Deliu v National Standards Committee 1 of The New Zealand Law Society

• Jurisdiction: New Zealand
• Judge: Brewer J
• Judgment Date: 25 May 2021
• Neutral Citation: [2021] NZHC 1177
• Court: High Court
• Docket Number: CIV-2020-404-1438
• Date: 25 May 2021

Between

Francisc Catalin Deliu

Applicant

and

National Standards Committee 1 of The New Zealand Law Society

Respondent

[2021] NZHC 1177

Brewer J

CIV-2020-404-1438

IN THE HIGH COURT OF NEW ZEALAND

AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA

TĀMAKI MAKAURAU ROHE

Judicial Review, Law Practitioners — application for judicial review of the respondent's decision to continue an investigation pleading that the investigation breached his right to natural justice — the investigation had been ongoing for over three years — excessive delay — Wednesbury (no practical purpose) — failure to take into account relevant considerations — Lawyers and Conveyancers Act 2006 — New Zealand Bill of Rights Act 1990

Appearances:

Applicant in person (via VMR)

M J Hodge and A-R C Davies for Respondent

JUDGMENT OF Brewer J

This judgment was delivered by me on 25 May 2021 at 4 pm

pursuant to Rule 11.5 High Court Rules.

Registrar/Deputy Registrar

Introduction

1 Mr Deliu is a former lawyer who practised in New Zealand as a barrister and solicitor of this Court. Mr Deliu is no longer resident in New Zealand.

2 The Lawyers and Conveyancers Act 2006 (“the Act”) provides a regulatory regime for lawyers. The respondent is a Lawyers Standards Committee established by the New Zealand Law Society as part of its complaint service as required by the Act. 1

3 One of the respondent's functions under the Act is: 2

… to investigate of its own motion any act, omission, allegation, practice, or other matter that appears to indicate that there may have been misconduct or unsatisfactory conduct on the part of a practitioner or any other person who belongs to any of the classes of persons described in section 121:

4 On 9 November 2017, the respondent resolved to commence an own motion investigation of Mr Deliu. The investigation continues. Procedurally, it is still in its earliest phase.

5 Mr Deliu contends that the investigation has been going on for too long. He applies for judicial review of the respondent's decision to continue the investigation, pleading that the investigation breaches his right to natural justice (in five respects), 3 that there is no jurisdiction for the investigation in one of the areas investigated, that there has been a failure to take into account relevant considerations (privilege), and that no practical purpose can be achieved by the investigation.

6 The remedies sought by Mr Deliu (who represents himself) are:

• i. A judgment for the plaintiff;

• ii. An order in the form of certiorari quashing the defendant's investigation;

• iii. A declaration (in accordance with the opinion of this Honourable Court) that the defendant breached the plaintiff's human right to due process;

• iv. A direction that the defendant enter a § 138 no further action determination in the file in question;

• v. A permanent injunction enjoining the defendant from further action against the plaintiff over any matters;

• vi. Costs; and/or

• vii. Such other relief as deemed fit.

7 The respondent abides the Court's decision. The New Zealand Law Society has been appointed to act as contradictor.

8 At the hearing before me it was accepted by Mr Deliu and by Mr Hodge for the contradictor that the two key grounds for judicial review are breach of natural justice through delay and lack of jurisdiction. I will consider them first.

Delay (the first cause of action)

9 Excessive delay by a regulatory body in carrying out an investigation can result in a court staying the investigation or otherwise bringing it to an end. The focus of the inquiry is usually the degree of prejudice the delay has caused to the person being investigated. At some point, prejudice can be presumed from the length of the delay.

10 The regime of the Act is relevant. First, the contradictor accepts the respondent has an obligation to carry out own motion investigations expeditiously. There is no statutory requirement to do so, but s 140 of the Act, which applies to complaints by others, provides:

140 Inquiry by Standards Committee

If a Standards Committee decides to inquire into a complaint, it must inquire into it as soon as practicable.

