Donna Marie Tai Tokerau Durie Hall

 
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[2014] NZLCDT 1

NEW ZEALAND LAWYERS AND CONVEYANCERS DISCIPLINARY TRIBUNAL

CHAIR

Mr D Mackenzie

MEMBERS OF TRIBUNAL

Mr W Chapman

Mr S Maling

Mr W Smith

Ms P Walker

LCDT 015/11

In the Matter of the Lawyers and Conveyancers Act 2006 and the Law Practitioners Act 1982

and

In the Matter of

Donna Marie Tai Tokerau Durie Hall of Welligton Solicitor
APPEARANCES:

Mr G Turkington for the Standards Committee

Ms H Cull QC for the Practitioner

Charge that law practitioner Hall (“H”) had been negligent or incompetent in her professional capacity, and that her negligence or incompetence had been of such a degree as to reflect on her fitness to practise or as to bring her profession into disrepute — H alleged to have acted for multiple parties (vendor, purchaser and lender) involved in a land transaction contrary to r1.04 Rules of Professional Conduct for Barristers and Solicitors 2006 (without informed consent) and r1.07 (without advising parties as to conflict, independent advice and/or without declining to act) — lengthy delays in hearing charge — whether stay of proceedings appropriate — whether appropriate to allow Standards Committee to amend the charge under the Lawyers and Conveyancers Act 2006 to a charge under the Law Practitioners Act 1982 — whether professional disciplinary charge made out.

At issue was whether: (1) the stay of proceedings was appropriate; (2) it was appropriate to allow the SC to amend the charge under the LCA to one under the LPA; and (3) was the professional disciplinary charge made out.

Held: (1) Application for stay: the Lawyers and Conveyancers Disciplinary Tribunal (“Tribunal”) had jurisdiction to permanently stay proceedings in appropriate cases ( Chow v Canterbury District Law Society). The outcome of an application for stay was depended on its own particular facts and the circumstances of each case, so care had to be taken in comparing cases.

While a stay had been granted in NZLS v Gilbert that case was in a different category to this one and involved extensive delay. The delay in this case was explainable having regard to the various steps and processes undertaken by each of the parties in the course of the investigation and subsequent proceedings, and those steps were all unremarkable.

The amendment to the charge sought by the SC involved a very minor technical correction, which did not affect process or substantive issues, was largely administrative and did not alter the applicable jurisdiction as suggested. The application to amend the charge therefore did not provide support for the application for stay.

While H understandably wished to obtain some finality regarding her submission of no case to answer, the process of the High Court referring the proceedings to a freshly constituted Tribunal did not itself support an application for stay. It was a normal process and a process that naturally followed as a result of steps taken. The fact H had made her submission of no case to answer on a number of occasions without receiving a determination did not represent a factor supporting stay.

Whether it was unreasonable and oppressive to proceed with the charge on the basis that H's conduct did not warrant the charge of negligence or incompetence was a matter for consideration when the substantive charge was considered.

There was nothing in the circumstances of this case which placed it in the rare category where to continue would have been, of itself, so unfair unjustifiably oppressive as to constitute an abuse of process.

(2) Application to amend charge: H's conduct was alleged to have occurred at a time when the LPA was in force but was not complained about until 2009 when the LCA had replaced the LPA. The only material difference in the relevant sections of each act was that under the LPA the words “tend to” appeared before the phrase “bring the profession into disrepute”.

Use of the words “tends to” did not imply a different threshold for measuring the seriousness of the conduct. It added nothing to the degree of seriousness of the conduct and did not require a change in the way members of the public or the profession might view the conduct, which was to be objectively assessed. The standard dictionary definition of “tend” reinforced the view that the exclusion or inclusion was of no moment so far as the likelihood of formation of an adverse view of conduct by the public or the profession was concerned.

(3) Professional disciplinary charge: the issue for the Tribunal was not simply the question of whether H was acting as legal adviser to the different parties in the transaction. It was the role H played in the transaction, whether informed consent was obtained, and whether her ability to observe duties placed on her as a result of her engagement was impeded by any conflicting interests of her clients, which were relevant.

There was evidence that H acted as legal adviser to the purchaser at the same time as she was acting as legal adviser to the vendor, but there was no direct evidence she acted for the lender regarding its loan to the purchaser.

The evidence showed that prior to her formal appointment as the purchaser's legal adviser, H was engaging with the purchaser trustees and owners on the transaction as a promoter representing the vendor, reflecting the initiative undertaken via the vendor for the benefit of Maori interests such as the purchaser trust. All signatories of a deed signed during this period acknowledged the issue of independent advice at the time. In these circumstances either the purchaser trustees did not instruct nor expect any advice from H on the deed, as their legal adviser, or if she was giving them legal advice they consented to her providing that advice despite knowing she acted for the vendor. In the circumstances there was no breach of rule 1.04 or rule 1.07 of the Rules. If informed consent was required then it had been given (rule 1.04) and to have breached rule 1.07 it would be necessary to show H was in fact acting as legal advisor to the purchaser and that was not certain.

There was evidence that H was subsequently providing legal advice to the purchaser, but it was not a situation where in so acting either of the rules had been breached. H's advice related to arrangements regarding the transaction which were generally in place and agreed prior to her involvement. The purchasers had also previously received, and discounted, advice on transaction issues before committing to proceed. While some of the purchaser trustee decision might have been criticised having regard to legal capacity and prudence, they were decisions effectively made when the purchaser was advised by another solicitor, whose advice the majority of trustees declined to follow. Simply because there might or might not be an issue regarding capacity and prudential decision making by the purchaser trustees did not of itself mean the purchaser had a different interest in the transaction which would have impeded H's ability to advise both parties.

Importantly, it could not be overlooked when considering whether any client was likely to be disadvantaged by H acting for both vendor and purchaser, that there was a particular mutuality of interest between the transaction participants. The vendor was established as the vehicle to serve the purchaser's land acquisition aspirations. In these particular circumstances it was doubtful that a conflict of interest of the vendor and purchaser leading to breaches of the rules as alleged could be said to have arisen.

There was insufficient evidence on which a finding could be made that H advised ether lender on the relevant loans involved.

While there was a case to answer, it was appropriate on the evidence that the charge be dismissed.

Application for stay declined.

Amendment to charge allowed.

Charge dismissed.

REASONS FOR DECLINING AN APPLICATION FOR STAY REASONS FOR ALLOWING AN APPLICATION TO AMEND THE CHARGE RESERVED DECISION ON THE SUBSTANTIVE CHARGE
Contents/Index

Subject/Part

Page

Introduction

3

Background

4

PART I: APPLICATION FOR STAY

The Application for Stay

5

Record of decision declining Application for Stay

8

Reasons for declining Application for Stay

9

PART II: APPLICATION TO AMEND CHARGE

The Application to Amend the Charge

14

Record of decision allowing Amendment Application

15

Reasons for allowing the Amendment Application

16

PART III: RESERVED DECISION ON CHARGE

Issues arising from the allegations

22

The transaction concerned

25

The...

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