficult to rationalise, it appeared that “a form of procrastination set in such that he in effect found himself paralysed and unable to get it done. Then there was a compounding effect such that as time passed getting it done became more insurmountable”.
“Considering all of the evidence, and the gravity of the matters alleged, the tribunal is unable to reach the appropriate level of satisfaction to conclude that the respondent’s conduct was deliberate to avoid tax liability,” he said.
The tribunal found Mr Graham’s failures to act were as a result of repeated and ongoing negligence in respect of his personal tax affairs, which distinguished the case from other disciplinary proceedings relating to tax offences, which involved dishonesty or fraud, or deliberate avoidance of liability.
The lawyer was also ordered to pay the LSC’s court costs.
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