11 Mr Hodge accepts that no lesser standard can apply to own motion investigations.

12 I agree. I think it relevant also that the first two purposes of the Act will be best served by expeditious investigations:

3 Purposes

(1) The purposes of this Act are—

• (a) to maintain public confidence in the provision of legal services and conveyancing services:

• (b) to protect the consumers of legal services and conveyancing services:

  …

13 I note that in Chow v The Canterbury District Law Society, 4 the Court of Appeal reached a similar view when considering s 101 of the Law Practitioners Act 1982. That section required a complaint against a lawyer to be inquired into “as soon as practicable”. Mr Chow's case was that after an inquiry into a complaint against him there was excessive delay in bringing a charge against him. There was no statutory requirement for a charge to be brought in a timely way. Nevertheless, the Court was satisfied that there was a statutory obligation to proceed promptly, “perhaps better captured in the notion ‘as soon as practicable’.” 5

The history of the investigation

14 The respondent decided to commence its own motion investigation on 9 November 2017 having received and considered two documents emanating from a Ms S. The first document was a statement Ms S provided to the New Zealand Police dated 17 October 2017. The second was her affidavit of 1 November 2017 filed in a disciplinary proceeding brought against Ms S by the respondent.

15 At the same time, the respondent commenced an own motion investigation into Mr Richard Zhao and Richard Zhao Lawyers Ltd (which traded as Amicus Law).

16 The allegations by Ms S against Mr Deliu overlapped her allegations against Mr Zhao and the company.

17 On 15 November 2017 the respondent appointed Ms McMahon as investigator.

18 Events thereafter are summarised from the respondent's point of view by Mr Hodge in his submissions:

2.8 Progress during the initial stage of the investigation was slowed by difficulties arising from the fact there were extant criminal and disciplinary proceedings against [Ms S]. 6 The Committee reasonably considered that it needed to obtain a statement from [Ms S] that was provided for the express purpose of the Committee's own motion inquiries rather than relying solely on (or disclosing at that stage) evidence provided by [Ms S] in criminal proceedings and separate disciplinary proceedings.

2.9 [Ms S's] focus, perhaps understandably, was on her criminal and disciplinary proceedings rather than on the Committee's own motion inquiry in relation to the applicant. Following the disposal of [Ms S's] criminal and disciplinary proceedings, Ms McMahon was finally able to obtain a statement from [Ms S] provided for the purpose of the Committee's own motion inquiries. This was on 10 August 2018.

2.10 The applicant had made objections to Ms McMahon's appointment as investigator. These objections were rejected by the Committee. However, on 24 August 2018 Ms McMahon's appointment was revoked. The Committee considered it was necessary to do so because Ms McMahon had been appointed as a member of the Lawyers and Conveyancers Disciplinary Tribunal.

2.11 The need to revoke Ms McMahon's appointment, and its timing, was unfortunate. Ms McMahon's investigation was underway. She had previously provided an interim report and had just been able to obtain a statement from [Ms S] for the purpose of the Committee's own motion inquiries. It was at this point, when the investigation could move forward with a statement obtained from [Ms S], that the Committee lost the benefit of Ms McMahon's services and her knowledge of the matter and had to appoint a new investigator.

2.12 A Law Society employee, Philip Strang, was appointed as the new investigator on 24 August 2018.

2.13 Mr Strang commenced his investigation and provided an interim report to the Committee on 25 March 2019. This report addressed a number of matters as required in the Committee's instrument of appointment, including:

• (a) Allegations in relation to:

  • (i) unauthorised billing;

  • (ii) taking fees by deduction;

  • (iii) failing to account to clients.

• (b) The applicant's association with Amicus Law.

• (c) Administration and management of Amicus Law.

• (d) Inquiries made of the Registrar-General of Land.

2.14 Mr Strang's interim report also noted areas he was having difficulty with or had otherwise not been able to substantially progress.

2.15 On 6 March 2019 the applicant raised what he termed “ultra vires” issues with the “whole enquiry”. Correspondence between the applicant and the Complaints Service on behalf of the Committee followed on that and other issues raised by the applicant in April and June 2019.

2.16 In August and September 2019 the Committee decided that it was necessary to appoint another investigator to work together with Mr Strang to address outstanding matters in the investigation and that the scope of the investigation could be narrowed down to three areas in light of the matters already reported on by Mr Strang to that point.

2.17 The first area for further investigation was the applicant's association with Amicus Law between March 2012 and June 2017 and in particular whether they had breached rules prohibiting the applicant, as a barrister sole, from:

• (a) practising in partnership or in an incorporated firm;

• (b) inducing other persons to suppose there was a connection between the applicant and any other legal practice;

• (c) having an arrangement that restricts the freedom of a solicitor to select such counsel as the solicitor or their client selects.

2.18 The second area for further investigation focused on the applicant's representation of employees/staff members between August 2016 and June...