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A former Ernst & Young taxation partner who was terminated over an altercation with a Sydney bar manager has failed to convince a court it was a breach of the partnership agreement.
Leonard Nicita, a former senior partner in Ernst & Young’s (EY) transaction tax team, contested his November 2023 termination for pushing and bumping his chest against the manager of Sydney bar, Dean & Nancy, during an argument over a missing jacket.
The ACT Supreme Court was told Nicita attended the bar with his girlfriend, her friend and other EY staff members after a fundraising function for the Sydney University Rugby Club in early August 2023.
Police attended and charged Nicita with common assault.
In addition to Nicita’s conduct at the bar, country managing partner David Larocca said he was concerned about the failure to disclose the criminal charge to EY and to the NSW Law Society. At the time of his termination, Nicita held a practising certificate.
Larocca met with Nicita the following month to express concerns about “public brand context” should the charge get media interest.
At that meeting, Nicita brushed off the bar incident as “innocuous” and was “very keen” to show Larocca the CCTV footage. This caused Larocca some confusion because, despite Nicita’s insistence that he did nothing wrong, the footage indicated “unacceptable” behaviour.
Nicita claimed the termination was a breach of the partnership agreement because the assault occurred in his private life, he had already given notice of his retirement, and he was denied the alternative course of being placed on “garden leave”.
In dismissing all claims, Justice David Mossop found it was open for EY to terminate Nicita under the partnership agreement if it held a good faith opinion that it was the best choice for the partnership.
This opinion was supported by Nicita’s “track record” of misconduct, which included propositioning a married colleague at a Miami Vice-themed work Christmas party, and a failure to inform the NSW Law Society he had been charged with common assault.
“It would be reasonably open to the country managing partner to conclude that EY’s interests would be advanced by only having persons as partners who demonstrated higher standards of conduct in their personal as well as professional lives than demonstrated by the plaintiff,” Justice Mossop said in his decision.
“It could not be said to be unreasonable for a person in the position of Larocca to conclude that, for a large firm performing professional services for large corporations and governments, the firm’s interests would be significantly harmed if it had a reputation for overlooking conduct such as that demonstrated by the 4 August 2023 incident …”
At the time of the termination decision, EY had commissioned and reported an independent review into workplace culture.
There was also a Senate inquiry and a parliamentary joint committee on corporations and financial services investigation into allegations of, and responses to, misconduct by major accounting firms.
The case: Nicita v Ernst & Young [2025] ACTSC 478.
