A LAWYER who sent up to 20,000 letters a month chasing small debts owed to video stores could be banned from practice after being found guilty of professional misconduct.Melbourne lawyer Pippa Sampson pursued the debts on behalf of chain stores including Blockbuster and Video Ezy between 2002 and 2010.
But the Victorian Civil and Administrative Tribunal ruled this week Ms Sampson, the sole partner of Glen Waverley firm Goddard Elliott, had breached the legal profession's rules by sending misleading letters and claiming illegal costs.
Costs sought were, at times, more than triple the amount of the original debt, the court heard.
In one instance Ms Sampson claimed $195 in costs for a $66 debt and on another occasion claimed $225 in costs for the recovery of a $216 debt. She also sent notices made to look like court documents demanding urgent attention.
Senior VCAT member Jonathan Smithers found Ms Sampson was specifically warned in 2009 that the notices she was sending out did not meet industry standards.
"The continued use of these forms of notice after March 2009 was, at the least, reckless," he said.
"Some degree of robustness is obviously a legitimate part of debt collection. However, Ms Sampson's conduct (went) beyond that.
"It displayed a disregard for the entitlement of debtors to receive information in letters of demand which was accurate."
Mr Smithers found Ms Sampson's misconduct was magnified by the fact that she sent thousands of letters of demand out each month.
Legal Services Commissioner Michael McGarvie said lawyers did not have a right to exaggerate entitlements when recovering debts.
"Another lesson for lawyers is they must not send out deceptive notices that are designed to look like official court documents," he said.
"My office warned this lawyer in 2009 and again warned all Victorian debt collection lawyers in June 2011 that they had to meet higher standards".
The matter will return to court at a later date to determine possible penalties for Ms Sampson, which could range from a fine to the loss of her licence.
The latest finding comes almost two years after the Federal Court of Australia found Ms Sampson guilty of misleading and deceptive conduct following action by the Australian Competition and Consumer Commission.