JurisdictionNew Zealand
CourtLegal Complaints Review Officer
Judgment Date27 January 2010
Neutral Citation[2011] NZLCRO 3
Docket NumberLCRO 54/2010
Date27 January 2010

[2011] NZLCRO 3

LCRO 54/2010

Concerning a review of a decision of X Standards Committee 356 pursuant to section 97 of the Law Practitioners' act 1982 and section 356 of the Lawyers and Conveyancers Act 2006

ZY of X

AB as the Applicant

ZY as the Respondent

The X Standards Committee 356

The New Zealand Law Society


The Applicant is the son of Mr RH (Mr H), who committed suicide in June 2004.


Mr H had a history of bipolar illness and disability.


The Respondent was a lawyer in private practice, and also a District Inspector for Mental Health (DIMH) appointed by the Ministry of Health (MoH).


In June 2001, as the DIMH, the Respondent had requested a review of Mr H under section 16 of the Mental Health (Compulsory Assessment and Treatment) Act 1992.


As noted below, the Respondent had known Mr H for some time prior to that, and acted for him and his partner (Ms M) in conveyancing transactions.


In 1998, the Respondent acted for Ms M in connection with a property agreement, whereby it was agreed that a property at O owned by Mr H and Ms M, would be transferred to Ms M, but with Mr H remaining liable in respect of borrowings secured against that property.


Mr H was represented by another solicitor, but there is some uncertainty as to the extent of that representation, as recorded below.


Subsequently, the terms of the agreement were called into question, and a dispute arose between Mr H and Ms M as to the extent of Mr H's equity in the property. This dispute remained unresolved at the time of Mr H's death.


At the time of his death, his claim against the property was protected by a caveat.


The Respondent acted for Ms M in the dispute with Mr H while he was alive, and subsequently continued to act on her behalf after his death.


The Estate eventually abandoned its claim for reasons which are not evident from the file.

History of complaint

On 8 March 2006, the Applicant lodged a complaint with both the X District Law Society (XDLS) and the MoH.


The core of the complaint related to the Respondent's role in acting for Ms M in connection with the property agreement and its subsequent defence, both during Mr H's lifetime and after his death, whilst at the same time being involved in matters relating to Mr H's mental health as the DIMH and in view of the fact that the Respondent had acted for Mr H (although the Respondent denies this) and had personal contact with him over the years.


In the letter of complaint, the Applicant posed a number of questions designed to highlight the issues being raised by him.


The initial response from the Law Society was that it was unable to assist the Applicant, instead, advising him that he should seek legal advice in respect of the matters he had raised.


The Applicant referred the matter at that stage to the Lay Observer. The Lay Observer returned the file to the Law Society for review and for a decision to be made on the complaint.


The Law Society's investigating solicitor had concerns about processing the investigation while the MoH inquiry was under way, as, in his view, the two inquiries were in respect of the same matter and the Respondent was thereby being subjected to double jeopardy.


In August 2007, however, the investigating solicitor concluded that MoH concerns were separate from any concerns relating to legal professional standards or ethics and that the investigation should proceed.


On 4 August 2007, he set out his views of the conflict of interest and the other matters alleged by the Applicant in some detail.


The investigating solicitor saw the complaint as one essentially arising out of the fact that the Applicant disagreed with the advice provided by the Respondent. This was not a matter with which the disciplinary processes should be concerned.


In an email of 28 August 2007, the Applicant referred to an earlier email which had not been received by the Law Society. In that email, the Applicant advised that the Respondent's appointment as a DIMH had been terminated. A copy of the MoH letter dated 20 August 2007 in this regard, was subsequently provided. The letter was brief and contained no reasons.


On 4 September 2007, the Law Society's investigating solicitor advised the Applicant that his firm view was that the complaint could not be substantiated. With regard to the conflict of interest he advised that he considered the interests of Mr H and Ms M were identical at the time any legal matters were completed by them jointly.


At that time also, the investigating solicitor advised that the Respondent was going to apply for a judicial review of the MoH decision, and proposed that the matter be left until the outcome of that Review was known.


The complaint then lay dormant until reactivated by the Applicant in February 2009, when he enquired as to whether there had been any progress.


It was then ascertained that the Respondent had not applied for a judicial review of the MoH decision and that the Respondent was no longer in practice.


The matter was then considered by the Standards Committee and on 2 March 2010, the Standards Committee issued its decision not to take any further action. It recorded that it considered that there was no unethical or unprofessional behaviour on the Respondent's part and that her advice to Mr H was in accordance with the usual practice at the time to protect his assets should he need to go into care.


The Committee went on to state that even if the advice given by the Respondent was deemed to be erroneous, the mere fact that her opinion and advice was not correct did not in itself amount to a professional breach.


The Committee also considered that there was no conflict of interest as the interests of Mr H and Mr M were identical.


The matter now comes before the Legal Complaints Review Officer (LCRO) pursuant to section 355 of the Lawyers and Conveyancers Act 2006 (the Act).

The role of the LCRO

By virtue of the reform of the law relating to legal practitioners, the office of Lay Observers ceased to exist on 1 February 2009. Under section 355 of the Act, any inquiries by the Lay Observer which were incomplete at that time, are to be completed by the LCRO.


In completing the inquiry, the LCRO has the duties and powers which the Lay Observer would have had under the Law Practitioners Act 1982.


This inquiry is therefore undertaken on that basis, and in conducting the review I effectively stand in the shoes of the Lay Observer.


The role of the Lay Observer is to consider any allegation by a member of the public “concerning any District Law Society's treatment of a complaint about the conduct of a practitioner” pursuant to section 97(1) of the Law Practitioners Act 1982.


The reform of the law relating to legal practitioners also disestablished the Complaints Committees of the District Law Societies on the same date i.e 1 February 2009, and pursuant to section 356 of the Act, the New Zealand Law Society is required to appoint a Lawyers' Standards Committee to carry out the duties and exercise the powers that a Complaints Committee appointed pursuant to section 100 of the Law Practitioners Act 1982 would have had under that Act.


Consequently, the Standards Committee of the X Branch of the New Zealand Law Society was established as a section 356 Committee and the primary focus of this inquiry is therefore on whether the Applicant's complaint has been properly considered by that Committee, and following such an inquiry, to provide a written report to the New Zealand Law Society which may contain such recommendations as I consider appropriate. This report is then to be considered by the Complaints Service of the New Zealand Law Society and any actions taken by it reported back to me.


For the sake of completeness, it is important to observe that any such action is at the discretion of the Complaints Service.


The following paragraphs represent my report.

Conflict of interest

The Standards Committee considered that the Respondent did not have a conflict of interest, as the interests of Mr H and Ms M were identical at the time any legal matters were completed for them jointly.


It is worth including in full here, the content of the agenda note considered by the Committee prepared by the investigating solicitor.


In a summary of the position, the investigating solicitor notes as follows:-

“Briefly, the complaint is that [the Applicant] considers his father received bad advice, and that [the Respondent] did not act in the best interests of his father and had a conflict of interest in acting for him in a private capacity...

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