The background involved three distinct sets of conduct, which are briefly summarised below. 

Criminal convictions 

Mr Haines accepted a charge of having a conviction that reflected on his fitness to practise and tended to bring the profession into disrepute as he pleaded guilty to two criminal charges of receiving commercial sexual services from underaged girls. The victims were aged 14 and 17 years and Mr Haines was sentenced to home detention.  

Complainant M 

Mr Haines was instructed to act for M in matters relating to insolvency. The engagement letter noted that invoices would be issued monthly. During the course of the retainer, Mr Haines and M’s financial circumstances became intertwined. Mr Haines took out three loans for which M was appointed guarantor. Mr Haines agreed with M that if he was unable to service the loans, M would do so. Mr Haines also advanced some of the monies from the loans to M. These arrangements were not documented and there was no record of independent advice being offered to M. On the eve of M’s bankruptcy proceedings, Mr Haines issued an invoice of $1,000,000 plus GST for legal fees. This invoice was for all work completed during the nearly two-year course of the retainer. Prior to raising the invoice, Mr Haines had advised M that an invoice of this size was to his advantage as it would make Mr Haines one of his biggest creditors.  

Mr Haines was found to have engaged in unsatisfactory conduct for failing to properly record and update the terms of engagement and three charges of misconduct for charging more than a fair and reasonable fee, inflating fees to “jig the numbers” to mislead the Court during the bankruptcy proceedings and for failing to maintain independence by continuing to act for M after entering into financial arrangements with him. The Tribunal found Mr Haines had failed to uphold the “fundamental precept of the fiduciary relationship owed by a lawyer to a client”. 

Complainant C 

Mr Haines was engaged by C to act on an insolvency matter. C made payments of around $90,000 to Mr Haines’ firm. C made additional payments of approximately $190,000 directly to Mr Haines’ personal bank account. The additional payments to Mr Haines included a personal loan of $55,000, which Mr Haines agreed he would repay. No invoices or receipts were issued for any of the payments made to Mr Haines personal account. Mr Haines failed to apply his client’s money as instructed or hold the money in a trust account and instead applied the funds for his own personal benefit. 

Mr Haines was found to have engaged in three counts of misconduct for receiving client funds in a personal bank account in contravention of trust account regulations; for failing to hold client funds on trust or use as instructed, and for misappropriating client funds. The Tribunal found Mr Haines had committed “a reprehensible abuse of his client’s funds” which was “disgraceful and dishonourable conduct” as well as a wilful reckless breach of the rules. 

In determining penalty, the Tribunal considered the charges fell into four distinct categories; repeatedly acting despite a conflict of interest, dishonest misappropriation of client funds, lack of fidelity to the Court and conviction for serious criminal offending. The Tribunal considered each category on its own could result in a lawyer being struck off. The Tribunal noted Mr Haines “has the unfortunate distinction of having committed misconduct in all four of the above categories” adding it must view the conduct individually and collectively in its assessment of penalty. The Tribunal held that no penalty short of strike off was proportionate in the circumstances and noted that until Mr Haines acquires a greater insight into his conduct, there is a public need for protection.  

Mr Haines was ordered to pay compensation of $25,000 plus interest to C (being the maximum amount under the legislation) but only if C had not received the $55,000 in compensation promised by Mr Haines from other sources. In relation to M, the Tribunal noted that as part of the bankruptcy proceedings, the High Court determined Mr Haines was able to justify a total fee of $603,750 (including GST). Having regard to the nature and seriousness of Mr Haines failings, the Tribunal considered it was inconsistent with the purposes of maintaining public confidence and protecting consumers to allow Mr Haines to claim his full fee given the value of those fees was never realised by M. Mr Haines was ordered to reduce his fee (as determined by the High Court) by 50%. Mr Haines was also ordered to pay costs.