Auckland Standards Committee No. 3 v Grant Shand
 NZLCDT 56
NEW ZEALAND LAWYERS AND CONVEYANCERS DISCIPLINARY TRIBUNAL
Judge D F Clarkson
MEMBERS OF TRIBUNAL
Mr K Raureti
Ms S Sage
Mr T Simmonds
Mr W Smith
In The Matter of the Lawyers and Conveyancers Act 2006
Mr M Hodge for the Auckland Standards Committee No. 3
Mr C Morris for the Practitioner
Penalty decision following admission of one charge under s241(c) Lawyers and Conveyancers Act 2006 (negligence or incompetence in professional capacity) — practitioner was negotiating a settlement in proceedings on behalf of the complainant — complainant had rejected a settlement proposal where by some of the amount would be paid in instalments which would cease if he died — practitioner departed from client's instructions and arranged settlement so that client would get the amount he sought but practitioner's fees would be taken from the instalments so that practitioner assumed the risk of them ceasing — practitioner did not tell the complainant about the arrangement but believed he was acting in complainant's best interests — whether a 3 month suspension was required in the public interest.
Held: The issue was whether suspension was required in the public interest.
The practitioner accepted responsibility for his conduct by his plea and by making in the course of the hearing a direct apology to the complainant. He accepted openly that his conduct was below the standard expected of lawyers in the particular circumstances.
The theme of competence, commitment and good communication skills on S's part was consistent in the references he had provided. The references were important and influential as they specifically addressed client communication.
Also pointing against suspension were the interests of his current client base, of over 200 clients, with approximately 100 claims currently lodged before the Courts.
The public interest did not require a period of suspension. Censure and monetary payment by way of costs and compensation was an appropriate disciplinary response to the offending. There was no need for protection of the public in respect of this practitioner nor were there fitness to practice issues.
Practitioner ordered to pay compensation and costs.
The practitioner admitted one charge of negligence or incompetence in his professional capacity “… of such a degree … as to tend to bring the profession into disrepute (s 241(c))”.
We considered submissions on penalty made on behalf of the Standards Committee and on behalf of the practitioner on 11 November. At the conclusion of the hearing after some deliberation, the Tribunal made orders and reserved reasons for the making of those orders. The decision which follows forms those reasons.
The full background to this matter is contained in an agreed summary of facts provided to the Tribunal by the parties. The salient features are as follows:
Mr Shand and a colleague had been conducting proceedings on behalf of the complainant. In the days leading up to the hearing Mr Shand had been negotiating with opposing counsel and his colleague had been taking instructions from the complainant. The complainant had indicated for some period that while he would seek to recover $150,000 from the proceedings, if he could receive $100,000 net of legal fees he would be prepared to accept that on advice. In the late afternoon of the Friday preceding the Monday hearing, opposing counsel came back to Mr Shand with an offer of $120,000 in cash and a balance of $30,000 to be paid by instalments of $1,000 per month. However, there was a clause that should the complainant die before the repayments were completed, they would cease.
Mr Shand's colleague telephoned the complainant who initially accepted the offer but 15 minutes later telephoned him back to indicate he wished to reject it. The complainant's problem was with the instalments clause and the cessation on death aspect which, having discussed with his family he was unhappy about.
This was reported back to Mr Shand by his colleague. Mr Shand reassured him that he would sort it out and not to worry further. Mr Shand or his colleague had earlier indicated that although they had time recorded fees in the order of $78,000, they would charge the complainant $50,000 (so that a $150,000 settlement would give him the $100,000 clear which he sought).
Mr Shand then decided that he could make the settlement proposal work by assuming the risk of the instalment payments on the part of the firm and ensuring that the complainant received his $100,000 clear, from the $120,000 initial payment. In other words the firm would take its fee of the balance of $30,000 from the instalment payments. Mr Shand persuaded himself that since this met the client's earlier indicated wishes of receiving $100,000 nett of fees, he was acting within his instructions. However he did not clear that arrangement with the complainant and indeed did...
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